As Arizona Goes, So Goes the Nation: How Medicaid Ruins the States' Fiscal Health
No. 6, July 2008
All is not well in Senator John McCain's home state. Confronted with a general fund budget shortfall of more than $1.3 billion, the Arizona legislature in June enacted modest cuts (primarily in community college and prison budgets), a stepped-up traffic enforcement system to produce some $90 million in speeding tickets, and $2 billion in new debt--half of it to close the hole in the $10.9 billion budget. (The other half will fund university construction.) The budget is a stopgap measure that bodes ill both for next year's budget and for the state's fiscal future, and no Arizona politician pretends otherwise.
Measured as a percentage of the state's fiscal year 2008 general fund, Arizona's projected FY 2009 deficit was the most serious shortfall of any state, exceeding even California's....
Arizona's fiscal crisis is due chiefly to the state's expansion of its Medicaid programs. That decision, in turn, is largely attributable to the perverse incentives created by Medicaid's inordinately generous transfers to the states. To oversimplify slightly, states get into fiscal trouble not because the feds shirk their obligations, but because they have made promises to pay in the first place. While Arizona's problems are exacerbated by a dysfunctional political system, the state's predicament illustrates a pervasive structural crisis.
Despite a relatively conservative political climate, Arizona used to be a high-tax state. Over the decades, however, Arizona's tax burden has remained roughly constant, while that of many other states has risen. As a result, Arizona has improved its position relative to other states. By the most widely used measure (the Tax Foundation's index of state tax burdens), Arizona is now near the median in terms of combined state and local tax burden on citizens....
However, the fiscal effects of federal-to-state transfers are not unambiguously positive, even for net recipient states like Arizona. While federal grant programs may have some fiscal substitution effect, on balance they increase state and local taxation and spending. By making program expansions look cheap and making cuts look outrageously expensive, federal matching grants ratchet up spending and taxes and tend to exacerbate the states' boom-and-bust budget cycles. All else equal, those effects increase in proportion to the matching program's size and generosity....
Under Medicaid, the federal government reimburses between 50 and 77 percent of a state's qualifying expenditures, depending on the state's wealth. Put differently, a state can purchase a dollar's worth of Medicaid health services at a cost of less than fifty cents to itself. Less happily, it cannot cut a dollar from its domestic budget without "losing" federal transfers....
Some states now cover families with incomes of up to 275 percent of the poverty level. Almost all provide long-term care for the poor and low-income elderly. In a few states, one-third of the population is now on Medicaid. In Arizona, about one-fifth of the population receives health care coverage through AHCCCS [Arizona Health Care Cost Containment System]....
Unsurprisingly, Medicaid expenditures constitute an ever-growing share of state expenditures. In 1987, that share amounted to slightly more than 10 percent. In 1992, the number was 17.8 percent; in 2006, 22.2 percent....
In Arizona, the crowding-out has been far more severe and rapid. The state's involvement with Medicaid did not begin until 1982, with the creation of AHCCCS. Previously, Arizona had been the only state to reject federal Medicaid funds. (Individual counties provided a piecemeal system of health care for the state's indigent.) AHCCCS was the first statewide Medicaid program to use managed care, offering recipients a variety of private and public health plans that channeled them into private physicians' offices. As recently as 2002, AHCCCS was cited as a model Medicaid program.
But AHCCCS has since caused much fiscal and budgetary trouble. These difficulties can be traced to the enactment of Proposition 204 in 2000, which substantially expanded Medicaid-eligible populations and services. Proposition 204 significantly loosened eligibility requirements for several AHCCCS programs. (For example, it allowed persons with incomes above the poverty line to spend down their income on medical bills to qualify for coverage.)...
The option of finding offsets for increased Medicaid spending elsewhere in the budget is illusory. Only the general fund and "other appropriated funds"--less than half of all state expenditures combined--are actually subject to the legislature's appropriation authority. "Other" appropriated funds are earmarked, and even within the general fund, about 60 percent of spending is essentially nondiscretionary, as it is automatically set to increase or decrease each year.[9] Thus, short of closing down community colleges and state prisons (or, perhaps, launching an aggressive pro-smoking campaign to raise short-term revenues and long-term mortality rates among Medicaid consumers), the Arizona legislature can do only what it has, in fact, done: enact phony cuts, use traffic enforcement as a revenue device (not a tax and therefore not subject to the Proposition 108 two-thirds requirement), and issue a pile of new debt....
