Deal attack ad misfires on claim Carter will spend billions

Republican Gov. Nathan Deal has a new television ad out that says his Democratic opponent, state Sen. Jason Carter, plans to go on a spending spree if elected.

It’s part of the GOP’s strategy to paint Democrats as the tax-and-spend party.

"Jason Carter’s plan: increase spending by $12.5 billion," the ad’s narrator says at one point.

That’s a head-turning forecast given that the state’s annual budget is about $21 billion.

PolitiFact decided to review this one further.

Deal spokeswoman Jen Talaber said the governor’s campaign developed the $12.5 billion projection based on Carter’s pledges to restore full funding to k-12 education and expand Medicaid.

School systems have not been fully funded by the state since 2003. That’s become a major issue in this year’s governor’s race.

Austerity cuts to education this year are about $747 million, and that’s better than the recent past.

Talaber said the $12.5 billion forecast assumes that Carter will spend $1 billion a year in each of the next 10 years, $10 billion total, to fully restore education funding.

But that also assumes Carter, if elected governor, would serve more than the two-term maximum (eight years) the law allows.

Second, it assumes that the Legislature, now in Republican control, would follow his recommendation and approve the money every year.

Lastly, at least for next year, the $1 billion is off the mark. Although adjustments have to be made for factors such as enrollment growth, school systems would need about $747 million to be fully funded, based on the extra money put into education this year on Deal’s recommendation.

The campaign does the same thing with its math for Georgia’s cost to expand Medicaid under the Affordable Care Act. It’s $2.5 billion projection is for a decade, not a single year.

That makes the figure disingenuous on its face.

But the number does exist, in a 2012 Kaiser Family Foundation study that focused on the ACA's Medicaid expansion plan.

If states sign up, the federal government pays all the costs for newly eligible enrollees in 2015 and 2016 and no less than 90 percent thereafter.

A similar state study projected the cost to be about $2.1 billion – still in the same general range.

Missing from the spending claim: the $31 billion to $35 billion in federal money that will come back into Georgia under expansion.

In other words, Georgia’s spending would create a 17-fold return on investment in actual dollars.

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The state study projects the spending also would stimulate $65 billion in economic activity over the decade.

"To say that the state is going to have to come up with $2.5 billion on its own is incorrect. There will be extra money coming back from the federal government," said William S. Custer, the author of the state report and director of the Center for Health Services Research at Georgia State University.

Deal has adamantly opposed expansion and say there’s little reason to believe the debt-ridden federal government will continue to pay 90 percent of the costs far into the future.

Further complicating the math, Georgia must spend some of the $2 billion projection, even without expansion, to meet ACA requirements. But without expansion, there is no counterbalance of federal money.

And, from a state budget standpoint, there also are areas where expansion could cut spending.

The studies don’t count cost reductions in state-funded health care to those who are incarcerated or in some mental health programs, who could be transferred to an expanded Medicaid program.

The state has not done the calculations to determine the potential savings, which would likely need to be done on a case-by-case basis to determine Medicaid eligibility, said Timothy Sweeney, director of health policy at the left-leaning Georgia Budget and Policy Institute.

Still, Sweeney said "substantial savings" could be achieved.

"We are serving these people already, with state funding," Sweeney said. "It’s clear that transferring that service to federal funding would cut state costs."

Those figures help prompt many health care leaders in Georgia to push for expansion. State lawmakers, though, backed Deal’s stance that expansion would be a fiscal trap by passing House Bill 990 last spring.

The measure requires the GOP-controlled General Assembly to approve any expansion of Medicaid "through an increase in the income threshold."

That leaves a loophole for Georgia to expand the program only via a loophole such as Arkansas did, by using the federal subsidy to buy private health care insurance, not Medicaid.

That more or less leaves the fate of Medicaid expansion – and the potential costs – in the hands of the Legislature, not the governor.

The ad says Carter’s plans will result in taxes on small businesses and the middle class, something Carter flatly denies. It calls Carter "silver tongued" and "untrustworthy."

Carter says additional funding for education will come from cuts in government waste, recovery of delinquent taxes and economic growth. That’s typical campaign banter. (We’ve ruled Half True a claim by Carter that education funding can be increased significantly if the state goes after $2.5 billion in delinquent taxes.

But what about the ad claim that Carter’s plan will cost $12.5 billion?

Those cost projections cannot be taken seriously. They are for a period of 10 years -- longer than Carter could legally be in office.

They leave out other critical facts -- like lawmakers would have to sign off on any major spending.

We rate the ad claim as False.