Last week the Congressional Budget Office reported that the Affordable Care Act will cause Americans to work less. Significant numbers of people will choose to keep their incomes low in order to be eligible for federal health care subsidies or Medicaid. Consequently, the economy will lose the equivalent of two million full-time workers by 2017.
CBO’s analysis is rooted in ObamaCare’s complex design that includes new subsidies, taxes and mandates. For low-wage, lower-skilled or discouraged workers in particular, ObamaCare offers incentives that can force them to trade jobs for entitlement benefits.
…The law’s insurance subsidies are gradually taken away as income rises….[This reduces] the rewards for work—whether it be overtime, accepting a promotion, or training in the hope of higher future earnings.
But the White House doesn’t think this is negative. Press Secretary Jay Carney saidpeople “will be empowered to make choices about their own lives and livelihoods” and “have the opportunity to pursue their dreams.”
However, penalizing people for increasing their earned income hurts workers in the long run. Having government programs, mandates, and regulations steadily disconnect work from reward replaces the American dream of building a better life for yourself and your family with, as the Wall Street Journal puts it, “the new American dream of not working.” If we keep following this road, not only our economy, but our spirit, will pay.
Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute.