“Obamacare Is Not A Job Killer”: How Critics Are Misreading A New Government Report
The Congressional Budget Office today released the latest update of its projections for the economy and the budget, including Obamacare. And a fair reading would be that not a ton has changed since last time. CBO now expects the law will lead to 25 million people getting health insurance, while some 31 million people will remain uninsured. It will require a lot of new government spending but, because of offsetting revenue and cuts to other programs, it will actually reduce the deficit.
But CBO revised one finding and, all day long, critics have been seizing on the revision as proof that the law is a boondoggle.
The real story, as usual, is a lot more complicated.
The projection is about how the Affordable Care Act will affect labor output—that is, the number of hours Americans work every year. From the get-go, CBO assumed that Obamacare would slightly reduce labor output, relative to what it might have been without the law in place. Why? The CBO gave a bunch of different reasons.
For one thing, CBO reasoned, the financial assistance Obamacare provides depends on income. The more money you make, the less assistance you get. CBO argued that this would discourage some workers from putting in more hours, since the reward for working harder would be more income but less assistance on health insurance. In addition, CBO noted, historically some people have taken or held on to jobs exclusively to get health insurance. Obamacare makes it possible to get coverage without a job. As a result, CBO predicted, some of these people would stop working—or, at least, work fewer hours.
These weren’t the only ways that Obamacare will affect jobs, according to the CBO. And sometimes Obamacare will lead to people working more hours—for example, by giving people with chronic medical problems more freedom to switch jobs or start their own firms.
Overall, the CBO had said previously, Obamacare’s net effect would be a reduction in total labor compensation of about 0.5 percent. Now, citing new research on the effects of taxes, CBO is predicting that the net effect will eventually be twice as large—a full 1 percent reduction in compensation, or the rough equivalent of what we’d expect if two million fewer people were in full-time jobs.
That sounds like a big deal—and Obamacare critics certainly treated it like one. Here’s the conservative publication Newsmax: “Simply put, the new analysis from the nonpartisan agency suggests the 2010 Affordable Care Act is driving businesses and people to choose government-sponsored benefits rather than work.” Here’s Republican Congressman Tom Price: “This independent analysis by the Congressional Budget Office confirms that Obamacare will destroy economic opportunity and with it financial security for many American families.” And here’s a spokesman for the National Republican Congressional Committee: “There is no way to spin this. Because of #ObamaCare, there will be 2.5 million less jobs in our economy.” (If you want more quotes, Glenn Kessler and Greg Sargent of the Washington Post have nice roundups—and some good analysis of their own.)
But CBO didn’t actually say Obamacare would lead to 2 million fewer jobs. It said that Obamacare would lead to the “equivalent” of 2 million fewer jobs. In reality, CBO expects a much larger group of people to reduce their hours by a much smaller amount. Only a relative few will stop working altogether.
More important, CBO says, most of the people working fewer hours will be choosing to do so. And that’s a very different story from the one Obamacare critics are telling. Some of the people cutting back hours will be working parents who decide they can afford to put in a little less time with their co-workers and a little more time with their kids. Some will be early sixty-somethings who will retire before they reach 65, rather than clinging to low-paying jobs just to get health benefits. “This is what we want in a fair society,” says Jonathan Gruber, the MIT economist and Obamacare architect. “We don’t want to enslave the old and sick to their jobs out of some sense of meanness. If they are dying to quit/retire, then let them. That’s a good thing, not a bad thing.”
Of course, some able-bodied Americans will cut back on hours for reasons that conservatives, in particular, might not like. To put it crudely, they’ll work fewer hours simply simply because they don’t feel like working so hard. But whether or not that’s so problematic, it’s also the inevitable by-product of any program that makes assistance conditional on income. The Earned Income Tax Credit works that way. So do food stamps and Medicaid.
And so, by the way, would the new health care proposal from three Republican senators, which makes subsidies available to people with incomes at 299 percent of the poverty line but not those with incomes at 300 percent. The only question with programs like these is how big the disincentive to work is—and whom, exactly, it affects. The only alternatives are to give help to everybody (which requires much more government spending) or to give help to nobody (which leaves many more people struggling).
Ironically, the CBO report included two other findings that should, if anything, make most people more optimistic about Obamacare’s future. First, the CBO found that the law will reduce the deficit by a little more than initial projections suggested. Second, it found that the now-infamous “risk corridor” program, in which government and insurers share gains and losses, will result in net payments from insurers to the government, rather than the other way. (Jonathan Chait has the details on that drama.)
The change in projected deficits isn’t very large and the risk corridor prediction comes with more uncertainty than usual, so you wouldn’t want to bet a lot of money on either prediction coming true. But both findings call into more serious doubt two of the Republicans’ favorite talking points—that Obamacare will drive up the deficit and that, because of the risk corridor program, it’s a “taxpayer bailout” of insurers. As of today, those claims look even weaker than they did before.
