By Donald Lambro
Friday, February 07, 2014
WASHINGTON - The fiery debate over Obamacare this week
sparked new fears about the harm it will inflict on our economy, jobs and the
rising costs of medical care.
They were ignited by the Congressional Budget Office's
troubling forecasts of the health insurance law's impact on all of us that
raised many more questions than answers.
But a few things became clearer in the aftermath of this
week's firefight between the White House, Democrats and the law's Republican critics:
The law will further reduce our nation's dwindling work
force.
It will cut the hours worked among many Americans as
employers attempt to avoid its employment health care costs. And the vastly
inflated enrollment numbers used by President Obama and his administration do
not hold up to serious scrutiny.
The White House, whose dishonesty index skyrocketed when
five million Americans lost the insurance they liked and their doctors,
defended the program. Obama's health care law is "helping labor markets,
is helping businesses and is helping jobs," said Jason Furman, the president's
chief economist.
That's not how Sen. Bob Corker (R-Tenn.) described the
CBO's outlook on what Obamacare would do to the U.S. economy in the years to
come.
"Today's CBO report gives a sobering outlook on our
economy. It confirms what we've known all along: The health care law is having
a tremendously negative impact on economic growth."
Stripped of its other economic analysis, CBO essentially
forecasts that more than 2 million Americans, who have relied on obtaining
health insurance through an employer, will see their work hours reduced or they
will stop working altogether as a result of the Affordable Care Act's medical
care benefits.
Why? CBO Director Douglas Elmendorf offered this answer
Wednesday at the House Budget Committee's hearing that made some Democrats
cringe:
"By providing heavily subsidized health insurance...
to people with very low incomes... the [Affordable Care Act] creates a
disincentive for people to work relative to what would have been the case in
the absence of the [law]."
Then Budget Committee Chairman Paul Ryan (R-Wis.) weighed
in with this jaw-breaking observation: "These changes -- they
disproportionately affect low-wage workers. Translation -- Washington is making
the poverty trap worse."
All of this opens up a new political can of worms for an
unpopular law that has been racked by multiple debacles in its botched web site
rollout, shaky finances, despotic mandates, and new Constitutional court
challenges.
The latest revelations now further threaten Democratic
lawmakers with widespread retaliation from the voters in the 2014 midterm
elections. And there were new signs this week that many of Obamacare's
once-stalwart defenders were distancing themselves from the controversial law.
The Washington Post, one of the law's most enthusiastic
defenders, reported Wednesday that when the CBO report came out, "few
Democrats publicly defended the law, a sign that lawmakers recognize its
vulnerability."
Democratic Rep. Hakeem Jeffries of New York said at the
House Budget Committee hearing on the report that CBO's findings triggered
"hysteria" on his side of the aisle.
Maybe that's why Obama devoted a mere 462 words to his
signature law in his State of the Union speech that was 6,778 words long --
despite one administrative disaster after another.
CBO tried to steer a middle course through its thorny
economic forecasts. It insisted that businesses would not significantly cut
employment rolls or reduce hours work to stay under a 30 hour threshold to
avoid providing workers with health care benefits. No one believes that except
its most ardent defenders.
But CBO does forecast long-term employment trouble ahead
in future years, saying Obamacare will result in the economy losing 2.3 million
full-time workers by 2021. That is almost three times its earlier estimates.
Then there are the wildly exaggerated estimates by the
administration on the number of Americans who've signed up for Obamacare and
its expanded Medicaid program.
For example, the administration claims that 6.3 million
Americans became eligible for Medicaid between October and December because of
the new law. But a study by the health-care industry consulting firm Avalere
Health found a much smaller number (between 1 or 2 million) actually signed up
because of the Obamacare law.
Many were renewals in the usual ebb and flow of the
Medicaid enrollment population that have more to do with rising or falling
incomes, the study found. Judith Solomon, vice president of health policy at
the Center on Budget ad Policy Priorities, told the Post that Avalere's numbers
were likely more accurate than the administration's figures.
One of the biggest and most politically explosive issues
raised by the CBO report became lost in all of the mumbo-jumbo murkiness of its
findings.
It was left to Paul Ryan to lay bare one of Obamacare's
worst offenses, that it will hurt many millions of Americans, especially the
poorest, most vulnerable in our economy.
At one key point in the hearing, Ryan bored deeper into
Obamacare's many flaws, asking CBO's Elmendorf that if the new law would reduce
the labor participation rate, as he says, wouldn't it therefore hurt economic
growth?
Elmendorf agreed that, yes, that would happen.
But there were broader problems in CBO's estimates,
according to the University of Maryland's business school economist Peter
Morici.
The impact would be worse than CBO forecasts.
"CBO once again low-balls the impact of the
Affordable Care Act on labor force participation and the economy," he
writes in his analysis of their report. The economic growth rate "and
employment for most workers will be harmed," he said.
But this is just the tip of the economic iceberg that
lies beneath Obamacare. Higher, unbreakable poverty rates, disincentives to
work, and a shrinking American work force that will further weaken our sluggish
economy are just the beginning of what awaits us under this harmful law.
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