An early point about the Obama administration’s new plan to help homeowners by forcing banks and lenders to reduce monthly mortgage payments to 31 percent of income, usually unemployment insurance:
The new push, which the White House is scheduled to announce Friday, takes direct aim at the major cause of the current wave of foreclosures: the spike in unemployment.
As noted in several places, the new health-care bill has already made the cost of employees more expensive and taken away capital that could otherwise have been used to hire workers.
Farm-equipment manufacturer John Deere “said it expects its expenses to rise by around $150 million on an after-tax basis, mainly in the second quarter, as a result of the legislation.”
Verizon “told employees in an email Tuesday that Verizon’s costs will go up in the near term, pinpointing a tax-subsidy reduction for retiree health benefits.”
Heavy-equipment manufacturer Caterpillar “said that its first-quarter earnings will be hit with a $100 million after-tax charge under tax law changes attached to the new health care reform legislation.”
AK Steele Holding Corp., “the third largest U.S. steelmaker by sales, said it will record a non-cash charge of about $31 million resulting from the health-care overhaul signed into law by President Barack Obama. The charge will be recorded in the first quarter of 2010.”
Valero Energy “will take a $15 million to $20 million charge to second-quarter earnings for the same reason.”
Medical-device maker Medtronic “warned that new taxes on its products could force it to lay off a thousand workers.”
If you want to reduce unemployment, stop passing legislation that kicks the snot out of employers.