A Global Wealth Tax Is a Lousy Idea


(Photo: Getty Images)

(Photo: Getty Images)

Thomas Piketty’s best-selling treatise “Capital in the 21st Century” elates liberals because it argues on behalf of soaking the rich with excessive taxation. Mr. Piketty’s preferred mechanism for equalizing incomes is to institute a global tax on wealth.

But there’s a drawback to Mr. Piketty’s wealth tax: It would tank the world’s economy. It would reduce economic inequality by making us all equally poor.

But let’s assume for the moment that Congress decided to pass a wealth tax anyway. Here we encounter another problem. Administering this tax would be extremely difficult. And recent administrative failures suggest that our government isn’t up to handling a challenge of such magnitude.

Mr. Piketty’s questionable central argument (which has been rebutted by well-known economists including Kevin Hassett of the American Enterprise Institute and Harvard’s Lawrence Summers) is that economic inequality is fated to explode in the coming years because income from wealth for the already wealthy will increase faster than will income from work for the rest. In the French economist’s mind, the wealth tax is necessary to prevent that occurrence.

The closest thing we have to a wealth tax is the estate tax, which applies to few people and only at death.

His wealth tax would be an annual progressive tax on all wealth. Assuming a broad wealth tax could pass constitutional muster (also highly questionable), such a tax would require the government to compile a detailed list of all the assets of every person in the country.

Such assets would include cash, stocks, bonds, life insurance policies, retirement accounts, housing, vehicles, appliances, furnishings, jewelry and lots of other stuff people own.

Financial wealth could be accounted for relatively easily, since financial companies accurately keep those records. But a detailed account of everything else we own would require a massive amount of work, possibly including an intrusive home inspection by government officials to inventory our valuables.

The government would then have to assign a value to those possessions and update the list regularly because people buy and sell things all the time and items change in value.

The process would look much like the process municipal governments go through yearly to administer their real estate property taxes. Those assessments are always highly contentious. Wealth-taxing feds would have to do the same thing — for all types of property, not just real estate.

Given its recent woes implementing Obamacare, there is no reason to believe government could pull off this much more daunting task competently.

Even if it could compile the list, privacy would be a major concern. The IRS would likely administer the tax. The agency’s recent scandal involving political targeting of conservative groups raises tremendous concern over its trustworthiness in handling sensitive information.

The ostensible purpose of a wealth tax would be to reduce inequality by both lowering the incomes the rich receive from their wealth, and redistributing that revenue to those with lower incomes. But the government is having significant problems administering existing redistribution programs.

A report just this month from the Treasury Department’s inspector general found that a quarter of the payments from the earned income tax credit, a program that rightly enjoys strong bipartisan support, were wrongly issued. These erroneous payments cost taxpayers upwards of $15 billion in 2013.

Another report indicates that a million Obamacare enrollees have received inappropriate subsidies in just the first few months of operation. Many of the erroneous subsidies are overpayments.

Similar problems would likely plague a new redistribution program using the money from the wealth tax, costing taxpayers additional billions in incorrect payments.

Even if it could work efficiently, tearing down those at the top and distributing the spoils to the rest with a wealth tax will ultimately cause the economy to crumble, leaving all of us worse off.

Far better to lift up those at the bottom through stronger economic growth. A growing economy helps everyone — and doesn’t impose an administrative nightmare to get the job done.

Originally appeared in The Washington Times

The post A Global Wealth Tax Is a Lousy Idea appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.

How Smarter Policies Can Transform the States, Renew the Nation


Kansas Gov. Sam Brownback  (Photo: Scott Olson/Getty Images)

‘Change direction’: Kansas Gov. Sam Brownback (Photo: Scott Olson/Getty Images)

His state doesn’t have pass-through taxes, so owners of small businesses don’t pay taxes on profits as part of their individual tax returns.

In little over three years, his state cut income, sales and property taxes; consolidated agencies; and ended legally mandated teacher tenure.

