Pethokoukis

More evidence Obamacare distracted Obama from the economy

It’s more than just a GOP talking point. The push for healthcare reform in 2009 and 2010 does seem to have distracted the Obama administration from focusing more on boosting economic growth and job creation. Some Obama allies, like Ezra Klein, have argued that the White House didn’t realize the economy was as bad as it really was toward the end of 2009. But Noam Scheiber, author of The Escape Artists, contends otherwise:

1. The unemployment rate was rising in late 2009.

2. By the spring and summer of 2009, WH economists saw the economy was weaker than expected and argued for more stimulus.

3. Democratic senators were also increasingly concerned about the economy in the summer of 2009.

4. The fact that the White House proposed and Congress actually passed more stimulus “while healthcare reform was pending shows a level of economic anxiety.”

5. “White House officials have acknowledged to me that health care derailed their plans to focus on the economy in late 2009 and early 2010.”

Bottom line:

All of which is to say, of course health care reform made it harder for Obama to get more stimulus and speed up the recovery. We can debate the size of this effect—and I’m willing to believe it was second-order rather than first-order—but the existence of a tradeoff seems undeniable to me. Now, that wasn’t necessarily a reason not to do health care. I’ll be the first to acknowledge it was a monumentally important achievement which may have been worth the cost. As Larry Summers put it during one of our interviews, 50 years from now people will remember that Obama gave us health care, not how long the recession lasted. The problem is that, in 2012, voters are still a lot more concerned about the recovery.

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