Tag Archives: Kansas

Passing the Tax Burden to Working Americans Via The Pass Through Loophole

Please excuse me while I jump up and down on this keyboard trying to flag attention to one of the most egregious GOP give-aways to the top 1% of American income earners.  It isn’t as though the Pass Through Loophole hasn’t garnered attention, it just doesn’t seem to have broken through the dismal cloud of information and misinformation about the GOP tax plan and into enough sunlight.

“The big one in the tax plan issued last week by the GOP and President Trump involves what’s known opaquely as “pass-through” business income. Even that term might have been too revealing, so the document the Republicans issued described it even more obscurely as a “tax rate structure for small businesses.” That’s also dishonest, however, because the businesses it affects are often nothing like “small.” [LAT]

There’s nothing new about legislative obfuscation of legislative intent — but this one is a major way to ease the burden on the 1% and put more pressure on the working and middle class Americans to make up the difference.   Here’s how it works:

“Pass-through” income is business income that’s reported to the IRS only by individual owners of, or partners in, the business. These businesses can be organized as partnerships, S-corporations, or sole proprietorships. They’re distinguished from C-corporations, which are almost always big businesses with public stockholders; C-corporations pay the corporate income tax, and the shareholders pay personal income tax on their dividends and capital gains.

In other words, if a business is a partnership, S-corporation, or a sole proprietorship it doesn’t pay corporate tax rates.  The income earned is reported by individuals.  Now, here’s how the Republican plan would specifically benefit the top 1%:

Currently, the top marginal individual rate is 39.6%; the new tax proposal would reduce the top rate on pass-through income to 25%. Pass-through income from an S-corporation, by the way, already is exempted from the Affordable Care Act surcharges that raised the top income tax rate on some high-income earners by as much as 4.7 percentage points.

So, if the business is an S-corporation, sole proprietorship, or partnership the tax rate is 25%.   Thus, if Desert Beacon were to become Desert Beacon LLC the income tax reduction would be from a maximum of 39.6% to 25%.   Now, who are those who tend to form the businesses which qualify for the LLC Loophole?

“Pass-through business income is substantially more concentrated among high-earners” than traditional business income, Treasury Department economist Michael Cooper and several colleagues observed in a 2015 paper. They also found that about one-fifth of it went to partners that were hard to identify, and 15% got sucked up into circles of partnership-owning partnerships, complicating IRS analyses.”

I sincerely hope the reader isn’t too surprised that these tax avoidance strategies are practiced mostly by high-earners.   Let’s take a closer look at the summary of that 2015 NBER paper:

Pass-through” businesses like partnerships and S-corporations now generate over half of U.S. business income and account for much of the post-1980 rise in the top- 1% income share. We use administrative tax data from 2011 to identify pass-through business owners and estimate how much tax they pay. We present three findings. (1) Relative to traditional business income, pass-through business income is substantially more concentrated among high-earners. (2) Partnership ownership is opaque: 20% of the income goes to unclassifiable partners, and 15% of the income is earned in circularly owned partnerships. (3) The average federal income tax rate on U.S. pass- through business income is 19%|much lower than the average rate on traditional corporations. If pass-through activity had remained at 1980’s low level, strong but straightforward assumptions imply that the 2011 average U.S. tax rate on total U.S. business income would have been 28% rather than 24%, and tax revenue would have been approximately $100 billion higher. (emphasis added)

Therefore, if someone is trying to pass this off as a “middle class” tax cut, or a “small business” tax cut, the appropriate (and perhaps most polite) response is BALDERDASH.

