Last week, the El Paso Inc. published a question and answer session with Ron Acton. The article, by David Crowder, should put to rest the notion that the El Paso Children’s Hospital will be self-sustaining without the funding from the taxpayers. Acton, the outgoing chair of the children’s hospital, clearly laid out how the taxpayers will fund the operation. However, as if that wasn’t bad enough, you should look at how Ron Acton laid out what the current taxation-based public policy for El Paso is nothing more than patronage funded by the hardworking taxpayers. What is most disturbing is the nonchalant way in which Acton explained the mindset of using other’s money for personal success.
In 2007, the County ordered a bond election for a children’s hospital to be built for the community. Proponents, like Veronica Escobar, promised the taxpayers of the city that the children’s hospital would pay for itself. Other than the bond to build the building, the taxpayers would not need to support the children’s hospital. Ron Acton, a founding member of the children’s hospital, stated that the children’s hospital “does not require any additional dollars from the taxpayers.”
In 2012, the children’s hospital held its grand opening. By then, the funding mechanism, Medicaid, had been reduced by the federal government. The funding scheme under which the hospital had been built ceased to exist. By May of 2015, the children’s hospital was forced to file for bankruptcy. In late 2015, the children’s hospital emerged from bankruptcy, after the University Medical Center, a taxpayer funded hospital, took it over.
The narrative that Escobar and cohorts want you to believe is that the children’s hospital is independent of UMC and that a “big increase in Medicaid reimbursement rates in coming months” will be a “boon” to the children’s hospital.
Notice how the notion is that Medicaid is the savior of the taxpayers?
Forget the unpleasant fact that Medicaid is a tax you pay. Look at how Acton is framing the scheme to the community. Acton told the El Paso Inc. that the children’s hospital will “break even” by September 30.
There are two issues you need to pay attention to this little nugget that Acton is offering you. First, his exact quote is; “Children’s should break even on a cash basis when the fiscal year ends Sept. 30.”
Acton is playing semantics here with you. He is playing a game with words. I’ll let him explain it you.
Acton is quoted by the El Paso, Inc.:
“What I believe and what our board is excited about is that we think we will break even on a cash basis this year. As you know, a hospital is a big business and it has lots of assets that depreciate, but that’s a non-cash item. I think that while our profit and loss will show a bigger loss than half a million dollars, the important thing is on a cash basis we’re going to be at break even.”
Huh? In one sentence, Acton is stating that the hospital will show a bigger loss than half a million dollars but you should ignore that because it will pay its bills with the cash they have on hand. Acton goes on to explain that businesses depreciate equipment as part of the balance sheet and it is this depreciation that will result in losses for the hospital this fiscal year.
Let me make it simple for you. I depend on my computer to work. My computer gets older each year and eventually there comes a time when I must replace it. Depreciation takes that into account and a strong balance sheet means that I will have the money to replace the computer when I need to.
What Ron Acton is telling the taxpayers is that they will have to pay for new hospital equipment and maintenance on the building where they operate.
But it gets worse for the El Paso taxpayers.
Medicaid was the funding mechanism that made the promise of a self-sustaining hospital feasible in the first place. It was also the reason the hospital filed for bankruptcy. Again, you are being promised that Medicaid will be the savior.
According to Acton, Medicaid reimbursements are going up significantly in August. Ron Acton further tells you in the article that the El Paso Children’s Hospital revenues are 80% of all the money it takes in.
Digest that for a moment, 80% of the money the hospital takes in comes from Medicaid reimbursements.
Here is what Ron Acton cleverly ignored and what David Crowder did not bother to ask him: what about Donald Trump’s attempts to end the Affordable Healthcare Act, also known as ObamaCare. Not only that, but Trump has been systematically trying to defund many federal programs to fund his pet projects. And if that wasn’t bad enough, the State of Texas, led by the Republicans, always look to curtail medical health services wherever possible.
Somehow and though all this chaos, the El Paso Children’s Hospital is expecting almost all its revenue to come from Medicaid.
Let that one sink in for a moment. What could possibly go wrong?
The Ron Acton Mindset is the El Paso Mindset of Taxing Workers to Death
I hope you had time to digest that the El Paso Children’s Hospital somehow believes that Medicaid reimbursements will be its salvation while at the same time, and to make things more palatable to you, are forgoing building a balance sheet that would deal with equipment and maintenance needs over the next few years. Because now I’m going to give you heartburn because Ron Acton explains in clear words why you need to pay to fund his, and his cohorts’ extravaganzas.
David Crowder asked Ron Acton to share his personal story. It is very telling.
“Primarily, my life has been built around working for J.O. Stewart Jr.” He is further quoted, “I still work for the Stewart family’s business, primarily investments.”
In other words, Acton is telling you that he hooked up with a rich guy and basically became his errand boy for his paycheck. That’s ok for some, but it smacks of the system of patronage.
Patronage is when someone, or a community, becomes subservient to others in return for privilege and financial support.
Let’s let Ron Acton, explain it for you:
“It started with my marriage. My father-in-law is Evern Wall, former head of El Paso Electric Co. He was totally community oriented and he told me that if I wanted his daughter’s hand in marriage, I would follow suit.
Then, I had the privilege of being in banking and had the privilege of working for Steve DeGroat, who was and is a community leader. He echoed my father-in-law and said if you want to be in banking, you’ve got to be involved in our community.
But then I had the privilege of working for J.O. Stewart, who had a heart for this city like very few people. He put his money where his mouth was. He encouraged me to work for community boards.”
Acton then closes his reminiscing by stating that El Paso “will do fine” if “people like the J.O. Stewarts, the Rick Francises, the Woody Hunts and the Paul Fosters” are in the mix.
The mindset clearly laid out by Ron Acton is the mindset of El Paso’s visionaries that believe that their vision of El Paso is the only correct direction for the city. The children’s hospital, the ballpark and the proposed arena are all part of the fantasy of creating a successful city by taxing the working people of the city. This mindset is currently being led by Veronica Escobar, Susie Byrd and Beto O’Rourke. Look at their history and you will clearly see that to them, it is not about hard work but, rather, depending on the taxpayers to give them a paycheck.
It is classic patronage.
What the patrones don’t want you to notice is that in return for their largess, you are expected to feed their whims just because they deem it so.
There you have it, want to be successful in El Paso, kiss some ass. Just make sure it is rich asses because the working middle class has no chance other than to eat hotdogs while paying the rich asses for the privilege of sitting in the ballpark their taxes paid for.
As for the El Paso Children’s Hospital, get ready to pay more to keep the scheme going. Ron Acton, himself warned you about it.