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Jon Fleischman

Hanretty: Robbing Small Businesses to Pay for Illegal Workers

Our former State Capitol Correspondent for the FR, Karen Hanretty, maintains a regular blog over at the MSM’s News10 Website, but (with permission) I lifted this post for your reading pleasure:

Robbing Small Businesses to Pay for Illegal Workers

A capitol insider asked me the other week if I think anything will come this year of Governor Schwarzenegger’s $12 billion health care proposal to provide health insurance to 6.5 million uninsured people in California.

My answer: Nope. The reason? Once voters realize what the governor’s health care proposal does, who it insures, and who picks up the tab, popular opinion will turn southward.

In today’s Opinion Journal, a daily email sent to subscribers by the Wall Street Journal, John Fund reports that Datamar, a polling firm in San Diego, "shows sinking support for Governor Arnold Schwarzenegger’s dramatic plan to tax employers, doctors and hospitals to create a universal health care plan. Despite claims by Team Arnold that over 70% of Californians back his approach, the Datamar poll showed a much closer result. The plan is currently favored by only 47% to 37% and the party breakdown in support will make it difficult for Governor Schwarzenegger to attract support from legislators in his own Republican Party. Democrats back Arnold’s health care initiative by a solid 60% to 25%, but his fellow Republicans vote thumbs down by 58% to 32%."

Here’s the real poison pill buried in Gov. Schwarzenegger’s costly proposal that I believe will anger the public.

The governor’s plan is estimated at about $12 billon to cover 6.5 million uninsured in the state. According to the California Health Care Foundation, there are 2.5 million uninsured illegal immigrants in California.

So that means that roughly a third of the $12 billion – or $4 billion – that Schwarzenegger wants to spend on health care would go to people who crossed the U.S. border into California illegally.

Here’s something else to consider about that number. The $12 billion isn’t being paid by taxpayers on the whole, it’s being paid for mostly by businesses (including small businesses with as few as 10 employees) through a payroll tax. In other words, Governor Arnold Schwarzenegger wants to tax law-abiding California businesses, which are prohibited by law from hiring illegal workers, to pay for the health care of people who broke the rules to get here.

Worst case scenario: You work for a small business owner with 10 or 12 employees who doesn’t currently pay for the cost of health insurance. The legislature adopts a version of the governor’s proposal, requiring businesses with as few as 10 employees to either pay for their employees’ health insurance or pay a 4% payroll tax into a government pool. As a result, the employer lays you off to cover the expense of the new government mandate. You’re now unemployed so that your boss can cover the cost of insuring someone who isn’t a citizen of the United States.