PIIGS is the acronym for the European countries of Portugal, Italy, Ireland, Greece and Spain.  These countries represent the most at-risk economies in Europe, particularly after the European sovereign debt crisis in 2009 and 2010.  Their fiscal conditions, which include astronomically high debt and large social-welfare states, should be a warning to the United States. 

On March 21, 2012, it became clear the nation was heading down the wrong path when House Minority Leader Nancy Pelosi (D-Calif.) uttered the following on the House floor marking the two-year anniversary of the Affordable Care Act’s (Obamacare) passage into law: 

I thank the gentleman for yielding. I appreciate his leadership for helping us honor what our Founders put forth in our founding documents, which is life, liberty, and the pursuit of happiness.  And that is exactly what the Affordable Care Act helps to guarantee: a healthier life, the liberty to pursue happiness free of the constraints that the lack of health care might provide to a family.  If you want to be a photographer, a writer, an artist, a musician, you can do so. If you want to start a business, if you want to change jobs, under the Affordable Care Act, you have that liberty to pursue your happiness.

When the Declaration of Independence’s awe-inspiring words are distorted to such an extent that they would be used to support the notion that our Founding Fathers would have approved the passage of ACA, which is a monstrous federal law that regulates one-sixth of the nation’s economy and forces citizens to purchase a product (health insurance) just because they are alive, then George Orwells’s “1984” wordsmithing is no longer fiction.

Approximately two years after Minority Leader Pelosi spoke, the Congressional Budget Office (CBO) put her lofty rhetoric into economic terms.  The CBO report, “Budget and Economic Outlooks for 2014-2024” reveals one of the many pernicious consequences of Obamacare, which is likely a “decline in the number of full-time-equivalent workers of about 2.0 million in 2017, rising to about 2.5 million in 2024.”  Chalk this up along with other disturbing numbers such as the rapid increase in disability insurance payments that grew  from 6.9 million in 2000 to 10.9 million in 2013, and the number of individuals on food stamps, which has risen from 17 million in 2000 to 46 million in 2013.  These programs among others will lead to a further swelling of the welfare state.  The nation is on a dangerous trajectory, drifting away from American exceptionalism with a can-do spirit toward statism, rampant social welfare, and mediocrity.

In a desperate attempt to fight the continuing negative news resulting from the implementation of Obamacare and in particular the CBO’s analysis that it will cause a decline in the number of full-time-equivalent workers, Obamacare supporters decided to say publicly that this is all a good thing.  Indeed, politicians are declaring a new-found “freedom” for the American people thanks to Obamacare.

According to Rep. Keith Ellison (D-Minn.), "We are going to have parents being able to come home, working reasonable hours.  People are going to be able to retire.  People might actually be able to cook dinner rather than have to order out and get some takeout."

Or this February 4, 2014, White House press release which states, “Over the longer run, CBO finds that because of this law, individuals will be empowered to make choices about their own lives and livelihoods, like retiring on time rather than working into their elderly years or choosing to spend more time with their families.  At the beginning of this year, we noted that as part of this new day in health care, Americans would no longer be trapped in a job just to provide coverage for their families, and would have the opportunity to pursue their dreams.”

And Senator Chuck Schumer (D-N.Y.) weighed in on NBC’s “Meet the Press” saying, “What CBO said is that many American workers would have freedom.  Now that's a good word, freedom to do things that they couldn't do. The single mom who's raising three kids, has to keep a job because of health care, can now spend some time raising those kids. That's a family value. The student, 27 years old, wants to finish school quickly so he can get a great job, can't because he needs health care, is now free."

Could this line of persuasion work for Obamacare supporters?  David Freddoso wrote on  February 14 in the Conservative Intelligence Briefing blog that in “the Florida-13 special House election next month, we seem likely to get an early test of the White House defense of Obamacare – specifically, its answer to [the] CBO report that says Obamacare will create an incentive for workers to cut hours or drop out of the labor force.” The election was held to replace the deceased Bill Young, a Republican.  The Democratic nominee, Alex Sink, was quoted on February 14 saying the CBO report is good news and presents an “exciting prospect” because Americans will have more choices in their lives and not be “stuck in a dead-end job.”

Did the Obamacare sales pitch work in Florida?  Sink, the former chief financial officer for the state of Florida and Democratic nominee for governor in 2010, had good name recognition, ran in a competitive district that had twice voted for Obama, and spent 3 times more money on ads than the Republican challenger, David Jolly.  She lost the election.  NBCMiami.com reported that Jolly campaigned on repealing Obamacare while Sink painted Jolly “as an extremist who wants to ‘take us back’ to when people were denied coverage due to existing conditions.  She pledged to ‘keep what’s right and fix what’s wrong’ in the health care law.”

Freddoso pointed out why CBO says there will be a decline of 2 million-plus full-time workers.  It isn’t because of some masterful utopian planning during the writing of the Affordable Care Act.  It is because of the negative incentives that come along with the taxpayer-funded subsidies and credits that help people purchase health insurance via the Obamacare exchanges.  He wrote:

To start a business (at least a profitable one) would be to defeat the purpose of reducing one’s own hours, which is to reduce one’s income.  The problem is the subsidy cliff – or alternatively, a massive marginal tax-rate hike for incremental gains in income for middle class families.

Depending on your income and family size, there’s a large transition range from the lower to upper middle class that will now seem not worth passing through, except for those who really do expect to come out on the other side quickly and become wealthy.

