Big Tax and Spend States Take Advantage of the Bail-Out

As a consequence of the $700 Billion bail-out bill, some states are requesting parity with banks and other institutions by seeking loans from the Federal Government. Massachusetts recently received 10.6 billion dollars to shore up its Universal Health Care Plan - 2.1 billion more than intended three years ago when the State negotiated with the Federal Government for a waiver in the income requirements for Medicaid. Now the State is asking for a loan under the guidelines of the new Federal Bail Out program . Massachusetts budget shortfall can be attributed to its Universal Health Care Plan, and insufficient tax revenues to cover the ever increasing costs of entitlement programs revered in the Bay State.

Massachusetts residents and business enjoy one of the highest tax rates in the nation, so why the discrepancy? Massachusetts has the 4th highest corporate taxes in the country – the result: businesses have gone over the border to neighboring Rhode Island; where corporate taxes were lowered. The income tax, sales tax and other fees levied on individual Massachusetts residents has resulted in an exodus of residents to neighboring states as well - and a severe decline in projected population growth has affected the state’s budget as well as a loss in House Seats.

The Lesson in all of this excessive taxation is as follows: Tax businesses and citizens at the highest rate possible and they will leave, reducing income needed to cover budgets that are stuffed with giveaway and pork programs. (Granted some of these giveaways are essential to the well-being of state residents.) The lesson of this tax bailout is that states that have exceeded their budgets, like California and Massachusetts, expect to take advantage of the Bail Out that was so important to Nancy Pelosi and company. Although a bi-partisan bill, supported by both President Bush, Harry Reid, Nancy Pelosi and both presidential candidates, it did not settle well with constituents and or certain members of Congress who saw the writing on the wall and Wall Street, the intended recipient - lost points after the bill was singed into law.

Feeding the Beast – Massachusetts Health Care Reform Act

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Communities across Massachusetts are expressing disappointment with budget cuts made by Governor Deval Patrick this past week. Give the Deval his due, the budget must make room for the States mandated health care plan, a program that is already running 200 plus million over budget with no end in sight – and a legislature fully prepared to include more state mandates that will insure the trend continues. The FY2009 budget is not yet set in stone, as the legislature still may override the governors veto on certain programs.

Those eligible to receive Commonwealth Care include families of 4 earning less than $63,612 annually (or poverty level in Massachusetts). Those not fortunate enough to qualify under the state program are paying family premiums upward to $1,200 per month (insurance premiums have risen to compensate for those numerous federal and state mandated health benefits). Woe to those that fall through the cracks (unable to qualify for Commonwealth Care and unable to afford private insurance) - they are assessed a fee, this fee is then charged to ones Massachusetts Income Tax. Mandated insurance can be added to reasons why the state is losing population.

The Governor has had to make tough decisions regarding this budget, and although one may disagree with types of programs left untouched. (The program to eliminate Racial Imbalance – METCO – FYI 09 Budget, granted $21,615,313 – may be viewed as critical by some in State Government but one must ask, in this Democrat run state, how racially imbalanced can Massachusetts possibly be? The governor did make cuts to programs that in today’s economy appear essential ($545,195 requested for the “Open Pantry” a Springfield MA community outreach program that feeds those who cannot afford to feed themselves (rising fuel and food costs) has been cut from the budget) outlining just how difficult the role of governing with a house, senate and executive branch of like political ideology may be, especially when the House Speaker rules with an iron fist and individual in the executive branch lacks – experience. (There will be no hope for a stable economy should the Massachusetts political model be exported nationwide.)

The Massachusetts Model of Health care, bearing no resemblance to the program that Hillary Clinton envisions (one which, when viewed objectively, is sound), should be a warning bell to those states who are considering implementing a similar plan. Suggestion, compare the current runaway Mass Health Care Reform Act to the proposals made by Sen. Hillary Clinton (National Health Care Reform) prior to making a commitment. (Sen. Clinton’s views on National Health Insurance can be found in the archives of this blog – interview with Bill O’Reilly)