FOR IMMEDIATE RELEASE: D.C.’S GREAT DISAPPEARING ‘FREE’ MONEY ACT

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Contact: Charles Siler
202-487-8652

FOR IMMEDIATE RELEASE: D.C.’S GREAT DISAPPEARING ‘FREE’ MONEY ACT
HOW THE FEDS RELY ON BROKEN PROMISES TO KEEP THE STATES ON A LEASH

Congress is supposed to be limited in its ability to tell the states what to do, but Washington politicians will say anything to get their way. The most common approach: luring states in with promises of “free” federal money. The only price is a few strings. Once everyone is tied up, the feds have little incentive—and even fewer resources—to keep those promises. That’s why federal promises are broken time after time and why states shouldn’t trust Washington’s new promise to fund ObamaCare’s Medicaid expansion, says a report released today by the Foundation for Government Accountability (FGA).

The feds have been playing this promises game for years, but it’s about to come to a head. The federal debt already topped $18 trillion, and it’s projected to hit $27 trillion in the next decade. This means federal dollars promised for state coffers will soon be on the chopping block.

The biggest program with a target on its back is also the target of Washington’s latest empty promise: Medicaid. Medicaid spending is set to more than double from $251 billion in 2012 to $588 billion in 2025. Rep. Paul Ryan, chair of the House Ways and Means Committee, has already told state lawmakers federal funding for Medicaid expansion is going to be eliminated and the House and Senate passed budget resolutions that do just that by repealing ObamaCare. Even President Obama proposed budgets that shift more ObamaCare Medicaid expansion costs back onto the states.

“There’s no question Washington is making promises it can’t afford to keep. When it breaks them, the states who expanded Medicaid will still be tied by the federal strings and state taxpayers will have to bail out Washington’s broken promise once again,” said FGA CEO Tarren Bragdon.

“It’s not even a well-kept secret that the feds don’t keep their funding promises, so it’s a wonder when state governments still fall for Washington’s promises.”

It’s hard to find an area where the feds haven’t broken their promises, whether they’re cutting highway money, holding back mineral royalties, bond subsidies to local governments, or withholding money for disabled children, according to FGA’s report.

The Individuals with Disabilities Education Act required states to provide disabled children with appropriate educational services. For their end, Congress promised to pay 40 percent of the additional costs for educating these vulnerable children. In reality, Congress simply decided to never fully appropriate the program, which now amounts to a roughly $17 billion shortfall per year. These are massive costs which have been and continue to be shifted to the states.

It’s time for the states to stop falling for the broken promises, and to set themselves free of all of Washington’s strings.

The FGA report, which shows why states simply can’t trust Washington’s Medicaid expansion promise, can be read here. The full report can also be downloaded below.

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To schedule an interview, please contact Charles Siler with the Foundation for Government Accountability at (202) 487-8652 or charles@thefga.org.


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