Instead of the promise of an Obamacare surplus, we have the reality of an Obamacare deficit.
“I will not sign a plan that adds one dime to our deficits.” – Barack Obama.
Let us revisit those CBO projections about sign-ups that are not coming true. Promises were made about the financial benefits of the Affordable Care Act, which are now turning into expensive liabilities.
According to the American Enterprise Institute, “Now there can be no doubt: Obamacare will increase the deficit.”
This is why the new report showing that Obamacare will increase the deficit over the next decade is so important. It does not rely on the alternative fiscal scenario, but instead takes CBO’s most recent figure regarding Obamacare’s effect on the deficit and updates that figure using CBO’s own numbers/assumptions regarding the economy.
Specifically, the most recent CBO estimate, released in July 2012, indicated the law was projected to reduce the deficit by $109 billion over the 10-year period from FY 2013–2022. Committee staff staff then extrapolated that July 2012 cost estimate by two additional years to allow for an analysis over the current 10-year budget window (FY 2015–2024). Staff analysts then accounted for CBO’s recent technical and economic baseline adjustments, and applied CBO’s published assessment of the law’s labor market effects for a current, comprehensive deficit impact. In short, they have arrived at a figure that presumably would be nearly identical to the one CBO staff would arrive at were they to formally re-estimate the July 2012 number and include the labor market effects.
In short, even using the overly optimistic CBO baseline scenario, we now know that Obamacare will increase the deficit over the next decade by $131 billion rather than reduce it by $109 billion. In just over two years, that’s a $311 billion swing in the law’s fiscal impact!
Of course, I don’t believe that the swing is merely $311 billion. By the time we get that long-delayed final accounting, we will wish for $311 billion.
Can we now stop listening? Can we now stop pretending that the CBO or anyone else has any idea what will happen in the future?
The government has promised a $109 billion surplus into a $131 billion liability. This is one of a long string of, uh, “miscalculations.” So why should they be permitted to make predictions about the future. Why should they be given any credence?
There is no reason at all to trust their calculations or to respect their judgment and yet the media and the Democrats will continue to quote the same source as if all intelligent people know that the CBO is trustworthy.
That is all it is: a pretense.
The silver lining of this dark cloud is that Obamacare shock continues. Hopefully it will impact the 2016 election as much as it impacted the 2014 election.