Gov. Sam Brownback’s state, Kansas, also added 53,000 jobs from January 2011, when he assumed office, up to last month, according to the Kansas Department of Labor.

“There is no state more transformed than Kansas,” Brownback said in a speech today at The Heritage Foundation. “You change America by changing states. Washington is too big to change. We desperately need this.”

Brownback, a Republican who previously served in the U.S. Senate and House of Representatives, offered a blueprint for how state prosperity can lead to a healthier nation.

The governor’s opening remarks illustrated the premise of the discussion that followed at the Heritage event subtitled “How Taxes, Energy and Worker Freedom Change Everything.”

Stephen Moore, Heritage’s chief economist, hosted the discussion with his three co-authors of the book “An Inquiry into the Nature and Causes of the Wealth of States,” which also provided the event’s main title.

In the book, Moore and fellow economists Arthur B. Laffer, Rex A. Sinquefield, and Travis H. Brown use data to argue that low-tax states across the country outperform their neighbors and help create prosperity for all.

Brownback, and Kansas, provide evidence for that premise. “This is a great success story about how using pro-growth tax cuts can revive a state,” Moore said.

Kansas suffered a deficit in 2010, the year before Brownback became governor.

Half the counties had lost 10 percent or more of population in the previous decade.

If he didn’t change policies, Brownback’s team projected, Kansas would see a $500 million deficit in 2011 – and the rural heart of the state, where he grew up, could be lost.

Brownback said:

I’ve told people many times, you don’t hire a new coach or CEO to manage a slow decline. You hire them to change the direction of things.  I am from Parker, Kansas. I want to see these places survive.

As part of a survival plan, Brownback last year collapsed three income tax brackets into two and reduced the top rate to 4.8 percent from 6.45 percent.

The governor says he has increased the state contribution to K-12 education each year and hired a task force that spearheaded more funding for technical education and efforts to raise low-level reading skills.

Kansas boasts an unemployment rate of 4.8 percent. Brownback said:

What we are trying to do is get people skills, so they can get jobs that are not minimum wage. I am proposing to the country how to renew the nation. You will see interesting models from states about how to make the nation American again.

For their book, Moore and his co-writers studied states that they say don’t provide a good model for a prosperous country: those that have adopted progressive individual income taxes in the past 53 years.

Looking at data for the three years before each of those 11 states acted — they include West Virginia, Connecticut, Maine, Michigan, and Illinois — the authors concluded that each state suffered in the years that followed, as told by several metrics.

Laffer, a member of President Reagan’s Economic Policy Advisory Board, said each of the 11 states incurred declining value in population, tax revenue, and output in the years after imposing a progressive income tax.

States that took another route fare better.

Moore said that from 1990 to 2010, Texas and Florida — two large states that don’t levy an individual income tax — added three jobs for every one that California and New York added.

And although sunny weather certainly attracts residents to Texas and Florida, Moore said, a more measurable variable plays a role too:

California will always have a natural advantage over a state like Minnesota. You can’t control the weather.  What policy makers can control is another factor; northern states have to make tax systems more competitive.

The post How Smarter Policies Can Transform the States, Renew the Nation appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.

Conservative Lawmakers Urge Vote in House on Obamacare Alternative


Rep. Steve Scalise (R-La.) (Photo: Bill Clark/CQ Roll Call)

Rep. Steve Scalise, R-La. (Photo: Bill Clark/CQ Roll Call)

The House Republican leadership promised a vote this year on an alternative to the health law popularly known as Obamacare, and now some lawmakers have upped the pressure to see that vote happen.

Writing to colleagues ahead of a meeting today of  the conservative Republican Study Committee, the trio — Reps. Steve Scalise, R-La., Vicky Hartzler, R-Mo., and Phil Roe, R-Tenn. — requested support and a push for a vote on the RSC’s health reform plan (H.R. 3121). Scalise is RSC’s current chairman.

