Streams

US Economy, Revised

Thursday, June 26, 2014

U.S. President Barack Obama speaks about the about progress in the economy since the financial crises that happened five years ago, in the Rose Garden at the White House on September 16, 2013. (Mark Wilson/Getty)

GDP for the first quarter was revised sharply downward, due primarily to lower-than-expected healthcare spending. Diane Brady, Bloomberg Businessweek senior editor and the author of Fraternity (Spiegel & Grau, 2013) talks about the drop, and why markets aren't reacting more strongly to the news.

Guests:

Diane Brady

The Morning Brief

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Comments [23]

Wow...Count the number of posters hoping that Q2 numbers are also a flop so that the GOP might have a prayer in the upcoming election.

Sheesh! And if asked these folks would call themselves good Americans.

Jun. 28 2014 05:54 PM

Also see:

http://www.bloombergview.com/articles/2014-06-26/obamacare-s-prognosis-grows-dimmer

"A nightmare for Affordable Care Act supporters has been the possibility that only the sick would be left to purchase insurance through its exchanges, driving premiums up and insurers out. While the law’s boosters have been quick to dismiss the possibility that such a so-called death spiral could occur, data published in the Wall Street Journal suggest that this chain of events may not be so far-fetched after all. . . . "

Jun. 26 2014 06:19 PM

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hicks136
6:02 PM - 26 Jun 2014 · Details

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@instapundit Is that because the price has fallen so low?

Jun. 26 2014 06:14 PM

History, Get me re-write!

"Q1 GDP fell 2.9%, Obama Admin blames winter. But ’85 winter was also historically cold & Q1 GDP grew 4%"

http://www.ijreview.com/2014/06/150933-know-economic-contraction-blamed-winter-ted-cruz-destroys-one-tweet/

Jun. 26 2014 05:36 PM

I was on the road when the caller "Sharen" gave her story about paying 800 bucks a month for her health insurance because the Obamacare rate was even more expensive.

Shame on you Brian for not having your BS detector on a more sensitive setting. Of course the reporter from Bloomberg wasn't about to question anything that trashes ACA.

The caller first said that there was no exchange in NJ......which is true. She clearly was fabricating a story....listen again to her call. When you gave her the out that she could have still applied for ACA on the federal exchange she comes up with the nonsense that she was quoted and even higher rate than 800 a month which was more than she was paying now with to a private broker/insurer directly.

She was clearly LYING!!!

She stated that the 800 was almost more than she was earning! Listen to her call!!!

Anyone earning less than 15 K per year in NJ is eligible for the Medicaid Expansion.....NJ Family acre with NO premiums a and NO out of pocket.

Also even people with incomes around 18 K would get major 400 to 500 dollar subsidies allowing them to but 800 dollar "silver" plans for about 300 a month or less.

Again, Brian...you let that caller create a totally false impression.......and the reporter who likely knew better failed to question the caller and went along with the propaganda.

You really should spend a few hours studying up on the basics of the ACA and the Medicaid expansion in the NY/NJ areas......it's not *that* complicated.

The media was full of these BS "horror stories" when ACA was first activated.......then they turned out to be BS when intelligently and knowledgeably assessed.....the perpetrators were/are either utterly mistaken/uninformed/oblivious or they are intentionally lying. Either way you really should scrutinize this call and do a follow up with a real expert who has no ax to grind.

Remember ACA was a REPUBLICAN THINK TANK initiative designed to take the steam out of the single payer movement.....it's far far far from some commie/left wing plot!!!

Jun. 26 2014 12:12 PM
h from newark

work at UH in Newark. These folks do an unbelievable job and treat each patient with dignity, respect and incredible skill

Jun. 26 2014 11:34 AM

@MikeInBk from Clinton Hill:

"And isn't it immoral that health care in this country is base on a for-profit model?"

No more immoral (or inefficient) than a "for-profit" model for food production. Or are you more in favor of the efficacy of government-fashioned "Five Year" plans?

May you continue to enjoy the blessings of World Peace.

Jun. 26 2014 11:12 AM
AdamL from New York City

The very notion of "GDP" as the definitive measure of the health of the economy - as GDP is currently calculated - is terribly misleading and unreliable. Overspending on healthcare (read: our bloated private-insurer based system), Military budgets and materiel (let's spend more on wars and the toys thereof!), incarceration on the federal and state levels (throw 'em all in jail, and pay for-profit firms to keep them there), fossil fuels (prices, cost of extraction and the costs of cleanup), the list goes on. GDP is Gross, an account of all that which we wish to spend on, constructive, productive spending, and everything we don't as well. Get OVER GDP.

Jun. 26 2014 10:56 AM
Susan from Upper West Side

Steve - we are not paying for health care in this country. We are paying for a for profit health insurance system that has all the ethics of loan sharks. And these particular loan sharks are subsidized by the government. Both are in bed together so the bureaucracy created in each system is exacerbated by the over the top profit making incentives of the other. Neither care providers nor those who have health problems benefit. Most everyone who is healthy that doesn't die from an accident or get murdered, eventually will get old and need some form of care so no... health insurance SHOULD be for getting appropriate care WHEN you need it. The HORRIBLE care part of it is because both insurance companies and the government right now are subsidizing a system that does not focus on prevention and comprehensive care, it focuses on the quick fix that really isn't a fix at all. I am shutting the radio off now.

