Let me get one thing straight up front - if I was to measure my personal trust of both government and big corportations on a scale of one to ten, I'd rate government at 3 and corporate America at about 1. So when I read AT&T is doing some accounting magic to alledgedly pay for increased healthcare costs, I view it with a heaping helping of skepticism... and because the right-wing hyperbole machine has latched onto this as proof of a bad bill, I wanted to find out for myself what was going on.
Under the 2003 Medicare prescription drug program, companies that provide prescription drug benefits for retirees and employees have been able to receive subsidies covering 28 percent of eligible costs. AT&T got $1.3 billion in government subsidies - meaning they spent roughly $4.64 billion on prescription drug benefits. Under the 2003 law, they could deduct from their taxes the entire amount they spent, PLUS the subsidy. So in addition to the $1.3 billion they got from the government to help pay for retiree drug benefits, they wrote off $5.94 billion on their taxes. The new law states that they can now only deduct the amount they actually spend. So, what AT&T did yesterday was make a NON CASH accounting charge against a perceived future loss of tax deductions through Medicare subsidies.
Let me repeat that - AT&T got $1.3 billion from the government to help pay healthcare costs to their employees. Seems corporate America already HAS a government-run healthcare plan, and it's a pretty sweet deal!
Furthermore, in my opinion, AT&T is using this a a bargaining chip against negotiations with the communications workers union coming up in 2012. They will bring a sob story to the table saying the healthcare bill is costing them so much that they can't afford to offer a prescription drug benefit for their retirees anymore - and will seek concessions from the union that will dwarf any subsidy write-off they get now. How convenient to be able to blame the healthcare bill and make more profit - all without growing income.
In fact, if you listen to the talking heads - it's a done deal. But the opposite is just as likely. The healthcare bill may indeed end up saving them money on employee prescription drug benefits. In either case it's a win for AT&T - it's just how much they'll gain.
And Obama-haters are calling him a socialist because the healthcare bill closed a corporate largess in a 2003 bill passed during the Bush administration. Seems clear to me AT&T is crying foul over losing their own brand of corporate welfare.
Man-up, AT&T. Go out an grow your business through innovation, superior products, great service and market share - and quit relying on government handouts to make your bottom line look better.
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