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By now you will have heard of the CBO report containing a projection that attributes a marginal net -2 million jobs to the existence of Obamacare. This is being reported and discussed, somewhat colloquially, as Obamacare destined to lead to the loss of 2 million jobs, or, ‘destroying’ 2 million jobs, over whatever-timeframe CBO was doing its projecting.
If you pay even closer attention to that you will have also heard the pushback/spin from Smart People. These Smart People, who are Very Serious, are pounding away as we speak on blog posts and articles whose headlines will inevitably read something like No, Obamacare Is Not Going To ‘Destroy’ 2 Million Jobs.
The jist of this spin, which as far as I can tell is fine as far as it goes, is that the CBO’s prediction is based on the fact that Obamacare will increase, by that amount, the number of people at or below the margin of whatever means-testing benefits-threshold(s) below which the incentive to work doesn’t exceed the incentive not to. According to the Smart People, therefore, these will just be an additional 2 million people who ‘choose not to work’. Which is totally fine! (Because after all, isn’t it great if a welfare law increases the number of people who choose not to work? Hmmm.)
Anyway, all I’d like to say about all this is that, contrary to what everyone seems to think, they’re both right!
Grant – as the Very Serious Smart People are saying – that Obamacare will ‘merely’ increase the number of people who ‘choose not to work’ by 2 million, because it will boost the welfare-incentive above what those people will be able to earn on the job market at that time. But this can only mean that, in that event, there won’t exist jobs out there that will pay enough to be worth being off welfare for those 2 million people, even though (by definition) there are now. Another way to say that is: because of Obamacare, there will be 2 million fewer, oh let’s call them, ‘welfare-surpassing’ jobs, where I hope the phrase ‘welfare-surpassing’ is pretty self-explanatory. But then let’s note that the set of ‘jobs’ is identical with the set of ‘welfare-surpassing jobs’, given that if a job isn’t welfare-surpassing, it won’t exist, by definition.
And so another way to say that, admittedly a shorthand way but a reasonably accurate way nevertheless, is that Obamacare will destroy 2 million jobs.
Have a nice day.
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