After the Easter recess, ultra-liberal Los Angeles congressman Henry Waxman will attempt to slam American companies that are trying to obey SEC disclosure laws by properly accounting for the repeal of an important prescription-drug tax credit. What’s new in this bad story? It’s the announcement of Waxman’s Star Chamber hearing that will subpoena internal documents from leading American companies like AT&T, Verizon, Caterpillar, Deere, 3M, and Valero.
According to post-Enron accounting rules, thousands of American companies are required by law to immediately declare these non-cash charges. The American Benefits Council estimates up to $14 billion in corporate profits could be lost. So in other words, Waxman is in effect declaring war on bookkeeping.
The real trouble here is that by removing the tax benefit, these very same companies may reduce or even eliminate retiree drug benefits, and then thrust them on We the Hapless Taxpayer through a big cost-shift to Medicare. Instead of blaming business, Mr. Waxman should blame himself and Obamacare.