Transcript: Q&A w/ Sen. Tammy Baldwin on the CBO’s 2014-2024 budget & economic outlook

Partial transcript of Q&A with Sen. Tammy Baldwin (D-Wisconsin) on the Congressional Budget Office’s (CBO) 2014-2024 federal budget and economic outlook. The Senate Budget Committee hearing was held on Feb. 11, 2014:

Sen. Tammy Baldwin (D-Wisconsin):
…A lot of the terrain that I intended to cover have already been covered by my colleagues but I thought – I still like to visit with perhaps a Wisconsin base starting with the report on the impact of the Affordable Care Act on people choosing to leave the workforce. To me, this brings me directly to a bunch of very hardworking people who I’ve been proud to represent both in the House and the Senate for many years, and I think of family diary farms. For so many years, one of the family has usually had to leave the farm to work solely to bring in health insurance whether it’s because of the pre-ACA rules whereby insurance companies could deny coverage to people with pre-existing health conditions or simply the risks and actuarial risks associated with covering a small organization in a risky business. And that story has repeated itself. I’ve met so many folks that are in that situation. And I think about the fact that they may – now that they can get family health coverage in a marketplace – choose to leave those jobs, and that will be counted in one way but I can assure you when they return full-time to the farm they will be working, both investing their efforts of labor in raising their families, caring for senior relatives but also engaged in the economic activity of the farm.

And I appreciated your blog entry the other day trying to bring greater clarity to what sort of movement in and out of the workplace this is. When somebody’s laid off, we mourn and we are upset. But when somebody chooses to leave in this sort of matter, whether it’s retiring or doing what they really want to be doing, working in their family enterprise, that’s more of a reason for celebration.

I also note in the report on the slow recovery of the labor market some of the recent numbers on the number of job seekers per job opening that exist – of course, we’ve reached a huge peak in, I guess, 2009 of 6.9 job seekers per open job and then dropped to what is now, I guess, 2.7 – I’ve been hearing 2.7, 2.9 – in the fall of last year. And so I know it’s not a part of your Affordable Care analysis to talk about what happens when people do leave the job or leave jobs because they can secure health insurance, but it is reasonable or logical to assume that there will be 2.7 people today looking to seize that opportunity if that displacement, dislocation occurs?

Douglas Elmendorf, Director of the Congressional Budget Office:
Yes, Senator. The effects of the changes in the supply of labor are very different under the economic conditions we face in the country today for the reasons that you noted – a large excess of people looking for jobs who can’t find them – than the effects of that reduction in labor supply will have later in this decade when we think the job market will tighten considerably.

Under current economic conditions where it really is the demand for labor that’s limiting the level of employment, changes in the number of workers doesn’t have much effect on the actual ultimate level of employment.

However, by later in the decade…I want to emphasize that by later in the decade when the job market will have tightened, that’s the point which we think changes in labor supply really will translate into changes in the number of people who are employed. We think this 2.7 number will have come back down to the more standard level we have in the labor force just given the net normal turnover.

Sen. Tammy Baldwin (D-Wisconsin):
And I know that my time is running out so I briefly want to associate myself with some of the previous comments on our ongoing debate on extending emergency unemployment benefits – long-term unemployment benefits. When you were last before the committee, we actually engaged in a conversation based on the Federal Reserve paper on the long-term unemployed and how they’ve become less attached to the workforce and have lost skills that they’ve once held and present other real challenges. I just have to say when this emergency unemployment compensation lapsed at the end of December, the statistics in Wisconsin are about 23,700 Wisconsinites lost benefits. It’s supposed to – if it continued throughout the year – hit somewhere close to 99,000. And we know the statistics nationally. The stories are heartbreaking – foreclosure. I hear from folks on the number of jobs they’ve applied for, the budgets that they’ve been trying to live on with unemployment assistance and what that will mean to not have it.

I guess I just would ask is it correct to say that extending unemployment insurance is one of the most cost effective ways to stimulate the economy – a weak economy?

Douglas Elmendorf, Director of the Congressional Budget Office:
Yes, that’s right, Senator. In the report that we did a couple of years ago about a number of alternative possibilities that you and your colleagues could pursue to strengthen the economy and add jobs in the short-run, expansion of unemployment benefit was the most cost-effective item on that list.


Learn More:

Leave a Reply

Your email address will not be published.