The bill, with 130 co-sponsors, would repeal the Affordable Care Act, also known as Obamacare, as well as the current tax breaks for employer-sponsored health insurance plans. Instead, all individuals and families could get tax relief to buy health plans.

The RSC bill also would expand access to health savings accounts, increase federal support for state high-risk pools, and allow Americans to buy insurance across state lines. Scalise, Hartzler, and Roe wrote:

Democrats continue to mislead the American people when they say that Republicans have no alternatives to Obamacare. That is not true, and it is why now is the time to move an Obamacare replacement bill through regular order and to the House floor for a vote.

Speaking to the Wall Street Journal, Scalise said the effort is to remind House leaders that the plan is one of several Republican health measures that deserve a vote. “We want to show there is a critical mass behind a bill that’s already drafted,” he said.

The push comes as a new Gallup poll, out today, finds that Americans’ attitudes toward the health law have changed only marginally  since Obamacare’s first open enrollment period ended March 31. A majority (51 percent) disapprove of the law, while 43 percent approve.

Fewer than four in 10 adults (37 percent) believe Obamacare will improve the health care sector, Gallup said, while a plurality (44 percent) say it will make things worse. Another 16 percent say it won’t make much difference to U.S. health care.

The post Conservative Lawmakers Urge Vote in House on Obamacare Alternative appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.

Speed Cameras Make a Comeback in New Mexico’s Capital


(Photo: Spaces Blend Images/Newscom)

(Photo: Spaces Blend Images/Newscom)

SANTA FE, N.M.—A lot of people just don’t like traffic cameras.

Two years ago, a 65-year-old Santa Fe man received the nickname “Speedcam Commando” after he pulled up to a camera set up on Bishop’s Lodge Road, got out of his car clad only in a nightshirt and pulled out a gun, firing five times at the speedcam. He then got back into his vehicle and drove home.

It was all caught on tape:

The “Speedcam Commando” ended up agreed to a plea deal that called for 18 months probation.

Now, two years after the video went viral, the Santa Fe City Council is on the verge of bringing back the speed cameras.

The city’s Public Safety Committee approved a proposal to sign an agreement with Phoenix-based Redflex Traffic Systems to place three unmanned SUVs equipped with cameras at strategic locations to nab speeders. The City Council is expected to vote on the proposal in July.

One council member, Ron Trujillo, says he’s is in favor of bringing back the cameras, which have sat idle for the past five months after the city’s contract with Redflex expired.

“I’ve got people who I represent saying, ‘Councilor, I’ve got people speeding through my neighborhood like it’s a raceway,’ ” Trujillo said. “You put those speed cameras in there and guess what? They call back and say the speeding has gone down dramatically.”

But some Santa Fe residents don’t want the speed cameras back at all.

“Regular traffic enforcement is what works,” retired lawyer Marlene Foster said in a telephone interview. “It’s not really about safety.”

Redflex has made headlines in other locations across the country.

In Chicago, Redflex lost its $100 million contract with the city after allegations surfaced the company bribed local officials. Six Redflex executives were fired. One said the company handed out gifts and favors to communities in 13 states.

“I’m just appalled” that the city of Santa Fe is considering a new contract with Redflex, Foster said. “That’s just astonishing to me.”

Redflex was the only company to bid on the Santa Fe contract.

“It’s unfortunate what happened in Chicago and other cities,” said Trujillo. “I personally think that’s outright wrong what they did, but Redflex says [it has] gotten to the source of what the problem was … I think the[company wants] to be more diligent about what [t is] doing but, in my opinion, this program has worked in this community.”

Trujillo says he has not received any gifts or campaign donations from Redflex.

“They say it’s about safety, but it truly has nothing to do with safety,” Foster said. “I think you can find studies that show it doesn’t help with that. It has to do with revenue collection.”

According to the Santa Fe New Mexican, the city’s SUVs produced $2.3 million since 2009. Half of revenue derived from the citations goes to the state and the other half is divided between Redflex and the city.

