The Significance of the Missing Employer Mandate

Weekly Standard ^ | 7/30/13 | JAMES C. CAPRETTA

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After getting over the shock of the Obama administration’s unilateral decision to delay the employer mandate for a year, supporters of the law have taken to downplaying the significance of the step. Jonathan Chait and Ezra Klein, among others, have said it is just not that big of a deal to delay a provision that they claim affects so few employers. After all, they argue, most employers offer coverage today without the mandate, so it can’t be true that imposing the mandate is essential to making the rest of the law work well. Klein goes even further and says it would be best just to get rid of the employer mandate altogether because its perverse employment incentives outweigh whatever positive role the provision plays in the rest of the law.

In his first public comments on the mandate delay, President Obama picked up on this “it’s no big deal” theme in an interview with the New York Times, stating, among other things, that “the number of employers who are potentially subject to the employer mandate is relatively small,” thus echoing the argument that the mandate is not a central provision of Obamacare.

It’s certainly a welcome development that some defenders of the law are willing to publicly admit that the employer mandate is already having disastrous consequences for employment, especially for workers from low income households, and therefore should not be allowed to go into effect. They are right. It is terrible policy for sure, and needs to be repealed for that reason, along with the rest of the law.

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