How Obamacare Will Hurt The Economy
Obamacare actually discourages work, according to Congressional Budget Office director Doug Elmendorf. Jed Graham writes at IBD:
Congressional Budget Office director Doug Elmendorf said Friday that ObamaCare includes work disincentives likely to shrink the amount of labor used in the economy.
In a speech on ObamaCare’s economic impact outside the health care sector, Elmendorf said that those effects will primarily be related to the labor market and “will probably be small.”
Factoring in additional demand for workers in health care and insurance, CBO estimates that “the legislation, on net, will reduce the amount of labor used in the economy by roughly half a percent,” he said.
The reason: The expansion of Medicaid and new health insurance subsidies will reduce “the amount of labor that workers choose to supply.”
It seems people are going to have to be very, very careful about not earning too much money, lest they become ineligible for their share of the government welfare pie. From Ted Frank on Point of Law:
According to the Kaiser Foundation’s Health Reform Subsidy Calculator (via IBD), a 62-year-old in a high-cost area earning $46,000 a year without health insurance is entitled to a $7,836 government tax credit. Leaving aside how our strapped government can afford that, here’s what’s interesting: if the same person makes a mistake and earns an extra $22 in income, he loses the entire $7,836 credit. (The cutoff, according to Kaiser, is between $46,021 and $46,022.) That’s a 35,618% marginal tax rate. Indeed, the problem is so severe that our 62-year-old subject will have more take-home pay if he earns $46,000 than if he earns $55,000.
Whoops, guess legislators should have read the bill and rubbed two thoughts together about it before they voted for it! Their bad. And now all of our bad.
By the way, if you want to make my boyfriend Gregg snarl, remind him that the passage of Obamacare means that he’s going to have to start 1099-ing Delta Airlines, Hertz rent-a-car, and a slew of others he spends more than $600 with annually. By the way, you’d better believe I’m going to stop my Staples spending at $599 if it means I don’t have to 1099 them.
Way to tank the economy, legislaturds!