Edwards' budget promotes ideology over real solutions

Rather than construct a budget putting Louisiana first, Democrat Gov. John Bel Edwards built the executive fiscal year 2017 document based on pursuit of liberal ideological imperatives.

His strategy of no pain, no gain – in other words, he cannot gain expansion of government without dishing out as much pain as possible to frighten people and their representatives into tax increases to fund a bigger state – calls for some roughly standstill spending for some parts of government and bigger drops in others, with the notable exception of a huge increase in health spending, most notably on Medicaid given his decision to expand it.

That alone actually boosts the budget much higher than the amended FY 2016 version currently limping along by over $1.5 billion higher to reach over $26.5 billion total. While a good chunk of that comes from increased federal funding that raises the amount of national debt each Louisianan owes, forecast at $2.2 billion more, some of it also comes from the state. A 2013 study, now understood to underestimate actual costs to the state, including administrative costs already consented to by the Edwards Administration not part of the research, forecasts net change for FY 2017 caused by Medicaid expansion to cost $41 million extra.

(Interestingly, the 2014 update that noted the underestimation has disappeared from the Department of Health and Hospitals website. DHH had scheduled a second update to appear at the beginning of the year, but that now is a month-and-a-half tardy, leading to speculation that the numbers come out distinctly unfavorably for the cause of expansion.)

Also, the higher numbers for DHH appear to include the equivalent of nearly $350 million in cuts previously sought by Edwards, cranking up its new total spending to the $2.6 billion range – an over 10 percent increase in this one department alone compared to the entire budget of last year. Counting the quarter of the cut that comprises state money, if added back into this year’s budget means roughly the state would spend the same on health care, so the entire increase would come from federal funding. Of the $2.6 billion increase in just federal funding, all but about $100 million comes in the form of Medicaid vendor payments; that is, funding related to Medicaid expansion.

(NOTE: Shortly after the original posting of this column, DHH in testimony to the Legislature clarified that the budget presented included cuts about half of the size described in the paragraph above.)

Compared to the rest of the budget and to last year, spending on health care and other social service programs under the Edwards plan rises from almost 40 percent to almost 47 percent, with proportions for the areas of public safety, education, business and infrastructure, environment and natural resources, and general government all headed lower. Keep in mind the relative increase in human resources spending does not include the $131 million in state money health care cuts that would come mainly either from reductions to the state-owned, nongovernment-managed charity hospitals or from denying services to people with disabilities.

In other words, while other parts of state government (excepting a few departments that can run largely or entirely off their own fees charged) would get cut by Edwards, he focuses on expanding Louisiana’s welfare state, quite possibly by beggaring its most vulnerable citizens. In his mind, better to expand Medicaid rolls, that unlikely would improve new enrollees’ health outcomes nor would change their use of emergency rooms as their primary care outlets because of the surge in demand, and thereby to secure their votes than to help people truly in need.

Nor does the budget do what we might expect when an organization needs downsizing. It anticipates actually increasing state employment by 140 full-time equivalent positions, with over half going to DHH as part of the roughly 250 new hires to service Medicaid expansion. (None of this includes higher education employees, as they technically go off budget as a result of a previous law.)

In summation, in order to grow the welfare state, Edwards proposes cutting most other parts of government, except that he does not cut numbers of another reliable source of votes, state employees, associated with these areas. It’s a joke budget, but Edwards never intended for it to be serious because he wants to use it as political tool to scare policy-makers into tax hikes to support the state in an expanded condition – despite that in 2015 Louisiana ranked 18^th in per capita spending among the states.

Legislators would best serve the state by throwing away this mess and putting together their own version, facilitated by wiping out all non-fee-specific statutory dedications in the current special session and then budgeting on the basis of demonstrated need of programs that would require little in the way of tax increases. They can crib a few good ideas from the Edwards product, but they must reject its use as an ideological tool in favor of utilizing it as a set of policy prescriptions designed first and foremost to improve the state.