Who Blew the CBO “2 Million Jobs” Story?

Reporting on Politics and Policy.
Feb. 5 2014 9:57 AM

Who Blew the CBO “2 Million Jobs” Story?

The talk of the political world yesterday was the new Congressional Budget Office update on the labor market. I didn't write anything about it, as my colleague Matt Yglesias put down a flag and turned around a fine take. Headlines were screaming that the Affordable Care Act would, confirmed, kill "2 million jobs." Wrote Yglesias: "Obamacare will kill jobs in the same way that Social Security kills jobs, by making it easier for people in certain circumstances to get by without a job." Or as the CBO put it:

The ACA will tend to reduce participation, with the largest impact stemming from new subsidies that reduce the cost of health insurance purchased through exchanges. Specifically, by providing subsidies that reduce the cost of health insurance purchased through exchanges. Specifically, by providing subsidies that decline with rising income (and increase with falling income) and by making some people financially better off, the ACA will create an incentive for some people to choose to work less.

Conservatives had their pick of possible spins. Subsidies were turning more people into "takers," for example. But the consensus spin was that, in the short run, there'd be 2 million fewer laborers looking for full-time jobs—more than the CBO had estimated previously. This was truncated into "Obamacare is killing 2 million jobs, even though Democrats said it would create jobs."


What followed was a handy lesson in he-said-she-said journalism and its companion, smart-take journalism. Republicans were saying that this CBO report was tragic for America but proved everything they'd been saying about Obamacare's job-killery. So a lot of reporters went with that story—Republicans clearly will run with this report. Politico:

The Republicans just got a big gift from the Congressional Budget Office: It’s going to be a lot easier for them to call Obamacare a “job killer.” That’s because the budget office’s new economic report, released Tuesday, says the health care law will cause Americans to work fewer hours — enough to be the equivalent of 2 million fewer jobs in 2017.

MSNBC's Chuck Todd:

WaPo's Erik Wemple has counted up lots more, and helpfully tracked the ways headlines changed as reporters revised the stories. Even WaPo changed its hed, from something about the ACA resulting in "2 million fewer jobs" to "2 million fewer workers." (McClatchy, as usual, had a perfectly balanced story.) That change occured after Glenn Kessler, WaPo's fact-check columnist, patiently explained that "some people might decide to work part-time, not full time, in order to keep getting health-care subsidies."

The GOP's mind-meld yesterday, the decision to lead with the "2 million jobs" story, was more interesting than anything its politicians/flacks actually said. The job situation's steadily improving, especially in some states with key 2014 Senate races—West Virginia, Alaska, Louisiana, North Carolina.* Clearly, Republicans want to leave voters with the impression that they might be sacked because of Obamacare. They could have just as easily taken on the "takers" theme, the fact that Obamacare would make it easier for people to leave full-time jobs. But they didn't.

Why not? Well, it's not obviously a bad thing that Obamacare makes it easier for you to leave a job. That's how it was designed! Health care mobility is part of every health care reform proposal, from the McCain campaign to the Republican Study Committee to (probably) the American Communist Party. There's a term for being "stuck" with a job you hate because you fear losing health care—"job lock." I've been laid off before and paid for COBRA, the stopgap program that lets you keep your last job's plan. It was almost prohibitively expensive—I wouldn't have ever considered leaving my job, considering how much health care would have cost.

If Republicans come up with an Obamacare alternative in 2014, if it's comprehensive, it's probably going to involve plan mobility. Boring! Much more fun and explosive to focus on how Obamacare will "cost jobs" by subsidizing mobility, and expecting the media to cover the controversy instead of the policy.

*The unemployment insurance disaster in that state is a related story—part of the rise in employment numbers is due to people accepting lower-paying jobs than they otherwise would have, because state-feds disagreement has throttled UI. 

David Weigel is a reporter for Bloomberg Politics