In less than 5 months, on October 1st, the Affordable Care Act’s insurance exchanges will go live online. A key provision is the expansion of Medicaid. Michigan has been offered $2 billion a year for 2 years to expand Medicaid to as many as 400,000 additional people. The Governor supports this expansion, while the legislature says “no”. In fact, the Republicans in the state instead are supporting a bill to limit Medicaid benefits to 4 years if a person can be gainfully employed. More than half of the states are on track to sit out the law’s Medicaid expansion goal, at least initially. This means that millions of low income people won’t have access to health insurance through Medicaid as the law anticipated. Is this the “Right Thing to do?” Should the states refuse to expand Medicaid? Let’s look at some issues:
GMOs: Feeding the World
Last year we experienced a drought that caused concerns about food prices and availability of key crops in the U.S.–especially corn, wheat, and soybeans. The problem was acerbated by the amount of corn mandated to be used to produce ethanol. A spokesperson for the UN pleaded with the U.S. government to have a waiver of the ethanol mandate to provide more corn at lower prices to help feed the hungry around the world. This year we have the concern of a cold and very wet spring that has significantly delayed planting in key agricultural areas in the U.S.—again raising concerns about our nation’s agricultural production and prices. However, there may be other ways to help feed the hungry around the world as well as keeping food prices at a reasonable level—Genetically Modified Foods or GMOs.
Once Again Flying the “Friendly Skies”
We heard a lot about the impact of the sequester budget cuts as the FAA furloughed traffic controllers leading to many flight delays. After a few days of major inconvenience Congress rushed to pass and President Obama signed a bill to allow the FAA to move funds in their budget to stop the furloughs and to get flight schedules back on track and in addition prevent the closure of 149 control towers at smaller airports. Under the bill, the FAA was directed to reallocate $253 million from other areas of its budget to shore up staffing and operations. The Senate voted unanimously for the bill and the House passed it 361-41. Was this bill really necessary and was the FAA acting responsibly when implementing the furloughs? Was their action the “Right Thing to do?”
The Rush to Tax Online Sales
The U.S. Senate is expected to vote as early as this week on legislation allowing states to require Internet retailers to collect sales taxes. Every time Congress has taken a serious look at proposals to boost internet sales taxes, it has rejected them. That may be the reason that pro-tax Senators are trying to rush through an online tax hike with as little consideration as possible.
Growing Agricultural Subsidies
It was a couple of months ago that Congress was considering the farm bill. We learned that a major portion of that bill was not to provide price supports or crop insurance, but instead to fund food stamps. Food stamp payments have ballooned from $30.4 billion in 2007 to almost $75 billion in 2012. The number of people receiving food stamps has increased 70% since 2008 to 47.8 million people.
The Sequester: Crime and Punishment
The second budget battle is over—the Sequester—or is it? You may remember that about 2 weeks ago the $85 billion in automatic budget cuts took effect—the so-called Sequester. The defense budget and discretionary budgets were hit. One result was the closing of White House tours. The Democrats have blamed the Republicans for refusing to replace the spending with more taxes. Despite ongoing pressure to replace the funding the Republicans have refused to budge, passing the Continuing Resolution budget to keep the government operating at the same level as last year, minus the sequester cuts. The Senate also passed the continuing resolution with the cuts and the President signed the bill.
The Budget Battles Continue
Dr. David Mielke is the Retired Dean of the College of Business at Eastern Michigan University March 27th is the next deadline for a budget compromise. As part of the fiscal cliff deal, Congress and the President pushed back the deadline to approve a budget for this year to March 27th. The House passed a [...]
Detroit: Is Bankruptcy Better?
Two big events occurred this week. The first is that the Detroit City Council appealed the governor’s decision to name a financial manager and a hearing was held on Tuesday. The governor rejected the appeal and named Washington DC bankruptcy attorney Kevyn Orr as the Emergency Financial Manager on Thursday. This brought on threats of suits, in particular by the City Council, and civil disobedience and a group of protests already. How did we get to this point?
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