White House press secretary Jay Carney claimed Obamacare helped drive economic growth Wednesday in the White House press conference.
However first quarter GDP registered a mere 0.1 percent, a drastic decrease from the 2.6 percent America saw in the fourth quarter of 2013 and well short of the 1 percent economists were expecting. Massive increases in healthcare spending reportedly kept GDP out of the red, as Carney was quick to trumpet:
WENDELL GOLER: There are some economists saying this report is an early indication of the impact of “Obamacare” and higher taxes. Do you dispute that?
JAY CARNEY: Well, I haven’t seen those economists because the fact of the matter is, and the GDP report makes it clear, that it was consumer spending on health care that helped drive economic growth in the first quarter. And that is directly related to the increase in people who have insurance because of the Affordable Care Act. We also saw, and this has been misunderstood and therefore is reported, the fact that health care inflation — which is a separate animal from health care spending — health care inflation remained historically low. And what that means is that more people are buying a product or spending money on a product, but the cost of that product remains — that the increase in the cost of that product remains at an historically level.
While healthcare spending increases due to Obamacare mandates are sure to have positive near term impacts on domestic consumption, there are a barrage of forthcoming taxes and fees consumers will see in 2014. Moreover, most Americans have seen only a tiny fraction of Obamacare’s roughly $1 trillion total tax increase.
Carney can brag about the benefits of forced healthcare spending now, but how the economy will cope with Obamacare’s yet to be implemented burdens remains to be seen.