This morning, the federal government released the first estimate of the Gross Domestic Product during the third quarter or 2013. The growth rate of the estimate was 2.8% which was higher than expected although about a third of the growth was an increase in inventories which makes the figure not as strong as it seems. All in all, however, it was a pretty good report for a stagnant period like we have been experiencing for the last five years.
Two key figures, however, stand out from this morning's report. First, personal consumption expenditures during the quarter came in at the estimated annual rate of 10.7 trillion dollars. As most folks know, these expenditures which most call "consumer spending" is the biggest single driver of the American economy. The second figure of importance is gross private domestic investment which came in at an annual rate of just under 2.6 trillion dollars. Investment is the most important figure in gauging how quickly the economy will grow in the future. Today's investment develops into tomorrows output purchased by consumers.
These figures are important to keep in mind when considering all the cash that the new Obamacare rules are going to cost. According to estimates, the additional cost of health insurance across America is going to total about 300 billion dollars per year. Not all of that cost will come out of consumers' pockets; some costs will be paid by the government with dollars borrowed from China and others. Nevertheless, the bulk of these additional costs will still come from consumers and companies across the country. Think about what this will do. Let's start with consumer spending. After the full impact of Obamacare kicks in, consumer spending will be contracting rather than growing. This will result in job losses, lower wages, and hardships across the country. Even worse will be the impact of a reduction in the amount of money available for investment. Simply put, this will not be a one time problem; the reduction in investment will have a lasting negative impact on the economy for years to come.
Obamacare is not just a bad idea regarding healthcare. It is clearly going to harm the economy.
Two key figures, however, stand out from this morning's report. First, personal consumption expenditures during the quarter came in at the estimated annual rate of 10.7 trillion dollars. As most folks know, these expenditures which most call "consumer spending" is the biggest single driver of the American economy. The second figure of importance is gross private domestic investment which came in at an annual rate of just under 2.6 trillion dollars. Investment is the most important figure in gauging how quickly the economy will grow in the future. Today's investment develops into tomorrows output purchased by consumers.
These figures are important to keep in mind when considering all the cash that the new Obamacare rules are going to cost. According to estimates, the additional cost of health insurance across America is going to total about 300 billion dollars per year. Not all of that cost will come out of consumers' pockets; some costs will be paid by the government with dollars borrowed from China and others. Nevertheless, the bulk of these additional costs will still come from consumers and companies across the country. Think about what this will do. Let's start with consumer spending. After the full impact of Obamacare kicks in, consumer spending will be contracting rather than growing. This will result in job losses, lower wages, and hardships across the country. Even worse will be the impact of a reduction in the amount of money available for investment. Simply put, this will not be a one time problem; the reduction in investment will have a lasting negative impact on the economy for years to come.
Obamacare is not just a bad idea regarding healthcare. It is clearly going to harm the economy.
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