MOLINE, Illinois (March 25, 2010) — Deere & Company announced today that the Patient Protection and Affordable Care Act signed into law this week will adversely impact its expenses for fiscal 2010. As a result of the legislation, the company’s expenses are expected to be about $150 million higher on an after-tax basis, primarily in the second quarter. This impact was not included in the 2010 outlook for net income attributable to Deere & Company of approximately $1.3 billion disclosed in the company’s first-quarter earnings report on February 17th.
Certain statements in this report are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to future events and financial performance. These forward-looking statements involve risks and uncertainties. Actual results may differ materially from those contemplated (expressed or implied) by such forward-looking statements, because of, among other things, the risks and uncertainties found in the Company’s press releases and other SEC filings, including the risk factors identified under the heading “Risk Factors” in the “Management’s Discussion and Analysis of Results of Operations and Financial Condition” in the Company’s most recent Annual Report on Form 10-K, as updated by the Company’s Quarterly Reports on Form 10-Q.
CHICAGO -(Dow Jones)- Caterpillar Inc. (CAT) said Wednesday it will take a $ 100 million charge in the first quarter to reflect additional taxes it expects to pay this year because of U.S. health-care legislation.
Okay, folks. Not only are the Democrats not focusing on unemployment, but they are enacting legislation which will directly stifle business development and growth.
Now, consider the ancillary consequences of this. That added cost incurred by just these two organizations, John Deere and Caterpillar, will be passed along in the form of increased prices for products made by those two organizations. Those increased prices will be passed along in the form of increased prices across the stream of commerce, perhaps for food harvested through use of John Deere equipment, and new homes built with the help of Caterpillar machinery.
And this just has to do with prices. What does this do to these two organizations’ capacity to hire? Will people already employed be laid off to offset the additional costs incurred due to the Democrats’ health care reform? What effect will that have on the housing markets in the immediate area surrounding John Deere’s and Caterpillar’s headquarters and facilities?
Furthermore, if this is only two organizations, albeit big ones, what does this mean for every other company, large and small, across the country? What about the major food companies? The farming co-ops? Transportation companies? Energy companies? What will the added burden caused by the Democrats’ celebrated new law do to food prices at the supermarket? The price of gasoline at the pump? Home heating oil?
In the converse, say for a moment that the health care reform bill signed into law on Tuesday was the 253-page legislation proposed last year by Republicans rather than the 2,700-page monstrosity forced upon us by the Democrats. What would the effect be, then?
The Democrats’ bill was scored by the Congressional Budget Office at $940 billion over ten years (without the Medicare “Doc Fix”), and both the CBO and AP admitted that premiums would increase. The 253-page bill, on the other hand, was constructed on three pillars–opening up the private insurance market to interstate competition, allowing individuals and small businesses to pool risk and buy insurance in groups, and modest tort reform–and was scored by the CBO at $61 billion over ten years. (That’s right — “billion,” with a “B.”) Moreover, the CBO said that the Republicans’ plan would decrease premiums.
If the bill signed into law on Tuesday was that bill, a bill which did not contain the taxes which will add $250 million in immediate expenses to John Deere and Caterpillar and a bill which decreased health care costs for Americans rather than increasing them, imaging the downhill consequences. Companies large and small could afford to hire and to expand. Prices for everything from food to gas to lawn mowers would not rise as sharply. The list goes on and on.
What lawmakers on both sides of the aisle need to understand is that everything they do affects America at more than just the superficial level targeted by the legislation or regulation in question. The reality of the effect of health care reform on the likes of John Deere and Caterpillar should go a long way to reinforce that sentiment.