Will Republicans stop making these arguments? Or will they at least acknowledge some uncertainty about them? Nope. And that’s a prediction in which you can feel very confident.
By: Jonathan Cohn, The New Republic, February 4, 2014
“When Women Have Options”: Obamacare, The Greatest Pro-Life Victory Ever
A new report finds that between 2008 and 2011, the abortion rate hit its lowest point since 1973, when Roe v. Wade declared access to the procedure a Constitutional right.
The rate fell 13 percent to 16.9 per 1,000 women in 2011, down from its peak of 29.3 per 1,000 in 1981.
While conservatives want to claim credit for the decline with onerous restrictions on a woman’s right to choose, the availability of contraception and family planning deserve most of the credit, according to the Guttmacher Institute’s Rachel Jones, the lead author of the study.
“The decline in abortions coincided with a steep national drop in overall pregnancy and birth rates,” she said in a statement. “Contraceptive use improved during this period, as more women and couples were using highly effective, long-acting reversible contraceptive methods, such as the IUD. Moreover, the recent recession led many women and couples to want to avoid or delay pregnancy and childbearing.”
Use of contraceptives has become near-universal and more common among married women than single.
Obamacare’s birth control mandate obligates all insurers to cover contraception without a co-pay, as it does all preventive care. Before the law 28 states already had such mandates in place and 85 percent of large firms offered coverage as part of their plans. Since August 1 of last year, that coverage is now standard for women no matter where they live or how they acquire health insurance.
A Washington University study released last year showed that providing birth control at no cost reduced the rate of abortions by 62 to 78 percent compared to the national rate. Meanwhile the right’s strategy of reducing abortions by requiring sonograms has had no effect on a large majority of women, according to a new study in Obstetrics and Gynecology.
Instead of encouraging the pro-life benefits of Obamacare, conservatives continue to try to minimize them. Republicans want to give employers the ability to opt out of the mandate, asserting falsely that some of the birth control options available induce abortion.
By opposing the mandate, the right reveals that its goal has always been to reduce women’s options, not unintended pregnancies. Obamacare will reduce thousands — if not hundreds of thousands — of abortions and could reduce even more if the Republican-led states that rejected Medicaid expansion would agree to provide subsidized care to approximately 4 million Americans.
Instead, so-called “pro-lifers” enable politicians who deny health insurance to those who need it most, threatening the lives of thousands. If only they were as pro-life as Obamacare is.
By: Jason Sattler, The National Memo, February 4, 2014
“Delusions Of Failure”: How Republicans Are Deceiving Voters And Deceiving Themselves
The Republican response to the State of the Union was delivered by Cathy McMorris Rodgers, Republican representative from Washington — and it was remarkable for its lack of content. A bit of uplifting personal biography, a check list of good things her party wants to happen with no hint of how it plans to make them happen.
The closest she came to substance was when she described a constituent, “Bette in Spokane,” who supposedly faced a $700-a-month premium hike after her policy was canceled. “This law is not working,” intoned Ms. McMorris Rodgers. And right there we see a perfect illustration of just how Republicans are trying to deceive voters — and are, in the process, deceiving themselves.
I’ll get back to “Bette in Spokane” in a minute, but first, is Obamacare “not working”?
Everyone knows about the disastrous rollout, but that was months ago. Since then, health reform has been steadily making up lost ground. At this point enrollments in the health exchanges are only about a million below Congressional Budget Office projections, and rising faster than projected. So a best guess is that by the time 2014 enrollment closes on March 31, there will be more than six million Americans signed up through the exchanges, versus seven million projected. Sign-ups might even meet the projection.
But isn’t Obamacare in a “death spiral,” in which only the old and sick are signing up, so that premiums will soon soar? Not according to the people who should know — the insurance companies. True, one company, Humana, says that the risk pool is worse than it expected. But others, including WellPoint and Aetna, are optimistic (which isn’t a contradiction: different companies could be having different experiences). And the Kaiser Family Foundation, which has run the numbers, finds that even a bad risk pool would have only a minor effect on premiums.
Now, some, perhaps many, of those signing up on the exchanges aren’t newly insured; they’re replacing their existing policies, either voluntarily or because those policies didn’t meet the law’s standards. But those standards are there for a reason — the same reason health insurance is now mandatory. Health reform won’t work if people go uninsured, then sign up when they get sick. It also can’t work if currently healthy people only buy fig-leaf insurance, which offers hardly any coverage.
And what this means, in turn, is that while we don’t know yet how many people will be newly insured under reform, we do know that even those who already had insurance are, on average, getting much better insurance. Since the goal of health reform was to make Americans more secure — to reduce their risk of being unable to afford needed health care, or of facing financial ruin if they get sick — the law is doing its job.