Arizona instead resorted to aping the Bush administration's major domestic policy innovation: the tax-free, debt-only finance of a major public health program.
No state can avoid the choice between more debt or rip-roaring tax hikes, combined in some way. The only plausible solutions to the states' Medicaid-induced fiscal troubles are to be found in Washington. Those solutions, however, have foundered and will continue to founder--paradoxically, due to the opposition of the states.
It is tempting but wrong to view Medicaid's stupendous, irresistible growth trends and its effects on state budgets as accidents. Medicaid is designed to be fiscally unsustainable--but politically self-sustaining....
Medicaid has created a political wonderland: to a man and woman, public officials who know the program to be ruinous to their states nonetheless clamor for more of the same. There is no will or incentive in Washington for a call to reality--not among Democrats, who rightly view Medicaid (and SCHIP) as HillaryCare on a bicycle, and not among Republicans, who are receptive to the intergovernmental lobby's call for "states' rights" and its clamor against "unfunded mandates" (and never mind that Medicaid is neither).
Eventually, Medicaid will fall victim to the late Herbert Stein's law: something that cannot go on will eventually stop. No one knows on what terms it will stop. We do know this, though: before it stops, there will be a lot more Arizonas.
My thoughts: ...And socialism sucks. I still can't excuse our legislatures for our debt. They are there to be leaders and to tell the truth not lie and be cowardly.
Thursday, July 29, 2010
Wednesday, July 28, 2010
We Are Not Free: 40 Years of the Drug War
On how, after 40 years, drugs are more plentiful, accessible, and cheaper than ever before. Also, on how we have become a police state because the war.
We Are Not Free: Politicians and their fear of the free man
In light of Arizona politicians refusing to uphold the freedom of the individual mandate found in the Arizona constitution I thought it appropriate to explore this a bit further.
Arizona's constitutions says the following:
Article II.
Section 1. A frequent recurrence to fundamental principles is essential to the security of
individual rights and the perpetuity of free government.
Section 2. All political power is inherent in the people, and governments derive their
just powers from the consent of the governed, and are established to protect and maintain
individual rights.
It seems to find an honest politician is very rare as they seek power and not the defense of liberty. This story goes into how an Idaho politician has been berated by the system and his "fellow republicans" for not upholding the power of the state.
The Plunderbund's Persecution of Phil Hart
Rep. Hart's actual offense was not withholding payment of taxes, but rather refusing to surrender to the IRS the names and contact information of the thousands of people who purchased his self-published book Constitutional Income: Do You Have Any?, a detailed, scholarly examination of the history of the federal income tax.
"I read your book `Constitutional Income: Do You Have Any?'" Hart was notified in a letter from IRS agent Barbara Parks announcing that the state-sponsored terrorist clique employing her was beginning an "investigation" of the book. The purpose of that inquiry, she continued, was "to determine whether or not your statements are commercial speech and whether this activity causes harm to the government."
With the help of the Center for Individual Rights, Hart successfully sued the IRS to interdict the agency's demand that he turn over the names of everybody who had purchased his book. Four years later, the IRS retaliated against Hart by issuing a final audit report denying all of his business deductions for eight years, hitting him with an additional tax liability of roughly $125,000.
Already under siege by the world's most despicable terrorist syndicate (no, not al-Qaeda -- the IRS), Hart now has to contend with spurious charges of seeking "special treatment" and "financial gain." Yet state Rep. Ken Roberts remains secure within the Idaho Republican Party in spite of the fact, recently disclosed by the Lewiston Tribune, that Roberts has received nearly $370,000 in farm subsidies since 1995.
Roberts, who ritualistically reviles subsidies directed at others, insists that when he's on the receiving end of plunder he's not redistributing wealth, but rather "recycling wealth." Predictably, nobody in the state Republican leadership has proposed that Roberts be subjected to an ethics inquiry.
My thoughts: Typical of politicians. They have no moral grounding.
