Medicaid Block Grants

The Trump administration is planning to set up procedures for allowing States to convert the Medicaid funding they receive from the Federal government from matching funds to block grants.

The new procedures would represent a large change.

Medicaid funding is open-ended, meaning the federal government matches state spending. If that funding is converted to a block grant, a state could get a limited, lump sum of federal money instead.

There are two key differences here. One is that the funding would go from strings-attached matches to no-strings block grants. The other is that the decision to go to block grants would be each requesting State’s, resulting in less Federal control over that State’s internal affairs.

Universal Basic Income

It’s creeping ever more deeply into the Progressive-Democratic Party’s psyche and ideology. It’s an idea that was first dreamed up in the ’70s, and it remains an idea that can only fail were it to be implemented.

Giving everyone a basic income won’t improve anyone’s income; it’ll only incentivize employers to pay a wage diminished by the amount of the guaranteed government payment.  But the failure runs much deeper than that.

Such a scheme is inflationary: the outcome can only be a spike in inflation followed by price stabilization at a higher price level.

European Keynesianism

Europe’s investors are hoping for some Keynesian stimulus—or what passes for Keynesian stimulus—in the coming year to continue 2019 boomlet in stocks.

Getting stocks to propel higher however, may require faster growth. Some see that slug of faster economic activity coming from a possible government ramp up in stimulus spending.
“Whichever way you slice it, there is a much greater burden on governments to do more” said Anik Sen, Global Head of Equities at PineBridge Investments.

Great Britain’s Socialist Party

Nominally, it’s the Labour Party, but its MFWIC, Jeremy Corbyn is moving to make it overtly socialist.  He’s jumped onto the Free Stuff, Higher Taxes, and Pay Raises for Government bandwagon with both feet. Sure, these things have been staples of Labour for generations, but Corbyn really intends to outdo his forebears. Corbyn intends to nationalize enormous sectors of the British economy:

  • fixed line network of telecoms provider BT [British Telecom] to provide free broadband
  • rail
  • water
  • mail delivery services.

Having taken over the economy, Corbyn then would raise taxes even higher than they are already, reorganize what would remain of private enterprises, and increase spending:

An Economic Misunderstanding

The Congressional Budget Office said Wednesday that the two-year budget deal will increase our annual deficits significantly over the next ten years.  That puts a premium on Republicans regaining the majority in the House, retaining/expanding its majority in the Senate, and retaining the White House, with an emphasis on Conservative Republicans in that mix.  That’s for another post, though.

What…triggered…me was this bit at the end of the article CBO Director Phillip Swagel:

The nation’s fiscal outlook is challenging. To put it on a sustainable course, lawmakers will have to make significant changes to tax and spending policies—making revenues larger than they would be under current law, reducing spending below projected accounts, or adopting some combination of those approaches.

Campaign Spending vs Intake

Progressive-Democratic Party Presidential candidates are spending more money than they’re collecting through campaign donations.

Eleven of the Democratic presidential campaigns, including former Texas Congressman Beto O’Rourke, New Jersey Senator Cory Booker and former Colorado Governor John Hickenlooper spent more than they raised in the most recent three months.

How quickly the 24 Democratic contenders are burning through cash seven months ahead of the first primary caucuses and elections is as important as how much they are bringing in.

Of course, they have to in order to stay/get competitive in the race.

Economic Misunderstanding

The broad Keynesian misunderstanding regarding government spending is continuing.

Spending by consumers and businesses are the most important drivers of economic growth, but in recent years, government outlays have played a bigger role in supporting the economy.
The level of the federal component of GDP in the first quarter of 2019 was $78 billion, or 0.4%, lower than what forecasters expected it would be following the February 2018 budget deal….
The government is spending much less on disaster relief than it did in fiscal 2017, and a partial shutdown temporarily stalled outlays in January. Those factors explain about one-third of the missing stimulus, Mr [Ernie, an Evercore ISI economist] Tedeschi said.

The Cost of a Celebration

President Donald Trump held America’s Independence Day celebration with a Salute to America, centered at the Lincoln Memorial.

Together, we are part of one of the greatest stories ever told—the story of America.  Today, just as it did 243 years ago, the future of American Freedom rests on the shoulders of men and women willing to defend it.

Just to pick out a couple of things: The Wall Street Journal cited “Democrats” complaining about

the use of military hardware for a traditionally nonpartisan celebration.

Because defending our nation’s existence and celebrating those who do that defense isn’t nonpartisan.  Sure.

Tax and Spent Progressive-Democrats

In spades.  They’re in a race to bankrupt us.  Or, as The Wall Street Journal put it,

The Democratic presidential primary is turning into a bidding war.

Senator and Progressive-Democratic Party Presidential candidate Elizabeth Warren (D, MA) has broken out of the starting gate with an offer of forgiveness of $640 billion in student debt for our votes.

Senator and Progressive-Democratic Party Presidential candidate Bernie Sanders (I, VT), though, has caught her at the first turn: he’s offering $1.6 trillion (yes, that’s with a ‘t’) in canceled student debt plus tuition-free “public” colleges.

The Land of the Free

Free Stuff, that is.  Here’s the latest from Senator and Progressive-Democratic Party Presidential candidate Elizabeth Warren (D, MA).  In addition to all the other free stuff she wants us to have, now she wants free child care.

[F]amilies living below the 200% poverty threshold (roughly $51,500 for a family of four) would get free access to child care and early education….

With this, Warren wants folks who, by her own definition, are not poverty-ridden to get free child care.  Notice, too, she’s lumped in with child care her “early education”—that’s her tacit admission that our public schools no longer provide actual education; they’re just child care facilities.