Obamacare Prepares to Slam the States – by Dick Morris

morris

Anxious to avoid raising taxes too much to pay for their health care proposals, the Obama administration and its congressional allies hit on a great new idea: Make the states raise their taxes to fund the program, instead.

Both the House and the Senate bills require that states cover a larger percentage of their people under Medicaid — a joint state and federally funded program. The idea was to force states to raise their taxes to cover a big part of the health care bill for treating poor people. Since the Feds can simply charge any increase in spending to their already overdrawn bank account, but the states have to balance their budgets, the increased state spending for Medicaid will cause sharp increases in state taxes. And the governors will get the blame, not Obama and not the Congress.

The House bill requires states to give Medicaid to those whose incomes are less than 150 percent of the poverty level, while the Senate will settle for only 125 percent. For most states, this is a hefty increase.

In some states, like New York, where Medicaid covers everyone making 150 percent of the poverty level already, there will not be any extra required spending.

But not so in California, which only covers 100 percent of the poverty level. Were the House bill to pass, the already fiscally beleaguered state would have to increase its Medicaid spending on poor people by 50 percent, at least an extra $2 billion a year and perhaps more.

In many Southern states, the Medicaid program only covers a portion of those living below the poverty level. For these states, the requirement to cover all those in poverty and then 50 percent more will cause enormous increases in taxes. In Arkansas and Louisiana, where swing-Senators Pryor, Lincoln and Landrieu come from, the cost could exceed $1 billion for each state each year.

Unfunded mandates for state spending imposed from on high in Washington have always rankled governors.

The senators and congressmen in Washington get the credit for spreading largesse, but the governors in the states get the blame for the taxes that are needed to pay for it.

Since Democrats currently control the vast majority of governorships, this process of making their own party members take the rap for raising taxes is politically self-destructive in the extreme. But Obama is so desperate to pass his health care legislation that he doesn’t care what havoc in his party he reaps in the process.

The question now is whether the governors of the 50 states, particularly the Democrats, are going to sit idly by and let their budgets be destroyed by the health care bill.

When the Republicans in Congress insisted on tacking big cuts in aid to legal immigrant benefits for disability and other areas onto the welfare reform bill, it was the Republican governors who forced them to repeal the pernicious cuts the very next year. They did not want to have to raise taxes to make up for the withdrawal of federal funding.

Now, the Democratic governors face the same situation. If Obamacare passes with its expansion of Medicaid benefits — but with no federal funding of the extra spending — it is these Democrats and their legislatures that will have to bite the bullet and pass new taxes to pay for it.

Since states are already facing mammoth financial problems as a result of dwindling revenues and swelling expenditures in the recession, these additional burdens could be politically fatal. Unless Democratic governors want to avoid the fate of one of their late brethren, former Gov. Jon Corzine of New Jersey, whose political career was ended in a blaze of new taxes, they might want to call their buddies in Congress and ask them to lay off the unfunded mandates, particularly during this recession.

  • Freeme

    Dick makes sense and good points, especially about States running in the Red already. Mary Landrieu sold her Soul to Big Bro to the tune of 300 million for her 'yes' vote on healthcare to the demise of her own constituents…and future debt her State citizens will not be able to pay. Another debacle leading to communism courtesy of criminals in congress without conscience.

  • keithrage

    The mess that Obamao is creating/leaving secures his downfall,keep it up Democrats your putting the noose around your own necks. I can't wait to see you fall.

  • abrahamstubenhaus

    Thank you again Dick Morris for another in a fantastic series of brave and outspoken truths about the damage that can still be avoided if we act by calling and emailing our representatives!

    I only wish that there would be a loud and clear announcement or advertisement saying very definitely to all the members of Congress that the name and vote of every single one of them will be openly published a few times before the upcoming elections. Most of them assume that by that time this will all be old memories. It won't, and we must let them know before they start scrambling for the special bribes, aka promises and offers, which will influence their decisions.

    Please Mr. Morris, try to let them know now, while there is still time. If they still vote for this load of trickery, then we can later announce that they were duly warned and that election time will be known as, “payback time.”
    Thanks!

  • Moriah

    After Obama bleeds, restricts, silences and breaks the backs of the American people, after he invites harm into our borders after surrendering to our enemies, after the smoke settles — literally, The American People will not vote in another Democrat for 50 years. Have fun – the end of the sickness called “Liberalism” is going out with a bang.

  • Sassamon

    There will be a “Tea Party” at the home of David Voelker, St. Charles Avenue,
    New Orleans, LA on Dec. 12. This will coincide with the “Tea” indoors hosted
    by Mary Landrieu for the Senator Harry Reid. $4,800.00 will be required at the
    door.

    The recall petition for Senator Landrieu will be signed outdoors.
    Your presence is requested.