It should come as no surprise that Kansas, under the spell of Brownback-ism, tried opening the LLC loophole as a way to “create jobs.”  It failed, and failed miserably.  Not only did the state find itself in a terrible revenue position, losing money for schools, transportation, and other government services, but it allowed high-income earners to stash more cash.  Case in point: KU basketball coach Bill Self was avoiding most Kansas income taxes on his $3 million salary by parking most of his earnings in an LLC.  Even some of the tax freeloaders were beginning to feel like tax freeloaders by late Summer 2016.  [see also NYT]

And, no one should suggest the amount of money lost because of the ‘reformed’ Kansas tax structure was negligible:

For fiscal year 2014, which ended on June 30, the state collected $330 million less in taxes than it had forecast, and $700 million less than it had collected in the prior year.  Those are big numbers in a state that spends about $6 billion annually from its general fund, and the revenue weakness led both Moody’s and Standard & Poor’s to cut Kansas’ credit rating this year. [NYT]

The situation hasn’t gotten any better.   There were promises made:

In 2012, Kansas Gov. Sam Brownback signed a bill that, among other things, substantially cut the state’s top tax rate and exempted “pass-through” business income from taxation (President Trump’s tax plan includes a similar loophole). The architects of Brownback’s plan predicted that it would provide an “immediate and lasting boost” to the state’s economy.

And promises not kept. The 2017 numbers are truly remarkable, and not in a good way:

Real GDP growth in Kansas since the fourth quarter of 2012 (Brownback’s cuts took effect in January 2013) has been relatively slow, at 6.1 percent through the third quarter of 2016. That’s about three-fourths of U.S. GDP growth over that same period (8.3 percent). A similar story holds for private employment growth: 5.0 percent in Kansas between December 2012 and March 2017, 9.1 percent in the U.S. overall. [WaPo]

The Kansas Legislature was so disappointed in the Great Brownback Experiment it voted to change the tax law — and the governor vetoed their bill.

“Unfortunately, that part of the plan — what Brownback called an economic “shot of adrenaline ” — hasn’t materialized. The state’s budget deficit ballooned to $350 million. And the small-business provision also created new ways for residents to avoid taxes, meaning more lost tax revenue and compliance headaches for the state.” [Time]

Just what we don’t need — lost tax revenue and compliance headaches.  The bottom line of this easy route to the bottom is that:

(1) Claims that pass through exemptions and tax cuts will create new revenue have already prove erroneous.  Witness what happened to Kansas.

(2) The loss of revenue from the pass through exemptions was serious and exacerbated an already tight budget situation.

(3) Claims that the tax ‘reform’ would help small middle class business owners proved elusive — the overwhelming numbers of those who benefited, and will benefit, were high income earners.

This would be a good time to contact Senator Dean Heller (R-NV) to let him know that no one is fooled by changing the name from “pass through” to “tax rate structure for small business;” it’s still a way to shift the burden of maintaining government services from high income earners to middle and working class Americans.   The Senator can be reached at 202-224-6244; 775-686-5770; or 702-388-6605.

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Filed under Economy, income tax, Politics, tax revenue, Taxation

That Changing Trump Tax Plan and the People Who Love It

 Trump Tax Plan It’s time to haul out the old Etch-A-Sketch template from the Romney campaign for another deployment in the Trump 2016 version – Trump has offered two tax policy proposals.  Neither one accomplishes much more than exacerbating the problems of the current tax code; in fact they’d both do more damage than good.  

Representative Joe Heck (R-NV3) candidate for the Nevada Senate seat and Danny Tarkanian, perpetual candidate and now a contestant for the 3rd Congressional District seat, have both endorsed Donald Trump as their choice for president, and here’s what they’re getting in the bargain.

