Paul Ryan: Obamacare is a ‘poverty trap’

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After a day of rampant misinformation, dishonest political attacks, and misleading media reports, Congressional Budget Office director Doug Elmendorf took the stand before a House committee to explain what, exactly, his report says about Obamacare.

The president’s health care law does create a new incentive for people to work fewer hours to qualify for subsidized insurance, Elmendorf told the House Budget Committee on Wednesday. But that means they are consciously deciding to forgo a higher salary because it’s worth more to them to have cheaper health-care and more time for other things, he stressed.

“There is a critical difference between people who want to work and can’t find a job…and people who choose not to work because because [they’ve] decided to retire, or spend more time with their family, or spend time on a hobby,” Elmendorf said. “They don’t feel bad about it, they feel good about it. We don’t feel bad about it, we say, ‘Congratulations.’”

For the most part, it will be lower-income Americans making these decisions: The maximum income to qualify for the Medicaid expansion is $15,282 for a single individual and $31,322 for a family of four. Exchange subsidies phase out altogether for single people earning $45,960, and families of four earning $94,200. Since the Medicaid eligibility and exchange subsidies are scaled according to income—i.e., means-tested—earning less income would make it easier to get cheaper insurance.

That’s prompted criticism from Republicans who argue that the new government program is a new “poverty trap” that will discourage lower-income Americans from working more, as Rep. Paul Ryan declared at Wednesday’s hearing.

“I guess I understand ‘better off’ in the context of healthcare. But ‘better off’ in inducing a person not to work who is on the low-income scale, not to get on the ladder of life, to begin working, getting the dignity of work, getting more opportunities, rising their income, joining the middle class, this means fewer people will do that,” Ryan told Elmendorf. In other words, Obamacare will create more “takers” not “makers,” in Ryan’s worldview.

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