The Scoop
Heritage Research
Niall Ferguson poked a hornet’s nest Sunday with his Newsweek cover story, in large part for its claim that Obamacare would increase the budget deficit.
“Anyone who actually read, or even skimmed, the CBO [Congressional Budget Office] report knows that it found that [Obamacare] would reduce, not increase, the deficit,” wrote liberal economist Paul Krugman (referencing an outdated CBO analysis), “because the insurance subsidies were fully paid for.”
As usual, however, Krugman missed the more fundamental point underlying Ferguson’s argument: It’s Obamacare’s spending that matters.
In government budgeting, spending comes first; it drives all other fiscal consequences. Spending is how government programs and agencies do what they do. “In a fundamental sense, the federal government is what it spends,” says longtime budget expert Allen Schick.
Read the rest on The Foundry…
Tags: CBO analysis, fiscal consequences, Newsweek, Obamacare spending, Paul Krugman, repeal the law
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