Larry Summers: Obamacare Is Already Accomplishing More Than Expected
Former Treasury Secretary Lawrence Summers told CNBC on Wednesday that Obamacare has already yielded benefits to the economy. He also said the Federal Reserve should concentrate on pushing the economy to expand.
"If you look at the medium run and the long run, the important thing that's happened for growth is, that in the last three years since Obamacare was passed, we have bent the [cost] curve on health-care costs," he said in a "Squawk Box" interview.
The problems with the federal health insurance website HealthCare.gov have been "exciting theater" for the media, the former Obama advisor said. "Getting it right is obviously going to be important to fully getting the benefits of Obamacare."
But he said that health-care reform has cut costs as a percentage of GDP. "That offers huge promise with respect to the future of the federal deficit, which looks much less serious than it did even a couple of years ago."
%VIRTUAL-article-sponsoredlinks%Summers had been a leading candidate to take succeed Ben Bernanke as chairman of the Fed, until President Barack Obama chose Fed Vice Chair Janet Yellen for the top post. Her confirmation hearing is scheduled for Thursday. "I think Janet Yellen will do a great job at the Fed," he predicted.
When the subject of the Fed's $85 billion monthly bond purchases came up, Summers wouldn't comment on whether the central bank should taper or not, but he did say that the central bank's "primary policy emphasis needs to be on spurring growth going forward."
He argued that there have been some profoundly positive things going on in the economy, but "we haven't caught up the economy's potential."
He also said the energy boom in the U.S. has also been greatly beneficial to economic growth. "We're going to be a net exporter of energy five years from now. That would have been inconceivable at the beginning of the president's term."