March 14 2012
Obamacare: The $1.76 Trillion Misunderstanding
Obamacare was supposed to cut back on the amount of money spent in the U. S. on health care. So how’s that working out?
The Congressional Budget Office, as you may have heard, has issued a new estimate that Obamacare will cost $1.76 trillion over a decade, not the $940 billion the president told us it would be. Why did this happen?
Democrats employed many accounting tricks when they were pushing through the national health care legislation, the most egregious of which was to delay full implementation of the law until 2014, so it would appear cheaper under the CBO's standard ten-year budget window and, at least on paper, meet Obama's pledge that the legislation would cost "around $900 billion over 10 years."
When the final CBO score came out before passage, critics noted that the true 10 year cost would be far higher than advertised once projections accounted for full implementation.
Today, the CBO released new projections from 2013 extending through 2022, and the results are as critics expected: the ten-year cost of the law's core provisions to expand health insurance coverage has now ballooned to $1.76 trillion.
That's because we now have estimates for Obamacare's first nine years of full implementation, rather than the mere six when it was signed into law. Only next year will we get a true ten-year cost estimate, if the law isn't overturned by the Supreme Court or repealed by then.
Given that in 2022, the last year available, the gross cost of the coverage expansions are $265 billion, we're likely looking at about $2 trillion over the first decade, or more than double what Obama advertised.
As Grace-Marie Turner sums it up for Forbes, “Obamacare: If Possible the News Is Getting Worse.” She gives a good summary of the bad developments, including the “anti-conscience” rules and the impact the law is having on investing.
It is true that the financial burden of Obamacare may be unsustainable, but I have to say that its direct attack on the First Amendment, with its abridgement of religious freedom and conscience protection, seems almost more important.
We may be broke and heading towards a Greek tragedy, but that this law is eroding religious freedom is worse. The heavy fines that the Obama administration intends to impose on faith-based organizations that refuse to carry out the HHS contraceptive mandate reminds me of the penal fines imposed on Catholics during the English Reformation. We’ve never been the kind of country that requires citizens, whether because they are pacifists or for some other reason, to violate their consciences.
The only good news is that Obamacare is such a disaster that, one way or another, it won’t be able to go on forever. Daniel Foster of National Review writes:
To me, the question has never been whether Obamacare will fail (by failing to bend the cost curve, by incurring massive per-person costs for its coverage expansion, and by foisting things like IPAB on the public). Rather, the question has been whether it will fail quickly and spectacularly enough that the political will is toward repeal, and not expansion. If it fails slowly, we’re likely to see more of it, not less.
Even if Obamacare is repealed, this administration has stuck us with other unjustifiable debts.