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Guest Blog - Why the state should reject federal healthcare money

August 12, 2011 J

Money carries too many strings – Why the state should reject federal healthcare money.

By TARREN BRAGDON
As printed in the Daytona Beach News Journal.

The current debate in Washington reminds us of the stark reality — federal money is not free money. As taxpayers, we already find ourselves in a very deep hole with an overwhelming federal debt burden of more than $14 trillion — or $46,000 for every man, woman and child in America. The solution is not to dig deeper, even if the shovel is being paid for by a federal grant.

While some want to criticize Gov. Rick Scott and legislative leaders for refusing “free” federal Obamacare handouts, I want to thank them. Their refusal is good fiscal policy and good health policy. Here’s why. Florida’s current state budget is $69 billion, state and federal funds combined. The rejected Obamacare programs and associated handouts total up to $90 million over five years. That means on an annual basis, the rejected Obamacare programs equal about 0.026 percent of total state spending.

Consider that the median household income in Florida is about $46,000. For comparison, 0.026 percent of the typical family’s income is $12. If I offered you $12 to do many things that I wanted but you did not, would it be irresponsible for you to refuse? Would you be hurting your children because you passed up this $12 and the corresponding long to-do list? Would you be shortsighted in rejecting $12 today if it required permanently increasing your spending and forever changing your workload? Let’s face it; it’s all borrowed money.

That means that lawmakers have to ask themselves two things: First, does this program makes sense for Florida taxpayers and patients? Second, is this federal money today worth reducing the future take-home pay of our children and grandchildren?
Now, $90 million in rejected federal handouts may be small against the incomprehensible $14 trillion in federal debt. But think about it. If we can’t say no to the little things, we will never deal with the much-needed major reforms to the colossal entitlements. Fiscal responsibility is about watching your dimes and your dollars — the millions and the trillions.

Federal budgeting is very different from state budgeting. Florida has balanced its budget without raising taxes. As Washington, D.C., begins to deal with the fiscal reality that unsustainable deficits can’t, by definition, go on forever, Florida must become even less reliant on the federal ATM. Rejecting federal money today for new programs is the first step toward dealing with the future reality of getting less federal money tomorrow for current obligations.

Finally, these Obamacare handouts are not good health policy. While it might be fun political sport to say that the “most vulnerable are being hurt” by rejecting these grants, as another paper has self-righteously editorialized, the merits of each of program must be carefully weighed. Is the proposed Obamacare program good health policy? Will it lead to expanded health freedom for Florida’s patients and doctors, or more government restrictions further enabling federal politicians to play doctor? Sadly, the whole premise of Obamacare is that Washington knows best, bureaucrats are better than doctors at curing patients and the best solution to all health care woes is more federal spending, even if politicians need to borrow it from our grandchildren’s future paychecks.

To be sure, Florida has real health care challenges for our families, small businesses, doctors, nurses and patients. But Obamacare, and its accompanying grant handouts, is not the path to higher quality, more efficient health care and lower cost health insurance.
Florida has many examples of specific programs tailored to the unique needs and resources of the state and its people, including numerous population-specific Medicaid waiver programs and state-funded health initiatives. Each of these efforts was debated and decided on its merits, because state taxpayers were footing all or much of the bill today (and not borrowing from the future).

Federal handouts to the states, Obamacare-related or not, are no different just because the money is coming from a different pocket — your child’s. Taxpayers should demand the same scrutiny. The governor and Legislature should be praised, not pummeled, for rejecting Obamacare handouts. Their wise decisions mean more health freedom for Florida patients and doctors today and a better economic future for our children and grandchildren.

Tarren Bragdon is the president and CEO of the Foundation for Government Accountability, a new nonpartisan, nonprofit free-market think tank based in Naples. Bragdon can be reached at tbragdon@FloridaFGA.org

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