If you’re the Governor, there’s an easy way to make your budget proposals look better than they really are: Staff your budget office with lackeys and yes-men who don’t actually produce accurate budget estimates. That way, your Department of Management and Budget can massage the numbers to make your budget look far more responsible than it really is.
That can be a problem, though, when you come across legislators who actually know what they’re doing. One such legislator is Larry Pogemiller, the Senate Majority Leader, who excoriated Finance Commissioner Tom Hanson yesterday.
Pogemiller had a simple argument: Spending shifts are not at all the same thing as budget cuts. Shifts, obviously, need to be paid back. They’re not true savings, they’re just procrastination. That’s why Minnesota law now requires the budget to be balanced over four years, not just two. Over four years, the Governor’s budget runs a deficit of $2.6 billion.
The Governor says that he can fix the budget without raising revenues, but the fact is that he can’t. He has only “balanced” the budget if you ignore billions of dollars in spending shifts and new borrowing, and pretend that we’ll never have to pay for them.
Speaker Margaret Anderson Kelliher also chimed in, saying the Governor’s budget was not ready for prime time. Watch that video after the break.
I wish our elected officials could tear themselves free from political games and deal with our budget’s major structural problems. Our budget has been made worse by the recession, but it has major long-term problems that need to be addressed. The problem is simple — revenues are declining because of an outdated sales tax system, while expenses are climbing as our population ages. Elected officials, for good reason, often focus on the here-and-now, but we actually need a long-term solution.
That’s why I’m disappointed with an amendment in the Minnesota Senate by none other than Majority Leader Larry Pogemiller:
The original omnibus proposal by chair Tom Bakk (DFL-Cook) [PIM item] would have imposed across-the-board income tax increases that sunset in 2014. Pogemiller’s amendment changes the sunset provision by causing the new rates to blink off, or to be reduced, in the event that any February revenue forecast prior to 2014 indicates that the state’s general fund will be balanced as of June 30 of that year.
Sure, it sounds great politically. Pogemiller is sending the message that we’re only raising taxes because we’re in a crisis, and we’ll undo it as soon as possible. The problem is that our budget crisis won’t really be over when the recession ends. It will only end when we start regularly taking in more revenue than we spend on a regular basis. That means higher taxes and fewer services — not just in this biennium, but for decades.
Let me get this straight — Republicans in Minnesota are adamantly against tax increases, but they’re also adamantly against spending cuts. Maybe they’re not aware, but we have a $6.4 billion budget deficit, and the budget needs to be balanced. Something has to be done to solve the budget crisis, and it needs to be something responsible, not just billions of dollars in budget gimmicks that put the solution off until the next budget cycle.
The Senate DFL yesterday showed that nothing was off limits, with a preliminary budget plan that would make steep cuts to health and human services, and even education, which could lose over $300 million after considering federal stimulus money. Republicans expressed outrage at the DFL plan, but at least the DFL is making an honest attempt to solve the problem. The Republicans’ solution? $1.3 billion in K-12 “payment shifts” [PPT] — what you and I would call IOUs.
If you were the administrator of a school district, which would you choose? A small decrease in funding during the recession, or Tim Pawlenty’s promise that you’ll be getting an increase someday, as soon as he comes up with the money? Would you put your district’s share of that $1.3 billion on a credit card while patiently waiting for the money? As they say, better the devil you know than the devil you don’t.
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