Opinion: Right-Sizing the Federal Government

By Mark Fernald

Washington is trapped in an endless fiscal debate.  Republicans argue that the Federal government is too big.  Democrats argue that revenues are too low.  The fight is over money, but the larger debate is over the size and scope of the government.

Before we line up on one side or the other, we should look at recent history.Over the past forty years, federal spending has averaged a little over 20% of Gross Domestic Product (GDP).

When the economy has been strong, federal spending as a percentage of GDP has dipped below 20%.  When the economy has been weaker, that figure has been several points higher.During the same forty years, federal revenues have averaged about 18% of GDP.  As a result, the federal government was in deficit for all but three of those years.

This fluctuation is to be expected.  When times are tough, spending increases for safety net programs, such as Medicaid, food stamps, and unemployment benefits.  The opposite happens when the economy booms, such as in the 1990s. Continue reading

Capital Comments: Gov. Hassan unveils budget Feb. 14

Capital Comments from State Senator Bob Odell

The long wait to learn what Governor Maggie Hassan is putting into her budget will end on Thursday.  Promptly at 10 o’clock in the morning, she will be introduced into Representatives Hall and with little ceremony will be introduced again for the purpose of making her budget address.

This happens in New Hampshire every two years.  And the Governor’s address sets the framework for the work the House and Senate will do before passing a two year budget in June for the fiscal year that begins on July 1. Continue reading

Capital Comments: Briefings give budget writers plenty to ponder

Senator Bob OdellCapital Comments from State Senator Bob Odell

One newspaper’s front page headline on Tuesday read, “For NH budget writers, it’s doom and gloom.”

The article was about a long day of briefings for House and Senate Finance and Ways and Means Committee members. Every two years the House and Senate invite in economic experts and analysts to put things in perspective as the budget writing process is beginning.

I remind my colleagues that the Governor will take the first step next month when she announces her budget plan in an address to a joint session of the legislature. That address will set out her spending plans that will tell us her policy goals. And she will explain her predictions on revenue for the next two years beginning on July 1.

Here is some of the news legislators heard.

First, economic growth is anemic. It is taking us longer to recover from the recession which officially ended months ago. And New Hampshire for the first time in memory is recovering more slowly than other states in New England except for Rhode Island. New England is also recovering more slowly than the rest of the country. That’s not good. Continue reading

Capital Comments: Hassan sworn in as governor, sets out priorities

Capital Comments from State Senator Bob Odell

Inaugurations of New Hampshire governors are always exciting and each one ties us to our long history of democracy as a state and nation.

Governor Maggie Hassan, a former State Senate colleague of mine for four years, is the second woman to be governor of New Hampshire and the first Democrat to replace another Democrat since the 19th century. Last Thursday, she was also the first woman sworn in by a female Supreme Court Chief Justice. Continue reading

Capital Comments: Senator Bradgon announces committee assignments

Capital Comments from State Senator Bob Odell

Organization Day, held on the first Wednesday in December in election years, is the opportunity for the new Senate and House to meet for the first time.  It is an occasion for legislators to share a special day with family and friends. Continue reading

Capital Comments: N.H. biennial budget process underway

Capital Comments from State Senator Bob Odell

The sparring over the size of the state’s next biennial budget began last week.  Over three days, agency heads offered their wish lists for appropriations for the two year budget cycle that begins on July 1.

Presentations at the Governor’s Fiscal Year 2014-15 Operating Budget Hearing, one of several steps in the budget process, gave department heads a chance to tell their stories publicly for the first time.  They will have plenty of other opportunities down the road.

The agency heads were providing the Governor, legislators and the public with what they think the costs will be to run the current programs in each department for the next two years. Their “maintenance” budgets do not take into consideration any new programs or activities … they simply keep programs as they are.

What does that get you?  Adding up all agency requests, if approved and they won’t be, there would be additional spending of $3.3 billion over the next two years, an increase of 26 percent over current spending levels. Continue reading

Capital Comments: N.H. Medicaid and the new healthcare law

Capital Comments from State Senator Bob Odell

A constituent that I hear from periodically wants me to introduce a bill to nullify the new federal health care plan.  He writes, “Obama Care must be nullified within our state to eliminate the vast, new, unconstitutional powers over health care …”

In the days following the election, some legislators, government officials, stakeholders like insurance companies and health care providers and the media are focusing on the implications for New Hampshire of the Affordable Care Act, which even the President has said is appropriate to call Obama Care.   About 100 of them turned out last week at the Department of Health and Human Services headquarters to be briefed on the part of the new law dealing with Medicaid.

HHS Commissioner Nick Toumpas introduced the program explaining that while the U.S. Supreme found the new law constitutional, the federal government cannot force states to increase the number of people on Medicaid, the program that provides services to indigent people.  Commissioner Toumpas said policy makers, the legislature and the Governor need to determine whether or not we will expand the number of people on our Medicaid rolls.

After support for public schools, Medicaid is the next largest spending line in the budget.  To serve about 120,000 Medicaid eligible New Hampshire residents, the state spends $600 million annually that is matched by another $600 million from the federal government. Continue reading

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