The Congressional Budget Office released a report this week projecting that the Affordable Care Act would shrink the U.S. workforce by the equivalent of 2 million full-time jobs in 2017, further fueling the political controversy surrounding President Obama’s health-care law. Critics of the law were quick to cite the report as support for their claims that Obamacare would prove harmful to the economy. “The middle class is getting squeezed in this economy,” said House Speaker John Boehner, “and this CBO report confirms that Obamacare is making it worse.”
“The real story, as usual, is a lot more complicated,” said Jonathan Cohn in NewRepublic.com. The CBO isn’t projecting that there will 2 million fewer jobs available because of Obamacare, but that Americans “will be choosing” to work fewer hours once the new law is in place. Some people who now hold full-time jobs only for the health benefits will be able to cut back to part-time and still have medical insurance. Some people in their 60s may choose to retire early for the same reason. And yes, some people will simply quit low-paying jobs they hate, knowing they’ll get Medicaid. In other words, “most of the people working fewer hours’’ will be happy to do so. That’s not a bad thing.
Yes it is, said John Podhoretz in the New York Post. “This is the classic problem of a government handout.” The law’s subsidies offer “perverse incentives” to the poor. Why work when taxpayers will give you health care for free?
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Obamacare remains a net positive for the economy, said Matthew Yglesias in Slate.com. The CBO report only proves “how much avoidable suffering the earlier system was causing”—to the uninsured and to workers who were “locked into jobs for fear of losing coverage.” It’s true that employers won’t be thrilled. As workers become pickier about their jobs, companies may “need to pay more to recruit workers.” I’d consider that progress.
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