Democrats: This Is Your Mess

Obamacare is going to eliminate 2.5 million jobs over the next decade, according to the Congressional Budget Office:

It said the equivalent of 2.3 million workers would be lost by 2021, compared to its previous estimate of 800,000, and that 2.5 million workers would be lost by 2024. It also projected that labor force compensation would be reduced by 1 percent from 2017 to 2024 — twice its previous estimate.

Although the CBO projects that total employment and compensation will increase over the coming decade, that increase will be smaller than it would have been in the absence of the healthcare law.

The findings immediately roiled the debate over the healthcare law on Capitol Hill ahead of this year’s midterm elections.

The CBO’s director was pretty blunt:

“All our analysis led us to conclude the effects of the [healthcare law] on labor force participation would be a good deal larger than we had thought originally,” CBO Director Doug Elmendorf said. “Fundamentally, the Affordable Care Act provides subsidies to lower income people and those subsidies phase out … that will have some effects on discouraging labor supply.”

This is on top of the fact that the “job growth” we have (or that the Administration said we had up until December; it’s actually gotten worse) wouldn’t get us back to 2006 levels until the 2020s.  Sometime.  Maybe.  Barring any other problems. 

Like Obamacare. 

By all means, Democrats – keep changing the subject.

29 thoughts on “Democrats: This Is Your Mess

  1. But Mitch, you have to give the Democrats credit for their spin. Not working full time now means “you can spend more time with your family”. CBS radio yesterday (via WCCO) actually reported this story in a cheery way by saying that. That Obamacare is allowing 2.3M people to not have to work full time anymore.

    Our country has come along way from the days when not working hard was looked down upon.

  2. Ugh. It looks like the results are WORSE than we’d predicted a few years back, and given that unemployment feeds itself–just look at the inner cities–things are looking really bleak if the Health Insurance Deform Act is not repealed.

  3. People retire early or quit jobs they were only working to keep their health insurance. That opens 2.3 million jobs for the unemployed. Very good news.

  4. Never miss a chance to screw the workers, do you, Rick DFL-
    The NYT is pushing the same line:
    http://www.nytimes.com/2014/02/05/opinion/freeing-workers-from-the-insurance-trap.html?ref=editorials&_r=0
    This is fantasy-land stuff. The job losses are due to the phasing out of the subsidies as income increases. Work harder, get paid less.
    And neither the NYT (or RickDFL) is self-aware enough to know that if the number was the opposite (CBO says 2 million jobs gained due to Obamacare), they would say that was evidence that Obamacare was good for the country and good for workers.

  5. “The job losses are due to the phasing out of the subsidies as income increases” Where does the CBO say that? Are you saying that if higher income workers were to get more subsidies, more of them would choose to keep working? That is sort of nuts.

    “CBO says 2 million jobs” The CBO report does not talk about jobs loses or gains. It talks about the impact of the ACA on the size of the labor force (i.e. people who want to work).

  6. Fuck “Slate”, RickDFL. Slate is as far left as Free Republic is right. Here’s what “The Hill” has to say about the CBO report:
    “The new healthcare law will cost the nation the equivalent of 2.5 million workers in the next decade, the Congressional Budget Office (CBO) estimated in a report released Tuesday.
    The nonpartisan agency found the reform law’s negative effects on employment would be “substantially larger” than what it had previously anticipated.

    It said the equivalent of 2.3 million workers would be lost by 2021, compared to its previous estimate of 800,000, and that 2.5 million workers would be lost by 2024. It also projected that labor force compensation would be reduced by 1 percent from 2017 to 2024 — twice its previous estimate.

    Although the CBO projects that total employment and compensation will increase over the coming decade, that increase will be smaller than it would have been in the absence of the healthcare law.”

    –and–
    “The CBO is not saying employers will fire millions of workers because of the law.

    It instead found that the healthcare law will create disincentives for people to work and that this in turn will cut into the labor supply, hurt the economy, lower tax collection and cause higher deficits.

    Some people will leave the workforce or reduce their hours in response to lower wages because of the healthcare law, while others will leave or reduce their hours because they have insurance coverage and do not need to work full time to keep it, the CBO said.

    “All our analysis led us to conclude the effects of the [healthcare law] on labor force participation would be a good deal larger than we had thought originally,” CBO Director Doug Elmendorf said. “Fundamentally, the Affordable Care Act provides subsidies to lower income people and those subsidies phase out … that will have some effects on discouraging labor supply.””
    http://thehill.com/blogs/on-the-money/budget/197365-cbo-o-care-slowing-growth

    I know you don’t understand market economics, RickDFL, but if you have a guy working so he can pay for his health insurance, that is good. If you have someone not working because someone else is paying for his insurance that is bad.

  7. . . . and of course the Dems insist that we legalize ten or twelve million illegals because we have a shortage of workers willing to work for starvation wages. I’m sure there is a Slate article somewhere that says this is true. Denser than the center of a black hole, these guys.

