KE Cellars

For once, Jim Hoffa is right.

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Listen to the broadcast of You Tell Me on KTBB AM 600, Friday, July 26, 2013.

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At the Democratic National Convention in Charlotte last year I interviewed Jim Hoffa, son of the infamous Jimmy Hoffa and, like his father before him, the head of the International Brotherhood of Teamsters. In that interview I disagreed with very nearly every word that came out of Mr. Hoffa’s mouth. So you know there has been a dramatic shift when I find myself suddenly agreeing with him.

In a recent letter to Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi, Hoffa said of Obamacare that it will,

“destroy the foundation of the 40-hour work week that is the backbone of the American middle class.”

For once, Mr. Hoffa is 100 percent correct. Already, Obamacare has modified the cultural lexicon. At one time the label ‘49er’ was applied to those who took huge risks and went ‘all in’ in search of fortune, as in the California Gold Rush of 1849. Today, the label ‘49er’ is more likely to apply to a small business owner, who carefully avoids hiring the 50th fulltime employee lest he bring down upon himself the huge costs of Obamacare.

Mr. Hoffa’s concerns regarding the 40-hour week are borne out by official government figures. According to the Bureau of Labor Statistics, in June of this year the economy gained 360,000 part-time jobs while it lost 240,000 fulltime jobs. The only reason the official unemployment rate isn’t well into double digits is because part-time work still counts as employment and those who have given up the search for work are not counted as being in the labor force at all. Account for these two groups, and the unemployment rate jumps up to near Great Depression-era levels.

As the mockingly named Affordable Care Act makes the transition from the abstract world of political demagoguery into the actual, daily life concrete world of economic reality, that reality is making life very uncomfortable for many who once supported Obamacare. Democratic senator Max Baucus summed it up neatly in just two words; “train wreck.”

Of course, Jim Hoffa didn’t write to Reid and Pelosi because he has suddenly come to his political senses. He isn’t advocating for anything at all like the outright repeal of Obamacare. His letter to Reid and Pelosi was purely for the purpose of demanding exceptions to the Affordable Care Act that would apply specifically to the Teamsters and other large unions. As for you and me and most particularly, for the millions of business owners across America that don’t employ union workers, we can all of us go hang. We are of no concern to Mr. Hoffa.

But we are of growing concern to vulnerable House and Senate Democrats. Democratic lawmakers that supported Obamacare, particularly those from red states, now know that they have no place to hide from disillusioned voters — voters who understand that there is not a single Republican lawmaker upon whom they can heap blame for the unintended consequences of the Affordable Care Act. (Unintended but not unforeseen. Many of us saw all of this coming from the minute the Affordable Care Act was first proposed.)

In 2008 we learned in particularly harsh fashion that you cannot, without inviting disaster, suspend by legislation the time-proven underwriting standards and fundamental economics attendant to issuing a home mortgage. You cannot by edict make someone suddenly creditworthy.

With Obamacare we are about to learn, perhaps equally harshly, that the government cannot, by simply passing a law, suspend the actuarial experience of insuring health. Saying, for example, that ‘pre-existing conditions’ must be covered at standard rates doesn’t make the economic costs of those conditions go away. If a health insurance carrier cannot underwrite individual risk, that is to say evaluate the age, health and lifestyle of a proposed insured, and then set the premium accordingly, the carrier’s only remaining choice is to either raise premiums on everyone or quit writing the coverage altogether.

Either way, the cost of health insurance goes up.

The real hope for those of us who opposed Obamacare from the jump is that all of this will lead Obamacare to simply collapse of its own unsustainability.

That scenario, as some nervous Democrats now understand, looks increasingly plausible.


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