Health care vies with elementary and secondary education as the largest destination for federal and state government spending. In fact, when I added it up in 2006 the federal, state and local governments were already paying for 75.0% to 80.0% of third party (insurance and public program) health care expenditures nationwide, which is to say expenditures other than co-payments and services people pay for themselves in cash (such as cosmetic surgery). Directly (Medicare, Medicaid, the VA Hospital system) or indirectly (health insurance purchased on behalf of civilian public employees and their families, the exclusion of employer funded health insurance from taxable income, other tax breaks).
Since then the population has aged, leading to more Medicare and Medicaid spending, Medicaid has been expanded to more working people, and Obamacare has added another form of indirect federal support for private health insurance. For all the discussion of “socialized medicine,” here in the U.S. the government share of third party health care expenditures is probably up to 85.0% or so, and as a percent of GDP it probably exceeds the cost of the entire health care system in developed countries.
Health care and social services, however, are provided by the government primarily through payments to private sector organizations, generally non-profits in New York City and throughout the Northeast. Therefore in this, the fifth post based on my tabulation of state and local government employment and payroll data from the 2017 Census of Governments, data on related private sector organizations from the Bureau of Labor Statistics will take center stage. And this analysis features the most shocking trend I have found so far.
New York City was long known as America’s welfare capital, with a large dependent poor population and extensive services for them. But one doesn’t hear much about that anymore. New York State has also had the highest Medicaid spending in the United States, but one doesn’t hear much about that anymore either. The data shows New York still spends more on aid to the needy than most other states, as a share of its residents’ personal income, but the gap between New York and the rest of the country closed between FY 2004 and FY 2014. As the gap closed, aid from the federal government to New York shifted to other places. Today, moreover, most of this “social” spending is on health care, and thus on older people, not on those with lower incomes. A discussion of these trends, with tables and charts, follows.
As noted in my prior post on tax revenues New York State has more of them, at both the state and local level, as a percentage of its residents’ personal income than just about anyplace else. With a particularly high local tax burden in New York City. And New York’s state and local government tax revenues increased as a percent of its residents’ personal income from FY 2004 to FY 2014.
In this post, the data shows that New York’s state and local government revenues other than taxes are also higher than the U.S. average, albeit not to the same extent. New York City’s local government charges for services, and its miscellaneous revenues, increased as a share of its residents’ from FY 2004 to FY 2014, while falling in the rest of the state. The State of New York’s federal aid revenues fell as a percent of state residents’ income during those years, and New York City’s state aid revenues fell as a share of city residents’ income as well. Demographic trends, with school enrollment falling, New York City becoming better off relative to the rest of the state, and New York State becoming better off relative to the rest of the country, may explain this.
It is once again time for a major federal election, and I am once again doing my best to avoid listening to the nonsense being spoken by the Presidential candidates. I have not watched any of the past debates, and based on what I hear don’t want to watch any future debates either. Despite our nation’s challenges, the candidates are promising to hand out more goodies, and promising the people who would benefit would never pay for them. Bernie Sanders claims that everyone can have everything, and the only people to pay would be the rich. Ignoring the fact that the Bush tax cut for the rich has already been repealed, and we are still facing a national fiscal disaster. Republicans are once again promising tax cuts for the rich, and promising that the only people who would face sacrifices would be the poor and those in younger generations. The same people Republicans have made worse off in federal policy for the past 35 years, with no acknowledgment of that fact.
Only Donald Trump speaks as if he realizes how much worse off the younger generations following in the wake of Generation Greed actually are. But he doesn’t really explain it, almost certainly doesn’t understand it, and instead panders by creating scapegoats, blaming the Chinese, Mexicans and Muslims for all of the nation’s problems instead. The way the poor, immigrants and those living in older central cities were blamed 20 years ago. And he promises that all people have to do is elect him, and the unsustainable consumer debt-driven phony economy that floated his casinos, before they went under, will somehow return. None of this has anything to do with anything any of them actually would, or could, do if elected. So rather than listen to what they say, I have once again tabulated some federal budget data to what the federal government has actually done over the past 35 years-plus. To see how the choices of the past have affected our real future.
The federal House of Representatives is not the most popular group of politicians these days, and for good reason. So it must have provided a bit of schadenfreude to write an oversight report about the doings of what ought to be an even less popular body: the New York State legislature.
I came upon this report while doing a search to see if anyone had linked on of my posts on Medicaid spending by state, and came upon this 2013 report instead. According to a bipartisan report by the Congress New York State’s Medicaid is rife with waste, fraud and mismanagement. In part because “in the last decade, at least half a dozen elected State representatives, including two State Senate Majority leaders, have been convicted of theft, bribery, or honest services fraud, related to health care.” The fraud was also bipartisan, and both Democrats and Republicans are fingered for blame. So is the federal Centers for Medicare and Medicaid Services (CMS), for its failure to crack down on New York and get the federal government’s money back.
Over the years I’ve noted that New York’s seniors pay far less in state and local taxes than young workers with the exact same income, particularly if they are retired former public employees. And that a huge and soaring share of New York City’s education, police and fire department spending goes to pensions and retiree health insurance. And that New York repeatedly enriches public employee pension benefits for those cashing in and moving out, and then cuts the pay and benefits of new hires.
And that New York has had trouble maintaining, let alone expanding, its infrastructure despite the nation’s highest debt burden. And that in every financial crisis, caused by the fact that those in the inside have deals to get more and more even when tax revenues fall (because the serfs are getting less and less), social services for children are cut first and most deeply – until later when a sensational case of a child being tortured to death hits the news and funding is restored.
Given these other priorities, how would one expect New York’s Medicaid program to operate? Let’s check New York’s Medicaid spending by age group and find out.