Medicaid’s Value as ‘Stimulus’

However bizarre it sounds to fans of limited government, many Obamacare supporters believed — and continue to assert — that Medicaid expansion is a powerful economic-development tool.

The state-federal welfare program covers over 72 million Americans. Amazingly, more than a third of New Mexico’s population is on Medicaid. Later this month, the Foundation will testify in Santa Fe on the costs and benefits of the governor’s Obamacare-enabled decision to expand the program, and whether the “multiplier effect” from increased Medicaid spending is improving New Mexico’s economy.

We’ve examined the 24 states that expanded Medicaid “on schedule,” in January 2014, and the 20 states that have declined to broaden enrollment. The average job-creation percentage in the two types of states has been almost identical, with a slight edge to the states that did not expand their programs:

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We’ll be examining other economic indicators as well, but at this point, it appears that making a defective and unsustainably expensive welfare program even bigger is not much of a “stimulus” in terms of employment.

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