Which brings me back to Bette in Spokane.
Bette’s tale had policy wonks scratching their heads; it was hard to see, given what we know about premiums and how the health law works, how anyone could face that large a rate increase. Sure enough, when a local newspaper, The Spokesman-Review, contacted Bette Grenier, it discovered that the real story was very different from the image Ms. McMorris Rodgers conveyed. First of all, she was comparing her previous policy with one of the pricier alternatives her insurance company was offering — and she refused to look for cheaper alternatives on the Washington insurance exchange, declaring, “I wouldn’t go on that Obama website.”
Even more important, all Ms. Grenier and her husband had before was a minimalist insurance plan, with a $10,000 deductible, offering very little financial protection. So yes, the new law requires that they spend more, but they would get far better coverage in return.
So was this the best story Ms. McMorris Rodgers could come up with? The answer, probably, is yes, since just about every tale of health reform horror the G.O.P. has tried to peddle has similarly fallen apart once the details were revealed. The truth is that the campaign against Obamacare relies on misleading stories at best, and often on outright deceit.
Who pays the price for this deceit? In many cases, American families. Although health care enrollment is actually going pretty well at this point, thousands and maybe millions of Americans have failed to sign up for coverage because they believe the false horror stories they keep hearing.
But conservative politicians aren’t just deceiving their constituents; they’re also deceiving themselves. Right now, Republican political strategy seems to be to stall on every issue, and reap the rewards from Obamacare’s inevitable collapse. Well, Obamacare isn’t collapsing — it’s recovering pretty well from a terrible start. And by the time that reality sinks in on the right, health reform will be irreversible.
By: Paul Krugman, Op-Ed Columnist, The New York Times, February 2, 2014
“GOP Take-No-Risks Approach Is Unraveling”: Wacko Birds Cloud Republicans’ Election Euphoria”
Some Republicans envisioned a successful rope-a-dope strategy for this year’s elections: Don’t make mistakes, and let the Democrats stew in the juices of Obamacare and a strapped middle class.
That take-no-risks approach is unraveling. Congressional Republicans are offering proposals on major matters, and the party’s right wing — whose members Senator John McCain called “wacko birds” — is omnipresent in Washington and across the U.S.
Congressional Republicans have introduced initiatives on immigration, health care, and economic mobility and poverty that are creating policy and political fissures. There were four separate Republican responses to President Barack Obama’s State of the Union address last week.
House Speaker John Boehner wants his chamber to pass immigration reform. Any compromise that is acceptable to Hispanic and Asian-American groups draws fire from the party’s sizable nativist bloc and political consultants who don’t want to divert attention from their campaign against health care reform. The Speaker’s task is enormously complicated, the prospects uphill.
On health care, three leading Republican senators recently offered an alternative to the Patient Protection and Affordable Care Act, one they say is more market-centric. But fewer people would be covered, the prohibition on discriminating against people with pre-existing conditions would be weakened, and the authors already are backing away from a proposal to deny tax benefits for some employer-based plans. Many Democrats would relish a debate over the competing plan.
Florida senator Marco Rubio, a contender for the 2016 Republican presidential nomination, took on economic inequality by proposing to expand the earned income tax credit for poor people without children; Obama cited Rubio’s proposal while offering a similar one during his State of the Union address. Rubio deserves credit for trying, but he has gotten tripped up in the specifics: whether the costs should be offset by other reductions in the tax break for the working poor or whether the entire credit should be reshaped.
And the wacko birds are flocking, with a special eye on women and gays.
On women, former Arkansas governor Mike Huckabee wasn’t an outlier with his claim that Democrats believe women can’t control their libidos. Ken Buck, the right-wing Senate candidate in Colorado and a cancer survivor, inexplicably suggested pregnancy was like cancer. This is the same man who in a 2010 race — when his opponent was a woman — said people should vote for him because “I don’t wear high heels.” He also compared being gay to being an alcoholic.
Then there is the always -provocative Texas congressman Louie Gohmert, who said judges who rule in favor of same-sex marriage “need some basic plumbing lessons.” Or Randy Weber, his fellow Texas representative, who tweeted before the State of the Union that he was waiting for the “Kommandant-in-Chef,” who he called “The Socialistic dictator who’s been feeding US a line or is it ’A-Lying?’” Taxpayers pay Weber $174,000 a year.
Out in the provinces, the right-wing base is restless. The Arizona Republican Party recently censured McCain for leftist tendencies. In a few months, state party platforms will be drafted; keep your eye on Texas, where Republicans have called for the elimination of 16 federal cabinet departments or agencies and have come out against promoting “critical thinking” skills in education.
