Proposition 3


Let’s talk about Proposition 3, the Medicaid expansion bill. This would be funded by a 0.15% increase in the sales tax, working out to a little more than 50 million dollars per year.

There are things to like about Prop 3. The concept behind medicaid expansion is that 90% of the cost is paid by money from the federal government, and, generally speaking, moving money from the federal level to the state level is a good thing. The idea that it would provide needed medical care to additional people sounds like a good thing. We all agree that medical care is far too unaffordable for too many people, and we want to fix that. Everybody wants anyone who needs medical care to be able to get it.

The question, though, is whether or not this is the best way to accomplish that, or for that matter even a good way, and I have to say I don’t believe it is. There’s an abbreviation you’ll see Libertarians use from time to time: TANSTAAFL. It’s from a Robert Heinlein novel, The Moon is a Harsh Mistress, and it stands for There’s No Such Thing As A Free Lunch. It refers to the idea that far too often things that appear to be free come with strings attached.

Right now two items dominate the Utah budget, education at around 26% and Medicaid at 19%. Proposition 3 would expand the categories of individuals who would qualify for Medicaid, significantly spiking that percentage and equally importantly limiting the legislature’s ability to allocate funds elsewhere where they may be needed. It contains language that would limit the legislature’s future ability to change the factors that determine eligibility.

What that means is that, if medical expenses grow in an unanticipated manner – and none of us could have anticipated the way they’ve grown even over the past decade – the legislature could have no choice but to cut funding from other departments, including schools and roads, in order to pay the costs of Medicaid. Because Utah’s budget is required to be balanced, it will inevitably mean more future tax increases beyond the small one included in this proposition.

And one other factor comes into play. The arrangement here is that the federal government supplies $9 of every $10, and Utah provides the other $1. What if Congress decides to send more money than it currently does? Then Utah is forced to raise its own contribution.

We know Congress swings back and forth between which party dominates: we can’t even say for certain what the balance will be this coming January, let alone 10 years from now. I think it’s a dangerous gamble to put Utah’s annual budget process at the mercy of Washington DC.

That’s why I will be voting no on Proposition 3. You may or may not agree, but I hope I’ve given you at least some food for thought.