Apparently, quite a lot of the money spent last year was clawed back this year:
Most filers who received government subsidies to buy Obamacare plans had to pay money back to the IRS this year, according to an H&R Block analysis released Monday that looks at the health law’s first full tax season.
The tax-prep giant studied its own massive customer base and concluded that two-thirds of its filers who got subsidies from Obamacare were overpaid during the course of the year, and owed money back to the IRS on the April 15 deadline.
They repaid $729 on average, cutting the average refund by about a third.
I hope the economic implications of that aren’t lost. It means that a significant amount of money was pumped into the economy last year and withdrawn from it this year. In econspeak that’s called “time-shifting”—consumption was transferred from this year to last year.
Sometimes that makes sense, for example, in the early stages of a recovery when you expect substantial growth for years ahead. The present recovery is now, what, 71 months old? Does time-shifting from this year to last year sound like a good idea to you? Oh, well. There were midterm elections to consider.
Initial reading on first quarter growth this year is 0.2%. Energy took a big hit. Consumer spending, though, was a little better than expected, I heard, though not as good as fourth quarter growth. How much is the time shifting mentioned above going to impact the next quarter? Some of it already has, no doubt, but it’s a question of how soon did the people with subsidies file this year?
Ice, while that .2% is shocking to see on paper, the lifelessness of the economy continues to be “felt” by the commoners called the American Middle Class. Basically, the distorted employment figures presented by government minions cannot hide the reality of those trying to make ends meet in such a “stuck,” wage-deficient main street world.
As for the cost-cutting efficacy of the PPACA, I’ve seen all the signs posted on H & R Block windows warning filers of the surprises that may be lurking in anticipation of their IRS refunds. Much of the subsidy windfall for such applicants has been akin to believing in a mirage. Even the much touted Covered California has seen a dissipation of enthusiasm for their plan, and consequently are looking at a less optimistic future in being able to fiscally sustain itself.