New study: Obamacare will decrease workforce by 2 million full-time worker’s hours

He voted for Obamacare, and he got it

He voted for Obamacare, and he got it… good and hard!

The study was done by the non-partisan Congressional Budget Office (CBO), and reported by Fox News.


ObamaCare will reduce work hours equivalent to 2 million jobs in the next decade amid a host of incentives not to work or to work less, a new Congressional Budget Office (CBO) report says — the latest blow to President Obama’s signature health insurance plan.

The report estimates the Affordable Care Act, or ACA, will make the labor supply shrink by 0.86 percent in 2025. This amounts to a shrinkage equivalent to approximately 2 million full-time workers.

The nonpartisan CBO estimates that the decline will come primarily due to workers responding to changes made by the law to federal programs and tax policy. The agency points to the introduction of health care subsidies tied to income as a key factor — which in turn raises effective tax rates as someone’s earnings rise, therefore reducing the amount of work Americans choose to do.

“Subsidies decline as income increases, reducing the return on earning additional income,” the report says. “That decline is effectively an increase in recipients’ effective marginal tax rate, so it generally reduces their work incentives through the substitution effect.”

Since the subsidies also reduce the burdens attached to unemployment, the CBO predicts that the law will create additional “work disincentives” for those who are unemployed for part of the year. It concludes that the exchange subsidies will contribute to half of the overall reduction of the labor supply.

The report also points to direct taxes, such as ACA’s hike of the payroll tax on high earners for Medicare’s Hospital Insurance Program, as a reason for discouraging some from working. Another pressure on wages will come from the employer mandate, which imposes a penalty on employers if they have more than 50 employees and do not provide insurance. The CBO predicts that within a few years this charge will be passed on to employees in the form of lower wages.

[…]The report comes at an awkward time for the Obama administration: just days after the Senate passed a bill that would repeal key parts of the law. The White House has said that President Obama will veto the legislation.

Oh well. It’s not like workers need to be paid fairly for their labor, right? I’m really not seeing how Obama expects the next generation to pay for the $10 trillion he’s added onto the national debt. If they are working less, then they are paying less in taxes. It’s fun to give speeches where you promise your gullible supporters a lot of goodies, but then, if the goodies discourage their employers from giving them work hours, then how will the spending be paid for?

More than anyone in modern politics, Barack Obama is a man who has perfected the art of sounding confident about things he literally knows nothing about. When elect a clown, you get failure. It doesn’t matter how confident a candidate sounds. It matters whether he has a record of solving the problems that he is talking about. Results, not rhetoric.

3 thoughts on “New study: Obamacare will decrease workforce by 2 million full-time worker’s hours”

  1. I wished more people understood economics so they see through the bad Democratic economic and fiscal policies that sound so good at the surface level.

  2. One of these days…

    All of these people who mooch off of the government in the form of welfare checks, Medicaid, and whatnot, are going to be in for a wake-up call…

    All of the money that gets paid out to entitled lazy people who refuse to get off the couch and earn their own living – that money will stop flowing in one of these days. The government can’t get enough money from its taxpayers to cover the cost of all of its promised goodies, which is why we’re in debt up to our eyeballs to other countries. Well, one of these days, those countries are gonna let the well dry up (and will no doubt come knocking on our door, rightfully expecting to be paid back all of the money that we owe them). What will all of those recipients of free money (etc) from the government do then? If there isn’t enough money to be taken (via extortion?) from those who work hard at their jobs and earn their own living, and other countries stop loaning it to us, then the money that gets paid out to the undeserving well inevitably dry up too. Then they’ll end up homeless, starving, and whatnot. Don’t people understand that the cycle has to end somewhere? That the free government goodies really aren’t free?

    1. It’s not easy to recover from a multi-year gap in your resume. Obama has been paying a lot of people not to work, and in the long run, that hasn’t helped them at all.

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