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Benefits of Obamacare: More People Are Able to Work Less

By       Message Dean Baker       (Page 1 of 1 pages)     Permalink

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Reprinted from Smirking Chimp

From flickr.com/photos/32619231@N02/13430320045/: Senator Charles Schumer on Obamacare
Senator Charles Schumer on Obamacare
(Image by Senate Democrats)
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There continues to be enormous confusion over Obamacare. Contrary to claims about the American people being stupid, the confusion is starting at the top. Last week U.S. Sen. Charles Schumer (D-New York), the third-ranking Democrat in the U.S. Senate, complained that the Affordable Care Act (ACA) would only help a relatively small number of people, most of whom don't even vote. For this reason he argued that the Democrats made a mistake in pushing through the ACA and should have instead focused on the economy.

This argument is silly for two reasons. First, while the Democrats certainly should have done more on the economy, Schumer doesn't indicate what he thinks they could have accomplished had they not pushed the ACA. Would Congress have approved a larger and longer stimulus (i.e., had much bigger budget deficits) if the Democrats hadn't passed the ACA? That's hard to believe.

Certainly many of us back in 2009 pushed for more stimulus and have continued to do so in the years since. We have been frustrated by President Obama's failure to clearly argue the case that more spending and larger deficits will be needed to get the economy back to full employment. However, none of his defenders has ever tried to say that the ACA somehow prevented him from going the route of more stimulus.

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The second, and more important, reason that Schumer's argument is silly is that the number of people benefited by the ACA is not small. The number of people who benefit directly at a point in time from getting insurance on the exchanges will not be very large. But what Schumer missed is that tens of millions of people who have employer-provided insurance are always at risk of losing their insurance if they lose their job. The ACA means that even if these workers lose their jobs, they and their families will be able to stay insured through the exchanges.

This is hardly a small group of people. According to the Bureau of Labor Statistics,more than 4.5 million workers lose or leave their jobs every month. A large percentage of these workers would be at risk of losing insurance for themselves and their families without the ACA.

Furthermore, because people know that they can get insurance outside their job, the ACA will give people the option to leave jobs they don't like, without the fear of losing insurance. The ability to tell an obnoxious boss to take their job and shove it is incredibly valuable.

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Many people will use this freedom to take the opportunity to start a business. Others may decide that they would rather work part-time to spend more time with their children or pursue other activities.

The November jobs data released last week showed that voluntary part-time employment is up by more than 1 million (6.1 percent) from its level a year ago. These are people who say that they are working less than 35 hours a week by choice. (Involuntary part-time employment has fallen by more than 600,000 over the last year, although it is still well above pre-recession levels.)

Helene Jorgensen and I did an analysis of the growth in voluntary part-time employment in the first six months of this year. We found that the increase was overwhelmingly concentrated among young parents, with a rise of 11.3 percent compared with the same months of 2013. In this case also, the number of parents who are benefiting at a point in time from being able to spend more time with small children will be relatively limited; however, over a span of five or 10 years, the percentage of the population who benefit will be substantial.

The ACA is far from perfect. It would have been much better to have a universal Medicare system, or at least have a public option, but it was a huge step forward not only because it insured millions of previously uninsured people but, even more importantly, because it freed tens of millions of workers from dependence on their employers for insurance. This is especially important for workers who have serious health conditions or have family members with serious health conditions.

It is striking that Sen. Schumer seems so ill-informed about the impact of the ACA. It is important that the rest of the public know more about the ACA than Schumer, both so that they can take advantage of its benefits and so that they can work to improve it.

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Dr. Dean Baker is a macroeconomist and Co-Director of the Center for Economic and Policy Research in Washington, D.C. He previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University. (more...)

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