Tags: Kentucky | jobs | Obamacare | Cronyism

Kentucky's 'Jobs' Fantasy Figures Show Obamacare Cronyism at Its Despicable Worst

Kentucky's 'Jobs' Fantasy Figures Show Obamacare Cronyism at Its Despicable Worst
(Dollar Photo Club)

By    |   Thursday, 21 January 2016 05:48 AM

In the history of governments encroaching on their citizens' liberties, never underestimate the power of crony capitalism.

At the intersection of politicians and business interests lies a toxic brew of greed and power lust that has combined to overpower conservatives' objections on far too many occasions.

A recent case in Kentucky is one of the most vivid examples in recent memory. It's a classic case of Obamacare cronyism: fictional job figures, lucrative no bid contracts, rampant media bias, and truth vindicated — this story has everything.

You may remember liberals have been holding up Kentucky as an Obamacare success story since about the time they realized Senate Majority Leader Mitch McConnell (R-KY) might be vulnerable in his 2014 re-election bid.

All through that year, there were an endless series of articles about how Kentucky's Obamacare success (the state's then-governor, Steve Beshear, is a Democrat who championed its implementation of the law) put McConnell in a difficult spot politically.

Reporters watched McConnell's rhetoric like Kremlinologists for any sign he was embracing Obamacare even in the slightest bit. And the conventional wisdom was it was so successful it could very well send McConnell back home. That led to headlines like this one from The Huffington Post, “Mitch McConnell's Re-election May Hinge On Obamacare”).

One factor in this was that the state's health insurance exchange market didn't spontaneously combust the second real people started to use it, like Healthcare.gov. (In the words of George W. Bush, it was the soft bigotry of low expectations). Flash forward to today and Kentucky's newest governor, Republican Matt Bevin is looking rid the state of the state-run exchange because it will “eventually cost the state money to keep running it.”

But we’re getting ahead of ourselves … the major linchpin of the debate was a study touted relentlessly by Beshear purporting to show major gains to the state's economy from the health care law.

“These numbers are not Gov. Beshear’s political talking points,” Beshear told reporters about the study. “They’re not my hopes and my dreams. It’s real data… It happened.”

According to the study, Obamacare would create tens of thousands of new high-paying jobs and bring billions of dollars in revenues to the state. “Study Backs Kentucky Medicaid Expansion,” blared the headline of the New York Times, not a paper known for chronicling events in the Bluegrass State.

Except, all of that collapsed like a deck of cards when a journalist in Kentucky actually checked to see if the “projections” (remember jobs “created or saved”?) matched up with reality.

The study projected 12,000 new jobs for Kentucky in 2014, first in the health care sector and then in other parts of the economy as the new health care jobs created new Kentucky wealth.

But as it turns out, Kentucky's health care jobs actually declined in 2014.

Overall, the state lost nearly 1,300 healthcare jobs. In the hospital sector alone, Kentucky lost 2,660 jobs, despite being projected to gain 3,000 jobs there.

“Our model predicted more employment (not limited to health care but certainly concentrated in health care) than materialized,” Janet Kelly, director of the University of Louisville's Urban Studies Institute, which helped with the study, conceded. I think that's academic-speak for “touch√©.”

But the story about the study, by WDRB's Chris Otts, doesn't stop there.

Behind the study was a consulting firm with very good reason to pad the stats when it came to Obamacare. Deloitte Consulting, LLP, was the firm that crunched the numbers, paid $140,000 through a no bid contract to produce a very useful  story for Governor Beshear. That, however, was peanuts next to the $125 million the same firm received to build Kentucky's health insurance exchange.

Here’s the bottom line — the same company receiving a lucrative Obamacare contract in Kentucky produced the single most important piece of supportive evidence for the exchange — “The report concludes that the estimated costs of expansion in the current and upcoming biennial budget would be more than offset by savings and new revenues generated from economic activity resulting from new health care spending.” 

So here's to you, Deloitte: for introducing a fictional Obamacare "success story" to justify your lucrative contract, which in the eyes of many put you in the crony capitalism hall of fame.

Christopher (Chris) Versace is the editor of the newsletter The Growth & Dividend Report and is a featured columnist to The Street.com as well as a contributor to FoxBusiness.com and Forbes.com. To read more of his blogs, CLICK HERE NOW.

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In the history of governments encroaching on their citizens' liberties, never underestimate the power of crony capitalism.
Kentucky, jobs, Obamacare, Cronyism
Thursday, 21 January 2016 05:48 AM
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