Wednesday, January 30, 2008

Good time, money woes, stimulus

The last Monday of each month is a particularly fun day for me. I belong to an unofficial group of retired folks who have all retired from the same place. We meet on this last Wednesday of the month for lunch, good conversation, and updates on our lives. Three members of the group weren’t there today as they have chosen to hibernate in Florida for the winter months except one of the three lives there permanently. We hardier souls, though, met and if anyone would listen to us could have resolved the problems of the world.


The state’s budget woes grew just a little today as Federal Medicaid rules changes will cost Maine about $45 million over the next year and a quarter. I forget the exact number right now, but close to a quarter of Mainers receive some sort of aid. If I understand the new rules correctly, the most affected in this change will be health assistance for children. I must admit here I’m not totally sure of exact range of the cuts right now. I’ll probably know more tomorrow or after this evening’s news.

But that’s not all. Those same rules changes will affect the non-state government area as well. Losses to community non-profit agencies, including non-profit health care providers and schools, will be more than $140 million over the same time period.

There’ll be a lot of adjustments that have to be made.


The more I hear about the federal government’s proposed income tax “rebate” package, the more I think it stinks. It sounds good. Individuals will receive a $600 rebate while families will get $1200 and $300 for each child. Sounds pretty good, doesn’t it. We all would like a few more bucks to spend for oil, gas, food, and possibly just stuff. But, and here’s the rub, not everyone will get that “rebate.” I put that word in quotation marks because my definition of “rebate” differs from that of Congress. Seems to me one has to spend money to get some of it back. But Congress says that’s not the case. Even the class of citizens who pay no taxes because of the size of their income will get a rebate. They’re getting something returned they never sent in. Amazing! And illegal aliens will also be able to get rebates. More Amazing! What about that upper income class who pay 75% or more of the taxes in the first place so we poor people can get rebates? Probably not even a thank you.

And there’s more to this “stimulus” package. Some members of the Senate, including our two Senators, want to add more, like increase food stamps among other things.

And where are we going to get all this money? Probably borrow it, and probably from the Chinese.

If the government, in fact both the federal and state governments, really wants to stimulate our economy, reduces our taxes. Both the John Kennedy and Ronald Reagan administrations proved dramatically that reduced taxes actually increases governmental revenue as people have more money to spend.


I haven’t said too much about this election season, which started three years ago, but now that primaries are in full swing and both parties are narrowed down to real contenders, I guess I’ll have to begin following it a little more carefully. I’ll share some of my thoughts sometime in the next few days.


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