On top of AT&T's $1 billion, the writedown wave so far includes Deere & Co., $150 million; Caterpillar, $100 million; AK Steel, $31 million; 3M, $90 million; and Valero Energy, up to $20 million. Verizon has also warned its employees about its new higher health-care costs, and there will be many more in the coming days and weeks.
As Joe Biden might put it, this is a big, er, deal for shareholders and the economy. The consulting firm Towers Watson estimates that the total hit this year will reach nearly $14 billion, unless corporations cut retiree drug benefits when their labor contracts let them.
So of course the no-accounts that didn't read the bill or listen to the Chamber of Commerce 9or the American people) are going to raise a political ruckus.
Meanwhile, Henry Waxman and House Democrats announced yesterday that they will haul these companies in for an April 21 hearing because their judgment "appears to conflict with independent analyses, which show that the new law will expand coverage and bring down costs."
I guess they can a simply answer that they got dinged for their own generosity in providing their retiree's a drug benefit and now those same retirees will be unceremoniously dumped into Medicare. Now I wonder how AT&T will get that 1 billion back? Perhaps by laying off more workers?
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