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Deere (DE +1.2%) says health care reform will increase its fiscal-year expenses by $150M, an...

Deere (DE +1.2%) says health care reform will increase its fiscal-year expenses by $150M, an amount not included in its FY2010 profit outlook. Similar disclosures from Caterpillar (CAT +1.3%) and AK Steel (AKS +1.8%) in the days since Congress passed the health care overhaul are the first in what may become a $14B whack on corporate profits.
Comments (7)
  • 14 billion wack..means less taxes paid....means more layoffs...means a bigger deficit..means the CBO estimate that was so widely proclaimed last week is wrong today....what a JOKE....what a JOKE....and we vote for these idiots....
    25 Mar 2010, 10:08 AM Reply Like
  • The solution for the increased costs is to go with temporary workers as much as possible meaning our work force will be far less confident about spending on discretionary items. Another solution is to subcontract as many subassemblies as possible to smaller manufacturers with lower benefit packages.
    25 Mar 2010, 11:57 AM Reply Like
  • What I love is Gary Locke proving yet again this administration is a bunch of fools and liars. He's out attacking these companies claiming that the rules are too complex and poorly defined at this point for them to know the true costs, but on the other hand they're not too complex and poorly defined for the administration to claim that this will reduce the deficit. The reality is it's orders of magnitude easier for companies to figure their costs than it is for the federal government to have any clue how this will impact federal receipts and expenditures. This administration is absolutely lacking in intellect or honesty. Medicare costs many times what was ever estimated, and this monstrosity will be likewise if not repealed.
    25 Mar 2010, 02:34 PM Reply Like
  • One-time non-cash hit.
    26 Mar 2010, 03:27 PM Reply Like
  • The offset is a reserve out of which they will pay cash. This is accrual accounting. You recognize an expense when you have the liability for it, not when you pay it.
    26 Mar 2010, 05:36 PM Reply Like
  • These companies have been getting tax free contributions from the government for prescription drug benefits and they have been able to deduct the amount of the contributions from their they will still get the contributions tax free but won't be able to dedect them from their taxes.....WSJ this morning....complete sympathy for these companies at all.....which small businesses got that deal?
    26 Mar 2010, 08:32 PM Reply Like
  • Yes, but you have to love the irony. This was a government gift to the unions. Now the government is still giving the gift, but taxing itself on the gift it is giving to the unions. Of course replace "government" with "Average Joe Taxpayer" and you see the real game. Joe gets it in the shorts both coming and going.
    26 Mar 2010, 09:41 PM Reply Like
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