Daniel Henninger makes a very good point about how Medicaid is causing havoc with many states’ budgets. He says that the problem is costly federal mandates. I’m not for costly federal mandates, but the bigger problem here is federal bribes. The program is structured so states that spend more get more federal cash. When times are good, that incentive leads to overexpansion. When times are bad, it leads to smaller-than-optimal cuts. It thus generates continuing state budget trouble.