Tipsheet

Democrats Spinning Madly on Devastating CBO Report


How does one spin the unspinnable? By trying to convince the country that millions of Americans leaving the full-time workforce is somehow good news. Here's White House economist Jason Furman doing his best to put a happy sheen on the terrible news, arguing that more Americans will be liberated to not work, or reduce their productivity. It's all about "choice," or something:



As I said yesterday, good luck with that. Americans differ on many issues, but there's near unanimity on the notion that our economy needs more people working, not fewer. Especially with the workforce participation rate at a 36-year low, artificially holding down the (still too high) unemployment rate -- which doesn't calculate those who've given up looking for work. The nonpartisan CBO has concluded that the "Affordable" Care Act will cost more than $2 trillion over its first decade of full implementation, will slow job creation in coming years, will retard economic growth, and will reduce the US labor force by the equivalent of 2.3 million full-time jobs. White House spokesman Jay Carney and other Democrats continue to claim that this is good news because people won't be "trapped" in jobs:


Democrats are increasingly employing a new tack in the battle over a projected reduction of two million jobs due to Obamacare, saying the decline is actually the result of people not being required to work anymore when they don't want to -- a concept labeled "job lock." "Yesterday, the CBO projected that by 2021 the Affordable Care Act will enable more than 2 million workers to escape 'job-lock' – the situation where workers remain tied to employers for access to health insurance benefits," House Minority Leader Nancy Pelosi's (D-Calif.) office said in a news release.


Actually, CBO also attributes the falling employment outcome to the lack of hiring and shaved hours resulting from Obamacare's employer mandate, in addition to the negative impact of its tax increases. But the bulk of this negative effect is, in fact, traced to people making the calculation that it's more beneficial not to work than to run the risk of earning too much money to qualify for generous Obamacare benefits. Conservatives often accuse liberals of being ideological supporters of an ever-growing welfare state. Liberals indignantly respond that of course they're not in favor of more government dependence. But here they are cheering a new entitlement program for "liberating" people from work. Remember, these people can't become less self-sufficient without other people picking up the slack. In this case, hardworking taxpayers will pay the tab for others choosing to dramatically scale back (or end) their workload. And the beneficiaries' healthcare subsidies will be "paid for" through higher costs for other people, including many in the middle class. Congratulations, middle class taxpayers, you're working harder, taking home less pay, and spending more on health coverage to help millions of people voluntarily quit their jobs or retire early. That shifts burdens onto the middle class, and destroys billions of dollars in worker productivity. And it's all thanks to Obamacare, which is unquestionably an income redistributionist scheme. Here is CBO director Douglas Elmendorf explaining the perverse incentives:



But wait, isn't healthcare portability a major goal of conservative reform proposals? Don't Republicans often talk about decoupling people's job from their insurance, which is a stubborn vestige of an outdated system? Yes, indeed, and Democrats have savaged them for it. But healthcare wonk Avik Roy explains the conservative goal, as opposed to Obamacare's results:


It is genuinely a good thing for us to move to a system where people control their own health dollars and their own health coverage, and aren’t stuck at a job because they’re afraid of losing the coverage they have. But giving people the opportunity to switch jobs is quite a different goal from encouraging them to drop out of the work force altogether. The negative effect of Obamacare on the labor market is far worse than any Republican alternative would be, because the ACA dramatically expands Medicaid, and because the law heavily subsidizes health insurance for those nearing retirement.


I'll leave you with a Wisconsin Democrat spinning a yarn about how less work is wonderful if you really think about it, because now more people will be able to tuck their kids in at night:



These are the same people who gripe endlessly about income inequality and lack of economic mobility, the latter of which is a pressing concern. But their signature law constructs very strong incentives for low-income people to work less, which in turn severely diminishes their chances of climbing the income ladder. When you're encouraging people not to work, their income and prospects for advancement will inevitably become less "equal." And the only way to "fix" that problem is to tax others more on the fruits of their labor, and hand it off to the "takers" -- of whom you've just created millions more. But don't you dare question Democrats' commitment to hard work and self-sufficiency. As someone once said, "when you spread the wealth around, it's good for everybody." Unless you're among those whose wealth is being confiscated and forcibly spread, a group that extends far beyond "the rich."


UPDATE - The New York Times editorial board descends into parody, arguing that Obamacare "frees" people from the "trap" of full-time work. The Journal's editors bring us back to reality. The Left is basically stuck arguing that Obamacare is terrific because it helps solve America's "too many people are working full-time" crisis. To which most Americans would respond, "what the hell are you talking about?"