Under the proposal before the City Council, the city will net between $8.50 and $18 per ticket issued. Drivers caught speeding on the Redflex cameras receive $100 tickets. The citations are not counted on a driver’s record or insurance.

Other cities in New Mexico have tried and then rejected traffic surveillance cameras.

In Albuquerque, despite calls from Mayor Richard Berry and other city officials to keep red-light cameras, 53 percent voted in 2011 to get rid of them.

In Las Cruces, red-light cameras were deactivated on March 30 after city officials decided not to renew the contract with Redflex. But $2.9 million in fines are still outstanding, and City Manager Robert Garza said drivers who received tickets are still responsible for them.

“Those who were recorded during the program operation still have outstanding citations, and those who received the citations are expected to pay the associated fine or follow the appeal process outlined with their citation,” Garza told the Las Cruces Sun-News.

Rob Nikolewski is a reporter for Watchdog.org, a national network of investigative reporters covering waste, fraud and abuse in government. Watchdog.org is a project of the nonprofit Franklin Center for Government & Public Integrity.

The post Speed Cameras Make a Comeback in New Mexico’s Capital appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.

GDP Report Confirms We Now Have a $2 Trillion Obama Growth Deficit


(Photo: Yin Bogu/Xinhua/Photoshot/Newscom)

(Photo: Yin Bogu/Xinhua/Photoshot/Newscom)

This morning’s depressing revised calculation of the growth of the economy in the first quarter of 2014 (-1.0 percent) makes it official: The Obama expansion is now $2 trillion short of where we would be if growth in this recovery had matched the Reagan recovery that started in 1982.

That is to say the average family would have about $5,000 more income each year to spend if it were not for this slow recovery.  The Census Bureau reports that median household income is down by $1,800 since this so-called recovery began.

Worse, investment plummeted in the first quarter of 2014 by 11.7 percent from the same period in 2013.  That was the biggest decline since the recession ended in 2009.  Without investment, businesses can’t grow and wages won’t rise.  Capital investment by businesses is a strong leading indicator of future prosperity.

The administration was quick to blame the dismal numbers on the cold winter and blizzard conditions in the Midwest and Northeast. But he 2013 growth rate was 1.9 percent, and the rate has been less than 2 percent for more than a year. Under Reagan, the growth rate during the expansion was more than 4 percent.

There are strong signs the economy picked up steam starting in April, but the overall picture of a failed recovery plan is now unmistakable.  We spent $830 billion on a stimulus stuffed with make-work government-jobs programs and programs to pay people to buy new cars, borrowed $6 trillion, launched a government-run health-care system that incentivizes businesses not to hire more workers, raised tax rates on the businesses that hire workers and the investors that finance businesses that hire workers, printed $3 trillion of paper money, shut down an entire industry (coal), and tried to regulate and restrain the one industry that actually is booming (oil and gas).

Is it really a surprise the government is underperforming and this is the worst recovery from recession in 75 years.Ideas do have consequences – especially bad ones.

What good that has come from Obamanomics? Hopefully, we all have relearned a painful lesson that government spending, congressional taxing, Treasury borrowing and Fed printing don’t stimulate the economy. The new GDP report reminds us these battle-tested economic strategies don’t work. For tens of millions of Americans, unfortunately, this is a lesson learned the hard way.

— Stephen Moore is chief economist at the Heritage Foundation and co-author of the New York Times bestseller An Inquiry into the Nature and Causes of the Wealth of States.

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Unions Reboot “Moving Ohio Forward” Front Group for 2014

Labor unions are complementing their endorsements of and contributions to Ohio Democrats with outside spending through 501(c)(4) front group “Moving Ohio Forward.”

“Moving Ohio Forward (MOF), a newly formed coalition of workers, individuals and progressive organizations headquartered in Columbus, announced its launch today and blasted all of Ohio’s statewide officeholders for ‘sacrificing the interests of Ohio’s women on the altar of right-wing politics,’” the group announced on May 28.

