Any large employers still on the fence about expanding in Colorado and creating jobs here are likely to look elsewhere after they get wind of a bill now making its way through the legislature.

House Bill 26-1327, sponsored by state Rep. Lisa Feret, D-Arvada, would assess Colorado’s largest employers thousands of dollars for each employee who uses the government’s Medicaid program for health insurance. Employers can avoid the assessment — let’s just call it a fine — if they can demonstrate they provide “affordable health coverage” to their workers.

It’s as if our state’s rising cost of living — and the growing list of regulatory mandates imposed on the private sector by ruling Democrats at the State Capitol — hadn’t put enough of a chill on new investment. HB 26-1327 is a swift kick in the shins to employers that will leave them no doubt Colorado is too costly a place to do business.

The economically oblivious proposal hits a sweet spot for legislative Democrats, offering them a trifecta. It’s a sop to their restive left wing, which morbidly distrusts private enterprise — and assumes there’s always more money to be found in the deep pockets of “greedy corporations.” The bill also serves as a PR ploy that can deflect blame for the legislature’s runaway Medicaid spending — purporting to recoup public funds from supposedly stingy employers who owe their workers “a living wage.” And it’s a potential cash cow those same free-spending lawmakers can use to bridge the gaps in a state budget deficit of their own making.

HB 26-1327 also affords its supporters a rare opportunity to appear fiscally responsible. In a press statement, sponsor Feret sanctimoniously declared Colorado taxpayers “should not subsidize the nation’s largest corporations by way of our state providing Medicaid for their employees.” Gosh, you mean the bill actually is an effort to rein in public subsidies? 

The claim might be more plausible if it didn’t make an utter mockery of Economics 101. Not to mention how it reveals abysmal ignorance of the way private-sector employment really works. 

The bill’s principal targets — big-box stores, fast-food chains and the like — typically offer low-skill or unskilled positions at modest wages. The measure exempts employers that provide affordable health coverage to employees working 20 or more hours per week or 80 or more hours per month — meaning it expects even part-time workers to be covered. Under the bill’s provisions, the employer must fork over $2,300 for each employee who receive Medicaid.

The gaping hole in the bill’s logic is that someone who qualifies for Medicaid while employed presumably would qualify if unemployed, as well. Would lawmakers prefer those workers not work at all — yet still be enrolled in Medicaid? Employers might see to that if the measure passes. They’ll downsize, farm out operations to contractors — or pull up stakes and leave.

Never mind what a gut punch that would be to Colorado’s economy in general. More to the point, it will leave precisely the people who need a leg up — unemployed. Employers pay what the market will bear for the level of skill required on a given job. That also applies to benefits. If the employer’s cost rises above market level, the job will go away sooner rather than later.

Blind to that basic reality, the bill’s backers seek to scapegoat employers for the state’s Medicaid spending meltdown — in essence, penalizing them for creating jobs. Ironically, it was the politicians who ran up taxpayers’ Medicaid tab in the first place.

The bill — a copycat of legislation introduced in New Jersey and other states — already has won approval from a couple of House committees though its overall chances remain unclear. 

It’s hard to imagine Gov. Jared Polis, an extraordinarily successful entrepreneur, doesn’t see the folly in the measure. Just in case lawmakers don’t come to their senses, let’s hope Polis has his veto pen ready.