Arizona's constitutions says the following:
Article II.
Section 1. A frequent recurrence to fundamental principles is essential to the security of
individual rights and the perpetuity of free government.
Section 2. All political power is inherent in the people, and governments derive their
just powers from the consent of the governed, and are established to protect and maintain
individual rights.
It seems to find an honest politician is very rare as they seek power and not the defense of liberty. This story goes into how an Idaho politician has been berated by the system and his "fellow republicans" for not upholding the power of the state.
The Plunderbund's Persecution of Phil Hart
Rep. Hart's actual offense was not withholding payment of taxes, but rather refusing to surrender to the IRS the names and contact information of the thousands of people who purchased his self-published book Constitutional Income: Do You Have Any?, a detailed, scholarly examination of the history of the federal income tax.
"I read your book `Constitutional Income: Do You Have Any?'" Hart was notified in a letter from IRS agent Barbara Parks announcing that the state-sponsored terrorist clique employing her was beginning an "investigation" of the book. The purpose of that inquiry, she continued, was "to determine whether or not your statements are commercial speech and whether this activity causes harm to the government."
With the help of the Center for Individual Rights, Hart successfully sued the IRS to interdict the agency's demand that he turn over the names of everybody who had purchased his book. Four years later, the IRS retaliated against Hart by issuing a final audit report denying all of his business deductions for eight years, hitting him with an additional tax liability of roughly $125,000.
Already under siege by the world's most despicable terrorist syndicate (no, not al-Qaeda -- the IRS), Hart now has to contend with spurious charges of seeking "special treatment" and "financial gain." Yet state Rep. Ken Roberts remains secure within the Idaho Republican Party in spite of the fact, recently disclosed by the Lewiston Tribune, that Roberts has received nearly $370,000 in farm subsidies since 1995.
Roberts, who ritualistically reviles subsidies directed at others, insists that when he's on the receiving end of plunder he's not redistributing wealth, but rather "recycling wealth." Predictably, nobody in the state Republican leadership has proposed that Roberts be subjected to an ethics inquiry.
My thoughts: Typical of politicians. They have no moral grounding.
We Are Not Free: The kingship of the presidency
Dan Carlin talks about how Vietnam proves that the Senate abdicated it's war power to the presidency and how the power of the purse given to the House of Representatives is a false power. Listen to the whole thing here.
Monday, July 26, 2010
Response to an Anti-immigration Forwarded E-mail
Response:
Ha ha. Yes, it's great to know we live in a freer country by seeing what other authoritarian regimes do. It's a great reminder of how we should be, and not be. I never really understood the anti-illegal immigration thing since it's just people freely moving from one place to the next and the only thing that makes it illegal is some arbitrary law made by politicians that are bought and paid for by some special interest group. Did you know there that if we had more of an open border we would see up to 90% of the immigrants from Latin America return home (they would come for work and then leave)? Did you know that it wasn't until 1921 (the period of US history was one of the darkest with the creation of the federal reserve and income tax which led directly into the great depression) that the US even had a limit on immigration? Did you know it is really the responsibility of each individual state to have their policies on immigration (the constitution only says the federal government is only responsible for naturalization and stopping invasions, nothing about immigration)?
Now let me address the list:
1. Freedom of contract is the greatest thing that the people of this country have. We should be able to hire whomever we want at whatever terms we want. This right is slowly being taken away by people that don't love freedom.
2. Yes, the driver's license. The government should even own roads. This is a private matter that should be left to private businesses.
3. Yes, socialism sucks. It leads directly to an "us vs. them" mentality. Instead of people focusing on the root cause of the problem (socialism) they start fighting with their brothers and sisters in God that happen to have citizenship in other countries. Did you know because of socialism and the great immigration debate that a national ID is being pushed like never before? This is leading closer and closer to a police state where the government can ask for your papers. Representative Jeff Flake is calling for the SS card to have biometrics, which would lead us closer to a national ID. Is this what you really want, a police state? Oh, how soon do people forget what freedom really means.
4. See #3. Get to the root cause, get rid of socialism. How could we have nearly open borders for over 150 years? Because we didn't have the drug war, socialism, etc.