Like Moving Ohio Forward’s message, the group itself is not new: the organization’s nonprofit arm and political action committee (PAC) were both registered with the secretary of state in 2012.

The 501(c)(4) nonprofit was incorporated by Ohio Education Association (OEA) Secretary-Treasurer James Timlin, OEA Executive Director Larry Wicks, and America Votes Ohio director Khaled Salehi. Until his retirement at the end of 2013, Wicks also led union front We Are Ohio.

Moving Ohio Forward’s PAC, Moving Ohio Forward Action Fund, was incorporated by Timlin.

The PAC spent well over $1 million promoting OEA-backed congressional candidates — all Democrats — in 2012, bankrolled primarily with labor union money from Washington, DC.

American Federation of State, County and Municipal Employees (AFSCME) contributed $529,630 and National Education Association (NEA) contributed $500,000 to Moving Ohio Forward Action Fund during the 2012 election cycle.

OEA poured $475,000 into the union front, while United Food & Commercial Workers (UFCW) donated $100,000 from its DC headquarters and International Brotherhood of Teamsters gave $50,000 from its DC headquarters.

In addition to pushing the usual array of government programs that funnel more money to public employee union bosses, Moving Ohio Forward is advancing the narrative of radical pro-abortion organizations Planned Parenthood and NARAL.

“State Representative Kathleen Clyde (D-Kent), Planned Parenthood Advocates of Ohio President and CEO Stephanie Kight, and NARAL Pro-Choice Ohio Executive Director Kellie Copeland are standing with Moving Ohio Forward to bring greater awareness to the inequality perpetuated by our current statewide officials,” the group’s May 28 released noted.

The Columbus Dispatch reported that Moving Ohio Forward’s spokesman is “Ryan Monell, who is on leave from the office of Sen. Joe Schiavoni of Boardman, head of the Senate’s Democratic caucus.”

“As a 501(c)(4) Moving Ohio Forward aims to expose the harmful policies of Ohio statewide officeholders, from John Kasich and Mary Taylor, to Mike DeWine, Jon Husted, Josh Mandel and Dave Yost,” yesterday’s release explained, calling out every state-level elected Republican.

“Along with women’s rights, MOF will be exposing the harmful effects of the statewide candidate’s supported policies on taxes and the budget, education, voter suppression, energy, and other issues that impact the lives of regular Ohioans.”

Translation: Moving Ohio Forward will focus on the exact positions being highlighted by the Ohio Democratic Party and its candidates for statewide office — and will do so with money from the same unions that fill Ohio Democrats’ campaign coffers.

OEA and Ohio’s other large labor unions wield considerable influence over many of the state’s elected Republicans, but the Ohio Democratic Party is essentially a subsidiary of Big Labor.

The post Unions Reboot “Moving Ohio Forward” Front Group for 2014 appeared first on Media Trackers.

Unions Reboot “Moving Ohio Forward” Front Group for 2014

Labor unions are complementing their endorsements of and contributions to Ohio Democrats with outside spending through 501(c)(4) front group “Moving Ohio Forward.”

“Moving Ohio Forward (MOF), a newly formed coalition of workers, individuals and progressive organizations headquartered in Columbus, announced its launch today and blasted all of Ohio’s statewide officeholders for ‘sacrificing the interests of Ohio’s women on the altar of right-wing politics,’” the group announced on May 28.

Like Moving Ohio Forward’s message, the group itself is not new: the organization’s nonprofit arm and political action committee (PAC) were both registered with the secretary of state in 2012.

The 501(c)(4) nonprofit was incorporated by Ohio Education Association (OEA) Secretary-Treasurer James Timlin, OEA Executive Director Larry Wicks, and America Votes Ohio director Khaled Salehi. Until his retirement at the end of 2013, Wicks also led union front We Are Ohio.

Moving Ohio Forward’s PAC, Moving Ohio Forward Action Fund, was incorporated by Timlin.

The PAC spent well over $1 million promoting OEA-backed congressional candidates — all Democrats — in 2012, bankrolled primarily with labor union money from Washington, DC.

American Federation of State, County and Municipal Employees (AFSCME) contributed $529,630 and National Education Association (NEA) contributed $500,000 to Moving Ohio Forward Action Fund during the 2012 election cycle.

OEA poured $475,000 into the union front, while United Food & Commercial Workers (UFCW) donated $100,000 from its DC headquarters and International Brotherhood of Teamsters gave $50,000 from its DC headquarters.

In addition to pushing the usual array of government programs that funnel more money to public employee union bosses, Moving Ohio Forward is advancing the narrative of radical pro-abortion organizations Planned Parenthood and NARAL.

“State Representative Kathleen Clyde (D-Kent), Planned Parenthood Advocates of Ohio President and CEO Stephanie Kight, and NARAL Pro-Choice Ohio Executive Director Kellie Copeland are standing with Moving Ohio Forward to bring greater awareness to the inequality perpetuated by our current statewide officials,” the group’s May 28 released noted.

The Columbus Dispatch reported that Moving Ohio Forward’s spokesman is “Ryan Monell, who is on leave from the office of Sen. Joe Schiavoni of Boardman, head of the Senate’s Democratic caucus.”

“As a 501(c)(4) Moving Ohio Forward aims to expose the harmful policies of Ohio statewide officeholders, from John Kasich and Mary Taylor, to Mike DeWine, Jon Husted, Josh Mandel and Dave Yost,” yesterday’s release explained, calling out every state-level elected Republican.

“Along with women’s rights, MOF will be exposing the harmful effects of the statewide candidate’s supported policies on taxes and the budget, education, voter suppression, energy, and other issues that impact the lives of regular Ohioans.”

Translation: Moving Ohio Forward will focus on the exact positions being highlighted by the Ohio Democratic Party and its candidates for statewide office — and will do so with money from the same unions that fill Ohio Democrats’ campaign coffers.

OEA and Ohio’s other large labor unions wield considerable influence over many of the state’s elected Republicans, but the Ohio Democratic Party is essentially a subsidiary of Big Labor.

The post Unions Reboot “Moving Ohio Forward” Front Group for 2014 appeared first on Media Trackers.

Why incumbents keep winning

If you are like most people, you are probably at a loss to explain the one-sided primary election results we are seeing so far this cycle. Is it due to weak candidates? Poor messaging? Unfavorable press? A lack of funding? “Extreme” ideology? Don’t be too sure… Conditions are indeed ripe for some changes at the […]

Nevada Gives Up on $91 Million Obamacare Exchange


(Photo: Mark Wilson/Getty Images)

(Photo: Mark Wilson/Getty Images)

Nevada has become the latest state to announce it will concede Obamacare exchange enrollment responsibilities to the federal government via healthcare.gov.

Nevada became the third state-based exchange to make such a decision, joining Massachusetts, which is joining the federal exchange temporarily while it works to fix its state-based exchange, and Oregon, which has ditched its exchange entirely—making a total of 39 states dependent on the federal exchange for, at a minimum, enrollment in 2015.

Federal taxpayers already have sent about $4.9 billion total in grants to the states to establish exchanges, with almost $4.2 billion going to just the 16 states and the District of Colombia that had planned to operate their own exchanges in 2014.

Nevada received $91 million in grants and, as of April 19, had enrolled 45,390 people, for a federal taxpayer cost of $2,005 per enrollee. Cover Oregon, the exchange that was never able to successfully enroll one person online from start to finish, got $305 million in federal grants and had 68,308 enrollees, so its cost was about $4,465 per enrollee. Massachusetts’s per-enrollee cost was $5,648.  Hawaii received $205 million in grant money and enrolled only 8,592 people, for an astonishing per-enrollee cost of $23,859.