We already had this problem for those at the upper edge of Medicaid eligibility – a raise or the addition of extra hours could suddenly endanger your health coverage.  Now we’ve extended the same perverse incentive to those who attempt to make the journey to a higher, self-sustaining family income from, say, a bit below 250 percent of poverty (Obamacare’s upper limit for receiving financial help paying deductibles) through 400 percent of poverty (Obamacare’s upper limit for getting subsidies to pay one’s premiums).  In the former case, to increase your hours from say 30 to 40 hours per week would be to make yourself less financially secure in case of illness.  In the latter case, an increase in work hours could cost you as much as you make extra.  Along with the existing progressive brackets in the tax code, those making the trek from one end of this financial range to the other will be more punished at each step because less work and a lower cash income can be more valuable.

Fortunately, not all Obamacare supporters are citing the talking points of living the high life by becoming a permanent part-timer who relies on their fellow taxpayers for their living.  Rick Unger, who writes “from the left on politics and policy” for Forbes, has a different take on the part-time work issue.  He stated, “While progressives argue – correctly in my view – that those whose circumstances create a legitimate need for public assistance should receive our help, most progressives, with the exception of those on the furthest fringes of the left, would likely agree that policy affirmatively encouraging people not to work because they stand to benefit financially as a result of government subsidies is a very bad idea.”  He went on to say, “While I think it is terrific if someone is able to retire at an earlier age, if that is their wish, I don’t think the opportunity should come as a result of subsidies being provided by taxpayers who continue to work.  Similarly, while  I think it is a wonderful thing  when a parent elects to take on the difficult work of staying home to raise children, and greatly admire those who accept the financial sacrifice of doing so, this choice is also not one that should be financed by taxpayers.”

As more provisions of Obamacare take effect, the country will turn into a European-style social welfare state with corresponding high debt to GDP ratios.  As Michael Tanner pointed out in the introduction to his Spring/Summer 2013 article in the CATO Journal, “Europe’s Crisis and the Welfare State”:

The reason for this dire fiscal situation is the massive expansion of the welfare state that has taken place in the years following World War II, first in Europe but more recently in the United States.  As government has taken responsibility for more and more areas of our lives – from retirement and health care to protecting us from unemployment or guaranteeing a minimum level of income – it has grown ever bigger, more costly, and more intrusive.  At the most basic level, it has become unaffordable.

Close examples of the pabulum Obamacare sycophants are now pushing can be found in many countries in Europe.  Pedro Schwartz wrote in The Welfare State as an Underlying Cause of Spain’s Debt Crisis that the four pillars of the Spanish welfare state are health, education, pensions, and unemployment benefits.  Healthcare is “free” and education, in particular at the university level, is heavily subsidized.  The population has an unemployment rate of 26 percent, particularly with the young, which is at 54 percent.  Spain’s current debt to GDP ratio is above 90 percent and climbing due to government overspending and “a housing bubble expanded by artificially depressed interest rates burst when the returns on overvalued assets became too low to attract new investors.”

According to a February 13, 2012 CBS News.com article, Greece was already living beyond its means before it joined the EU, which then kicked its structural problems into overdrive.  The country’s toxic soup of a welfare state and a large public sector with powerful unions has practically prevented any meaningful cut backs in government jobs.  Its high taxes have stifled growth and led to a huge debt to GDP ratio and high unemployment, currently standing at 157 percent and 28 percent respectively.

It’s not just the PIIGS that have problems.  As Minority Leader Pelosi gushes about artists being able to follow their dream, take a look at France; where actors, musicians, choreographers, stage hands, and even circus clowns get a special unemployment benefit from their fellow taxpayers.  According to the The Guardian, the “special dole system [is] designed to protect them in the downtime between jobs and sparing them the curse of out-of-work creatives elsewhere in the world: waiting tables or telesales.”

The Guardian noted that whenever France has tried to reign in the expensive benefit, some of the “world’s biggest strikes and most flamboyant street demonstrations” take place.  The newspaper also noted “whether a costly special unemployment system that privileges actors and arts technicians can survive in an economic environment when scores of other professions are facing similar levels of job insecurity is the question political commentators in France are wrestling with.”

France may protect special classes of citizens such as their artists with government programs and support its public workers with generous benefits, but it all comes with a hefty price.  State workers are one-fifth of the total employment ranks and their salaries consume one-quarter of public spending expenditures.  The country has an unemployment rate of approximately 11 percent, with the under 25-year olds at 26 percent.  France, apart from Belgium, has the highest tax burden in the Euro-zone.  Someone has to pay for their social welfare policies.

Why would the U.S. want to emulate Europe is incomprehensible.  The average unemployment rate in the European Union is at about 11 percent, with youth unemployment (under age 25) at 23 percent.  Stagnant economies, enormous debt, and lofty unemployment numbers are how our European cousins pay for all their “free” stuff like healthcare and a laissez-faire lifestyle that includes early retirement and month-long vacations in August.

The United States has long been the land of opportunity.  We have had a strong work ethic since our founding.  In America, people who wanted to be entrepreneurs, run a business, or become an artist or photographer found a way to become successful without depending upon taxpayer handouts.  Tens of millions of immigrants flocked to the U.S. because they knew if they worked hard, they could get ahead and have a better life.

Americans have had the freedom to move from a “lower class” to a higher one, by achieving their dreams beyond their expectations.  History is replete with Horatio Alger stories.  Millions took enormous risks to create robust businesses and became wealthy as their reward.  But that is changing.  Now the government is deciding who shall have the “freedom” to pursue their dreams and who gets to pay for it.  Unfortunately, unless the nation changes course, the PIIGS will become the USPIIGS.