5. See #3 and 4.
6. Freedom of contract, ain't it grand?
7. Freedom of contract. Of course, we need to get rid of the federal reserve and Fannie and Freddie Mac so the contracts on truly free and not based on socialism.
8. See #3 & 4.
9. See #3 & 4.
10. If we lived in a truly free country the federal government would be so small that we wouldn't need lobbyists.
11. If we lived in a truly free country we would need so much permission to conduct business and live. Another sign of our freedoms being taken from us.
12. I think we've determined that we don't live in a constitutional free loving republic any more. Besides that. 99% of wars that are fought now days are not fought out of a search for freedom for the US but out politicians bloodlust and contractors love of money. The wars in Iraq, Pakistan, Afghanistan (the very beginning was but once we chased out the terrorists we should have left), and every other country we invade are not for our freedoms, the wars are anti-freedom.
13. If we lived in a free country I'm sure they would have more respect since they would be able to return to theirs after working here for a short period of time. If you look at immigration from the historical and from other countries points of view you would see that in every country the "us vs. them" mentality is alive and well, this is not a unique problem to the U.S.
Hope this addressed your concerns and fears. Remember if the government is telling you to fear something you know they have an agenda up their sleeves. In this case it is more power and national ID.
Original e-mail:
If you cross the North Korean border illegally you get 12 years hard
labor.
If you cross the Iranian border illegally you are detained indefinitely.
If you cross the Afghan border illegally, you get shot.
If you cross the Saudi Arabian border illegally you will be jailed.
If you cross the Chinese border illegally you may never be heard from
again.
If you cross the Venezuelan border illegally you will be branded a spy
and your fate will be sealed.
If you cross the Mexican borders illegally you will jailed for two years.
If you cross the Cuban border illegally you will be thrown into political
prison to rot.
If you cross the United States border illegally you get:
1 - A job
2 - A driver's license
3 - A Social Security card
4 - Welfare
5 - Food stamps
6 - Credit cards
7 - Subsidized rent or a loan to buy a house
8 - Free education
9 - Free health care
10 - A lobbyist in Washington
11 - Billions of dollars in public documents printed in your language
12 - Millions of servicemen and women who are willing to - and do - die
for your right to the ways and means of our constitution
13 - And the right to carry the flag of your country - the one you walked
out on - while you call America racist and protest that you don't get
enough respect.
Ha ha. Yes, it's great to know we live in a freer country by seeing what other authoritarian regimes do. It's a great reminder of how we should be, and not be. I never really understood the anti-illegal immigration thing since it's just people freely moving from one place to the next and the only thing that makes it illegal is some arbitrary law made by politicians that are bought and paid for by some special interest group. Did you know there that if we had more of an open border we would see up to 90% of the immigrants from Latin America return home (they would come for work and then leave)? Did you know that it wasn't until 1921 (the period of US history was one of the darkest with the creation of the federal reserve and income tax which led directly into the great depression) that the US even had a limit on immigration? Did you know it is really the responsibility of each individual state to have their policies on immigration (the constitution only says the federal government is only responsible for naturalization and stopping invasions, nothing about immigration)?
Now let me address the list:
1. Freedom of contract is the greatest thing that the people of this country have. We should be able to hire whomever we want at whatever terms we want. This right is slowly being taken away by people that don't love freedom.
2. Yes, the driver's license. The government should even own roads. This is a private matter that should be left to private businesses.
3. Yes, socialism sucks. It leads directly to an "us vs. them" mentality. Instead of people focusing on the root cause of the problem (socialism) they start fighting with their brothers and sisters in God that happen to have citizenship in other countries. Did you know because of socialism and the great immigration debate that a national ID is being pushed like never before? This is leading closer and closer to a police state where the government can ask for your papers. Representative Jeff Flake is calling for the SS card to have biometrics, which would lead us closer to a national ID. Is this what you really want, a police state? Oh, how soon do people forget what freedom really means.
4. See #3. Get to the root cause, get rid of socialism. How could we have nearly open borders for over 150 years? Because we didn't have the drug war, socialism, etc.
5. See #3 and 4.
6. Freedom of contract, ain't it grand?
7. Freedom of contract. Of course, we need to get rid of the federal reserve and Fannie and Freddie Mac so the contracts on truly free and not based on socialism.
