Most republican counties get a majority of their funding from the federal government…and that money is going away

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The big government spending Maga voters cannot live without
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In many places where Trump is hugely popular, residents are increasingly reliant on state income transfers. The issue could fracture the Republican party


© Carolina Vargas/FT/Alamy
Our Lady of the Angels hospital in Bogalusa, a small Louisiana town about an hour’s drive north of New Orleans, sees itself as a beacon of hope in a parish blighted by poverty. Its mission — and its future — have rarely seemed so uncertain.

Last month, the Republican-controlled House of Representatives in Washington passed a budget plan that envisages massive spending cuts in order to help pay for a sweeping $4.5tn tax reduction that was a key pillar of Donald Trump’s re-election campaign.

The fear in Bogalusa is that Congress will slash Medicaid, the government health insurance programme for people on low incomes that serves one in five Americans. It is a scheme that many Republican lawmakers have long wanted to curtail.

Bogalusa’s doctors warn of the consequences. “Any cuts would be very impactful,” says Maria Christina Buenaflor, an obstetric gynaecologist at Our Lady of the Angels. “Upwards of 60 per cent of the women who deliver here are on Medicaid.”

Bethany, a mother of two from Bogalusa, is one of them: her third baby is due on April 4, and Medicaid will cover the whole cost of delivery. Cutting the programme would be a “huge step back for all of us”, she says. “Times are hard — we can’t afford it ourselves right now.”

Bethany, who declined to give her surname because she does not want to publicise her political views, voted for Trump in November. But she says she is surprised at all the talk about curtailing a programme that has become indispensable to her and her family.

“It never came up in the campaign,” she says. “I don’t think people saw it coming.”

The future of the Our Lady of Angels hospital strikes at the heart of the issue that has the greatest potential to split the Maga movement.

Although Trump seems to have total control of the Republican party and his administration, powerful factions are pulling him in very different directions.

Over the next few months, he will have to find a way to balance the interests of both the fiscal hawks and billionaire allies, who want to radically downsize the federal government, and his working-class Maga base, which has become heavily reliant on government support.

The tension is a result of two powerful trends that have been reshaping American politics and society over the past two decades. The first is a realignment of the two major political parties, with the Democrats expanding support among college-educated, suburban professionals, while the Republicans have picked up votes among working class Americans.

At the same time, a growing section of voters has come to rely on government transfers, the result of an ageing society and rising inequality. These include Medicaid for poorer families and Medicare and Social Security for retirees.

Dr Maria Christina Buenaflor and a nurse look at a patient’s chart
Maria Christina Buenaflor, an obstetric gynaecologist at Our Lady of the Angels in Bogalusa, says more than 60 per cent of women who give birth at the hospital are on Medicaid © Claire Bangser/FT
In 2000, according to the Economic Innovation Group, a think-tank, just 10.4 per cent of counties in the US derived a quarter or more of their total personal income from transfers. But by 2022, that had risen to 53 per cent of counties in the US. Many of those counties are in the sort of rural areas where Trump is hugely popular.

“As much as Republicans like to rail against big government, [their voters are] often its biggest beneficiaries,” says John Mark Hansen, professor of political science at the University of Chicago.

Or as Steve Bannon, one of the architects of Trump’s initial rise to power, put it in a recent podcast: “Medicaid’s going to be a complicated one . . . a lot of Maga’s on Medicaid.”

Louisiana is a prime example of these trends. The state is as red as they come, choosing the Republican candidates in 12 of the past 14 presidential elections. Governor Jeff Landry hung a “Make America Great Again” flag from his official residence on the day Trump was inaugurated, and urged others to do the same.

But Louisiana is also a relatively poor state, with one of the highest proportions of people on Medicaid. In the congressional district of Mike Johnson, Republican Speaker of the House, 33 per cent of people are enrolled in the programme. That means Louisiana will suffer more than other regions if the Trump administration indeed decides to reduce funding for Medicaid, as well as other anti-poverty schemes that have long been in the Republicans’ crosshairs.

EJ Kuiper, chief executive of Franciscan Missionaries of Our Lady Health System (FMOLHS), which runs the Bogalusa hospital, says more than 40 hospitals in Louisiana are at risk of closing if Medicaid funding is reduced.

“All the [members of Congress] we talk to . . . understand that a lot of hardworking people seek care in these hospitals, which are often the backbone of the local economy,” he says. “So they’re going to be very careful about passing measures that would be detrimental to their constituents.”

The alliance that brought Trump to power for a second time is far more heterogeneous than it was in his first term.

