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How Much More GDP "Growth" Will Be Due To Obamacare?
A month ago we revealed that, much to the chagrin of economists who proclaimed that the laughable 5.0% GDP surge in in Q3 was the result of the now undisputable economic "recovery" (where is that recovery now?), that the bulk of the upward revision came from the latest attempt to centrally-plan and socialist the US economy: an attempt which has immediate, and short-term benefits and a very long lasting adverse side-effects: the mandatory wealth-redistribution that is the tax known as Obamacare.
So looking forward, now that the soaring dollar and plunging crude are sure to punish the Q4 2014 and Q1 2015 GDP growth rate by more than half, with estimate now sliding to the mid to low-2% area, what "benefits" to the US economy can one expect from the tax that is Obamacare?
As the following chart courtesy of Goldman shows,thanks to contributions from Medicaid and Medicare and, drumroll, Exchange subsidies, the "benefits" from Obamacare will be with us, well, maybe not "us", but certainly with the way GDP is calculate for a long, long time, as the recent health spending ramp is only just getting started. Here's Goldman's Alec Phillips:
After several rounds of downward revisions to forecasts, projected spending on federal health programs has been more stable recently. CBO did make a small additional downward adjustment to Medicaid spending in its new estimates; that change was driven by evidence of slowing spending growth in that segment. However, overall the changes are a rounding error compared to the size of the programs and much smaller than the downward revisions made over the last few years, which cumulatively reduced projected spending over the next decade by more than $1 trillion. Recent data show an acceleration in spending growth in federal health spending programs, though this appears to be due mainly to the coverage expansion resulting from the Affordable Care Act (ACA) rather than increasing cost growth, as might be suggested by rising growth in Medicare spending, for example (Exhibit 2). That said, whether health spending growth begins to pick up will be an important factor for the medium-term budget deficit.
In other words, all that is needed for the Q1 "winter storm" impact to be fully offset in GDP is for millions of Americans to have no choice but to pay even higher monthly taxes, pardon Obamcare premiums. Then economists wonder where all those "low gas price" savings are going to.
And all this, we should reminder readers, is happening just as some 20% of American savings were "revised" away.
Perhaps all that is needed for 10% GDP growth every quarter, every year is for the government to confiscate all household savings and to dictate just how all this "excess" money is invested most cleanly and efficiently. In other words, just like the USSR.
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Ulcers and facepalm mishaps should account for upwards of 50%.
ha! trick question!! There is no GDP
ObummerCare is a tax and a tax is not GDP.
How much more GeeDeePeaz would there be without Teh 0'Bamacarez?
Eat ur Peaz
BINGO! +1000
Taxes and further finacialization. That's sustainable growth.
Fucking shit show.
Can't wait for those Super Bowl commercials?
It's all fake why bother anymore?
Fake or real, scalps bleed. Identify the enemy and start taking scalps. We are way past a political solution to this country's problems. It is time to start inflicting REAL PAIN on those who have brought this about...those who brought this about by cunning, or ignorance.
Stupid people only learn by experiencing pain.
Let the pain begin.
Dutch: "If it bleeds, we can kill it"
Obamacare like the president is a total fraud.
I take some schadenfreude knowing that Obamacare will hurt those who supported and championed it.
I feel absolutely no remorse about it, in fact, I can't wait to donkey punch those fucks. In fact, I may just have to start spending some of my free time in hospitals engaging in some mutherfucking Alinsky ridicule of those whose loved ones are being harmed by O-care.
He ate dog, you ate his shit.
Please take videos and post them.
Challenge Accepted.
Schadenfreude indeed.
I was getting my hair cut..."Would you believe how much my health insurance went up?!? Fuck Obama!" It took all could do to keep from quoting Jonathan Gruber.
Hey, she had scissors in her hand ;-)
nmewn, I am a UAW worker. Imagine the abject intellectual and moral bankruptcy I have to deal with every single day(or night) I clock in. These people are TRUE BELIEVERS™. Obamacare was crafted by the elite to punish the rich, and give healthcare to the oppressed. They all think that without giving it any thought. One of my coworkers just told me that small businesses were bitching about having to provide "adequate" health care to their workers because they were greedy and immoral. He said they shouldn't be ALLOWED TO HAVE BUSINESSES. These people ARE AMERICANS. I can't even genuinely get mad about this stuff anymore because I know that we are getting exactly what we deserve.
Sounds like none of them have ever tried to be a small business and employ others.
