New Info on the Cost of Obamacare

The Pelican Institute, a Louisiana-based think tank, released a report yesterday (PDF) on the economic costs of federal health care reforms in their state.

From the press release:

The report was produced by Arduin, Laffer & Moore Econometrics, the research firm of internationally renowned economist Dr. Arthur Laffer. It models the general concepts included in the health care reform proposals by President Obama and the congressional leadership.

The end results of the proposed reforms would include: an increase in national health care expenditures by an additional 8.9 percent by 2019; an increase in medical price inflation by 5.2 percent above what it would have been otherwise by 2019; an increase in total federal expenditures by 5.6 percent over the next decade, creating an additional $285.6 billion deficit in 2019 assuming the extra expenditures are not financed by a tax increase; and a reduction in U.S. economic growth in 2019 by 4.9 percent.

As more information becomes available about the specific costs to each state, it’s likely we’ll see even sympathetic state legislators give reforms a second thought – especially in states with economic problems like those in Michigan.

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2 responses to “New Info on the Cost of Obamacare

  1. This from the guy who invented the Laughing Curve, that has been totally repudiated by every other economist. Even Reagan repudiated it by becoming the biggest tax raiser in history. And so we are to take his comments seriously?

    • Greg, while we don’t know (and probably can’t know) the exact shape of the Laffer Curve, it hasn’t been repudiated. All the Laffer curve says is that tax revenue is zero if your tax rate is 0% and zero if your tax rate is 100% (people won’t work), and greater than zero in between, and therefore at some level an increase in the tax rate will decrease tax revenues.

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