8. See #3 & 4.
9. See #3 & 4.
10. If we lived in a truly free country the federal government would be so small that we wouldn't need lobbyists.
11. If we lived in a truly free country we would need so much permission to conduct business and live. Another sign of our freedoms being taken from us.
12. I think we've determined that we don't live in a constitutional free loving republic any more. Besides that. 99% of wars that are fought now days are not fought out of a search for freedom for the US but out politicians bloodlust and contractors love of money. The wars in Iraq, Pakistan, Afghanistan (the very beginning was but once we chased out the terrorists we should have left), and every other country we invade are not for our freedoms, the wars are anti-freedom.
13. If we lived in a free country I'm sure they would have more respect since they would be able to return to theirs after working here for a short period of time. If you look at immigration from the historical and from other countries points of view you would see that in every country the "us vs. them" mentality is alive and well, this is not a unique problem to the U.S.
Hope this addressed your concerns and fears. Remember if the government is telling you to fear something you know they have an agenda up their sleeves. In this case it is more power and national ID.
Original e-mail:
If you cross the North Korean border illegally you get 12 years hard
labor.
If you cross the Iranian border illegally you are detained indefinitely.
If you cross the Afghan border illegally, you get shot.
If you cross the Saudi Arabian border illegally you will be jailed.
If you cross the Chinese border illegally you may never be heard from
again.
If you cross the Venezuelan border illegally you will be branded a spy
and your fate will be sealed.
If you cross the Mexican borders illegally you will jailed for two years.
If you cross the Cuban border illegally you will be thrown into political
prison to rot.
If you cross the United States border illegally you get:
1 - A job
2 - A driver's license
3 - A Social Security card
4 - Welfare
5 - Food stamps
6 - Credit cards
7 - Subsidized rent or a loan to buy a house
8 - Free education
9 - Free health care
10 - A lobbyist in Washington
11 - Billions of dollars in public documents printed in your language
12 - Millions of servicemen and women who are willing to - and do - die
for your right to the ways and means of our constitution
13 - And the right to carry the flag of your country - the one you walked
out on - while you call America racist and protest that you don't get
enough respect.
Sunday, July 25, 2010
AZ Historical Expenditures
It's difficult to find data about how much AZ spends which makes it difficult for residents to make intelligent choices when voting. Fortunately we should start getting better information here soon according to Sunshine Review: Arizona currently has no statewide, official spending database online. However, a database will be placed online on or before January 1, 2011.
Below is a graph of how much the state spends each year with the GDP included. Thanks to US Government Spending and the Goldwater Institute via AZ Rural Times for the information. The spending estimates are based on Goldwater Institute (from AZ Rural Times) numbers.
Below is a graph of how much the state spends each year with the GDP included. Thanks to US Government Spending and the Goldwater Institute via AZ Rural Times for the information. The spending estimates are based on Goldwater Institute (from AZ Rural Times) numbers.
We Are Not Free: The War on Milk
- The Regime's War on Food
- "I drink raw milk, sold illegally on the underground black market," admits organic farmer and polymath Joel F. Salatin in the foreword to David Gumpert's book The Raw Milk Revolution: Behind America's Emerging Battle over Food Rights. "I grew up on raw milk, from our own Guernsey cows that our family hand-milked twice a day. We made yogurt, ice cream, butter and cottage cheese. All through high school in the early 1970s, I sold our homemade yogurt, butter, buttermilk, and cottage cheese at the curb market on Saturday mornings."
This was possible only because our rulers -- who plunder our earnings to subsidize production of government-approved toxins such as high fructose corn syrup, and don't hesitate to confer the "safe foods" label on Twinkies and other hydrogenated wads of incremental death -- hadn't yet decided to protect us from the scourge of unprocessed natural foods, such as raw milk.
That oversight has since been corrected. As a result, explains Salatin, home dairy producers like the family in which he grew up are forbidden to sell their products at a contemporary farmer's market.
- My thoughts: Read the whole article it's interesting. This war has been going on for some time. I know it seems ridiculous (and it is) but this is a definite sign that government has grown far to large.
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