Posted by: conservativecritic | June 22, 2012

OBAMACARE – A COLLOSAL ERROR IN JUDGEMENT

President Barack Obama’s focus on reforming health care as a centerpiece of his first term amounted to a “colossal error of judgment” that weakens the economic recovery and angers millions of Americans, economist-author Robert Samuelson writes in the Washington Post.

The Supreme Court may rule as early as this week on the Patient Protection and Affordable Care Act (PPACA), informally referred to as Obamacare. Both Republican opponents and Democratic supporters of the law are girding for a struggle in Congress and a backlash across the country.

Obamacare raises uncertainty and decreases confidence just when a recovery from the Great Recession requires more confidence and less uncertainty, says Samuelson.

Due to the complexity of the law, people don’t know where they will get insurance or how much it will cost, while 30 percent of employers surveyed say they might drop insurance coverage and pay fines.

The law raises the cost of hiring and thus discourages job creation by requiring employers to buy health insurance for some workers. Because the employer mandate exempts firms with fewer than 50 workers, that’s an incentive for firms not to grow, Samuelson writes, citing economist Diana Furchtgott-Roth of the Manhattan Institute.

Instead of reining in health-care costs, Obamacare will exacerbate them, he writes. Because insured people use more health-care services than the uninsured, the law raises overall spending. The government’s own actuaries forecast health care as a percent of GDP to rise to 19.6 percent in 2021, from 17.9 percent in 2010.

Obamacare will likely worsen the federal deficit. Health care, driven by Medicare and Medicaid costs, exceeds one fourth of the budget. Obama’s plan will raise federal spending by $1.76 trillion by 2022, according to the Congressional Budget Office. That gain may be offset by tax increases and assumed cuts in Medicare, but the cuts may be repealed or reduced, he writes.

The plan also favors the old and discriminates against the young by forcing some young Americans to buy insurance at artificially high premiums, says Samuelson.

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