On February 13th, columnist Charles Krauthammer offered the readers of many newspapers, including the San Jose Mercury News, an essay entitled, “Obama’s War on Jobs.”
Reviewing this article reveals, first, that the war on jobs was allegedly most glaringly demonstrated by passage of the Affordable Care Act (aka ObamaCare), and, second, that Mr. Krauthammer’s comments on this subject include an impressive number of whoppers.
To begin with, Krauthammer focuses on the recent Congressional Budget Office estimations of the number of people who hold on to jobs primarily to retain health insurance. With ObamaCare available, these people are likely to stop working or reduce their hours – to an extent equal to the hours of 2 million employees by 2017. Krauthammer’s hostility to this outcome is based on the fact that the taxes of workers will be used to subsidize the health insurance of these new non-workers – who he assumes will be artists or perhaps folks who spend their time in the “study of butterflies.”
There is a fly in Krauthammer’s ointment, actually at least two of them. The employers of these workforce dropouts have presumably not been providing them with a paycheck out of altruistic motives but rather because of the productivity they generate for businesses. Thus, it is highly probable every effort will be made to find replacement employees. In addition, the United States has an agonizingly high unemployment rate of 7.3%. People looking for work will be ecstatic to secure the employment the dropouts leave behind (these are, by definition, not just jobs but jobs with benefits). Moreover, those who have been out of work and without income are almost certainly already the recipient of a variety of taxpayer paid support programs, including access to health care through Medicaid.
So what we have in effect is some people giving up jobs they don’t want – for reasons that may include caring for a chronically ill family member as well butterfly contemplation. Other people desperate for employment will gain access to a paycheck. At the same time, taxpayers in the United States will still be providing a lower level of safety net services than in any other developed country. This is a war on jobs? No. The war on jobs is a whopper.
But Mr. Krauthammer isn’t finished yet. He wants to generalize from his findings to criticize any form of government support for the poor. Shouldn’t honest liberals, he asks, admit that a disincentive to work exists in any means-tested government benefit? That’s why, he goes on, recipients must be required to work lest they “choose to live on the dole forever.” In response, one might state that what really matters is whether any specific disincentive to work actually outweighs the numerous other incentives to be employed. For example, Germany has a means-tested health insurance program. It also has an unemployment rate of 5.2%, one of the lowest amongst western industrial nations. Miraculously, Germans continue to want to work despite access to subsidized health care and a host of other social-welfare programs. Either Germany’s economic success is a myth, or Charles Krauthammer has generated a second whopper.
Finally, Krauthammer concludes by charging that ObamaCare is so structured that it is crushing small businesses and killing jobs. Of course, ObamaCare exempts small businesses – those with 50 employees or under; it even provides many of them with tax credits. So perhaps Krauthammer is referring to the numerous small businesses with more than 50 employees. But numerous small businesses with more than 50 employees don’t exist; a whopping (excuse the pun) 96% of the 6 million businesses in the United States have 50 employees or less. What then, Charles? Mr. Krauthammer zeroes in on the businesses that would expand to 51 employees or more if not for the burden of ObamaCare. How many businesses experience this pressure? 4.4 million of American businesses have under 19 employees, not even close to 50. That’s whopper number three; Krauthammer has scored a hat trick.
Bob Brownstein is Director of Policy and Research for Working Partnerships USA.
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Clearly Krauthammer slept through the Clinton-era attack on the social safety net. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) created strict workforce participation requirements for recipients and states, Despite changes to the law in 2012, it still provides strong incentives to enter the workforce – although few support services to address barriers to employment. There is no “disincentive to work” in current means-tested government benefits, there’s just no assistance for those who require additional supports in order to enter the workforce.
Ah, well – if they can’t afford bread …