When I was out and about today I heard an interesting radio interview with a cat from Northwestern’s business school on the subject of the economic effects of the PPACA. His general thrust was something with which I agree: there are too many moving parts to have much confidence in pronouncements one way or another. There are some good aspects, e.g. portability will make it easier for sole proprietor entrepeneurs to start new businesses. But there are bad aspects as well, e.g. people who buy healthcare insurance don’t spend that money on other things.
He did say a couple of interesting things. The first was something that had occurred to me: the PPACA may well be the beginning of employers getting out of the healthcare insurance business. But one of the things had never occurred to me. His research has suggested that in some states a substantial number of people are working solely to get employer-provided healthcare insurance and that they are likely to stop working when either the employer no longer offers insurance or employment isn’t necessary to be insured. That may further depress the labor force participation ratio.
It also might be bad news for the states. Small as those incomes may be they’re still subject to state income taxes. It might even be the case that the PPACA will cause state revenues to fall while inducing state expenses to rise.
I’d be interested in further observations on the economic effects of the PPACA. Like much else about the law we’ll have a better idea in the fullness of time.