  8. Because Obamacare increases the economic incentives to work less, people will work less, and society and the government will have less wealth to distribute. Re-distribution is the easy part of social democracy. Re-distribution without killing the wealth-creation is the hard part. Even the successful social democracies of northern Europe constantly struggle with this balance. Painful reforms like Schroeder’s labor plan (Jobs 2010, was it?) are the flip side of re-distributive social policies. You can’t afford the one without the other. Obamacare isn’t free! That doesn’t make it wrong, but its supporters must deal with the problems they create or lose credibility (and electability).

    There are those who think the writing’s already on the wall and the employer and individual mandates as written are dead. It’s too politically unpopular. If that’s the case, Democrats may have no option but to embrace something along the lines of the Republican plan. And Democrats who care more about health care than partisan politics should embrace the opportunity.

    Aspects of the GOP plan are better than Obamacare even by Democratic standards. It allows states to auto-enroll the uninsured. It caps the employer tax deduction which amounts to a tax on the rich. Sure, there’s no mandate but insurers are allowed to penalize late enrollees which is functionally identical to a mandate without the stigma of a mandate. Fiddle around the edges of the plan and you essentially get Obamacare but better and with bipartisan appeal.

  9. Emery, most conservatives — all the conservatives I personally know or whose work I have read — acknowledge that there is a trade-off between economic policies that decrease disparities in wealth and economic policies that produce higher growth. The mechanism is well understood. In times of high economic growth, the wealthy, by definition, are able to invest a greater proportion of their assets than the poor.
    I have never heard a democrat admit that such a trade off exists. People like the president and the NY Times editorial board believe that you can have both. To them it’s not a matter of engaging in the political arena with the other party to negotiate the best compromise between wealth equality and wealth creation, They really believe that they can produce both, while conservatives can only offer wealth creation that favors the rich.

  10. The sharply means-tested subsidies for health care act to further increase the slope of the already steep increase in marginal tax rates as income rises from poverty to the median. This creates a large disincentive for people to move from part-time or periodic to full time work. Upper income tax rates are irrelevant to this discussion. You’re focused on the wrong end of the income spectrum.

  11. There is a growing group of Americans, particularly the young (which means we won’t age out of the problem), who are unemployable. Some combination of a) not feeling a desire or need to work, b) not having the skills to work, and c) not being worth hiring because regulatory mandates have increased the cost of hiring, has resulted in this shrinking percentage of working Americans.

    Policies to reverse this trend would a) make sure the government does not subsidize those who choose not to work but are able, b) reform education to get more marketable skills bang for our education buck, and c) reduce employer mandates to make it easier for employers to hire.

    Instead we get redistributive candy like Obamacare.

  12. Policies to reverse this trend would a) make sure the government does not subsidize those who choose not to work but are able, b) reform education to get more marketable skills bang for our education buck, and c) reduce employer mandates to make it easier for employers to hire.
    Good luck with that!
    The political system we have is not designed to provide rational solutions to society’s problems. Any system that would be able to provide rational solutions to society’s problems would necessarily be undemocratic (c.f. the European Union).

  13. My sister, who was developmentally disabled, was getting SSI, Section 8, food stamps and Medicare. While she was capable of doing some level of work beyond the sheltered workshop (i.e. she could have cleaned tables in Wendy’s, for example), economically she could not afford to do any more work. Because if she made 1 dollar more than the specified limit FOR A SINGLE MONTH, her Section 8 benefit went from what ever it was to 0. And if her income again dropped below the limit, it would be 18 to 24 months before her benefit would be restored. And the limit was so low as to make even a 10 -15 hour a week job at minimum wage not economically viable.

  14. I personally know people who have been asked by their subordinates NOT to give them a raise for the very reason Loren suggests.

    Really, the ideas Rick promotes are a fallacy that dates back to before the Depression–that if you take group X out of the work force, that leaves those jobs open for Group Y. Reality is that it’s not so simple, as FDR’s abysmal record in the Depression–over 10% unemployment until Pearl Harbor–attests. Incentivizing productive people not to work is always a bad thing because it’s goods and services that never reach the economy, or translated into terms Rick might understand, “an ongoing recession” like the one we have now.

  15. Older workers are hogging the jobs just for health insurance, thereby blocking young people’s progress up the ladder of success. We need to get blockers out of jobs so younger workers can take them Obama-care helps us get blockers out; therefore, Obama-care is good.

    Next up: old people are sucking up the medical care dollars, their lingering prevents young people from getting the care they desire. We need to get lingerers out of hospital beds so young people can have them. Death Panels help us get lingerers out; therefore, Death Panels are good.

    And, of course, the perennial favorite, Jews are . . . .

    Scapegoating. It’s Easy! Anyone can do it! Try it Today!

    .

  16. Regarding “blockers”, those who endorse them not working (I’m talking to you, Rick) are apparently unaware that spending taxes to transfer a job from a “blocker” to another person will also tend to put that person out of work. “oops”, again, this is why the Depression lasted a decade, where previous recessions, unless extended by government, lasted a year or two.

