California Myths - Obamacare and state fiscal health
Among the many vituperative reactions I had to yesterday’s column, one recurred a lot — namely, the assertion that California’s rising enrollment in Obamacare would bankrupt the state, which is already a fiscal basket case.
First of all, the Obamacare subsidies — both the credits for insurance purchased on the exchanges and the Medicaid expansion — are paid for by the federal government. In fact, implementing Obamacare is a major fiscal and economic boost to any state that does it, and states opting out of the Medicaid expansion are going to have significantly lower overall incomes and fewer jobs than if they had gone along. (My back of the envelope says around 1 percent of GDP, but I’m still working on that.)
Beyond that, however, the California as fiscal basket case narrative is way, way out of date. Jerry Brown and the huge Democratic majority in the legislature have turned that situation completely around.
I know, it’s not supposed to be that way — and a lot of people will stick to their narrative, never mind the facts. But anyway, California is doing OK, both on health care and on budget policy.
http://krugman.blogs.nytimes.com/2013/11/26/california-myths/?_r=0
"a lot of people will stick to their narrative, never mind the facts." And they generally have an (R) after their name. 