Aside from the Maga populists there are now the “broligarchs”, ultra-wealthy tech executives like Elon Musk who have become some of the president’s most ardent supporters. There are also working-class Black and Hispanic voters who backed Trump for the first time last November, attracted by his promise to bring down prices on day one.

By tapping these new sources of support, Trump was able to narrowly win the popular vote, which eluded him in 2016, and help his party retain control of the House and win a majority in the Senate.

But the majorities are slim in both chambers: just three seats in the House, which presages heated battles over legislation. Meanwhile, the budget debate has opened up deep faultlines in the party between conservative hardliners in the Freedom Caucus and members of Congress from swing districts who are fearful of withdrawing funds for the health programmes their constituents rely on.

 

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EJ Kuipder with blue suit and tie
EJ Kuiper, head of FMOLHS, which runs the Bogalusa hospital, says more than 40 hospitals in Louisiana are at risk of closing if Medicaid funding is reduced © Claire Bangser/FT
“There are some very deep divisions there that have been papered over by the extraordinary loyalty Trump commands from his voters,” says the University of Chicago’s Hansen. “It’s the fiscal hawks vs the rest of the party, not just Maga, but the dwindling number of moderates.”

These fissures are reflected in polling data from KFF, a non-profit health policy research group, from last month. It found 67 per cent of Republican voters wanted the government to either increase or maintain spending on Medicaid, with only 33 per cent saying it should be reduced.

“If you look at the president’s base, it’s a large number of low-income working families and those are the folks that are on Medicaid,” says Ryan Cross, head of government affairs at Franciscan Missionaries hospitals. “And that’s why he’s taken the position he has so far.”

The position he refers to is Trump’s repeated assurance that he would “love and cherish” not only Medicaid, but also Social Security, the government pension scheme, and Medicare, a health insurance programme for the elderly and for younger people with disabilities. Officials in Bogalusa believe him. “I take Trump at his word,” says Ryan Seal, the Republican president of Washington Parish, of which Bogalusa is a part.

He also believes Johnson, the House Speaker, who has insisted that in trimming spending, the focus would be on ferreting out “fraud, waste and abuse” in Medicaid, rather than cutting benefits or shrinking the programme.

But his attempts to reassure voters contrast with the more aggressive tone adopted by Musk, who has called Social Security “the biggest Ponzi scheme of all time”, and told Fox in a recent interview that there was “$500bn-$700bn in waste” that needed to be cut from entitlement spending. “That’s the big one to eliminate,” he said.

Democrats claim cuts to Medicaid are inevitable, given the Republicans’ spending plans. The House’s budget blueprint adopted last month instructs the energy and commerce committee, which oversees Medicaid and Medicare, to come up with at least $880bn in savings over 10 years. Democrats say it will be hard to do that without touching health insurance for the poor.

Nurses in the Emergency Department at Our Lady of the Angels Hospital in Bogalusa
Emergency department nurses at Our Lady of the Angels. Hospital officials fear cuts to Medicaid will hit their ability to provide intervention before health problems turn into medical emergencies © Claire Bangser/FT
“Musk enjoys brandishing his chainsaw but it’s not funny when you take a person’s job, it’s not funny when you take their healthcare,” says Cleo Fields, a Democratic lawmaker from Louisiana.

All the talk of cuts to anti-poverty programmes is one of the reasons why voters have been haranguing Republican members of Congress at town hall meetings up and down the country in recent weeks, in angry scenes that have been shared thousands of times on social media.

Fields says the anger is understandable. “The vast majority of people who voted for Trump did not expect him to . . . take money away from their disabled kids,” he says.

He believes Medicaid could become a rallying cry in the 2026 midterm elections, just as threats to make big cuts to healthcare paved the way for the Democrats’ victory in the 2018 midterms, during Trump’s first term.

But political analysts do not yet detect a change of heart among Republican voters. Arlie Russell Hochschild, a sociologist from the University of California, Berkeley, who has written books about the rise of the right-wing Tea Party movement in Louisiana and white nationalism in poor parts of Kentucky, says she has not yet seen a shift in voters’ sympathies away from Trump.

“In Kentucky, which is a Democratic state that later swung right, everybody’s confused, everybody’s in doubt, but we’re not at the tipping point,” she says.

The expansion of Medicaid in towns such as Bogalusa is part of a broader story about the huge increase in the amount of money the federal government is paying out to US citizens.

Income from government transfers was the fastest-growing major component of Americans’ personal income, according to the EIG report last year. It said they made up 18 per cent of all personal income in the US in 2022 — a total of $3.8tn — with the share more than doubling since 1970.

Transfers, which include state pensions and state health insurance, as well as veterans’ benefits, food stamps, unemployment insurance and other benefits, were now the third largest source of Americans’ personal income, after income from work and investments, EIG said.

