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tazzygirl -> The "Cry me a river for Caterpillar" thread (3/20/2010 10:14:40 AM)
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This was pulled from Master Tim's thread. I have severe trouble worrying about a global company with profits last year of over 800 million and a work force of over 90,000, moaning about having to spendn accounting wise, an extra 100 million because of an extremely generous prescription plan to retirees and their families.
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ORIGINAL: mcbride
Not odd at all, and the facts on Caterpillar's involvement speak for themselves. Obama knew what he was doing (just as he did with the Fox interview), and it's interesting to note that as soon as Obama left, Caterpillar's CEO immediately contradicted him.
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ORIGINAL: Sanity
Odd, because that sure wasn't how Obama felt about the folks at Caterpillar when he did a speech at their plant to push his stimulus plan, and had his photo op with the Caterpillar CEO.
http://www.youtube.com/watch?v=at_o2qs6XQc
And Caterpillar is one of the best employers you can have, with a fantastic benefits package, but the best you can do is never enough for some people.
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ORIGINAL: mcbride
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ORIGINAL: Sanity
One prediction, plucked straight out of the headlines -
Caterpillar: Health care bill would cost it $100M
Anyone who thinks that Caterpillar isn't spewing propaganda for the sake of the right wing hasn't been paying attention.
Few companies have worked harder against health care reform, and fewer have been more closely tied to right-wing and corporate lobby groups. The company is one of the largest corporate contributors to the Republican party, but that's just the beginning.
Caterpillar was a leader in the fight against patients' rights legislation that would have created liability for HMOs that harm patients through negligence.
Ed Kaleta, who headed government affairs for Caterpillar Inc, is now the head Washington lobbyist for Humana, the fourth-largest for-profit private health insurer.
Donald V. Fites, a former CEO and chairman of Caterpillar, is a prominent member of the National Republican Senatorial Committee, a political committee devoted to increasing the number of Republicans in the Senate.
Some "prediction". If only Caterpillar would spend all those dollars and all that effort on health care for its employees, huh?
Here is a follow up to the Caterpillar complaint...
In a letter Thursday to House Speaker Nancy Pelosi (D., Calif.) and House Republican Leader John Boehner (R., Ohio), Caterpillar urged lawmakers to vote against the plan "because of the substantial cost burdens it would place on our shareholders, employees and retirees."
The company said the potential extra costs would primarily come from provisions to tax the federal subsidies the company now receives for providing prescription-drug benefits to retirees and their spouses.
Since the Medicare drug program was enacted in 2003, Caterpillar and more than 3,500 companies that already provided drug benefits for retirees have received tax-free subsidies from the federal government as an incentive to maintain their drug programs.
The subsidies average $665 per person covered under a company-sponsored prescription program, according to benefits consultant Towers Watson, which recently completed a study on the health-care legislation's effects.
Watson Towers estimates federal taxes on the drug subsidies would amount to $233 per person receiving drug benefits under such programs.
About 40,000 Caterpillar retirees receive company-sponsored drug benefits, which are more generous than Medicare's drug plan, in which recipients are required to pay some out-of-pocket expenses.
Proponents of subjecting the drug benefit subsidies to federal income taxes argue that Caterpillar and other companies are already able to deduct health care benefit costs, including the drug program, from their taxes as a business expense.
The Peoria, Ill., company also says it faces higher insurance costs from a requirement in the health-care legislation that would extend coverage for employees' dependent adult children up to age up to age 26. The company currently covers adult dependents up to 25, but only if they are full-time students.
Caterpillar said this provision, along with eliminating the tax exemption on drug subsidies, would raise its health care costs by at least 20%, or more than $100 million, in the first year after the health-care overhaul program.
That big increase would largely be a noncash charge, stemming from adjustments to Caterpillar's tax liability. Accounting rules require that the long-term tax costs be included on the company's balance sheet at one time, even if the taxes paid annually on the subsidies are actually much less. Although the health-care legislation would be phased in over a number of years, the tax effects of the legislation would be felt in 2010 if the bill becomes law this year.
"From an accounting standpoint it hits right away," said Roland McDevitt, director of health care research for Towers Watson. The tax charges also would count against companies' earnings at a time when corporate profits remain fragile because of the weak economy.
McDevitt estimates that a company with 25,000 retirees on subsidized drug benefits could see its 2010 earnings reduced by $70 million.
Caterpillar and other companies have been lobbying to maintain the tax-free subsidies as an effective way for the federal government to hold down its costs for Medicare prescription drug coverage by keeping retirees enrolled in company-run programs. They predict that taxing the subsidies will cause companies to curtail drug benefit programs for retirees.
http://www.foxbusiness.com/story/markets/industries/transportation/nd-update-caterpillar-health-bill-cost-company--million/
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