President Obama’s top economic adviser Wednesday blamed the harsh winter for a drastic slowdown in the economy in the first three months of the year, and said it would have been worse without Obamacare spurring consumer spending.
Jason Furman, chairman of the White House council of economic advisers, said “historically severe winter weather” contributed to slowing growth to a 0.1 percent annual rate in the first quarter, down from 2.6 percent growth in the previous quarter and the weakest pace since the end of 2012.
But Mr. Furman said the report by the Commerce Department also showed “the positive impact of the implementation of the Affordable Care Act which, together with continued slowing in health costs, helped strengthen the economy in the first quarter.”
Health-care spending by consumers rose at a 9.9 percent annual rate in the first quarter, which Mr. Furman said “appears to have been driven by greater use of health care services by people who gained insurance coverage during the first quarter because of the Affordable Care Act.”
“Ensuring access to care is a key goal of the Affordable Care Act’s coverage expansion, so this increase in utilization is neither a surprise, nor a cause for concern,” he said. “Furthermore, any upward pressure on health care spending growth from expanding insurance coverage will cease once coverage stabilizes at its new, higher level, so it does not affect the longer-term outlook for spending growth.”
Health-care prices rose at an annual rate of 0.5 percent, which the White House said was an “exceptionally” slow rate.
In light of the weak growth report, Mr. Furman said President Obama “will do everything he can either by acting through executive action or by working with Congress” to create jobs, including spending on infrastructure, education and research, a reinstatement of extended unemployment insurance benefits, and an increase in the minimum wage.
The Senate is set to vote later Wednesday on a bill that would increase the federal minimum wage from $7.25 to $10.10 per hour, one of Mr. Obama’s top policy goals this year.
• Dave Boyer can be reached at dboyer@washingtontimes.com.
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