He doesn't have my vote

I just received a form email from my U.S. Representative who happens to be a Republican. The email was an attempt to explain his position on the budget reconciliation bill that passed the House earlier in the week. I checked to see how he voted on the bill and he voted to pass it.

From what I can tell, his reason for cutting funding to Medicaid was that the costs of the program have grown significantly over the past few years. His email mentioned the reforms to Medicaid put in place by the new budget with the main reforms being reducing wasteful spending and preventing fraud and abuse within the program. He then went on to attempt to justify approving last year’s tax cuts by saying tax receipts went up by 15 percent because of the cuts and the resulting increase in GDP.

I have many issues with my Rep’s take on the budget. First, if I believed that cutting budgets to federal programs would eliminate government waste I would be for it 100%. It’s an interesting concept – just give them less money and they’ll have to spend it more efficiently. Unfortunately this isn’t like cutting off the hand that feeds these programs, it’s more like cutting off their heads.

Second, tax receipts didn’t go up because of the tax cuts. Off the top of my head I can think of two other reasons for the increase (though I’m sure there are many more). One is simple – there are more people, which means more tax payers and more income earned by more people driving up the GDP. The other is due to the Alternative Minimum Tax which was originally designed to ensure the wealthy weren’t finding their ways around paying their share of the taxes. AMT is now affecting more and more middle-class tax payers because the limits haven’t been raised since it was introduced about 25(?) years ago. However there is talk of eliminating the AMT in the next round of tax cuts that should be debated within the next few months (which, speaking as an accountant, I wouldn’t mind because AMT creates two tax calculations – it’s a pain in the ass and a good reason why I’m not a tax CPA).

I know that states determine who is eligible for Medicaid but the federal government oversees the program. (Side note: Missouri has set a lovely example in that arena – per our governor it is morally correct to cut 90,000 people from the Medicaid roles because it will prevent him from being forced to raise taxes.) We should be able to find some way to reduce government waste in Washington without slashing budgets for this essential welfare program.

In my opinion, if the Republicans really wanted to reduce the costs of Medicaid they could do so by finding some way to keep the prescription drug makers from jacking up the price of prescriptions. I somehow don’t think that’s going to happen.