Today, AT&T announced that it would take a 1,000,000,000 loss in 1Q 2010 because of Obamacare while also indicating it will substantially alter its employee benefit plans
Gigantic telecommunications company AT&T announced just now that it will take a $1,000,000,000 loss in the first quarter of 2010 because of changes made to the health care laws by Obamacare. Additionally, AT&T noted that the benefits packages are subject to substantial alternation in the next few weeks. AT&T’s announcement, on the heels of similar announcements by Caterpillar, John Deere, AK Steel and other large American companies, is more evidence of the negative economic effects from Obamacare. Reuters broke the story a half hour ago:
NEW YORK (Reuters) – AT&T Inc (T.N) said on Friday that it would record a $1 billion non-cash charge for the current quarter related to the new U.S. health care reform law signed by President Barack Obama this week.
AT&T’s charge appeared to be the largest in a series of charges announced by U.S. companies this week.
The operator, whose annual revenue is expected to be $124.1 billion this year, said the charge is the result of a provision in the law related to the tax treatment of Medicare subsidies.
As a result of the legislation, the company said it will be evaluating prospective changes to the health care benefits it offers.
AT&T’s announcement, and others that are sure to follow from America’s blue chip companies, appears to disprove the Democratic claims that Obamacare would create hundreds of thousands of jobs “almost immediately” after passage. Indeed, the corporate losses incurred already from Obamacare appear destined to reduce, not enhance, the ability of America’s companies to hire new employees.
Furthermore, AT&T’s statement that “as a result of the legislation, the company said it will be evaluating prospective changes to the health care benefits it offers” also disproves the oft-repeated Obama misrepresentation that “if you like your plan, you can keep your plan” after the passage of Obamacare. The tens of thousands of employees of AT&T are learning the hard way that sometimes Americans cannot trust the rhetorical claims of politicians about the policies they pursue.
Tags: 1 Billion, 1000000000, 1q 2010, 2010, Ak Steel, almost immediately, Alternation, Amp, at&t 1 billion, at&t 1b, Att, Barack Obama, benefits, benefits changes, Blue Chip Companies, Caterpillar, charge off, Dollar Loss, Economic Effects, Employee Benefit, First Quarter, Half Hour, Health Care Benefits, Health Care Reform, Hundreds Of Thousands, if you like your plan keep your plan, if you like your plan you can keep your plan, Job Creation, job loss, John Deere, Medicare, obamacare, Prospective Changes, Reuters, Telecommunications Company
It’s like Obama doesn’t understand capitalism or something. Weird.
Huh. How is AT&T going to have to change their health benefits? The mass majority of employees only have a CDHP option or the cheapest, lousiest HMO regional option if the company allows it. Only the upper-management employees of AT&T have actual, viable health benefits. Will those be restructured or cut? Doubtful. It will be the health benefits of the mass majority; health benefits that have been stripped to the bare-bones already.
This is a bunch of garbage.
Well, we’ll have to wait to see AT&T’s position in a few weeks when they announce the changes.
Somehow, I doubt you’re actually an AT&T employee as you use a nonexistent “yahho” email address and appear to have a grudge against large companies.
Perhaps you’re in favor of the government running the health care industry then?
Well, Mr. Geoff,
How did you know I misspelled my email address when it is not published?
Yes, I am in fact an AT&T employee and not against large companies. Actually, I am not in favor of the government running the health care industry either. However, AT&T is using this as an excuse to cut already perhaps the worst health care benefits provided to its mass employee population of any large company in this country. That is shameful.
We didn’t publish your email address, my friend, and never would. This site is not for profit, its for knowledge and information. If you are indeed an ATT employee, my apologies for saying otherwise. I would note that the point of the article is that Obamacare is costing blue chip companies billions…..
[…] of first quarter losses taken by America’s blue chip companies because of Obamacare (as epitomized by AT&T’s one billion dollar loss), it is very possible that the popularity of Obamacare will decline even further, as […]
I work for AT&T in Dallas, Tx. and I think this is poetic justice. BTW, AT&T has EXCELLENT insurance. We have a Caddilac plan that will not be taxed for years since the CWA is so pro-Obama (it’s his “pay-back”). I’m proud to NOT be a member of the Union. (Tx is a right to work state, we don’t have to join). Anyway, the union moaned and complained when their insurance was going to be taxed; it just was not fair. They want someone else to pay for everything. Now that AT&T says they will pay more, the employees attitude is “stop whining”. They don’t care if the people who give them a paycheck lose money, as long as they don’t. Who exactly do these Obama-bots think is going to pay for this bill? It sounded goood to them and the union told them to support it, so they did; perhaps they should have done a little research. The company has a right to a profit. Period. If the government cuts into that profit it will filter down and affect the employees. The Union thinks the company should just suck it up …. of course, they were unwilling to do the same. So when people start getting laid off, (rumors of surplus are already circulating) the union will continue to sing the praises of “change.” Sheep being led to the slaughter. CWA.. Think you are going to negotiate a good contract next time? Do you think you are going to get out of being taxed? As long as it does not affect the employees you love the bill. I’m sitting here at this moment listening to uninformed people talk about how unfair it is and, yes, I’m laughing. Although it affects me also, I still can not help but be entertained when stupidity catches up to the masses.
