From the Corner:
Having promised lavish subsidies for expansive health insurance, it seems state officials in Massachusetts have finally begun to admit that their health-care reform program, passed in 2006, is unaffordable for the state’s taxpayers.The New York Times (!) suggests the plan took the path of good intentions by forcing health care coverage now and worrying about those pesky finances later:
To make it happen, Democratic lawmakers and Gov. Mitt Romney, a Republican, made an expedient choice, deferring until another day any serious effort to control the state’s runaway health costs.Next stop: price controls, which have always been successful since the dawn of time.
The day of reckoning has arrived. Threatened first by rapid early enrollment in its new subsidized insurance program and now by a withering economy, the state’s pioneering overhaul has entered a second, more challenging phase.
Thanks to new taxes and fees imposed last year, the health plan’s jittery finances have stabilized for the moment. But government and industry officials agree that the plan will not be sustainable over the next 5 to 10 years if they do not take significant steps to arrest the growth of health spending.
4 comments:
E,
How far are you from New Hampshire? And, don't you drive a distance to work anyway? Were I you, I would think about evacuating just like I did New Jersey 8 years ago.
This graphy actually implies a different cause. It appears Mass has basically ALWAYS been more expensive than the national average and the 2nd derivitive of that function hasn't changed much on this graph. There is a change in teh 1st derivitive around 2000, when Mass appears to begin to pull ahead, but that is 6 years before the health care was passed. Seems like some other entitlement aspect to it is to blame. 23 to 33% more expensive over 30 years is only a change of 0.2% per year or so...
Shhhh!!! You're ruining a perfectly good snit! Just say that liberal policy is always catastrophic, and Massachusetts goes to eleven!
http://www.nytimes.com/2009/03/19/nyregion/19leave.html?_r=1&partner=rss&emc=rss
It is perhaps the most potent argument offered by those who oppose increasing the income tax on wealthy New Yorkers: If you raise it, they will flee......
Yet there is surprisingly little evidence to support the proposition that rich New Yorkers would bolt if forced to pay higher income taxes. Though tracking the movement of wealthy taxpayers from state to state is difficult, experts on public finance and migration say they have yet to document a substantial “rich drain” in states that have raised income taxes in recent years.
“At the level we’re talking about, there’s no quantitative evidence that it affects the mobility decisions of affluent taxpayers,” said Douglas S. Massey, a demographer at Princeton University and president of the American Academy of Political and Social Science.......
But even experts who oppose such taxes on other grounds — out of fear that they will retard economic growth and innovation, or encourage lawmakers to indulge in bouts of new spending — concede that there is not much evidence that raising taxes on the wealthy would drive out a significant number.
“I kind of clench my teeth every time Paterson says people will leave,” said Edmund J. McMahon, director of the Empire Center for New York State Policy, a conservative-leaning research group that has advocated for sharp cuts in spending to balance New York’s budget.
“It is the selling point. It’s also a dumb point,” Mr. McMahon added. “Nobody says your wealthy enclaves will shrink dramatically. What they say is that your economy will suffer.”.......
--- a study by Professor Massey and two colleagues, published in September, estimated that the previous tax increase cost New Jersey only 50 to 350 existing “half-millionaire” households — a relatively small number against the total of 44,000 such households in the state.
While those departures cost the state about $38 million a year in revenue, the study estimates, the higher taxes levied on those who stayed have brought in an average of $895 million a year. Also in 2004, California voters approved a 1 percent income tax surcharge on personal income over $1 million, and Silicon Valley and Beverly Hills appear to remain well populated with the wealthy. From 2004 to 2007, according to a study by the California Budget Project, a left-leaning research organization, the number of millionaire taxpayers rose by close to 50 percent, well outpacing the 8.6 percent growth in the total number of those paying personal income tax.
“It is one of the oft-cited urban legends in California politics — that the rich are leaving California because of higher taxes,” said Jean M. Ross, the project’s executive director......
While [New York City] did lose residents at all income levels in 2005, according to a 2007 study of population data published by the city comptroller, William C. Thompson Jr., households with incomes of $250,000 and higher were the least likely to leave.
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