A Tax Plan for the Top 0.1%

Bracketology: The Tax Policy Center analyzed the initial Trump Tax Proposal (December edition) and this release was followed by significant changes in the original proposal as of August 16, 2016.   And here comes the confusion:

“Trump’s original tax plan included defined brackets, which have since been removed from his campaign website. Trump’s standard deduction increase would make the first $25,000 in income tax-exempt. According to his original plan, the lowest bracket would then apply to all taxable income between $25,000 and $50,000 for single taxpayers, the middle tax rate would be assessed on income of $50,001 to $150,000 and the highest rate would apply to income above $150,000. For married couples, the income ranges would be double these amounts.”  [Motley Fool]

And now:

“As a practical matter, Trump’s plan features a sizable tax-free bracket. He wants to quadruple the standard deduction (currently $6,300) to $25,000 for single filers and $50,000 for joint filers. As a result, about half the population wouldn’t pay income tax.” [TaxAnalyst]

As everyone who has ever filed with the IRS knows full well, what a person actually pays is tax on the adjusted income – income after deductions. If we don’t know what the allowable deductions are then it’s almost impossible to discern what the tax proposal actually means for the average tax payer.  It also isn’t helpful that the ‘defined brackets’ have been removed from the policy section of the Trump info-site.  We can guess that the 12% rate goes for those with taxable incomes between $25,000 and $50,000; 25% for those with taxable income between $50,000 and $150,000; and, 33% for those with taxable income over $150,000.

Who plays in the Brackets?  Here comes the fun, and the way the Trump Tax Plan benefits the upper income earners.   We need to look at Trump’s “pass through entities.”   This is a loophole not only large enough to drive a tractor trailer through, but most of the freight cars on the Union Pacific as well.

“Trump would go one step further, creating an enormous tax loophole for the rich by applying his 15 percent corporate rate to “pass-through” entities as well. Pass-through entities are businesses whose income are not taxed at the corporate level, but rather passed through entirely to the businesses’ owners and then taxed at the owners’ individual income-tax levels. High-income households can easily avoid paying their full income tax bill by reclassifying their income as pass-through income. This loophole allows Trump to claim that he is closing the carried interest loophole, while actually lowering the rate that hedge fund managers would pay from 23.8 percent to 15 percent.”  [EPI]

In 2012 the state of Kansas under the direction of Governor Sam Brownback and a GOP controlled legislature enacted this loophole with disastrous budget results, because of  reduced taxation rates for LLC’s, S Corps, partnerships, farms, and sole proprietorships.

The normally extremely conservative Tax Foundation is not amused:

When the exemption was passed in 2012, it was projected that 191,000 entities would take advantage of the provision. As more and more people have realized the very sizeable tax advantage of being a pass-through entity in Kansas, that number ended up being 330,000 claimants, over 70 percent more than was anticipated.  It’s important to note here that while decreasing taxes is generally associated with greater economic growth, the pass-through carve out is primarily incentivizing tax avoidance, not job creation. [TaxFnd]  (emphasis added)

Thud.  That’s the sound of budget and revenue problems hitting the floor as a result of a ‘carve out’ for the top income earners disguised as a tax cut for small businesses.  Here’s a simple example. If I were earning $165,000 per year working for the Acme Explosives Company, I would ask my employer Wile E. Coyote to immediately re-hire me as an “independent contractor.”  I would re-create myself as an “S” corporation. Handy, since I live in Nevada which doesn’t have a personal income tax, and thus doesn’t recognize the federal S corporation election.  I file the paperwork, get my EIN number, pay some fees, and bingo! – I am taxed at the 15% rate rather than 33%.  There is obviously no job creation here – just a wonderful and perfectly legal way for me to reduce my “bracket” at the expense of those who don’t have the wherewithal to follow my shady example.

The Wichita Eagle editorial board summarizes:

“As part of the 2012 tax cuts, about 300,000 business owners in Kansas don’t have to pay state taxes on pass-through business income. Not only do many Kansas wage earners think this is unfair, so do some of the business owners receiving the tax break – especially when the state is facing serious budget problems.  The exemption is costing Kansas about $260 million a year in revenue. And contrary to what Gov. Sam Brownback promised, it hasn’t acted “like a shot of adrenaline into the heart of the Kansas economy.”

Trump, Tarkanian, and Heck would seemingly like to have Nevada and 48 other states go the way of Kansas?  Only if we’d like to raise tax avoidance and cheating to an art form.

