Epic chart: Look at Idaho’s transition to a welfare state

Epic chart: Look at Idaho’s transition to a welfare state

by
Dustin Hurst
January 20, 2015
Dustin Hurst
Author Image
January 20, 2015

Let’s play the Upworthy/Buzzfeed/Vox click-bait game for a second: This one epic chart will leave you in shock and shaking your head.

Hopefully, you’re hooked.

There does exist, in fact, a chart that reveals a huge problem with government: despite well-intentioned policies, more and more Idahoans rely on federal and state dollars to live.

It’s an inconvenient fact lawmakers on Idaho’s budget-committee glossed over during a meeting with Idaho Department of Health and Welfare officials Monday. Sure, lawmakers asked the right questions, at least superficially: queries rolled about employee counts, spending authority and spending money on Obamacare.

Yet, legislators completely ignored the most startling chart in DHW Director Dick Armstrong’s Powerpoint presentation. This chart, shown below, revealed an absolute explosion of welfare dependency in Idaho.

More than 332,338 residents relied on the state and federal government for help with food, child care and Medicaid coverage in fiscal year 2014, a 69 percent increase from fiscal year 2006.

If you’re keeping track at home, that’s more or less Gov. Butch Otter’s entire tenure as governor.

In 2006, only 13.8 percent of the state’s 1.46 million residents relied on welfare programs. In 2014? It was 20.2 percent of Idaho’s 1.61 million residents.

Those changes are costly. Idaho’s Medicaid system served more than 250,000 residents in 2014, spending more than $1.8 billion to do so. In 2006, the state spent $1.25 billion on 170,000 enrollees.

Is there someone to blame for the mess, though? Is it Otter? Perhaps the Idaho Legislature?

College of Western Idaho economist and Idaho Freedom Foundation Board of Scholars member Steve Ackerman thinks he has an answer.

“I would lay it on both of them,” Ackerman said. “How come they are not passing more legislation that would help people get tech ventures off the ground?”

Rather than condemn the takers or censure lawmakers, Ackerman wants legislators and policy people to see the opportunity of the moment.

“Cut taxes to a flat 5 percent for everybody,” the economist prescribed. “You would automatically have a lof of extra cash business owners would put back into their companies.”

Ackerman sees Boise as a future hub of the sector -- but only if lawmakers find ways to lure the companies here. That means a better workforce, lower taxes and, uncomfortable as it might be for some city hall bureaucrats, fewer regulations.

“We’ve got to increase our income and develop high-wage jobs,” Ackerman said.

Idaho’s welfare growth could stem from several factors: loosening of eligibility rules at the federal level, the poor economy and, more recently, more people joining Medicaid because Obamacare forces them to purchase insurance.

Ackerman sees several problems with the Idaho economy, including a preference for the haves, and little assistance for the have-nots. “The reason these rolls get bigger is we have a two-tiered economy,” he said, noting Idaho cuts big breaks for big ag businesses and tech giants Hewlett-Packard and Micron.

The economist even slices some of Otter’s most-trumpeted achievement. For instance, he suggests while the huge handout for Chobani -- ticketed at more than $30 million -- was a ray of sunshine for the Magic Valley region, the company’s wages don’t impress.

“The money for Chobani -- the average wage there was $12 an hour,” Ackerman said. “Our economic development dollars aren’t going to high-wage jobs.”

The state has had some success of late drawing high-wage employers to the state using another giveaway know as the Tax Rebate Incentive. The state touts Gayle Manufacturing, which will bring 105 jobs that pay more than $65,000 annually, as its prized get for the program.

One lawmaker who saw the DHW presentation Monday offered a different take. Sen. Steve Thayn, R-Emmett, said the problem rests with the people, too.

“I believe the greatest challenge for Idaho and America is the growing feeling of entitlement,” Thayn said.

There are systemic problems lawmakers must examine, he added.

“To me, the greater issue, since the recovery has started, why hasn’t that dropped?” he asked.

But does Idaho have an exit strategy to lift welfare recipients from poverty to prosperity? “No,” Thayn offered with no reservation. “I don’t believe so.”

Rather than focus on improving jobs to move people from welfare rolls to self-sufficiency, Thayn wants to find new ways to control medical costs and empower Idahoans to spend more wisely on health expenses. Only by putting them in charge of their dollars, he said, would they improve recipients’ situations.

Thayn suggests Idaho find ways to limit the federal government’s involvement in caring for the needy simply to give the state more flexibility. No federal money, no strings, he suggests.

“This is how you get out of it,” Thayn said. “This is a long-term process.”

For his part, Otter’s spokesman, Jon Hanian, didn’t reply to questions about the chart.

Take a look at the full chart below:

Otterchart1

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