Mrs.N (a small business owner) didn't get one of her bi-weekly paychecks this month (three paychecks this month) but all the employees got theirs.
The socialist slugs never think about this, is what it is. I told her she should shut it down and they can all go to work for McDonalds or Walmart for all I care.
She is not me ;-)
It would seem you need to deliver a great many donkey punches. I feel for you bro...
Thanks.
Small businesses (20 employees or less) are the primary job growth drivers. So BIG GOV continues to make it harder and harder to keep one running or start one.
Seems hard to believe any of this is accidental.
"He ate dog, you ate his shit."
I wish i had thought of that when the whole eating dog thing was a scandal. Good one.
"Recent data show an acceleration in spending growth in federal health spending programs, though this appears to be due mainly to the coverage expansion resulting from the Affordable Care Act (ACA) rather than increasing cost growth"
Yes, it's called opening up Medicaid to about 10-15 million more people. Far and away the biggest number of people to be "insured" under Obamacare.
You wonder if they'll morph Obamacare into true single-payer, like we all know is going to happen. We're already half way there.
And probably only a few of those 10-15 million realize that Medicaid has been turned into a loan program. Under the current rules, when Medicaid gives someone help, it keeps track of how much. When you die, instead of your kids inheriting your house, the state takes it to cover your accumulated bill.
If you are a billionaire, estate taxes are evil. If you die poor, the state takes everything.
Did I mention that the US has the best medical care system in the world.
Is this True
State Medicaid programs must recover certain Medicaid benefits paid on behalf of a Medicaid enrollee. For individuals age 55 or older, states are required to seek recovery of payments from the individual's estate for nursing facility services, home and community-based services, and related hospital and prescription drug services. States have the option to recover payments for all other Medicaid services provided to these individuals, except Medicare cost-sharing paid on behalf of Medicare Savings Program beneficiaries."
If you spouse is alive, they wait until the spouse dies before they steal the kid's inheritance.
But it's FREE!!!!! Long live the FSA.
Thank you for posting that. I wish that ZH would do an article about Medicaid claw-backs. I posted a long post re it here about a year ago. People who are over 55, who are in desperate straits, will sign on to Medicaid, and then if in the future they get a job (and add to their estate) and leave Medicaid, the bill will still be there waiting for them in the end. By being briefly desperate, they will become permanent peons.
Oh, to make things worse, it will be a grossly inflated bill, of course. You won't be paying back the system, some fair amount of money for the medical care you got. In some cases, you will be put into a "Medicaid HMO" and your cost will be imputed at thousands a month, even if you get no care at all.
You can also be signed onto Medicaid against your will.
Medicare also has some clawbacks. I work in corp insurance - if we settle over someone injured we have to report the settlement to Medicare to ensure people arent getting their medical expenses covered by the settlement AND Medicare.
That whole reporting system is a remarkably archaic piece of shit btw. Section 111 reporting @ CMS COBC.
Is that GAAP or non-GAAP GDP?
Depends. are Hookers and blow therapeutic?
Healthcare premiums are counted as GDP? WTF. WTF WTF WTFWETGf=dfhde0dvfhsh09dh'Lif'lSFIHF
From the skinny that brought you "necessarily skyrocket"
So is EBT or any government expenditure, thats how fucked up GDP is.
How many times can we count this pea? Talk to a government accountant ;-)
Maybe they're finally acknowledging that the state of US health insurance is actually closer to that of pre-paid goods/services rather than true insurance.
Or perhaps, people are starting to realize (as they come under the provisions of Obamadon'tcare as I have) that the health insurance industry is a trumped up Mafia protection racket with monopoly pricing power backed by government guns.
America? FUCK YEAH!
Maybe the CBO can model increased tax revenue from obamacare uplift and no one will think this is a gigantic round tripped circle jerk.
How come John Williams of Shadow Stats did not mention this? He said the 5% was BS but did not state why.
Maybe he occasionally flies in private aircraft or sits in a hottub?
I bought some stuff today with my retirement money. I'm doing my best to help the economy but I don't have much room left to keep more stuff.
Hey if ALL assets were liquidated and converted to Obamacare payments, imagine that boost to GDP!
If everyone spent all of their income, AND went into debt -10,000USD each year, imagine that boost to GDP!!
Keep talking like that and you'll get recruited to either the TBTF, FEDRES, or maybe the government.
They like people who 'get it' and know what side they're on.
"Next quarter lets boost GDP by having people throw money into a pit, I got the last one so we can call this program Bidencares."