August 11 2011
ObamaCare Deficit-Neutral? What a Joke!
Sometimes, a situation is too sad to say, "Told you so." But the fact remains that ObamaCare skeptics were right about the law's costs: They will far exceed projections. ObamaCare was never deficit-neutral.
The most recent piece of evidence on this front is a working paper published by the National Bureau for Economic Research. I wrote about this study a few weeks ago after a story appeared about it in The Hill. But this week, now that the Daily Caller is reporting on it, the blogosphere has really caught on and is railing against the CBO and the JCT for their huge mistake.
What huge mistake? It boils down to this: The CBO score of ObamaCare mistakenly measured one variable as a "self-only" coverage provision when it came to costs. Meanwhile, proponents of the law boasted better access for these same people... and their families. Anyone who has held health insurance knows that self-coverage and self-plus-dependents-coverage are two different things (with two different pricetags!)
So now we have a situation where either the Administration must come out with the truth - that many families will be firewalled by the law (unable to afford employer plans, but also ineligible for subsidized coverage in statewide exchange pools) - or the CBO will be forced to revise the law's cost projections upward to include the costs of insuring those dependents... upward to the tune of $50 billion a year. (That's $500 billion over 10 years folks. Ouch.)
This should be a reminder: You can't get something for nothing. There's no such thing as free health insurance, free health care, or free lunch. And more recently, there's no such thing as free birth control. I guess it would be nice if there was a magic wand that could pull resources out of thin air. But in reality, we live in a world with limited resources. Someone's got to foot the bill.
In fact, when the government tries to manage a particular resource or service, costs usually end up climbing faster and higher because of the wasteful, inefficient choices that government makes (choices that would never be made in the private sector). This leads, eventually, to higher taxes, higher debt, and a less stable, less valuable currency - making us all poorer.
ObamaCare's goal of expanding access to affordable health care for everyone sounds like a friendly, worthy idea. But we should have recognized sooner that using the federal government to regulate, tax, and spend health care dollars would not make anything more affordable. We have only just begun to see the enormous costs of this law on the horizon. Question is: Will we reverse course before it's too late?
(For further reading, Avik Roy, on Forbes blog, has a great in-depth analysis here.)