America's Business Is Business
12:00 AM, May 25, 2013 • By IRWIN M. STELZER
· The debt ceiling deadline came and went this week, and no one noticed. The Treasury can juggle accounts to put off any need for congress to act until October, and Republicans have no taste for closing down the government, or coping with (false) charges of having induced default, lest they damage their rather good prospects of retaining control of the House and winning the senate in 2014.
In short, ho hum—nothing worth paying much attention to when deciding whether to buy a car, or house, or fridge.
The only exception to this relegation of the federal government to a lower level of importance in the economy is Obamacare. Even its leading proponents say that implementation promises to be “a train wreck,” one that has derailed the small business sector: firms with 50 or more employees face large cost increases to meet Obamacare’s requirements that they provide health insurance for any full-time worker (30 hours or more per week) or pay a fine of $2,000 per employee. Some fast-food franchisees tell me they are planning to share workers—leatery A gives each employee 20 hours of work, eatery B obligingly gives those workers another 20 hours. Then they reverse the process. The employees get full-time work, but the employers are not saddled with Obamacare coverage obligations, and avoid the $2,000 per worker fine levied on firms that don’t provide health insurance.
I have no idea how widespread schemes such as this will turn out to be. But I do know that small businessmen are saying that despite the recent improvement in sales and in their view of future prospects, they are reluctant to hire that 50th worker or provide that 30th hour of work.
Still, small businessmen—builders in Phoenix, retailers in St. Louis and Houston—say that business is better than it was last year. And likely to remain so: consumer sentiment is at its highest level in almost six years, suggesting that we are indeed headed to a year-end 3 percent growth rate. The wealth effect and private sector recovery now matter more than perfervid televised fulminations of Washington politicians.
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