Elmendorf's statement follows a controversial report released by the Congressional Budget Office that provides details on how millions of workers would cut their hours and opt out of the job market in order to retain the benefits provided by the healthcare law.
The Congressional Budget Office is a non-partisan governmental entity that serves to forecast the impact of governmental policies on future government revenues. Its findings on the economic impact of ObamaCare are disheartening.
Fox News reported, "The CBO report on Tuesday effectively found that more people would opt to keep their income low to stay eligible for federal health care subsidies or Medicaid. The workforce changes would mean nationwide losses equal to 2.3 million full-time jobs by 2021, the report said."
The report also assigns some blame to the reduction in labor force participation to the structure of the tax code, which pushes Americans into higher tax brackets as they earn more money, further highlighting the need for significant revisions to the federal tax code.
In his testimony before the House Budget Committee, Elmendorf underscored the findings of the report in relation to the healthcare law: "By providing heavily subsidized health insurance to people with very low income and then withdrawing those subsidies as income rises, the act creates a disincentive for people to work — relative to what could have been the case in the absence of that act."
When asked about the impact that the reduction in laborers would have on the economy, Elmendorf responded, "It is the central factor in slowing economic growth. After we get out of this current downturn, but later in this decade and beyond, the principal reason why we think the economic growth will be less than it was for most of my lifetime will be a slower rate of growth by the labor force."
In response to Elmendorf's statement, House Budget Committee Chairman Paul Ryan said, "It's adding insult to injury. As the welfare state expands, the incentive to work declines — meaning grow the government, you shrink the economy."
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