Playing with Children:  Another element of the Trump Tax proposal is the child care tax deduction, and here too the top 1% fare very well thank you.   It’s important to remember at this point that the economic value of a tax deduction increases with the marginal rate of the payer. Or, the higher your tax bracket the more valuable the deduction – for child care.  The deduction is of no use whatsoever to someone already in the Zero bracket but is ever so helpful for those in the upper income levels.

Playing for the Children:  Mr. Trump is pleased to tell us that the Federal Estate Tax is a “horrible weapon which has destroyed many families…”  Not. So. Fast.  “Today’s estate tax is only imposed on less than 0.2 percent of households. Fewer than two estates in a thousand pay it. More than 2.5 million Americans die each year, but less than 5,000 estates were taxed in 2014. Only estates of $5.4 million or more must pay any estate tax at all.” [C&L]   Perhaps it is not too much to return to the appellation “The Paris Hilton Legacy Protection Act,” for this long sought GOP gift to the rich.

There are some serious questions which should be posed to Mr. Trump and his supporters like Mr. Tarkanian and Representative Heck:

#1.  What exactly are the specified brackets in the modified Trump tax policy proposal?  We can assume that the new rates apply to the old brackets but without clarification from the campaign there are significant questions about the revenue projections (or revenue deficit projections) which remain unanswered.  Do those brackets leave us with a revenue deficit of $3 trillion over ten years?  [Tax Analyst] If so, thus much for budget balancing and other forms of fiscal contortion.

#2. Does Trump mean to allow individuals to avail themselves of the Great Pass Through Tax Dodge?  If so, how does he intend to avoid what’s happened in Kansas?

#3. Does Trump intend to provide child care deductions for the rich while working families see none of the economic benefits of it?

#4. Do Mr. Trump, Mr. Tarkanian, and Representative Heck really mean to advocate for estate tax avoidance for those estates of $4.5 million or more? For less that 0.2% of the United States population?

We may have to wait for Trump Tax Policy 3.0 before these questions can be fully answered?

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Filed under Economy, Heck, income tax, Nevada politics, tax revenue, Taxation

Caught: GOP Pension Raids in the Public Cookie Jar

Retirement Fund Raids

Kansas is currently providing a text-book classic example of the way Republican governors and legislatures are assaulting public employee pensions.   Remember, the GOP frames the discussion as a choice (a false choice) between government services and pension stability – NOT as a choice between tax cuts for the rich/corporations and government services.

So, how is Kansas a prime example?   In 2012 Governor Sam Brownback signed a bill to provide massive tax cuts to everyone but employees, some retirees, and individuals whose investments are so modest they cannot afford to create trusts or partnerships in which to shelter their incomes. [LJworld]  And then came the perfectly predictable news, “Brownback’s policies blew $258 million hole in income tax revenue.” [KCStar]  Now that the gap has been blasted in the state budget, what does Brownback propose to do?

“Most Kansas state agencies will have their funding cut by 4% as a way to address a projected budget shortfall. Governor Brownback announced his initial budget actions today.

The Governor will implement an allotment plan for most state agencies, reducing their spending by 4% in the second half of the fiscal year.

In addition, the plan calls to transfer $95 million from the state highway fund and take $40 million from the KPERS fund.” [KAKEtv] (emphasis added)

There we have it. A false choice between a cut in services and a pension raid versus the rollback of those exceptionally generous tax cuts for wealthy individuals and corporations in the state of Kansas.  Were those cuts a bit too generous? It would appear so:

“…the act dramatically changes the Kansas tax system, shifting the income tax burden from the wealthy and prosperous to working people. The act provides that all income of business owners is tax-free (except in the unusual case where a regular corporation is used). Although the act was promoted as a boost to small business, there is no limit on the size of business that can be exempt from tax.