Sorry to spoil the party but it turns out that the $1 billion goes back to the famous 2003 Medicare prescription drug entitlement passed by a Republican-controlled Congress and paid for through their innovative pretend-it’s-not-there financing system.
In order to keep businesses from ending their drug coverage and dumping their retirees on the federal system, Congress provided a 28 percent reimbursement for the benefits. Better still, companies got to deduct the entire cost of the drug plans from their taxes. Including the government subsidy.
Yes! Obamacare involves no longer allowing big corporations to take a tax deduction for spending money we gave them. Somehow, this doesn’t seem to have the makings of a tea party rally. I’m not saying I like Obamacare or think it’s going to work but at least in this case, it appears that theirs a “rest of the story.”
Danny seems to think Corporations actually pay taxes. Not people. Like the shareholders and customers of AT&T.
That $1B is real profit the corporation is losing and that amounts to layoffs and hiring freezes in the real world.
I have to side with the current employee’s agrument on the fact that, and I am still digging and tyring to verify the best I can, special assistant Sean Kennedy, at&t lobbyist till ’05, openings are still there if he chooses to return. Dana Singiser, former member of hil clint’s campain team, now member of obama’s staff , her last lobbyist job was with at&t (cant find dates yet, still looking). Probably not any big deal, but could see this as chance for at&t to pad its bottom line and blame the government for its reasoning. Just find the Kennedy and at&t ties a little disturbing. Unlike Dana, it was his only lobbyist job he held before becoming active in politcs in 2007.
found this article bookmarked and really liked it. I will certainly bookmark it too and check your other articles later.
Hmmm… after reading some of the comments I wonder whether they in reality read the blog posts and reports before leaving your 2 cents or maybe they just look at the title of the entryand type the very first thought that comes to mind. regardless, it is nice to browse through clever commentary from time to time instead of the exact same, old blog vomit which i generally notice on the internet
[…] it was only after The Powers That Be got through with their passing of a bill which resulted in more jobs lost, did our present governmental powers then decide to turn their wandering dementia of attentions […]
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[…] AT&T—Telecommunications giant AT&T announced it will take a $1 billion loss in the first quarter of 2010 because of healthcare changes from the Obama administration. This […]
What a great post. Thank you for it 🙂
It is easy to make outlandish claims. But when the evidence for such claims is not disseminated, it should be obvious it is all BS. It seems many people just believe whatever supports their delusional reality. Any layoffs are politically motivated due to greed. How dare the government take money out of the rich people’s pockets and give it back to the poor who were largely exploited by the rich in making the rich wealthy?
Per website I’ve referenced . . .
The “costs” that these companies are “booking” are tax-free government subsidy payments that the companies receive to help these companies pay the cost of health care for their employees.
Under the 2003 Medicare prescription drug program, companies that provide prescription drug benefits for retirees have been able to receive subsidies covering 28 percent of eligible costs. But they could deduct the entire amount they spent on these drug benefits – including the subsidies – from their taxable income.
Let me reiterate that last item: before the Obama reforms companies were allowed to deduct subsidies (income they received for free from the government) from their taxable income. How’s that for double dipping?
The new law allows companies to only deduct the 72 percent they spent.
It’s NOT that the companies are having to PAY OUT in cash the $1Billion or $150 Million or $31 Million, it’s that these companies can no longer “book” the unearned extra income they derived from preferential tax loopholes.
The subsidies to these companies from the government are really your tax dollars, so in fact “Obamacare” reform is SAVING taxpayer money from being wasted on corporate welfare!
This story demonstrates the lengths to which the right wing will spin facts to their political and financial advantage.
http://www.huffingtonpost.com/2010/03/27/att-plans-1-billion-charg_n_515747.html
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i retired from ATT after 31 years of service . I just got my open enrollement for 2013 , my rates are going up % 500 percent ,,,,yes that is right five hundred percent . Thanks for changing the tax laws obamacare , i started out making 4 dollars a hour for 5 years , for this new law to change my healthcare is wrong and I hope the law is undone .
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[…] AT&T—Telecommunications giant AT&T announced it will take a $1 billion loss in the first quarter of 2010 because of healthcare changes from the Obama administration. This […]
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