Medicare Cuts Would Be Bad For Business?

That’s what one study says by liberal, pro-government health care group Families USA says, but their reasoning could only appeal to those ignorant of economic reality. They argue that less government spending means less economic stimulus.

FARGO – Proposed Medicare cuts floated as part of a budget-balancing plan would translate into a significant loss of business activity and jobs, according to a study by an advocacy group.

Medicaid, which provides health care coverage for the poor and disabled as well as those in nursing homes, is a partnership between the federal and state governments.

The costly “entitlement” program is under scrutiny as Washington grapples to tame the federal budget deficit.

“Every federal Medicaid dollar that flows into a state stimulates state business activity and generates jobs,” Ron Pollock, executive director of Families USA, which released the study, said in a statement.

In the aftermath of Obama’s stimulus spending disaster we really shouldn’t have to debate any more about whether or not government spending stimulates the economy. But apparently this is one argument that just won’t go away.

In a national budget environment where we had no debt and no budget deficits we could say that this argument is nonsense because every dollar the government spends is a dollar it first takes from we taxpayers. You cannot say that Medicare spending stimulates the economy because any stimulation the spending might represent is more than offset by the stimulation destroyed when the money is taken from the taxpayers.

But we don’t have a balanced budget, and we are running deficits that total in the trillions, so the situation is actually worse. The money being spent on Medicare isn’t our money, necessarily, because most of our tax dollars have been spent. The money being spent on Medicare is the next generation’s. Meaning not only is this spending not stimulating the economy, by spending it we’re robbing from our children’s future prosperity.

Rob Port is the editor of In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters.

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  • sbark

    maybe some short term pain………….but long term gain………

    Minn govt shut down———-state shut down?  NOPE……….now if the private sector in Minn would shut down, or via taxation be shut down———–then Minn. would literally shut down,   govt shutdown of any form is a inconvienience, but easily found to live without,

    in fact Medicare is the main reason for our health care woes………it being shutdown would accelerate the free market system back into health care costs……..sure the dem’cats would be able to float a few contrieved “victims” in front of some congressional hearings, but society in general would overcome and be better off very quickly.

  • Kevin Flanagan

    Using their line of (il)logic, why not just drop cash from airplanes?

    • Goon

      Careful Kevin, I could see the Obumble administration actually doing that during their get out to vote campaign.

      • Kevin Flanagan

        That’s OK, I’ll just make money selling them the aviation fuel they will need to do it.

  • WOOF

    Business is bad for Medicare.

    Are you, Governor Rick Scott, of Florida, ” a current or former employee of Columbia/HCA —

    “Upon advice of
    counsel, I respectfully decline to answer the questions by asserting my
    rights and privileges under the Fifth Amendment of the U.S.

  • DopeyDem

    How can getting thirty cents on the dollar for services rendered be good for the economy? Can anyone here at SAB survive by getting 30% of your salary?

  • The Whistler

    government spending reduces wealth because it’s spent in the most wasteful means possible.

    • WOOF

      Your gonna need a CAT scan and an MRI.
       Go  to Your Doctor’s leased machine facility.
      That keeps some parts of the economy, not humming, but singing operas.
      It’sa da busyness

      • The Whistler

        So much money is wasted in the medical field because “someone else is