Big corporations like Nike, Apple and Microsoft don't just appear overnight, they all started small. Small businesses drive this country. President Obama says his Affordable Care Act will help small businesses. A recent poll done by Forbes magazine indicates otherwise, showing that 93 percent of small businesses do not want to switch from their current health care plans to Obamacare. Utah is home to many small businesses, and unless it is amended, Obamacare will impede their growth and hurt Utah’s economy.
Companies with 50 or more full-time equivalent employees must provide insurance or pay a fine. This immediately affects these companies by raising the cost of employing workers.
According to Thumbtack.com’s second annual small business survey, Utah is ranked as the best state for small businesses as of 2013. Forbes magazine also recognizes Utah as the best state for business three years running. Forbes notes that Utah’s economy has expanded 2.3 percent annually since 2006, while the nation as a whole only expanded 0.5 percent. Our local economy thrives off the growth of small businesses. Implementing Obamacare will discourage the expansion of these companies due to increased costs.
Health reform legislation signed by President Obama indicates that many of the small businesses would be able to offset the costs of his plan with tax credits. Michael D. Tanner’s article in The Wall Street Journal brings to light how deceiving the offsetting tax credits are: “Perhaps only 12 percent of small businesses will use them, according to the Congressional Budget Office.”
A percentage like that means companies need to be extra particular with bookkeeping. Dedicating more time to bookkeeping will cost businesses more money, offsetting any tax credit they receive. If Utah businesses spend more time and money looking for loopholes to receive tax credits, they will not be as profitable for our economy.
The American dream is to create something of your own from nothing. This boosts the economy as job opportunities are created and wealth is generated. Small businesses are founded and driven by this ideal. If Obamacare goes forward in its current form, this dream will soon become obsolete. Consequently the economic climate in Utah will become less friendly for small businesses due to the increased government mandates.
Diminishing growth in small companies will stall our economy’s growth. In the recent Gallup poll, 41 percent of small businesses said they have already held off on plans to hire new employees, and 38 percent said they have pulled back on plans to expand. Worse, 11 percent indicate that they have let workers go or cut back their hours. If companies in Utah and throughout the nation follow this pattern, it will not be long before the self-made men and women disappear. At that point, the primary ideals this country was founded on will be irrelevant.
Obamacare is good in theory, but it needs to be amended. Small-business owners are against it for a reason; it will impede growth. Utah is currently considered the best state for business, but unfortunately for small businesses, the Affordable Care Act is anything but affordable. If Obamacare is not amended, many of Utah’s small businesses may not survive. Businesses shouldn’t be forced into anything because Big Brother said so. The freedoms and ideals this country was founded on should be relevant today.
Devin Peterson is a finance/economy major currently studying at Utah State University.