The main driver of this trend, EIG said, was the ageing of the US population. Because the largest transfer programmes — Social Security and Medicare — are aimed at people of retirement age, transfer payments expand as the elderly population grows.

“Across huge swaths of the American map, ageing has pushed transfers higher while local economic struggles have suppressed growth in other earnings,” the authors wrote. “The result is a reshaping of how communities derive their livelihood — and a fading importance of work and productive activity in generating local incomes.”

The trend is not confined to a few poor pockets of the country. The report says that “most US counties depend on a level of government transfer income that was once reserved only for the most distressed places”.

It said the transfer share runs highest in parts of the country that are “rural, old and poor”. Some of these, Appalachia and the rural South, are firmly Republican.

Those finding have been echoed by other studies. A report by the Center for Children and Families at Georgetown University in January found that there are 15 states where at least one-fifth or more of non-elderly adults in small towns and rural areas are covered by Medicaid. Of these, eight voted for Trump in November.

Louisiana is one of those states. According to Cross of Franciscan Missionaries hospitals, the federal government shoulders around 70 per cent of the costs of Medicaid in the state.

 

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Garland Anderson, with stethoscope around his neck, sits at his desk
Garland Anderson, head of primary care at Our Lady of the Angels, says locals ‘have a lot of need. A lot of these people are living off instant ramen and little else’ © Claire Bangser/FT
But that proportion is even higher in the Medicaid expansion ushered in by the Affordable Care Act, more commonly known as Obamacare, which brought tens of millions of previously uninsured Americans under Medicaid’s protective umbrella.

The ACA broadened Medicaid coverage to nearly all adults with incomes up to 138 per cent of the Federal Poverty Level, around $21,597 for an individual. The federal government pays 90 per cent of the costs for new enrollees in the expanded programme — the so-called federal matching rate. States like Louisiana that have implemented the expansion pay just 10 per cent.

Yet one of the proposals Republicans have discussed to reduce the cost of the programme involves trimming the matching rate, leaving states to make up the shortfall in funding. That could put a huge strain on their budgets.

“A lot of the policies on the table are about either directly taking coverage away from people or . . . shifting costs to the states and then leaving them holding the bag,” says Allison Orris, an expert on Medicaid policy at the Center on Budget and Policy Priorities, a think-tank. “States will need to make choices about their programmes, and those choices likely include cutting eligibility, cutting benefits and cutting provider rates — probably all three.”

Indeed, KFF, the research group, estimates that eliminating the federal matching rate could reduce Medicaid spending by nearly one-fifth, around $1.9tn, over a 10-year period and could lead to 20mn people losing coverage.

The expansion of Medicaid proved an important safety blanket in Bogalusa.

Nicknamed “Magic City” in the 1920s on account of its rapid population growth, Bogalusa grew up around the vast Great Southern Lumber company sawmill, which processed virgin longleaf pine from the forests of Louisiana and neighbouring Mississippi. But the mill closed in 1938 when the supply of pine became depleted. A paper mill continues to operate in Bogalusa, making containerboard and corrugated packaging, but it employs many fewer workers than the sawmill did in its heyday.

Exterior of Our Lady of the Angels hospital in Bogalusa
Our Lady of the Angels hospital is in Bogalusa, a city grappling with economic and social problems including drug abuse and homelessness. Louisiana has one of the highest proportions of people on Medicaid © Claire Bangser/FT
The city has grappled with economic problems. “We’ve had our struggles,” says Seal, the president of Washington Parish. He explains the town was hit hard by the opioid epidemic and the fentanyl crisis, adding: “Drug abuse has really taken a toll on rural America.”

Homelessness is rife, too. “We have people who fall through the cracks where housing’s concerned,” Seal says. Single mothers with young children are often forced to live in temporary accommodation, such as the Choctaw Motel on S Columbia Street in downtown Bogalusa.

“People here have a lot of need,” says Garland Anderson, head of primary care at Our Lady of the Angels. The incidence of chronic disease is high, he adds, and nutrition poor. “It’s easy for me to say, ‘watch your sodium intake’, but a lot of these people are living off instant ramen and little else,” he says.

Anderson says Medicaid expansion under Obamacare made a big difference. It allowed Our Lady of the Angels to adopt a programme of “managed care”, with more screening for high blood pressure, cancer and other diseases. It was a way to “cut costs” by allowing doctors to intervene before health problems turned into medical emergencies and “raise the quality of care”, he says.

But the talk of cutting Medicaid has called that into question. “Just as we’re transitioning, they’re pulling the rug out from under us,” he says.

“We fought so hard for it, and it’s stressful that it could so easily be taken away.”

Cartography by Steven Bernard