Why the CBO report is (still) bad news for Democrats

In the immediate wake of the Congressional Budget Office's report Tuesday on the effects of the Affordable Care Act, I wrote a piece entitled, "The worst headline for Democrats this year." The basic argument I put forward was that the CBO's report gave Republicans two very powerful arrows to fire at Democrats in the midterm elections: (1) That the bungling of the rollout of HealthCare.gov led a million fewer less people than projected to sign up for coverage, and (2) that the number of full-time employees will drop by 2 million due to the law.


Chairman of the White House Council of Economic Advisers Jason Furman speaks about the Congressional Budget Office (CBO) report and the Affordable Care Act at the White House in Washington February 4, 2014. REUTERS/Kevin Lamarque

I postulated that the report would allow Republicans to run a slew of ads that savaged Democratic incumbents for supporting a law that cost Americans jobs and was so badly bungled that 1 million people decided not to sign up for it. Hence "Worst Headline for Democrats this year."

For shame, screamed Democrats. Republican spin! Fluff and nonsense! Their complaint? That the CBO report didn't say that the ACA would cost 2 million jobs but rather that it would create a 2-million-person decline in the labor supply, meaning people not putting themselves out into the workforce -- which, in an instance in which a person was keeping a bad job solely for the health insurance benefits, could actually be a good thing. (Worth noting: I made clear the delineation between eliminating jobs and a decline in the labor supply -- and even quoted the relevant passage from the CBO report -- in my initial post.)  Democrats repeatedly pointed me to Glenn Kessler's Fact Checker piece, which ran on my own site (!!!!) and which gave three Pinocchios to the claim that the CBO report predicted 2 million in job losses due to Obamacare.

It's worth quoting Glenn at length here because he effectively both explains the difference between killing jobs and a decline in the labor supply and makes the broader point of my first analysis on the report. Here's Glenn:

The CBO’s estimate is mostly the result of an analysis of the impact of the law on the supply of labor. That means how many people choose to participate in the work force. In other words, the nonpartisan agency is examining whether the law increases or decreases incentives for people to work.

One big issue: the health insurance subsidies in the law. That’s a substantial benefit that decreases as people earn more money, so at a certain point, a person has to choose between earning more money or continuing to get the maximum help with health insurance payments. In other words, people might work longer and harder, but actually earn no more, or earn even less, money. That is a disincentive to work. (The same thing happens when people qualify for food stamps or other social services.)

Thus, some people might decide to work part-time, not full time, in order to keep getting health-care subsidies. Thus, they are reducing their supply of labor to the market. Other people near retirement age might decide they no longer need to hold onto their job just because it provides health insurance, and they also leave the work force.

Look at this way: If someone says they decided to leave their job for personal reasons, most people would not say they “lost” their jobs. They simply decided not to work.

There are two main reasons why I think, Glenn's points notwithstanding, the CBO report means political trouble for Democrats this fall.  And it's all about how politics and political campaigns are not governed by the rules that many people -- especially those on the left -- seem to believe.

1. Glenn's explanation is thorough -- and complicated. Remember that most voters -- people who don't follow this stuff as closely as me, you or, likely, most people we know -- make their decisions based on 30-second TV ads. (While the power of TV ads is shrinking somewhat, it remains the dominant force in terms of persuading voters.)  The Republican ad on this CBO report writes itself: Job losses, botched rollout, etc. The Democratic one is WAY more complicated as it relies on explaining the idea that a decline in the labor market isn't the same thing as job losses and that all of this could well wind up being a good thing for the public. And, for an electorate that pays -- at best -- passing attention to politics, the Republican message is cleaner, simpler and more digestible than the Democratic one.  And it's not close. (If you think that most people make up their minds about whom to vote for by reading deeply about each candidate's positions on issues, researching those positions independently and then arriving at their own conclusions, you have never sat in a focus group or talked to an actual voter.)

But wait, Democrats argue. Casting the CBO's report as saying that the ACA will cost jobs is, at best, a parsing of what the report said and, at worst, a lie. On that front, I think my former colleague and political handicapper extraordinaire Amy Walter said -- or, more accurately, tweeted -- it best.

Bingo. If every negative ad was required to provide the full context of every attack contained therein, 30-second ads would have to be transformed into 30-minute infomercials. (It's worth reading this lengthy FactCheck.org analysis of the claims the Democratic National Committee made against Mitt Romney in the 2012 campaign -- and how many of them were either devoid or lacking in context.) And, they would be a whole lot less effective.

Now, Democrats can -- and will -- cite Glenn's Fact Checker column in response ads to the inevitable attacks that will come from Republicans citing the CBO report. But that leads me to my second point.

2. People believe what they are already preconditioned to believe. The Republican base has hated Obamacare for years. Republicans view it as a sign of massive government overreach and see the botched rollout of the HealthCare.gov Web site as evidence for why government shouldn't be involved in these sorts of things. The CBO report doesn't just add fuel to that fire; it takes a gas station and blows it up (a la the gas fight in "Zoolander"). If Republicans were convinced that Obamacare was a bad thing for the country before the CBO report (and they were), now they are absolutely convinced that they have to show up at their polling places this fall to send a message to this president about the wrongheadedness of the law.

And, remember that midterm elections are typically low (ish) turnout affairs in which a mismatch in base intensity matters hugely in determining winners and losers. (See 2006 and 2008 for Democrats and 2010 for Democrats.) And, a very fired up Republican base -- made even more so by GOP-backed ads using the CBO report -- makes already difficult races for Democratic Sens. Mary Landrieu (La.), Kay Hagan (N.C.), Mark Begich (Alaska) and Mark Pryor (Ark.) that much tougher. It doesn't mean they will lose -- Democrats have done an outstanding job over the last few cycles of distancing themselves from the national party and running state-focused campaigns -- but it  certainly doesn't help them any.

Now, I can already hear people saying some version of this: "It's your job in the media to INFORM people. To tell them what's right and what's wrong. To cut through the clutter." Absolutely true. And that's why I included the actual language from the CBO report in my initial post and why I think Glenn's post is so valuable. But, I would say to those critics: You overestimate the media's ability to (a) cut through the clutter or (b) change peoples' minds about what's true and what's not. As I noted above, people, largely, believe what they want to believe. And that's even more true in a siloed media world where conservatives read, listen to and watch content that affirms their beliefs and liberals do the same.

My job is to assess not the rightness of each argument but to deal in the real world of campaign politics in which perception often (if not always) trumps reality. I deal in the world as voters believe it is, not as I (or anyone else) thinks it should be. And, I'm far from the only one. In the wake of my piece yesterday, I got two e-mails from very senior Democratic campaign operatives. Here they are verbatim.

* E-mail #1: "Those CBO #s are awful. We can get past them and ACA by Nov[ember] in enough states to hold the majority but there's no denying the damage done by ACA and this is the latest blow."

* E-mail #2: "That CBO report is horrible for Dems -- Chuck Schumer would even agree...as well as all the red state Dems."

Politics is about perception and confirming or debunking deeply held beliefs (whether or not those beliefs are factually based). Understood through that lens, the CBO report remains a gift to GOP campaign strategists already gleeful about the possibility of making the 2014 midterms a referendum on the Affordable Care Act.

Chris Cillizza writes “The Fix,” a politics blog for the Washington Post. He also covers the White House.
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