The Case Against Employer Mandates
Conn Carroll /
Stunned by the $1.6 trillion price tag for their health care plan, the Senate Finance Committee is weighing a ‘pay or play’ employer health mandate. Staffers are still negotiating which businesses will fall under the mandate, and how they are to be punished if they fail to offer “affordable” health care to their employers, but the ultimate details matter little: employer mandates are terrible public policy.
1. Employer Mandates Are A Regressive Tax. An employer mandate would be a regressive tax on business that would be directly shifted to employees in the form of reduced future wages or job losses. But don’t trust us. Obama White House National Economic Council Director Larry Summers wrote in 1989: “Mandated benefits are like public programs financed by benefit taxes… There is no sense in which benefits become ‘free’ just because the government mandates that employers offer them to workers.”