Income of professionals — such as doctors, lawyers, architects, and accountants — practicing in partnerships will be tax-free. In a law firm, for example, the partners will pay no tax, while the clerical staff will continue on the tax rolls.

Income received from partnerships and trusts will be tax-free. Wealthy Kansans who own real estate, stocks, bonds and other investments will simply transfer those assets to a partnership or trust, thereby freeing all their investment income from tax.”  [LJworld] (emphasis added)

There we have it. Instead of admitting that the tax base was demolished and replaced with an extremely regressive tax structure, instead of admitting the tax base is no longer adequate to provide Kansas with essential public services, Governor Brownback is asserting that even more Austerity Political Economics will be applied – rather like announcing the hole in the bottom of the boat is fixed by making it larger. [More at IBTimes]

We might all be a bit more comfortable if Kansas were the only state raiding its public pension funds to cover budget shortfalls.  It isn’t.

The Great New Jersey Turnaround, during which in 2011 Governor Christie made a deal to salvage his budget using a restructuring of public employee pensions as part of the package – a package he is now trying to disclaim:

“The 2011 law shifted more pension costs to public workers, but it also gave them a contract right to full payments from the state budget into their underfunded retirement plans every year. Now, lawyers for Christie are calling that budget obligation unconstitutional, “void and unenforceable” and economically reckless.” [NJ.com]

His own plan is now “void, unenforceable, and unconstitutional?”  It isn’t too hard to figure out that the New Jersey governor can no longer deliver on his promise, so the lead paragraph in the  newspaper should come as no surprise:

“Gov. Chris Christie is asking a state judge to dismiss a flurry of lawsuits challenging a budget veto that reduced funding for public worker pensions from a once-promised $2.25 billion to $681 million.” [NJ.com]

Kansas, New Jersey, Michigan, Wisconsin [Prog] have all experienced raids on the public employee pension plans.  In Michigan pensions were raided to pay for film studio bills. [CapConf]  The raids have been numerous and counterproductive. [Alternet]

Trickled On: Indeed, the stock answer to all budget problems from Republican corners appears to be to cut services and raid the public employee pension funds – Heaven Forefend the solutions would incorporate cutting tax loopholes and raising taxation on the wealthiest citizens and businesses.  America’s most accomplished looters are living their Austerity Economics fantasies on the backs of secretaries, dispatchers, file clerks, police officers, sheriff’s deputies, firefighters, teachers, school lunch cafeteria workers, public health nurses, public hospital employees, city sanitation workers, city bus drivers, state and local highway department employees, emergency medical technicians, and the list goes on…

The messaging coming from GOP/conservative quarters is almost breath-taking.  Public employees are “pigs at the public trough” who are “thieves from honest taxpayers,” they are not the dispatcher in the sheriff’s office who talks a frantic father through the birth of his daughter, or the firefighter who risks his or her life to protect our property.  They aren’t the clerks in the county court house who insure that the records of your lawsuit don’t get lost in the jumble. They aren’t the people in the recorder’s office who insure that they title to your property is legal and proper.  They aren’t the highway department workers out at 4:00 a.m. clearing your way to work.

It’s easy to rail against “faceless, nameless bureaucrats,” it’s not so easy to disparage the efforts of public health nurses, or insult the efforts of the voting registrar’s office.  It’s easy to pontificate against those “faceless, nameless” ones, except that they do have names and faces and they work in comptroller’s offices making sure companies doing business with the state or city get paid.  They have names when they file incorporation papers for you with the state, they have names when they plan and advocate for highway intersection improvements, and they have names and faces when they when they are trying to handle ungodly case loads for children needing foster care.