Jun. 26 2014 10:56 AM

@Steve from NYC

"While income taxes are disproportionately a tax on the Wealthy, Healthcare is disproportionally a tax on the HEALTHY."

What bullsh*t! FACT: Taken together the percentage of income taxed for middle-tier earners dwarfs that paid by the Wealthy. (Income taxes, FICA, sales tax and property taxes). The wealthy may pay a larger amount but it is a far lower percentage of total income, therefore it hurts less.

Healthcare premiums are INSURANCE, nimrod. When you learn something about insurance pooling come back and sell your noise.

Jun. 26 2014 10:53 AM
MikeInBk from Clinton Hill

And isn't it immoral that health care in this country is base on a for-profit model?

Jun. 26 2014 10:48 AM

MikeInBk from Clinton Hill:

" . . . Why is this not a good thing?"

Because, if aggregate costs are going going down in the face of inflexible pricing - people buying less - it's only a "good thing" if they don't in fact need the medical care or procedure.
The guest did not answer my "called in" question - she did have a very spirited, but "data-less", narrative.

Same approach to her stories about the general economy.

Jun. 26 2014 10:48 AM
Susan from Upper West Side

Can't even stand to hear about the Affordable Care Act right now since our outrageously expensive $20,000 plan was discontinued even with ridiculous deductables. All the money is going to bureaucratic systems that are out of control. Large scale for profit institutions are no better than large scale government institutions and when it comes to health care they are worse. This October we are going to end up paying more money for even less coverage and the options now through the Affordable Care Act are worse. We should have had a single payer plan.

My husband and I are both health care providers and on that side too - its ridiculous. My husband is moving away from dealing with insurance altogether. My profession never used to be covered but now that the Affordable Care Act says it is supposed to be covered clients expect free service. Meanwhile the insurance companies have figured out how not to cover the services that are required under the Affordable Care Act. So my profession may actually disappear. The Affordable Care Act was a big fat free gift to the insurance industry, not to either providers or clients.

Oh - and the Affordable Care Act wiped out all but one or two of several hundred women owned businesses that provided a very service oriented retail business providing breast pumps. Now the market is flooded with junk pumps that are sent to clients 2 weeks after a request. If they need a pump because their baby is premature or because their baby has a suck swallow disorder, their milk is gone by the time they get a pump.

Can't listen any more.

Jun. 26 2014 10:47 AM
jgarbuz from Queens

GDP figures do not tell you whether what is being produced and bought is good or bad. If lots of money is being spent on drugs and pharmaceuticals that do little good and often produce harm, that still goes into the GDP figures. People are employed in jobs doing lots of things that do not contribute to the health and well being of the people.

Jun. 26 2014 10:46 AM
Steve from NYC

I think people on the Left need to understand something about Healthcare. While income taxes are disproportionately a tax on the Wealthy, Healthcare is disproportionally a tax on the HEALTHY. And I love hearing people who tend to find themselves left leaning politically complaining about the healthcare costs.

Healthy people pay in to a system so that a relatively unhealthy person can take out more. That's the way all these things work, income taxes included. So welcome. Welcome to our world. Let's see how long you enjoy paying high insurance premiums for horrible healthcare. It's no different than paying high income taxes for horrible government spending.

Welcome

Jun. 26 2014 10:45 AM

…WHAT?!?!?!?

Healthcare spending went…DOWN!??!

…those damn commies!!

GDP…? Might be time for a new, sustainable form of Kapitalism®.

Jun. 26 2014 10:45 AM
jgarbuz from Queens

GDP figures does not tell you whether what is being produced and bought is good or bad. If lots of money is being spent on drugs and pharmaceuticals that do little good and often produce harm, that still goes into the GDP figures. People are employed in jobs doing lots of things that do not contribute to the health and well being of the people.

Jun. 26 2014 10:45 AM
J Reilly from Bellmore, NY

FYI - after only 3 months with our new health care plan our company had recieved notification that our rate will be increasing by 5.5% next year. It was the cheapest NY State Health policy avaialable. We may have to drop out if it gets much higher.

Jun. 26 2014 10:44 AM
Amy from Manhattan

The work situation the caller from NJ described sounded as though she could be eligible for a subsidy (unless her main job pays fairly well & she's waiting tables *just* to pay for her health insurance).

Jun. 26 2014 10:43 AM
MikeInBk from Clinton Hill

Healthcare spending going down ... Why is this not a good thing?

Jun. 26 2014 10:37 AM
IMHO

We're also spending less money on bullets and bombs because the president is winding down our wars. I guess that's "bad news" for the munitions manufacturers.

Jun. 26 2014 10:34 AM

The country is in the hands of the "Best and the Brightest" hands.

Jun. 26 2014 10:26 AM

Tanking Economy Everybody's Fault but Obama's - Sean Davis, Federalist

GDP, and Obama's Massively Subpar Growth Record - Editorial, Investor's.com

Q1 Economy: Worse Than Everybody Thought - Neil Irwin, New York Times

Big Losers in GDP Report: Democrats - Megan McArdle, Bloomberg

Jun. 26 2014 09:57 AM

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