The Failure of Veteran Senate Republicans

It's the Economy, Stupid

I’m wondering why some of our veteran Senate Republicans are jumping on the easy track to fixing the so-called Medicaid expansion “problem”.

Republicans are supposed to lean toward market based, economic oriented solutions and away from entitlement-based fixes, which ultimately our grandchildren, not us, nor the aging Republican Senators (who feel the need to “do something“), will pay for.  And it should go without saying that this entitlement solution would come from an already-bloated, debt ridden, ever-encroaching Federal Government that cannot be trusted.

I wonder why they aren’t focusing on improving the New Hampshire jobs climate, helping the very people targeted by this expansion to attain and afford sufficient healthcare on their own, rather than counter-intuitively taking it from a Federal program that requires a built-in “exit strategy”.  After all, Democrats aren’t focusing on the economy, whatsoever, so this would be a chance for Republicans to seriously differentiate themselves.

I then started to look for some low-hanging business and economic fruit to pick.  While doing so, I discovered a few things that really surprised me.

NH fares pretty well when it comes to taxes, having neither a sales nor income tax, but this is offset by high corporate (8.5%) and property tax rates – we sit dead-last in the US here, having a 5.588% share of property taxes to personal income.  We rank pretty well with regard to Gas Taxes (#10/50 at $0.196 dollars/gallon of gas), which is something you hope Republicans would want to leave alone, given that the cost of energy is high when doing business in New Hampshire.  Our unemployment tax rate for businesses is also appealing (ranked #19, currently at 2.11%).

But, sitting at the dreary rank of #31 in Forbe’s Best States for Business, New Hampshire certainly has room for improvement.

According to this study (see their methodology), our Business Cost rank is near the bottom, at a miserable #44.  This category is heavily weighted by labor costs but also includes business taxes and energy costs, where we rank #47 at 16.21 cents/kw, more expensive than our pre-Hassan days.  Our Regulatory Environment ranking is just as dismal at #46.  This category includes labor regulations, health-insurance coverage mandates, occupational licensing, the tort system, right-to-work laws (or lack of), tax incentives, and more.  Our average Economic Climate ranking of #27 is a function of our low unemployment rate, somewhat offset by the small size of the top-1000 public and private companies having their headquarters here.  On the positive side, our Growth Prospects ranking is an impressive #18.

So, with this mix of positive and negative, you would think that Republicans would see an opportunity for some success.  You would think that if they focused on reducing business regulation, lowering energy costs and corporate tax rates, and facilitated marketing campaigns to lure business to the Granite State, they could improve our economic position, while benefiting the lives of the under- and unemployed poor in their quest for jobs, better jobs, and affordable healthcare.

This also makes sense from a Party strategy standpoint because, again, improvement is achievable and the Democrats simply aren’t doing it.  If I were heading up the NHGOP, I would be frantically devising an economic improvement initiative, attacking our weaknesses and exploiting our strengths, before the 2014 elections; and I would be hammering away at Democrats for their lack of initiative and action.

Finally, the following facts surprised me and raised serious questions about why we even NEED to cave into the hype of expanding Medicaid with Federal money:

Labor Supply #19/50 : We have a fairly rich labor pool to draw from, with 91.8% of our residents graduating from high school and 34.6% graduating from college.  About 10% of our workers are union members, 2.5% below the national average.  Instead of taking Federal money for Medicaid expansion, how about we help find better jobs for those who can’t afford sufficient healthcare coverage but are qualified to work? How about we find ways to create better jobs (and more jobs), so more able-bodied people can provide for themselves?

Growth Prospects #18/50 : This high ranking comes from a combination of growth forecasts from Moody’s Analytics, business opening/closing statistics from the Small Business Administration, and venture capital investment data from MoneyTree and PriceWaterhouseCoopers, showing that positive growth potential for New Hampshire exists.

Quality of Life #7/50 : Crime rate, poverty rate, school performance, Moody’s Cost of Living, Department of Health statistics, culture and recreation, and the presence of top-ranked four-year colleges in the state make up this ranking.  New Hampshire has the distinction of having just 10% of its population below the poverty line – the lowest in the US as of September, 2013.

I’m very bullish on our state but, frankly, I was not aware that it had so much potential, with such a high quality-of-life rank and low poverty rate.  Yet, here we are, on the brink of expanding a government-subsidized entitlement program, as though we were New Jersey, New York, or California, instead of trying to “rise the tide” ourselves.  Why?

Instead of relying on an inept, over-spent Federal government to take care of the very small number of poor in New Hampshire, Republicans should be taking on the challenge to develop local, state-based solutions, zeroing in on improving our business and economic climate, which will surely benefit all, not just the poor.  With a healthy state economy, it would be very easy (and gratifying) to create that safety net for the weakest among us – and then some – without worrying about strings-attached or failed promises.

This is what State government is supposed to do.

But, like hopelessly clinging to the latest fad diet, or falling for some “get rich quick” scheme (which never ends well), our veteran Republican Senators are taking the easy route, avoiding the path of fundamentals, leadership, and creativity, which could benefit New Hampshire in the short and long term.

And it would extend their political careers, which are beginning to take on serious water.