We have one recent example of what can happen when private interests take over the jobs of public employees.  Just for a moment, remember when the mortgage servicers and lenders tried to do an end run around county recorders?  The electronic MERS system was supposed to speed up the transaction time for mortgage lenders previous to the collapse of the housing bubble, in many cases by-passing the humble office of the county recorder.  How well did that work out?  By 2012 the system got a major smackdown:

“Today, Washington State, which is a non-judical foreclosure state, gave MERS a serious setback. Its finding in Bain v. Metropolitan Mortgage, that MERS may not foreclose in Washington, is not as bad as it sounds, since MERS instructed in servicers to stop foreclosing in its name in 2011. But the reasoning of the ruling is far more damaging. And the court has opened up new grounds for litigation against MERS in Washington, in determining that its false claim to be a beneficiary under a deed of trust is a deception under the state’s Consumer Protection Act (whether that can be proven to have led to injury is a separate matter).” [NakedCapitalism]

This problem wasn’t confined to the state of Washington. Some 62 million mortgages were involved. [Yes]  Problems at MERS became so severe that fewer than 30% of the mortgages had accurate records of home ownership. [NYT]  No one is now advocating the Speed Is Everything privatization of mortgage handling – there’s been too much litigation, and entirely too much confusion. [Wash]   Yes, life was more predictable, litigation less extensive, and confusion less apparent when public employees handled the recording of deeds.

However, even public recognition of previous disasters in privatization, acknowledgement of public service workers as public servants, and attention to what happens when public services are cut in the interest of saving the fat wallets of corporate America, won’t be enough to stop the Great Cookie Jar Raid by the Republicans.

They won’t stop until someone applies a sharp slap on the wrist, or they are reminded that “you shall not press down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold.” [WJB]

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Filed under conservatism, Economy, Politics, public employees

Questions and Numbers in the Abortion Debate: There’s No Such Thing As A Free Pregnancy

Statistics from the Guttmacher Institute indicate that only 19.6 pregnancies per thousand  in the United States end in induced abortion procedures, a number that has declined from 29.3 per thousand in 1981.  Of these some 88% occur in the first 12 weeks.

If 88% of all induced pregnancy terminations take place within the first 12 weeks, why would states enact ultrasound testing? Further, why would a state enact a statute forbidding physicians from imparting information about potential pregnancy complications or about the results of pre-natal tests which show the likelihood of fetal abnormality?

What if the test showed evidence of anencephaly, a neural tube defect which usually happens in the first four weeks of a pregnancy?  Approximately 1 out of every 4,859 babies born in the U.S. are anencephalic, and will not survive very long after their birth. [CDC]  What if the ultrasound, demanded now by the state of Virginia, indicated that a fetus was thus fatally flawed, and would not survive for much longer than 24 hours?  The irony may be that in the case of the Virginia statute, the parents may well receive information which might cause them to seek termination of a pregnancy rather than “scaring” the woman into not seeking the termination.

What if the pre-natal testing indicated congenital, chromosomal, or genetic defects?  What if the parents were financially incapable of supporting a child with such severe defects?  One can demand that a fetus not be aborted for financial reasons, however such a demand requires a commitment on the other side of the equation, i.e. the community and state must provide services needed which the parents cannot afford.  Are the state legislatures willing to appropriate funding for a range of special services from institutional care facilities to home based medical providers to special education program funding?

The response in some instances, such as Arizona, is to put the government “between a woman and her doctor” and restrict what the physician can tell the family.  This is not a rational solution.

Frankly,  Kansas, which is considering draconian anti-abortion and contraception measures, enacted a state budget which proposed the exact opposite:

“Lawrence schools have about 11,000 students and 1,600 employees, with a monthly payroll of $4.5 million. The district trimmed its spending by laying off paraprofessionals who worked with special-education students, reducing the number of days teachers work and increasing the student-teacher ratio by one student, a move that may seem small but saved more than $1 million in one year.” (emphasis added)

Again in Kansas, a move to privatize the state’s Medicaid program, would leave programs for the developmentally delayed under the auspices of organizations which have no experience in related issues.
“The House Health and Human Services Committee is scheduled to hold hearings next week on a bill that would exempt long-term care services for the developmentally disabled from the managed care provisions in KanCare, Gov. Sam Brownback’s Medicaid reform plan.” [KHI]

