In rebuttal, Rep. Richard Malaby: Insurmountable indebtedness

In his recent guest column (Sept. 29), Rich Livingston, president of the AARP of Maine, was sadly mistaken about medical welfare expansion and Maine's decision not to do it. He said that if Maine doesn't spend the money to expand its Medicaid program, the funds will just go to other states instead, and that Mainers won't get their "money back" from the federal government that they pay in the form of federal income taxes.

That is not true.

First, money not spent by the federal government to expand Medicaid will not be redistributed to other states. It will go directly back into the U.S. Treasury, thus reducing (or not expanding) the federal deficit.

I would have thought that Livingston, as the president of AARP of Maine, would support such an action, as out-of-control federal spending and borrowing have brought on inflationary rises in food and fuel costs resulting in crushing fiscal pressures on the at-risk elderly population.

That same government spending has also depressed the rate of return on savings and has many middle class seniors worried that their life savings will expire before they do.

Also, Maine is a net "taker" of federal funds — Maine citizens send much less money in taxes to Washington each year than the state gets back in benefits and funding.

Finally, what does this debate really say about us as a state and a nation? Livingston evidently believes that Maine shouldn't fall behind in the mad scramble to plunge our children and grandchildren into insurmountable indebtedness.

The hot pursuit of federal dollars is not a race I want to win.

Rep. Richard S. Malaby, Hancock

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Comments

 's picture

Rep. Malaby

What "out-of-control federal spending". I agree that from 2001-2009 federal spending was out of control. The yearly deficit went from zero (the Federal Government had a budgetary surplus) to over $1.3 trillion dollars in the last Bush budget.
Now with the deficit falling every year to under $700 billion this fiscal year, it looks like we have the budget over controlled. Necessary commitments by the Federal Government are not being met. The recovery is reducing the deficit and will continue to do so if your party members in Washington doesn't wreck it again.
Do you only panic when Democrats are making decisions for the good of the country?

 's picture

Now can the Representative explain what he thinks he means

"That same government spending has also depressed the rate of return on savings and has many middle class seniors worried that their life savings will expire before they do." How is this. To depress the rate of return on savings you have to reduce interest rates generally. The interest rates is controlled by the Federal Reserve to achieve inflation and unemployment targets. Federal spending has little or nothing to do with this Fed decision. We now have all time high Federal spending and record all time low interest rates. A few years ago we had all-time high Federal deficits and today we have all time low interest rates. Low interest rates have depressed the rate of return on savings. To increase the rate of return on savings we need high interest rates like perhaps those in the Carter-Reagan years. We have low rates because we are just emerging from recession and rates will rise when the demand for money increases because of increasing business activity. Nothing in any of that has anything to do with Federal spending.
So Rep. please explain.

 's picture

And the road you rode in on.

The money comes because we qualify for monies for initiatives to address poverty, health, workforce development, economic development, highways, research and development, etc. I guess the folks in Hancock, Maine are all set.

 's picture

Where is it written, that what you contribute in taxes

should come back to you exactly as Federal spending. I really don't understand that. Federal Spending is to achieve national goals. The better national goal are attained the better off we in Maine are. So if we contribute 1.50 and get back $.75 or if we contribute $1.00 and get back $1.41, in either case what's the problem? Perhaps a little respect for our Country and a little Patriotism.

Jim Cyr's picture

Mr. Albrecht, did you

mean a little Patriotism with respect for the " Constitution "?

MARK GRAVEL's picture

There is one more little fact

There is one more little fact about federal tax distribution. Maine receives about $1.41 for every $1.00 sent to Washington DC.

That is, Maine already receives more than it pays.

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