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Obamacare's War on Jobs

By: Charles Krauthammer | Posted: February 14, 2014 3:55 AM
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WASHINGTON -- In the ongoing saga of the Affordable Care Act, oddly referred to by Democrats as the law of the land even as it is amended at will by presidential fiat, we are beginning to understand the extent of its war on jobs.

First, the Congressional Budget Office triples its estimate of the drop in the workforce resulting from the disincentive introduced by Obamacare's insurance subsidies: 2 million by 2017, 2.3 million by 2021.

Democratic talking points gamely defend this as a good thing because these jobs are being given up voluntarily. Nancy Pelosi spoke lyrically about how Obamacare subsidies will allow people to leave unfulfilling jobs to pursue their passions: "Think of an economy where people could be an artist or a photographer or a writer without worrying about keeping their day job in order to have health insurance."

Nothing so lyrical has been written about work since Marx (in "The German Ideology") described a communist society that "makes it possible for me to ... hunt in the morning, fish in the afternoon, rear cattle in the evening, criticize after dinner."

Pelosi's vision is equally idyllic except for one thing: The taxes of the American factory worker -- grinding away dutifully at his repetitive mind-numbing job -- will be subsidizing the voluntary unemployment of the artiste in search of his muse. A rather paradoxical position for the party that poses as tribune of the working man.

In the reductio ad absurdum of entitlement liberalism, Jay Carney was similarly enthusiastic about this Obamacare-induced job loss. Why, Obamacare creates the "opportunity" that "allows families in America to make a decision about how they will work, and if they will work."

If
 they will work? Pre-Obama, people always had the right to quit work to tend full time to the study of butterflies. It's a free country. The twist in the new liberal dispensation is that the butterfly guy is to be subsidized by the taxes of people who actually work.

In the traditional opportunity society, government provides the tools -- education, training and various incentives -- to achieve the dignity of work and its promise of self-improvement and social mobility. In the new opportunity society, you are given the opportunity for idleness while living parasitically off everyone else. Why those everyone elses should remain at their jobs -- hey! I wanna dance, too! -- is a puzzle Carney has yet to explain.

The honest liberal reply to the CBO report is that a disincentive to work is inherent in any means-tested government benefit. It's the unavoidable price of helping those in need because for every new dollar you earn, you lose part of your subsidy and thus keep less and less of your nominal income.

That's inevitable. And that's why we have learned to tie welfare, for example, to a work requirement. Otherwise, beneficiaries could choose to live off the dole forever. That's why the 1996 Gingrich-Clinton welfare reform succeeded in reducing welfare rolls by two-thirds. It is not surprising that the same Obama administration that has been weakening the work requirement for welfare is welcoming the disincentive to work inherent in Obamacare.

But Obamacare's war on jobs goes beyond voluntary idleness. The administration is now conceding, inadvertently but unmistakably, Obamacare's other effect -- involuntary job loss. On Monday, the administration unilaterally postponed and weakened the employer mandate, already suspended through 2015, for yet another year.

But doesn't this undermine the whole idea of universal health coverage? Of course it does, but Obamacare was so structured that it is crushing small business and killing jobs. It creates a major incentive for small businesses to cut back to under 50 employees to avoid the mandate. Your business becomes a 49er by either firing workers or reducing their hours to below 30 a week. Because that doesn't count as full time, you escape both the employer mandate to buy health insurance and the fine for not doing so.

With the weakest recovery since World War II, historically high chronic unemployment and a shockingly low workforce participation rate, the administration correctly fears the economic consequences of its own law -- and of the political fallout for Democrats as millions more Americans lose their jobs or are involuntarily reduced to part-time status.

Conservatives have been warning about this for five years. This is not rocket science. Both the voluntary and forced job losses were utterly predictable. Pelosi insisted we would have to pass the law to know what's in it. Now we know.



Charles Krauthammer's email address is letters@charleskrauthammer.com.


(c) 2014, The Washington Post Writers Group


Tags: News, Columns

Comments (3)

famullar
4:53PM FEB 14TH 2014
The agency expects another 70,000 policies to be shifted to private carriers in December. Also, the state Office of Insurance Regulation in January could approve about 100,000 more policies for further takeout, Ashburn said.

The goal of the depopulation effort, as well as a legislatively approved insurance clearinghouse, is to direct what are expected to be many of the least-risky policies into the private market and to restore for Citizens the status of insurer of last resort. Ashburn said an ideal number of policies for Citizens is around 727,000.

"That would really put us back to older homes, lower value homes, the markets that are more the niche market, mobile homes in Florida," she said.

Still, the effort is going a little slower than anticipated.

The November takeout total of 160,683 policies is far below the 390,897 that had been approved by the Office of Insurance Regulation in August.

The private companies collectively made 328,343 requests for policies, but many of the requests were for the same policies. A pre-set computer algorithm divided up the overlapping policies among the companies, which lowered the number of policies that faced a shift to 205,736.
famullar
4:20PM FEB 14TH 2014
Not long ago, the idea of the United States producing more oil than Saudi Arabia seemed like a pipe dream. But then fracking, a technique the energy industry has been using in some capacity since the 1950s, came into its own. Huge advances in hydraulic fracturing and horizontal drilling over the last decade have coaxed crude oil and natural gas from shale beds once considered impenetrable in the United States. The implications are huge: According to the International Energy Agency, the U.S. could be the largest oil producer in the world as soon as next year. Remarkably, many industry conversations now revolve around exporting – not importing – oil and gas. So-called unconventional shale gas and oil supplies are coming online in both the energy industry’s Texas heartland and as far afield as North Dakota and Pennsylvania. In October, the U.S. was producing 7.8 million barrels of crude oil per day – outpacing imports for the first time since 1995. By 2016, American producers should be cranking out 9.5 million barrels per day, according to the U.S. Energy Information Administration. American reliance on imported crude oil has been falling since 2008, and net imports are at their lowest level in two decades. But that abundance has created its own challenges. Combined with major efficiency gains, the development of shale gas fields has driven a sharp decline in prices for natural gas, of which the United States is now the world’s largest producer. Prices at the Henry Hub, a key distribution point in Louisiana, averaged $3.63 per million BTUs in 2013 – up 83 cents from 2012, but still far below the $9-plus prices of 2008. While last year’s price bump prompted some exploration and production companies to restart drilling operations they had temporarily shuttered, producers remain wary of oversupply.
famullar
4:19PM FEB 14TH 2014
SO MUCH for the drugs The Justice Department took the unprecedented step Friday of clearing the way for banks to do limited business with marijuana sellers, releasing guidelines for how banks can work with pot shops in states where it's legal.

The new memo is designed to dovetail with legal guidance the Justice Department issued last year to federal prosecutors. In that document, Deputy Attorney General James Cole outlined eight instances where federal authorities would still investigate and prosecute marijuana sales. Under the latest guidelines, banks would also be prohibited from dealing with sellers engaged in any of those illicit activities.

Friday’s guidance is intended to increase availability of financial services for legal marijuana businesses. But it still preserves the government's power to enforce criminal laws.

“These guidelines, together with the Treasury Department’s guidance to financial institutions, are intended to increase the availability of financial services for marijuana businesses – that are licensed and regulated – while at the same time preserving and enhancing important law enforcement tools,” a Treasury Department spokesperson said in a written statement.

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