McMeghan has a typically fact-free post containing a bunch of reasons why healthcare reform will not increase the number of small businesses. Because even she can recognize that an argument conjured from thin air, moonbeams, and the tears of Andrea Mitchell is a little weak, she later amended the post with this column by an economist who could actually use a statistical website. Here’s his “argument”:
The latest Small Business Economy an annual publication of The Office of Advocacy of the Small Business Administration explains that 60.7 million people have employer-sponsored health insurance from their employment (people covered by their spouses don’t matter here because they don’t face job lock). Therefore, 607,000 additional people per year would begin the entrepreneurial process if we eliminated health insurance job lock.
But not everyone who begins the process of starting a business manages to get one up and running. In fact, analysis of the Panel Study of Entrepreneurial Dynamics data by Paul Reynolds shows that a new business results from about one-third of startup efforts. So we will get about 200,000 new businesses if we can eliminate the job lock that comes from employer-sponsored health insurance.
Again, not an economist, but isn’t it just possible that some businesses fail because of high healthcare costs or the uninsured illness of a founder? If I were an economist, wouldn’t I want to at least mention that possibility, and maybe allow that a few more businesses might succeed if healthcare weren’t such a burden? And why don’t spouses count as job locked? Lots of small businesses are family businesses, and maybe that spouse is stuck in her job instead of helping out the business, because her job is the only way for the family to get insurance.
(While I’m asking stupid rhetorical questions: Is there any profession whose practitioners debase themselves more often in the service of ideology than economics? )
If you’re interested in learning something about healthcare and small business, this mommy blogger is far more informative than either of the two aforementioned idiots. She started a family media company a couple of years ago. Because of some minor illnesses (such as hay fever), she had to get “high risk pool” insurance for her family. She’s a perfect example of a business owner more likely to succeed now that the bill is law. She also got a great teabagger flyer in her door, and her reaction shows just how alienating teabagging can be.