"Real liberty is neither found in despotism or the extremes of democracy, but in moderate governments.
Alexander Hamilton

Sunday, June 14, 2015

"The distorted priorities of politics "


The state budget passed by the Senate and now headed for a reconciliation conference with the House was passed along partisan lines, 14-10. The budget, which by law needs to be balanced, has to be passed and signed into law by Gov. Maggie Hassan by June 30. The state’s fiscal year begins July 1 but the budget itself is a biennial plan that covers the period from July 1, 2015 through June 30, 2017. What bothers us about the proposed budget – and should bother you – is its odd priorities, which seem to work against one another. On one hand the Senate has taken the position that the state’s business taxes are too high and are stalling economic growth in the state. On the other it has refused to extend Medicaid expansion, which so far is proving that it can reduce medical expenses not only for individuals but the state as well. The business tax cuts proposed are modest to begin with, reportedly costing $14 million in revenue during the biennium but, as the planned cuts are fully implemented (reducing the Business Profits Tax down from 8.5 percent to 7.9 percent and the Business Enterprise Tax from 0.75 percent to 0.675 percent by 2019), the tab will be $80 million in lost revenue. Proponents argue that the cuts will more than pay for themselves as businesses grow and new businesses are created or move into the state. Opponents point to Kansas, which went much farther than what is proposed here in 2012 in cutting business taxes, and is now facing a $400 million budget deficit due to revenue shortfalls. Opponents also argue that business taxes are low on the list of business concerns in our state: high energy costs, infrastructure limitations (not only roads but internet access and speed), and finding good employees top the list for most businesses. We also note that the Tax Foundation has consistently listed New Hampshire in the top 10 of business-friendly states (currently ranked eighth) due to our lack of income and broadbased sale taxes. In the meantime the Senate, which did not consider Kansas’ problems a reason to hesitate to cut business taxes, declined to extend the expansion of Medicaid, which just went into effect last year. As a result, on Dec. 31, 2016 the 34,000 residents who signed up for Medicaid will lose that coverage. The sunset date was set by the Senate when it reluctantly passed the original bill: it is the date that federal funding of the expansion falls from 100 percent to 90 percent. Opponents of expansion, including our own Sen. Jeb Bradley, are concerned that continuing the expansion beyond the point where the federal government pays 100 percent would add to the costs of Medicaid, which grew as percentage of the state budget from 24 percent to 27 percent between 2012 and 2014. This is a puzzling position, particularly on the part of Bradley, who, more than any representative in Concord, has devoted more time and energy to trying to rein in the cost of Medicaid. The increase in Medicaid costs between 2012 and 2014 occurred despite his successful campaign to convert Medicaid to a managed-care plan. Bradley freely admits that the expansion, which is cutting the cost of uncompensated care to hospitals and providing preventative services avoid major medical expenses, is a “so far, so good” program, yet he voted against it, along with the 13 other Republican senators. It seems to us that not doing anything – letting the expansion sunset next year – will simply mean a return to higher and higher costs, resuming the growth rate between 2012 and 2014. At the same time the cuts to business taxes will most likely drop the full $80 million projected, forcing further cuts to infrastructure and education spending, even as Medicaid costs once more rise. We think the best way to attack not only the cost of Medicaid and other Health and Human Services expenses is to turn away from boilerplate partisan solutions like tax cuts and focus instead on the real problems that businesses in the state say are inhibiting their growth. New Hampshire’s greatest appeal to businesses, tourists and we who live here is its quality of life, and that in turn depends to investing in our towns, our schools and our roads and energy sources. Who wants to live some place that feels it is not worthy of its own investment, let alone yours?


Joe Cormier/jcormier2@myfairpoint.net said...

Why isn't the cost of "medical care" ... as opposed to "medical insurance" ... the debate? Why does it cost so much to get healthy? It is because a JD degree, as well as an MD degree is needed?

Why can't our tax dollars be paying for medical school grants, to the qualified, and willing to practice for a certain number of years for the "public good", and then go into private practice? With all the gov't mandates, why not "conscript" potential doctors, and draft them into service for the country (you can salute here)!

Business ... why isn't "business" growing in NH.
Got a flash for ya ... JOBS and business is an issue across the USA.
Let's see ... that means MoBo, NH, USA.

Rumor has it, in the financial sectors, that there are trillions of dollars sitting offshore! Why? How can that be, when we don't have jobs (I'm retired so ... I'm must saying).

Maybe politics is the issue ... hindrance not stimulant.

Maybe we can look to Liberal, Kansas and the Land of Oz. Another fairy tale, you know ... like politicians fixing things





Long term care (or go bankrupt to get Medicaid)

Medical schools

Come into my parlor said the spider to the fly said...

Let's not forget these words of wisdom.


Free money is NOT free, it comes with strings.

Grumpy said...

At some point the state (along with our towns and yes, even the federal tax and spenders) must learn how to live within their means. There seems to be an attitude that if three fools want something they think "the government needs to pay for it". And there seems also to be an attitude of we'll find or create a new tax to pay for it all. Community Ctr? "it will only add 50 cents to your taxes". Taxes and fees are raging more and more.
Tax his land, tax his wage, tax the bed in which he lays... Tax his tractor, tax his mule, teach him taxes are the rule... Tax his chew, tax his smoke, teach him taxes are no joke, tax his car, tax his gas, tax the roads he must pass... If he hollers tax him more, tax him 'til he's good and sore, tax his coffin, tax his grave, tax the sod in which he lays.
And when they get the hint like Maggie just did, they will cut the services the public feels the most. They will never get rid of the do nothing programs that are failing but keeps the good old buddy bureaucrat administrator employed.