In Iowa, some activists are plotting to dump the state’s moderately conservative lieutenant governor, Kim Reynolds, at the party’s convention. Governor Terry Branstad, a Republican who is likely to be re-elected, is the longest-serving U.S. governor, and there are expectations he will leave during his next term. Unless the ultra-right-wingers have their way, Reynolds then would become the state’s first female governor (Iowans have never elected a woman to the Senate or House, either).
Democrats have their own crazies on the left, but they aren’t as prevalent or influential.
History and polling data suggest Republicans should do well in November, keeping their House majority and with an outside shot at taking control of the Senate. But some of these big issues and the wacko birds could unsettle these prospects.
By: Al Hunt, The National Memo, February 2, 2014
“Is The GOP Giving Up Tea?”: It’s An Illusion For The GOP To Think Bashing Obamacare Is An Elixir
The botched rollout of the health-care law has called forth some good news: Republicans are so confident they can ride anti-Obamacare sentiment to electoral victory that they’re growing ever-more impatient with the tea party’s fanaticism. Immigration reform may be the result.
The GOP is looking like a person emerging from a long binge and asking, “Why did I do that?” The moment of realization came when last fall’s government shutdown cratered the party’s polling numbers. Staring into the abyss can be instructive. For the first time since 2010, the middle of the House Republican caucus — roughly 100 of its 233 members — began worrying less about primaries from right-wing foes and more about losing their majority status altogether.
Obamacare’s troubles reinforced the flight from the brink. House Speaker John Boehner (R-Ohio) is telling his rank-and-file that they can win the 2014 elections simply by avoiding the stupid mistakes their more-ferocious colleagues keep urging them to make. In this view, the health insurance issue will take care of everything, provided Republicans end their tea party fling.
In fact, it’s an illusion for the GOP to think that bashing Obamacare is an elixir, especially if Democrats embrace and defend the law. Now that its benefits are fully kicking in, Republicans should be asked persistently, “Who do you want to throw off health insurance?”
Also: Do you want to go back to denying people coverage for preexisting conditions? And: What about those 3 million young adults now on their parents’ health plans? “Repeal Obamacare” is not as popular as it seems in GOP bastions. Some Republicans know this, which is why they are trying to cobble together much narrower alternatives to the law.
Nonetheless, some illusions are useful. Boehner is using them aggressively. The immigration principles he announced at his caucus’s retreat last week in Cambridge, Md., are a breakthrough because they are potentially more elastic than they sound. This is why many immigration reform advocates were elated, and why President Obama, sensing what was coming, offered not a hint of partisanship on the issue in his State of the Union address.
The principles have been loosely described as favoring the legalization of undocumented immigrants without a path to citizenship. But what the statement actually opposes is a “special path to citizenship” for the roughly 11 million who are here illegally. Everything hangs on the implications of that word “special.”
A bill barring a path to citizenship would be a nonstarter for Democrats — and it ought to be a nonstarter for Republicans and conservatives. Creating a vast population of legal residents who lack citizenship rights undercuts the rights of those who are already citizens. It would undermine the commitment of a democratic republic to equal treatment and self-rule.
But reform advocates inside and outside the Obama administration note that even without a “special” path, many immigrants, once legalized, could find ways of gaining citizenship eventually.
Changes in visa allocations, including more generous rules for the spouses and parents of citizens, could help as many as 4 million undocumented residents, as The Post’s Pamela Constable has reported. Republicans have already signaled openness to a path for “dreamers” — their numbers are estimated at between 800,000 and 1.5 million — who were brought to the United States illegally as children. The bill already passed by the Senate would put as many as 8 million people on a path to citizenship. A compromise that found “non-special” ways of reaching a number reasonably close to the Senate’s is now at least possible.
It’s also possible, of course, that Boehner could make a play to improve his party’s image with Latinos by appearing to be flexible at the outset but in the end appease hard-liners by balking on a final bill — and try to blame Democrats for not compromising enough. Rep. Paul Ryan (R-Wis.) warned on ABC’s “This Week” Sunday that passage of a bill was “clearly in doubt.”
But the GOP consists of more than the tea party. Both business interests and conservative evangelical leaders really want a reform law. Most of the intra-party tiffs have been over tactics: whether to use shutdowns or debt-ceiling fights to achieve shared objectives. The immigration battle, by contrast, will expose more fundamental rifts among party constituencies along philosophical lines.
None of this heralds the dawn of a new Moderate Republican Age. Shifts in the Republican primary electorate and the tea party insurgency dragged the party so far to the right that it will take a long time to bring it within hailing distance of the middle of the road. But change has to start somewhere, and the GOP’s slow retreat from the fever swamps may turn out to be one of Obamacare’s utterly unintended effects.
By: E. J. Dionne, Jr., Opinion Writer, The Washington Post, February 2, 2014
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