  17. Or, translated, this means that when I take a million out of a rich person’s hands, that is money he doesn’t invest in an IPO, or use to hire a gardener, or use to buy a car (keeping dealerships open), or otherwise benefit the economy.

  18. I don’t why anyone would think that a person, deprived of the need to work, would sit around doing wonderful things like starting a business or spending more quality time with his or her family. This is an assertion without evidence. Surely we can look at other countries that have a dole and learn from their experience? When you walk through the council houses of England, do you find that they are hotbeds of entrepreneurism and wholesome family life?

  19. Step away that the stuff just piles up.

    So PM, you just completely abandon your assertion “The job losses are due to the phasing out of the subsidies as income increases”. I will just chalk that up to spewing random anti-ACA talking points without any idea what you are saying.

    The Hill source you site makes exactly the same point as the Slate article. The CBO says ACA will cause many people to leave the labor force but does not say the ACA will shrink the number of jobs in the economy. It is cute how you treat CBO labor force projections as gospel and simply ignore the CBO projection that the ACA will increase employment.

  20. “So PM, you just completely abandon your assertion “The job losses are due to the phasing out of the subsidies as income increases”.
    Making things up now, RickDFL?
    Read it again, moron:
    “Fundamentally, the Affordable Care Act provides subsidies to lower income people and those subsidies phase out … that will have some effects on discouraging labor supply.””
    http://thehill.com/blogs/on-the-money/budget/197365-cbo-o-care-slowing-growth

  21. Sorry I called you a moron, RickDFL, but what in the blazes are talking about? You asked ” Where does the CBO say that?”, didn’t you? I showed where the CBO says that: http://thehill.com/blogs/on-the-money/budget/197365-cbo-o-care-slowing-growth.
    The link you supplied has the CBO guy replying to leading questions from a Democrat congress-drone, and the time periods are different. The Democrat kept referring o ‘the next few years’, while the official CBO report in The Hill talked about 2024.
    Slate is not a reliable source. Especially a Matt Yglesias pick up on a Greg Sargent youtube clip taken out of context.
    I am dead certain, RickDFL, if the CBO report had claimed that Obamacare would create 2.5 million jobs by 2024, you’d be claiming it as proof of Obamacare’s success.

  22. As the number of income transfers from the working young to the idle old increase and the young begin to complain, will a coherent political movement result, and which party will represent which side?

  23. Emery, that’s actually a perceptive question. Most of us at SITD would hope young people would vote Libertarian to dismantle the boondoggles that cost so much. But it’s entirely possible they might vote Democrat simply to redirect the slops into their trough. Gimme More Free Stuff versus Leave My Money Alone . . . tough to say which way they’ll go. Excellent question. Troubling question.

  24. Lois Lerner apologized for the same thing, on May 10, 2012, before taking the Fifth to get out of answering questions about whatever it was there’s absolutely no evidence of.

    I suspect Liberals interpret “apology” as “free pass.” They probably learned it from overly-permissive parents, the kind who see Jimmy smack Sally and tell him “say you’re sorry” and then beam with pride when he mumbles it. Jimmy learns it’s okay to smack others, as long as he blurts an insincere “sorry” when he gets caught. Doesn’t stop him from doing it again.

    Kids like that grow up to be Democrat politicians. They’ll smack you, say “sorry” when they get caught, and go right on doing it.
    .

  25. @RickDFL
    We already have a demonstrated problem where some people in poverty won’t take jobs or leave disability for fear of losing their Medicaid. They’re stuck in poverty forever, and likely their kids will do the same. Obamacare extends that phenomenon well into the middle class. Don’t take that promotion, or you family could lose their subsidy. Don’t work those extra hours of overtime. Don’t take that degree a night. Don’t start your own business. That’s the problem that Obamacare is contributing to, and that’s the problem the CBO is finding is a lot bigger than originally stated.

  26. I would hope that you have figured out by now that this part of the report wasn’t talking about JOBS at all. It was talking about Labor Supply. The workers will be choosing to leave the labor force, if they have the resources to do so, because they are not chained to a job because they need health care. This is a job supply issue…not a job demand issue. Democrats will gladly own up to creating that “problem”.

  27. It sounds as if you’ve discovered the economic policies of southern European social democrats all by yourself. Just get everyone to retire early, and then we’ll have full employment, and life will be good. How’s that worked out for them? Please have a good read of the lump of labor fallacy.

    The opposite of employers offering fewer jobs to workers is employers offering more jobs to workers, which is certainly not what the CBO report describes.

    It also doesn’t say that merely the supply of workers will be reduced by 2.3 million people either. It estimates that the net effect of changes to the supply of workers will result in 2.3 million less man-years worked per year by 2021. If there is truly no reduction in demand, that implies a much larger reduction in supply.

    An economy with 2.3m fewer jobs will produce much less, and will reduce the wages of those who are removing themselves from the supply (yes, by choice) which will increase the inequality in society and drive the need for yet more subsidies and yet more disincentive to work. Eventually you have 40% of the working age population which doesn’t ever expect to work, with the other 60% subsidizing their poverty, and your economic problem is now a crisis of democracy.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.