You guys are like my inside-baseball group. I am a little more exploratory in Over My Shoulder, as we need to think through ideas from more than one point of view.
My worry that Obamacare may not transition smoothly in terms of large numbers of healthcare workers losing jobs and hospitals and providers getting less money has so far not caught on with nearly any mainstream econ types. They think it all gets washed out, from a macro perspective. Less spending on healthcare means more spending on something else; it all balances. I am just not that sanguine. I think the transition is going to be a bitch by the 3rd and 4th quarters, resulting in shifting spending and employment patterns. I think there is a fundamental difference between the implementation of ACA and Y2K. By the way, this is NOT about the problems of the exchanges not working. That eventually gets solved and is not a big deal, macro-wise (impact on GDP), but it is understandable by the press so gets a lot of play, as it should. The thing we will not see for a bit is the dislocation of workers. We get all upset over housing, which is at most 5% of the economy. Down 18-19% and the bulls run for cover. But here we are dealing with 20% of the economy and getting ready to shrink it to 14%. Yes, spending goes elsewhere, but when and how? What are the consequences we don’t see? Maybe there will even be positive surprises. Who knowsz? Snd that is my concern: no one knows, and I see the potential for serious disruption of previous patterns. I hope I am just getting all worked up over what will turn out to be an orderly transition as we move from one pattern of spending to another and that healthcare workers will be readily employed at new facilities if they lose jobs at old ones, even if they must take lower wages.

The next OMS will be a piece on what happens because of extended periods of unemployment. It takes 20 years to catch up. Maybe healthcare workers are different. Maybe it is all different this time, but when you putz around with 18% of the economy and purposely decide to shrink it and think only good things will happen, I wonder what model you are using.

Again, maybe I am way out on a limb here and letting my biases creep into my analysis. Would not be the first time. But let’s read the following two pieces from other econ types (major figures) who are also concerned. This is something those of us who worry about macro forces MUST be paying attention to. I would seriously like your feedback and forwarding of thoughts and articles on topics like this.