By David Steil
December 6, 2017
Congressional Republicans’ biggest argument for their tax plan is that it will increase our country’s economic competitiveness. As a mid-sized business owner and Republican who represented the 31st legislative district in Pennsylvania for 16 years, I can tell you that nothing could be further from the truth.
There is no evidence to support Republicans’ claims that cutting taxes for wealthy individuals and large corporations will trickle down to create jobs and raise incomes. In fact, the state of Kansas tested this theory with disastrous consequences for its economy. Instead of increased wages and job creation, residents got cuts in crucial public services like shorter school calendars, delays in infrastructure repairs, and decreased aid to the state’s poorest residents. And never in the history of the United States has economic growth from tax cuts ever covered the loss of revenue.
If congressional Republicans want to encourage businesses to expand their markets and create jobs, they’re not looking in the right place. Until we solve the problem of our overburdened and complex health care system, it will always be a barrier to companies looking to expand here.
Radical increases to health insurance premiums are an overhead cost to businesses that is drastically underestimated.
If congressional Republicans want to encourage businesses to expand their markets and create jobs, they’re not looking in the right place.
The average annual premium to insure a single full-time employee was $6,345 in 2016. If that employee has a family, the average premium cost went up to $18,145. That means for a full time employee with a family, it costs $8.72 an hour to keep them insured.
That is money that could have gone to jump-starting the slow wage growth we have been experiencing since the “Great Recession.” In an economy that is close to 70 percent consumer driven, those increased wages could have helped to create new jobs in the service and consumer products industries. For those who are concerned about investing and innovating, that money could have gone to developing or purchasing new technologies, or expanding businesses to new markets.
If I were a business owner in a country with a stable, publicly funded health care system, and I was looking for a new market to expand my business, too, I’d be wary of choosing the U.S. We have more purchasing power than anywhere else in the world, and yet foreign companies are reluctant to create jobs here in the U.S. What is the incentive to open an office and employ U.S. residents when the cost of keeping them insured year to year is both enormous and unpredictable?
That doesn’t even begin to address the fact that health care costs are keeping our businesses from staying competitive in the international business community. We have created an insurance system where the primary motivation is profit, instead of one where we focus on minimizing costs and delivering high-quality health care.
If Congress wants to truly enhance American competitiveness, it should take up the Medicare-for-All bill, with its 16 co-sponsors in the Senate and 120 co-sponsors in the House.
If we switch from an employer-based insurance system, which puts a strain on businesses and employees while lining the pockets of huge insurance companies, to a single-payer system, health care would be cheaper and more accountable to our needs. It would allow doctors’ offices, hospitals, and other caregivers to continue to operate independently. It would allow patients to see any physician they want, instead of ones that are “in network,” and would place patients’ elected officials in the driver’s seat to better control costs and limit administrative burden.
Workers would have more money in their pocket to buy more goods and services. They would be able to advance their careers by switching jobs or starting their own businesses without worrying about losing their insurance. Businesses will have more flexibility to invest in new technologies. Entrepreneurs would be able to invest in their business without the debilitating costs of trying to keep their employees insured.
If we are really looking to kickstart the American economy and create jobs, it is well past time we eliminate the economic burden of the healthcare insurance system.
David Steil is the CEO of Micro Trap Corporation in Pennsylvania, and is a former Republican member of the Pennsylvania State Legislature.