Last week’s U.S. Supreme Court ruling on Obamacare was a disaster for constitutional government and individual liberties.
By upholding this law, fatally flawed by government intervention, the Supreme Court set us on a course toward a more expansive federal government and more expensive health care. But Texas does not have to follow the feds’ folly.
First, Chief Justice John Roberts’ ruling, which upheld the individual mandate under the taxing power that the Constitution allows for the federal government, represents an unprecedented intrusion into the lives of Americans and Texans.
Considering our Founding Fathers revolted over a nominal tax on tea, one finds it hard to fathom that they envisioned a federal government that could have taxed its citizens for not buying the tea in the first place. But that is exactly what has been allowed here.
The ultimate question is, “Where will this intrusion end?” What began in Wickard v. Fillburn as a simple case of a farmer growing wheat for his family has become a slow, inexorable erosion of individual liberties over the course of seven decades.
And now the federal government has the ability to tax us into compliance with whatever it believes to be beneficial. The intrusion of the federal government into the lives of ordinary Americans has crossed a new threshold, and it continues to move forward at full speed.
To add insult to injury, the law is not even expected to work. The Medicare Actuary projects that the law will add $478 billion in health spending from 2014 to 2021.
Despite the promises made by the law’s supporters, the nonpartisan Congressional Budget Office estimates that the law’s insurance mandates will raise the cost of insurance by $2,100 per family. And it does this while gutting Medicare by $500 billion. These rising health care costs are the engine driving our federal and state budgets toward insolvency.
However, there is a thin silver lining here. The Supreme Court ruled that the Medicaid expansion was unduly coercive of state governments.
If Texas said no to the Medicaid expansion before the ruling, we would have risked losing all of our Medicaid funding, but now we only lose the amount in the expansion.
Even before this expansion, our Medicaid program was unsustainable. From 2001 to 2011, Medicaid grew from 14 percent to 20.2 percent of the state’s budget. Under Obamacare, Medicaid is projected to grow to 28.7 percent the state’s budget. This growth in spending threatens the rest of the state’s budget.
Of course, proponents of the law will argue it’s a great deal for the state. The feds pay 100 percent of the costs of the expansion until 2019. After 2019, they will cover 90 percent of the costs in perpetuity. This sounds like an offer we can’t refuse, but there are two problems here.
First, with Medicaid costs rising at an unsustainable pace, the state can’t afford even the 10 percent long-term. Second, anyone taking an honest look at Washington’s financial health knows they can’t afford the 90 percent.
Just two months ago Texas Deputy Executive Commissioner Billy Millwee informed state leaders that Medicaid spending is rising faster than tax revenue.
Even in a state as economically successful as Texas, if you spend more money than you take in, you will eventually go bankrupt. This is a fact that has apparently been lost on our federal counterparts. If we can’t afford Medicaid as it is, then why should we believe we can afford more of it?
The federal government can’t afford this plan, either. Our national debt is greater than $15 trillion, and our annual budget deficit is greater than $1 trillion.
Our nation’s entitlement programs are headed for insolvency if they are not reformed quickly, and Medicaid is among those in need of reform.
The federal government simply cannot afford the additional $100 billion or more a year it is expected to need for this expansion.
It is not reasonable to expect them to keep funding 90 percent with the precarious status of the federal budget, and it is reasonable to expect that they will push costs back to the states.
Ultimately, this plan is nothing more than a bait and switch that will leave Texas taxpayers on the hook for Washington’s mistakes.
To be clear, no one is advocating leaving individuals who cannot get care out in the cold. But the state cannot continue to pour money into a broken program whose long term costs are rising out of control.
Medicaid needs structural reforms that bend the long-term cost curve down and gain control over health care spending. Until that happens Texas would be wise to reject any ill-advised expansion that puts our future at risk.
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