Good Luck With That, Lame Duck

by James A. Bacon

The Joint Tax Subcommittee of the General Assembly is convening in Richmond today to discuss how to make Virginia’s tax code more “fair and equitable,” reports Michael Martz in the Richmond Times-Dispatch

When the Democrat-controlled legislature says it wants to make taxes more “fair and equitable,” it’s time to reach for your wallet. What’s “fair and equitable” to Democrats is rarely fair and equitable to you and me.

Martz informs us that unnamed “officials” say the tax code needs to fix the overreliance on income taxes, a top state income-tax bracket kicking in at $17,000, service-sector exemptions to the sales tax, and… and here’s the kicker… “the need to generate more money to pay for K-12 public education and the state’s share of Medicaid health care costs.”

Governor Glenn Youngkin is pressing for tax cuts, not tax increases. But House Finance Chair Vivian Watts, D-Fairfax, whom the RTD assures readers “prefers a long-term outlook,” accuses Youngkin of playing politics. “That’s the politics of the only state with a one-term governor,” she said. “You don’t do tax reform just for a political agenda.”

Got it. Republicans wanting spending restraint and tax cuts is a “political agenda,” while Democrats raising taxes is just being “fair and equitable.”

Let’s look at K-12 and Medicaid spending, which supposedly need more of our money.

K-12 schools. Between FY 2019 and FY 2025, the budget for direct aid to public education increased to $11.5 billion, up 42% over six years, far exceeding the 22.6% increase in the Consumer Price Index between June 2019 and June 2024.

Medicaid. Between FY 2019 and FY 2025, Virginia’s Medicaid budget increased 93% to $24.3 billion, outdistancing inflation like Summer McIntosh left her Olympic swimming rivals in the bubbles of her wake.

For General Assembly Democrats, the solution to every social ill is always more government spending. The response is never to ask, hey, we’re spending tens of billions of dollars here, is that spending accomplishing what we expected of it? It’s never, hey, could we spend it more efficiently?

As it happens, Virginia taxpayers have legitimate reason to question whether the tens of billions shoveled into K-12 and Medicaid are being spent to good effect. Academic achievement levels have plummeted since 2019. (It’s possible Standards of Learning scores recovered somewhat last year — we’ll find out more when this year’s scores are released.) Why do the hard work of fixing cell-phone abuse, classroom disruptions, and collapsing academic standards when you can just throw more money at the problem and pretend you fixed them?

Meanwhile, how’s Medicaid expansion working out? Admittedly, it’s hard to disentangle morbidity and mortality statistics from the impact of COVID-19, but do we have any evidence that Medicaid expansion has improved health outcomes for poor Virginians or made the system more efficient? We were promised that Medicaid expansion would move patients out of expensive emergency rooms and into less-expensive settings. Has that happened? Or did the brainiacs who designed Medicaid expansion neglect to factor in the increasingly acute primary-care doctor shortage?

Maybe the Democratic Party legislative leadership will astonish voters by working with Youngkin in his effort to provide tax relief for Virginians.

But then, maybe not. As Martz reports:

“I look forward to working with the General Assembly to do just that in the next legislative session,” he said.

In an interview Monday, Senate Finance Chair Louise Lucas, D-Portsmouth, called the governor “a lame duck” and said, “Tell him good luck with that.”

 

 


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6 responses to “Good Luck With That, Lame Duck”

  1. f/k/a_tmtfairfax Avatar
    f/k/a_tmtfairfax

    You make some good points but there should be data on the impact of Medicaid expansion on reducing both ER use and uncollectable medical expenses. Those were two of the big sales points. They were also used here in North Carolina to persuade the legislature to expand Medicaid eligibility. Of course, holding the public sector's feet to the fire is no longer a job of journalism.

    1. Eric the half a troll Avatar
      Eric the half a troll

      โ€œuncollectable medical expensesโ€

      โ€œStudies suggest that hospitals experienced higher reimbursements and decreased uncompensated care costs. Studies also find that other providers, including federally qualified health centers and community health centers, experienced increased revenue following expansion.

      Some studies find that these economic effects vary by provider type. For example, a few studies find that despite declines in uncompensated care costs, improvements in financial performance were stronger for (or only observed among) rural and small hospitals.โ€

      https://www.kff.org/medicaid/press-release/recent-studies-show-that-medicaid-expansion-has-improved-the-financial-performance-of-hospitals-and-other-providers-in-line-with-prior-research/#:~:text=Studies%20suggest%20that%20hospitals%20experienced,among)%20rural%20and%20small%20hospitals.

      In terms of ED use, the studies seem to be mixed. There donโ€™t appear to be many and some show reductions and some show increases. The difference seems to be based on whether hospital data is used (the former) or user survey data is usedโ€ฆ self-reporting (the latter). The former indicates that the biggest reduction was in cases that could have been handled through primary care or were non-emergency cases. With the latter, the implications seem to be that without insurance individuals were more reticent to go to the ER when care was needed (or are less reticent now) or they are simply more likely to self-report now.

    2. how_it_works Avatar
      how_it_works

      Anecdotally, the bigger ER (ab)users are Medicaid recipients.

  2. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    Oh, I dunno. I would put Del. Vivian Watts (D-Fairfax) and her knowledge of taxes up against anybody. And, to be bipartisan about it, Del. Lee Ware (R-Powhatan) also has a deep knowledge of tax policy.

  3. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    What would you cut?

  4. LarrytheG Avatar
    LarrytheG

    Medicaid has vastly improved the lives of many people who did not have insurance before including kids about 40% in Virginia are on Medicaid.

    But for those look for a 100% "fix" , (like they do for other things like poverty), the real world don't work that way. For instance, rural hospitals
    are closing so those folks not only did not have Medicaid but problematical access to hospitals. We've addressed the Medicaid, now we need to address
    the other instead of saying "despite gobs of tax, we have "Failed".

    Ditto with public schools. We have issues, no question especially with low
    income kids but if you compare the US to PISA – we score near the top if
    we just look at the scores of Asian and White kids.

    https://uploads.disquscdn.com/images/cbccf138e52014c5a0c89c9969715a064c358e4470ed3638573e593edce5b4fe.png

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