Transcript: Q&A w/ Rep. Tim Ryan on the CBO’s 2014 budget & economic outlook

Partial transcript of Q&A with Rep. Tim Ryan (D-Ohio) on the Congressional Budget Office’s (CBO) 2014 federal budget and economic outlook. The House Budget Committee hearing was held on Feb. 5, 2014:

Rep. Tim Ryan (D-Ohio):
…So the report did not say that Obamacare would get rid of or cost 2 million jobs. Correct?

Douglas Elmendorf, Director of the Congressional Budget Office:
Correct.

Rep. Tim Ryan (D-Ohio):
It said that the Affordable Care Act will cost the equivalent of 2 million jobs and that means hours – it will be a reduction in hours? Correct?

Douglas Elmendorf, Director of the Congressional Budget Office:
So we tried to frame this as reductions in total hours worked. But I also want to be careful about the use of the word cost, Congressman. Again, we’re trying to draw a very important distinction between changes in people’s work that is forced upon them by their employers saying, “We can’t afford to pay you to work” or “We can’t afford to pay you to work as many hours”, and choices that individual workers will make to reduce their hours.

Rep. Tim Ryan (D-Ohio):
So, these are choices that workers will make?

Douglas Elmendorf, Director of the Congressional Budget Office:
The effects that we estimated are almost entirely…[overlapping audio]

Rep. Tim Ryan (D-Ohio):
Because of the coverage I have I can now choose to reduce hours.

Douglas Elmendorf, Director of the Congressional Budget Office:
The effects that we estimated are almost entirely choices by people.

Rep. Tim Ryan (D-Ohio):
Of that group, who’s the largest group that you would classify of people who will make that choice?

Douglas Elmendorf, Director of the Congressional Budget Office:
So, there are a number of channels through which the Affordable Care Act reduces the incentive to work and thus we think will reduce work hours. Some of those are through the subsidies for lower-income – I mean, particularly the subsidies for lower-income people. But there are also some effects of the higher tax rates on some higher income people.

Rep. Tim Ryan (D-Ohio):
So, who? Like who would this be?

Douglas Elmendorf, Director of the Congressional Budget Office:
…I think a number of groups of people could be affected in that sense. We’ve not tried to break this down. So it can be spouses but it can be primary earners who decide to scale back their hours, they may not leave the workforce altogether. It can be some older people who decide to retire earlier than they would have been able to otherwise. It also can include younger people.

Rep. Tim Ryan (D-Ohio):
So, we’re talking about a situation where there’s a husband and wife, and they’re both working and they have a baby, and one of them decides to not work or reduce their hours in order to stay home with the baby. They would fall into this category.

Douglas Elmendorf, Director of the Congressional Budget Office:
Yes, Congressman. That’s one example.

Rep. Tim Ryan (D-Ohio):
So, a steel worker in Youngstown who worked from 18-years-old to 58 or 60 years old, retired, now has a little part-time job, low-wage job in order to pay for their health care. If they stopped working because they now will have access to health care, that steel worker would fall into this category. Right?

Douglas Elmendorf, Director of the Congressional Budget Office:
Yes, Congressman.

Rep. Tim Ryan (D-Ohio):
In your analysis of this, do you account for anyone who is going from working three jobs to go down to work to two jobs? Would something like that fall into this analysis as well?

Douglas Elmendorf, Director of the Congressional Budget Office:
We’ve not tried to break this down.

Rep. Tim Ryan (D-Ohio):
So someone who has done that – because I remember George Bush was President and someone said, “Mr. President, I’m having a really rough time working. I have three jobs.” And he said, “That’s great.”

And what we’re saying is we want to try to make it a little bit easier to go from three jobs to two jobs or from two jobs to one job, and I think it’s important for us to say those people fall into this number. They will be reducing their hours.

If you’re a two-parent home, if you have a kid, you have a sick parent and you say now “Because we can afford health care” – because of the credits or the expansion of the Medicaid, whatever the case may be – “I can reduce my hours that I’m working to take care of a sick parent.” And maybe they don’t have to go into a nursing home and draw on the Medicaid program now. None of that is factored into long-term costs either here. Correct? I mean, you don’t say, “Well, a number of these people will reduce their hours and they’ll be able to take care of mom instead of her going to a nursing home.”

Douglas Elmendorf, Director of the Congressional Budget Office:
You’re right, Congressman. We’ve not incorporated any of that.

Rep. Tim Ryan (D-Ohio):
I think that’s the point. There are so many different scenarios that average people around the country are living with right now, that are not anymore so much, but have struggled to make ends meet, and the pressure put on these families is being reduced now because of the Affordable Care Act.

Last thing I’d like to say, I think there’s been an undertone of disrespect in this hearing as I sat through it about people just don’t want to go to work. I don’t – there’s always a few people, I’m sure, that will find a way even if they work to scam a company or to run a scam. There are always going to be people like that. But for the most part, if there’s a job that opens up in our town and it pays well, there are thousands of applicants who want to take that job. And I hope that we can get away from this idea that, “Oh nobody wants to work. Everybody just wants to get on the dole. Nobody wants to work for a living.” That’s not true, and the scenarios that we discussed, I think, outline, and so I appreciate you being very clear that this is not 2 million jobs; this is about average people having the opportunity to reduce the burden on their own family.

Douglas Elmendorf, Director of the Congressional Budget Office:
Yes, Congressman.

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