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President Barack Obama makes a statement to the nation Sunday night, March 21, 2010, following final House passage of the health care bill in the East Room of the White House. (AP Photo/J. Scott Applewhite)
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By Matt Cover
(CNSNews.com) – Congressional Budget Office Director Douglas Elmendorf said the most significant economic effect of President Barack Obama’s health care reform package will be to drive people out of the job market.
“For the economy outside the health sector, the most significant impact of the legislation will be through the labor market,” Elmendorf said on Oct. 22. “We estimated that the legislation, on net, will reduce the amount of labor used in the economy by roughly half a percent, primarily by reducing the amount that people choose to work.”
Elmendorf made the remarks at a conference sponsored by the Leonard D. Schaeffer Center for Health Policy and Economics at the University of Southern California.
He explained that people would choose not to work because they could subsist on the generous federal insurance subsidies and Medicaid payments contained in the health care overhaul.
“Some provisions of the legislation will discourage people from working more hours or entering the workforce, and other provisions will encourage them to work more,” he said, adding that “[t]he net reduction in the supply of labor is largely attributable to the substantial expansion of Medicaid and the provision of subsidies through the new insurance exchanges.”
Elmendorf’s analysis of the health care law’s economic impact seems to support House Speaker Nancy Pelosi’s (D-Calif.) seemingly off-the-cuff remark in May when she said that because of the subsidies in the health care bill, people could quit their regular jobs and pursue their artistic dreams because the government would now provide for their health care.
“We see it as an entrepreneurial bill,” Pelosi said on May 14, “a bill that says to someone, if you want to be creative and be a musician or whatever, you can leave your work, focus on your talent, your skill, your passion, your aspirations because you will have health care.”
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