ObamaCare Spending Parallels GDP Decline

ObamaCare Spending Parallels GDP Decline

While financial markets have responded mildly at best to Wednesday’s disturbing report about first quarter’s sharp GDP decline, the data has jolted a number of economists. The reported 2.9 percent decline on an annual basis is the worst quarterly decrease reported in five years. Economists are drawing a parallel between the launch of the Affordable Care Act (ACA) in January and the reported GDP decline.

A recent Wall Street Journal article points to a presumed linkage between the ACA launch date and current trends. The Journal contends, “January saw the formal launch of the Affordable Care Act, and its attempt to transform U.S. health insurance and medical practice. So it’s notable that a major cause of the sharp downward revision in first-quarter GDP was a decline in consumer spending on health care. Lower exports and investment also played a role, but the overall decline in health spending from the previous quarter was a startling 6.4%.”

Obamacare is clearly leaving its footprint on the American economy, but, unfortunately, not in a positive way. Let’s hope this footprint doesn’t lead Americans down the path to economic disaster.

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