Donor State

Had a chance to sit through a “forum” for the Virginia Gubernatorial candidates and heard a classic argument that I’m sure many of us have heard a lot over the last year or two:

“Well, if we don’t take the money, then that means we’re a donor state…we’re paying our taxes and not getting money back. That’s not fair to Virginians.”

The arguer, of course, was the Democratic candidate for Governor, and the issue at hand, was “Medicaid Expansion.” For those of you not “in the know” on Obamacare implementation, “Medicare Expansion” means that if States raise the threshold of who is eligible for Medicaid from 100% to 125%, thus significantly increasing the Medicaid rolls in Virginia and elsewhere, then they get goodies (cash) from the Federal Government.

While the Supreme Court decision last year basically said that as long as the Federal Government calls something a tax, it can extort as much money from individual citizens as it wants — even if it means forcing them to buy a private product or service — SCOTUS also held that the Federal Government could not force States to expand Medicaid. It could bribe them, but it couldn’t force them to accept it by holding the rest of the Medicaid money hostage (which is what they wanted to do).

Everybody clear on that? Bribery is OK, extortion is not.

So States have the choice to take the bribe or not. So here we are with the age-old argument that we HAVE to take the money or we’re just throwing it away, and letting other states live high on the hog from our Donor State generosity.

Four basic responses to this argument:

  1. As far as the Medicaid money in particular, it comes with strings attached. It always does. There is ample evidence that if Virginia, and other States, were left to their own devices for Medicaid that they would do a much better job of managing the systems themselves. The money is also short term. It starts to go away after two years, and it only covers the costs of care and not the extra administration costs that go with it. But the expansion never goes away. It’s like getting your first go at an addictive drug for free.
  2. In general, since when does 30 wrongs make a right? So to follow the logic: if someone stole hundreds of billions of dollars from you and 49 of your friends, and 30 of them were taking a small portion of it back, it would be…well…”wrong” for you not to take your share back. In what world is that morally and ethically good?
  3. What’s wrong with donating? It seems that the “we don’t want to be a donor state” is so aggressively hypocritical as to be laughable. Of course, I realize that the argument is about helping the poor of our great Commonwealth, but shouldn’t we simply ask the question first whether we desperately need it? Are liberals completely shirking the States’ core responsibilities to handle its own poor? What if there was ample evidence that other States are suffering more and need more Medicaid money than Virginia does? Should we just pretend that New York, Mississippi, and New Mexico don’t desperately need more Federal resources?
  4. Now assuming that we CARE about Federal overreach and fiscal ineptitude (which is what is hidden behind this argument — it is always in desperate response to: “The Federal Government has no money, and it shouldn’t be giving us more of what it doesn’t have.” “Yeah, but if we don’t then those OTHER states will…”), then we must first ask the question of where it will end? Do we want to live in a State in which the leaders of said State are willing to take anything the Federal Government will give them whether it’s the right thing to do or not? Do the ends justify the means?

The truth is, we all know that the Federal Government is notorious for not living up to its promises, and there are no guarantees that we’ll get the money we’re promised, or that we’ll get the “flexibility” (usually in the form of waivers) which will allow the Commonwealth Government to administer its health care system for the poor the way it deems fit.

The first question should always be: if it was OUR money — State money, that is…it’s all technically our money — would we expand such a fine-tuned and well-oiled machine as Medicaid any further? The answer is obviously a big fat, “NO.” So why is it OK to take the money that is being printed by the Federal Government, but not directly taxed by the Commonwealth to Virginia citizens?

How is that noble?

And for those Republicans who are pushing for it, using basically the same aforementioned
argument as Democrats, who like to pretend that “reform first” is some super-principled stand, I have a few questions:

Why did it take Obamacare and a SCOTUS decision for you to determine that you need to fight for Medicaid reform (more waivers, etc)? And if reform is so critical, and you intend to use the Federal Government new goodies for “reforms” where is the money going to come from for the new Medicaid recipients? Is there any evidence that your supposed reforms will actually save money? No? Didn’t think so. Here’s the reality:

THE MONEY VIRGINIA WILL GET FROM THE FEDERAL GOVERNMENT WILL NOT PAY FOR MEDICAID EXPANSION. It’s that simple. The State budget increases by $200B+ a year (approximately) and we get less than that from the Federal Government….for two years, then we get even less. Our elected representative in Richmond all know good and well that without the Federal cookies they would not be expanding Medicaid…so why do they think it’s a good idea just because someone else (your “donors”) is paying for it.

Don’t buy it. Largesse is largesse. Overreach is overreach. Unconstitutionality is unconstitutionality. Rationales about someone else getting the dirty money should be dismissed for what it is: hypocritical and twisted.

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