The Democratic Party supported bill may not get much support in a Republican controlled legislature.  The situation in Virginia isn’t much different, the state legislature cut approximately $700 million from its budget for K-12 education, meaning that special education services will also feel the squeeze. [CBPP]  The 2012 Virginia budget cut $400 million from Medicaid funding. [ABC7] Those proposing the enaction of stringent restriction on abortion procedures, appear not to have thought ahead as to what state services will be required if all pregnancies — including those in which there is a strong chance of fetal abnormality — must be carried to full term.

Not to put to fine a point to it, but I am awaiting the day when the same people who rally for “Pro-Life” statutes attend hearings on Medicaid, state health services, and education with the same level of enthusiasm.

If the prevalence of abortion procedures has declined in the last three decades, as the chart clearly indicates, what is the role of contraceptive services in precluding abortions?  The science is clear:

Rising contraceptive use results in reduced abortion incidence in settings where fertility itself is constant. The parallel rise in abortion and contraception in some countries occurred because increased contraceptive use alone was unable to meet the growing need for fertility regulation in situations where fertility was falling rapidly. [Guttmacher]

Meaning:  In developed nations with relatively stable fertility levels, such as the United States, the availability of contraception resulted in fewer abortions.

What of the pregnancies which are not prevented or terminated?  We’ve still not developed a nationwide consensus on how to support infants with health issues.

The latest figures from the CDC indicate there are about 6,408,000 pregnancies in the United States every year. [CDCpdf] The CDC also reports that 8.2% of live births are complicated by Low Birth Weight, and another 12.2% of live births are Pre-Term. [CDC]  That means there are 338,715 low birth weight babies born each year, and another 503,941 infants born pre-term.

We know that smoking, age, genetics, and nutrition play a significant role in the low birth weight statistics.  From a Stanford University study we can add some additional information:

“Different ethnic groups show varying degrees of prenatal care utilization, with 76 percent of all women seeking prenatal care within the first trimester, and only 61 percent black and Hispanic women seeking prenatal care during the same time period. Underutilization of prenatal care is often attributed to poor socioeconomic statuses like inability to pay for prenatal care, a lack of knowledge in the importance of prenatal care, and inadequate location and availability of prenatal care providers.” (emphasis added)

Medicaid covers 51% of all babies delivered in Florida hospitals, but the state is looking at proposed program cuts ranging from $376 million to $720 million:  “Dr. Peter Dayton, who provides prenatal, obstetric and gynecological services for Medicaid patients through the Physicians to Women program, told the editorial board hundreds of pregnant women would be put at risk if Medicaid funds are slashed.”Five hundred women will be showing up in emergency rooms with no prenatal care if this program is not sustained,” Dayton said.” [TCPalm]

A 2011 editorial in Texas summed up the problem:

“Texas already runs one of the leanest Medicaid reimbursement programs – one so lean that it doesn’t cover the actual cost of treating Medicaid patients. Doctors already lose money on those patients; many simply can’t afford to accept them. And further cuts could mean that far more would have to stop accepting Medicaid.

The upshot? If pregnant women can’t find a doctor who’ll see them, they’re likely to skip prenatal care — and thus, more likely to suffer serious problems with their pregnancies or give birth to a premature baby. Those intensive-care outcomes aren’t just tragic; they’re far more expensive than prevention. And we taxpayers will end up paying for them.”

And so it goes.  Those demanding severe anti-abortion statutes, and those demanding restrictions on the availability of contraception, are all too often supporting politicians who also favor the restriction of public health services, and the parsimonious funding of education and family assistance programs.  IF we truly are a compassionate nation, in which we care deeply about healthy families, then we must also be a country in which we recognize that there is no such thing as a “Free Pregnancy.”

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Filed under 2012 election, abortion, Women's Issues, Womens' Rights