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Discussion: (5 comments)

  1. Those percentages sound scary.
    But let’s look at what the family actually has to pay:
    – sole earner, $35k = federal income tax $1503; Hennessy says insurance $1410/year. Fine.
    – Two incomes, $47k = fed income tax $3161 (unrelated to ACA!); insurance $2970/year (related to ACA subsidies).

    I don’t know why H is adding employer-side payroll taxes to the worker’s taxes. And EITC, payroll taxes etc. are going to be a factor even in the absence of ACA, just like the federal income tax.

    So the ACA-specific penalty is just $1400 on that extra $12k. The family can take personal responsibility for that call, surely…

  2. do we have evidence of the poor remaining poor and refusing to take a job so they could remain eligible for Medicaid? unless we’ve seen that, it’s hard to imagine anyone making that choice with an ACA subsidized health care plan…

    1. This is a critical question, for which I only have a small anecdote. The men I employ are THE target audience for the ACA and many other social programs. Not a single one has ever said to me, “Boss, don’t give me that raise… you’re paying me too much.”

  3. I get that as a family climbs up the income ladder, it leads to reduced EITC and reduced refundable child credits, as well as higher employer and employee-side payroll taxes.

    Why does Hennessey attempt to pin that specifically on Obamacare?

  4. I hate to bring this up, but the CBO is comprised of, you know, people… who make projections that, however well-intended, don’t necessarily come true.

    The argument that it is likely to come true is pretty sound. But, so is its counter: The target audience for this social program is unlikely to “do the math” to determine the break-even point for total income. Consequently, the impact on labor will be negligible.

    Which one will prove out? We won’t ever know for sure. The only way to know for certain would be to “turn back time” and replay the next few years without the ACA. Since that can’t happen, we’ll be down to anecdotes and projections once again when we try to “calculate” the law’s effects at some future date. It will be a pointless effort that can only yield opinion, not fact.

    All social programs produce winners, losers, and unintended (and/or unmeasurable) consequences. Social Security almost certainly influences people to retire rather than keep working. Welfare almost certainly influences people to lower their ambitions. But these programs are generally popular, in part because their absences would seem to be far worse alternatives. So, maybe “popularity” is the sole yardstick for measuring the worth of a social program? If a program proves popular, we keep it. If not, we either change it or get rid of it. I give enough credit to the collective wisdom of the people being governed to be able to discern the difference.

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