Monday, December 14, 2015

Monday, December 14, 2015

Closing in on Medicaid expansion; The shrinking middle class; Good lists vs. bad lists; and Ending the EITC ‘marriage penalty’


Closing in on Medicaid expansion

With Gov. Bobby Jindal taking a farewell tour around Louisiana as he prepares to leave office in January, the legislators who are left to clean up the state’s fiscal mess are turning their attention to expanding the state’s Medicaid program. Jindal had steadfastly refused to accept federal dollars available for covering low-income adults. But as the AP’s Melinda Deslatte reports, Gov.-elect John Bel Edwards’ support for expansion has legislators taking a fresh look at the issue:


Many lawmakers hadn’t bothered to learn the ins and outs of how an expansion would work before they voted down the legislation. Now, they’re getting a crash course. After a Senate Finance Committee briefing last week, senators instructed the Department of Health and Hospitals to draw up a Medicaid expansion proposal by Jan. 1. And the request was coming not just from the Democrats. “I’d like to see how much it costs. I don’t think we’ve ever had a really good estimate of what it costs,” Finance Committee Chairman Jack Donahue, R-Mandeville, said after the hearing. “It could be a benefit to Louisiana.”


Republican Sen. Bret Allain, of Franklin, asked the Legislature’s financial analysts to study the different models used by other states to determine how they could apply to Louisiana. If Louisiana decides to expand its Medicaid program as allowed under President Barack Obama’s signature health overhaul, as many as 500,000 more people would be eligible for the government-funded health insurance, according to data presented to the Senate committee.


The shrinking middle class

Last week’s news that middle-income earners no longer make up the majority of American households got a reaction from Times-Picayune columnist J.R. Ball. He notes that things are even worse in Louisiana, where the 20 percent poverty rate is among the nation’s highest and only 42 percent of households qualify as middle class.


This is also something Gov. John Bel Edwards and state legislators should keep in mind when looking for solutions to Louisiana’s dismal state budget. They can make all the “no new tax” promises they want, but the only options when fixing a budget short on cash is to either cut spending or find more money. Fine, tell us the solution rests in the elimination of tax credits and exemptions, but add up all the ones that have even a remote chance of passing and the budget is still way out of whack, especially if the goal is long-term solutions. And don’t count on oil and gas revenue — the lifeblood of Louisiana’s budget —coming to the rescue, given the price per barrel of oil has slipped below $40.


If history is any indication, when the conversation drifts to taxes, usually it’s the middle class hit hardest. Business and industry will have an armada of lobbyists defending every penny of corporate welfare it receives and will make the case it can’t afford another cent in taxes. So if new revenue is needed, guess the most likely target?


Good lists vs. bad lists

The Advocate’s Mark Ballard, like anyone who’s spent time around Louisiana’s current governor, knows that Bobby Jindal loves lists. At least the ones that reflect positively on his administration. But Ballard notes that even though Louisiana fares well on some subjective “business climate” rankings, we still rank near the bottom on the indicators that count the most, such as poverty and health.  


But pseudo-scientific polls plug objective statistics into their formulas. And one factor always drags down Louisiana’s score: the state’s nearly nation-leading poverty rate. One in five residents falls under the federal government’s official rate, but about half the residents are hovering near that line. The typical Louisiana household brings in an average $44,164 per year. That’s the eighth lowest in the country and compares poorly with the nation’s $51,939 median household income. … At the start of his administration, Jindal embraced the conservative bromide that more jobs and better education, alone, would lift the poor. But poverty rates have increased under Jindal’s watch. The “get a job, get a life” plan sounds good and may well work one day, but Louisiana’s position at the bottom of a bunch of these lists shows little has changed.


Ending the EITC ‘marriage penalty’

As Congress rushes to confect a year-end compromise on tax policy, The Washington Post editorial board looks at one of the few policy areas where liberals and conservatives might find common ground: The Earned Income Tax Credit. Building on recent recommendations by the Brookings Institution and American Enterprise Institute, the Post says Congress should increase the EITC for childless workers and extend a provision in current law that allows married, two-income couples to receive the full EITC.


Come to think of it, EITC expansion is one of the few things about which Republicans and Democrats sometimes do agree. Both President Obama and House Speaker Paul D. Ryan (R-Wis.) have supported versions of it in the past. And, as it happens, the EITC is at issue in Congress’s current year-end negotiations over extending various temporary tax breaks, mostly for business and special interests. … We can’t think of any policy more consistent with the spirit of the AEI/Brookings report than this protection against an EITC “marriage penalty.” It could be one of the few bright spots in a bill that otherwise shapes up as a monument to politics as usual.


Number of the Day

42 percent – Share of Louisiana households that are considered middle-class by the Pew Research Center (Source: