fed pinches states, states pinch the poor

Borrowing the language of Reaganomics. Fact sheets management efficiency, the federal from the National Con-budget proposal of the Bush admin-ference of State Legisla­istration arrived on congressional tures show that forty-three desks dressed up like a corporate states are in deep shit al­annual report. Printed on thick, ready, citing social pro-glossy paper and filled with color grams — Medicaid in charts, it departs from black and particular — as their worst white just-the-facts tradition by, ac-enemy. cording to the Washington Post, “in-According to the cluding photographs that symbolize Center on Budget and proposals the adminstration believes Policy Priorities, more will prove popular.” than two-thirds of the

Calling it a “bold agenda for states have already taken reform,” the administration’s bud-steps to cut spending on get contains unveiled threats to fed-programs that serve low­eral employees. “Dollars will go to income citizens, with programs that work; those programs Medicaid taking the hardest hits in Healthcare, “that Congress will sup-that don’t work will be reformed, 17 states. Washington, Florida, Illi-port the industry.” constrained, or face closure.” nois, Indiana and Oklahoma have FYI: His Kindred Healthcare

While it contains provisions for made the deepest cuts to Medicaid chain, division of Omnicare, Inc., extra money for states to “find ways so far, but leaders in that race to the swooped in to snap up Vencor, a to promote marriage” and “teach bottom change daily as state legisla-large nursing home and rehab chain teenagers to abstain from sex,” the tures grapple with record shortfalls. founded and operated by a small-budget cuts funding to states for Nursing home operators, who time Louisville vending machine housing, education, and health. suck up about one quarter of the operator, when Vencor sought pro-

$120 billion in state Medicaid funds, tection from creditors after being hit Impact in States don’t expect to see their incomes with charges of Medicaid fraud. This is the worst budget year for shrink. “I’m confident,” says Joel Chains operate more than half

states in the U.S. since the days of Gemunder, chairman of Kindred of nursing homes nationwide. Med­icaid funds approximately 75 per-cent of nursing home beds.

• penny wise, pound foolish •

Economists know this: poor ings (aka “rainy day funds”) and people, unlike rich ones, spend other fiscal reserves in order to fore-nearly every dollar of their income stall cuts to income supplement pro-as soon as it comes in the door, just grams such as SSI, unemployment to stay alive. That’s why income security, and food stamps fare better supplement programs are seen as than states which cut programs for “economic stabilizers” — money the poor. that the government puts in one end Legislators, perhaps not as pumps straight out the other into the knowledgeable as economists, of-economy. Cutting programs that put ten make their states’ wealthier citi­cash in the hands of low-income zens the beneficiaries of economic people actually slows an economy. stimulus packages, thus contribut-

States that draw down their sav-ing to a downward economic spiral.

Don’t Worry, Be Happy

While the Bush budget proposes $9 billion in cuts to the public hospi­tals which serve America’s poor, Jack Bovender, chairman of Hospi­tal Corporation of America, sees “no clouds on the funding horizon.” None of the budget cuts proposed will touch the for-profit chains, which will, because they are for-profit, benefit from the corporate tax cuts and newly-instituted tax writeoffs contained in a variety of state and federal economic stimulus bills. — L.G.