Worse yet, in Nevada, the federal government is now spending even more money to transition their exchange to the federal exchange.

According to Nevada’s announcement:

“The federal government will pay all costs associated with transitioning from the BOS [Xerox’s health insurance enrollment system] to healthcare.gov. Nevada will not be required to pay a monthly per -member per-month fee to healthcare.gov for its use. The federal government will pay 90 percent of any costs incurred to disconnect Nevada’s Medicaid system from the BOS and to connect Nevada’s Medicaid system to healthcare.gov. The initial high estimates of this cost ranges between $15 – $20 million, of which Nevada must pay 10 percent.”

As with much of Obamacare, it remains unclear where this additional money will come from, what the total costs will be or whether other states are receiving the same deal.

In response to this this continuous steam of Obamacare exchange spending, Sens. Orrin Hatch, R-Utah,  and John Barrasso, R-Wyoming, recently introduced a bill that would make states that choose to no longer operate their own exchange  return the taxpayer dollars that were spent on the failed exchanges to the federal government. The legislation would require states to repay 10 percent of their wasted federal grant funding each year for 10 years.  This would force Nevada, Oregon, and Massachusetts to repay a combined $575 million.

BL-cms-grants-for-exchanges_HIGHRES


The post Nevada Gives Up on $91 Million Obamacare Exchange appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.

Nevada Gives Up on $91 Million Obamacare Exchange


(Photo: Mark Wilson/Getty Images)

(Photo: Mark Wilson/Getty Images)

Nevada has become the latest state to announce it will concede Obamacare exchange enrollment responsibilities to the federal government via healthcare.gov.

Nevada became the third state-based exchange to make such a decision, joining Massachusetts, which is joining the federal exchange temporarily while it works to fix its state-based exchange, and Oregon, which has ditched its exchange entirely—making a total of 39 states dependent on the federal exchange for, at a minimum, enrollment in 2015.

Federal taxpayers already have sent about $4.9 billion total in grants to the states to establish exchanges, with almost $4.2 billion going to just the 16 states and the District of Colombia that had planned to operate their own exchanges in 2014.

Nevada received $91 million in grants and, as of April 19, had enrolled 45,390 people, for a federal taxpayer cost of $2,005 per enrollee. Cover Oregon, the exchange that was never able to successfully enroll one person online from start to finish, got $305 million in federal grants and had 68,308 enrollees, so its cost was about $4,465 per enrollee. Massachusetts’s per-enrollee cost was $5,648.  Hawaii received $205 million in grant money and enrolled only 8,592 people, for an astonishing per-enrollee cost of $23,859.

Worse yet, in Nevada, the federal government is now spending even more money to transition their exchange to the federal exchange.

According to Nevada’s announcement:

“The federal government will pay all costs associated with transitioning from the BOS [Xerox’s health insurance enrollment system] to healthcare.gov. Nevada will not be required to pay a monthly per -member per-month fee to healthcare.gov for its use. The federal government will pay 90 percent of any costs incurred to disconnect Nevada’s Medicaid system from the BOS and to connect Nevada’s Medicaid system to healthcare.gov. The initial high estimates of this cost ranges between $15 – $20 million, of which Nevada must pay 10 percent.”

As with much of Obamacare, it remains unclear where this additional money will come from, what the total costs will be or whether other states are receiving the same deal.

In response to this this continuous steam of Obamacare exchange spending, Sens. Orrin Hatch, R-Utah,  and John Barrasso, R-Wyoming, recently introduced a bill that would make states that choose to no longer operate their own exchange  return the taxpayer dollars that were spent on the failed exchanges to the federal government. The legislation would require states to repay 10 percent of their wasted federal grant funding each year for 10 years.  This would force Nevada, Oregon, and Massachusetts to repay a combined $575 million.

BL-cms-grants-for-exchanges_HIGHRES


The post Nevada Gives Up on $91 Million Obamacare Exchange appeared first on The Foundry: Conservative Policy News from The Heritage Foundation.