Entitlements Are Forever : The legal fight over California's attempt to balance its budget

The Wall Street Journal reports:

At least in the Western Hemisphere, there isn't a better example of the way entitlements capture and then overrun government budgets than California. Amid a fiscal crisis approaching Grecian urgency, the courts are now bidding to turn back even the fitful efforts of the Sacramento political class to close a $19 billion deficit.

Arnold Schwarzenegger is embroiled in a fight with the federal Ninth Circuit Court of Appeals, which over the last 18 months has invalidated about $2 billion and counting in emergency spending cuts that were approved by the legislature and signed by the Governor. In this case, the fiscal hatchet was taken to the state's $40 billion Medicaid program, known as Medi-Cal. If the Ninth Circuit has its way, California—and other ailing states—will lose whatever flexibility they have left after ObamaCare to manage an entitlement-driven budget crisis without raising taxes.

The Ninth Circuit wants to overrule the elected branches of government on the basis of an "equal access" clause in the original 1965 Medicaid statute. This joint state-federal program originally meant for poor women and children—ObamaCare will expand Medicaid to roughly a quarter of the U.S. population—is price controlled like Medicare. States are required to set rates that "are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area."

In the 1990s, hospitals, doctors, pharmacies and other providers started suing states over rate cuts they claimed violated this amorphous law. If a state set its price controls too low, they argued, Medicaid recipients wouldn't receive the same standard of care as everyone else. These suits were an invitation for the federal courts to install themselves as the ultimate arbiters of equal access, and thus control all political decisions about Medicaid itself.

Great welfare state moments.