Democratic Budget Is At Least A Sound Starting Point
April 05, 2009
The ink was not yet dry on the biennial budget proposal put forth last week by the General Assembly's Democratic majority when a mighty howl of protest went up from House and Senate Republicans and interests such as the Connecticut Business and Industry Association. The Democrats' tax increases will destroy jobs and their proposed budget cuts are phony, the critics said.
Gov. M. Jodi Rell quickly weighed in with the most blistering criticism of all, calling the Democrats' budget "the most fiscally irresponsible scheme I have seen in years," an "economic disaster."
There's some truth in what they say. The Democrats' budget for fiscal years 2010 and 2011 is far from perfect, with too many unspecified spending cuts and few if any bold, concrete proposals to make state government permanently leaner and more effective.
But at least the blueprints drawn by the Appropriations Committee and the Finance, Revenue and Bonding Committee are based on realistic projected deficit figures for the next two fiscal years, providing a baseline from which, it is hoped, honest negotiations for a final budget between lawmakers and the governor can begin soon, and in earnest.
Mrs. Rell and her budget chief, Robert Genuario, have all along low-balled the looming deficits, giving them room to float a budget proposal that makes no really painful decisions; using sleight-of-hand, her two-year budget was balanced with few state employee layoffs and no tax increases. That's a fantasy, and a failure of leadership on the governor's part.
If Mrs. Rell's intention was to make the Democrats blink first — to be the first to admit that taxes have to be raised, for example — then she has won. The Democrats blinked. But what was the point? Tax increases will have to be part of the mix in passing any balanced budget that isn't an accounting trick, and the Democrats' budget plan acknowledges that truth. Tax increases have been part of deficit-reduction budgets passed during other recessions.
Soon the governor will have to admit it, too. Let the budget negotiations between her office and legislative leaders of both parties begin immediately. It'll be tough going, but if the governor and the Democrats can finally forgo their battle of toxic press releases and obnoxious finger-pointing and agree to work cooperatively, they should be able to agree before the session ends on a budget that reflects these hard times. We give the Appropriations and finance committees credit for finishing their work an admirable two weeks early so that final budget talks can begin.
Our problem with the Democrats' budget is that it could, as critics say, hurt job retention and growth with its tax increases targeting business.
Further, Democrats are wasting this economic crisis, as White House chief of staff Rahm Emanuel might say. They have taken only baby steps in reinventing government — scaling back the bureaucracy in a couple of large departments but not eliminating or consolidating agencies to achieve big savings and make government more efficient.
They encourage the regional sharing of services between municipalities, but don't require it. The majority party would phase out the property tax credit on the income tax, making the state's sky-high property taxes even more onerous and reform an ever more distant goal. There are no bold steps such as closing a prison, which some states are doing.
The number of state jobs might decline a little because vacant positions are being eliminated, but the government will basically be as big as it was before the crisis hit. The Democrats couldn't even suck it up enough to eliminate several small advocacy commissions, such as the Permanent Commission on the Status of Women, and instead cut their budgets by 20 percent. Mrs. Rell proposed to ax these commissions, and she was right. If they aren't essential, they ought to go.
As of now, the budget debate is business as usual, which is not good enough in a time of crisis. Each side, the governor and the legislature, can do much better for the people of Connecticut.
Reprinted with permission of the Hartford Courant.
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