Candidates Stay Mum on Solutions to State Budget Crisis

As of Sunday, September 19, 2010

One of the few things that there is a consensus about in this contentious election season is that the state faces a budget shortfall next year that will exceed $3 billion.

There’s not much disagreement about the primary causes of the problem either: sputtering state revenues combined with the expiration of the temporary tax increases passed in 2009, and the end of federal stimulus money that helped balance the budget in the last two years.

How to address the shortfall is a much different matter, with few specifics from the Democrats who now control the General Assembly or the Republicans who are trying to take over.

Democrats at least have a record to run on, having taken a generally balanced approach to solving the budget crisis in the last two years, making painful cuts and raising new revenue to stave off even deeper reductions that would devastate fundamental institutions and the services they provide.

Republican candidates talk a lot on the campaign trail about the looming shortfall, but only to blame Democrats for it and then to promise they will not raise taxes next year to balance the budget.

Most Republicans have taken one of the absurd no-new-tax pledges circulated by groups like Americans for the Prosperous. The candidates are promising not to raise taxes next year, or ever, no matter how bad the budget shortfall becomes or what damage must be done to public schools, health and human services, and the criminal justice system to balance the budget without new revenue.

They have very few specific suggestions about where to cut $3 billion on top of the reductions already made in the last two years. One candidate says we should sell state buildings, which wouldn’t raise very much and would provide only one-time money anyway, not a recurring source of funding to keep state government operating.

Others are happy to point to individual examples of what they claim is waste in government, like the $25 million pier in Nags Head that all Republicans and Democrats supported last year, but added together they only amount to a tiny fraction of the shortfall.

The no-new-tax pledgers are simply or unable or unwilling to tell the voters how they will fill the $3 billion hole without raising new revenue. The folks at the right-wing think tanks don’t have many ideas either, other than never raising taxes, though one did weigh in this week, calling it “feasible” to make $3 billion in cuts in the budget.

One of the suggestions is to slash Medicaid benefits and eligibility. The same think tank has long advocated only covering services required by the federal government, though the program was built anticipating that states would cover many more services like prosthetics, podiatry for diabetes patients, eye care and ambulance service.

It is true that North Carolina could save money by denying an artificial limb to someone who loses an arm or leg, and that apparently is exactly what the think tankers on right-wing avenue want the state to do.

Other recommendations include more vague language about making cuts in the administrative services the state provides to local school systems that have already been dramatically cut in recent years, and massive tuition increases for students at UNC schools to reduce what the right considers a subsidy of higher education.

None of that would come close to $3 billion, of course, so there’s a recommendation to look back at a budget proposed by a think tank two years ago, which included federal money to pay for many programs.

But that budget would abolish nationally recognized housing programs like the North Carolina Housing Trust Fund and the Home Protection Pilot. It would end programs like Smart Start and More at Four that help at risk kids.

It would slash worker safety programs, food safety protections, and deny lifesaving medication to people with HIV/AIDS.

There’s plenty more, but you get the idea. And that’s just some of what is in store next year if lawmakers now taking the no-new-tax pledge are elected and keep their promise.

It may be feasible to cut $3 billion out of the state budget if you’re not too worried about public schools, at-risk kids, people who need artificial limbs or families that cannot afford a place to live.

Feasible and frightening. No wonder so many candidates pandering for votes don’t want to talk about specifics.

Chris Fitzsimon is executive director of N.C. Policy Watch. Contact him at chris@ncpolicywatch.com.

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GeorgiaMan 2 years, 8 months ago

Mr. Fitzsimons writes a pretty sounding piece, but it should strike a sour note with everyone. I have lived in North Carolina for 7 years - I moved here the State Budget was around 12 Billion Dollars. It is now right at 20 Billion Dollars. When Governor Easley and his cohorts two years ago put a budget out that almost reached 22 Billion Dollars we should have known the end was near. You cannot spend at that rate and expect that the party will never end. Mr. Fitzsimons states that the "Democrats at least have a record to run on, having taken a generally balanced approach to solving the budget crisis in the last two years, making painful cuts and raising new revenue to stave off even deeper reductions" - What a load of hooey. Who got us into this mess - They did.

I have an approach to solve the problem - Go Back 7 years and start with that budget. Then look at all of the new funded and unfunded obligations that the Democratic controlled House and Senate got us into. Start cutting those new programs. Give the People's Money back to the People. Cut the Corporate and Personal Tax Rate, Cut back one of the highest gas taxes in the country - Allow people to keep their money and the economy will grow at a reasonable rate not one that almost doubles the State Budget in less than 7 years.

People need to open their eyes and look at what is going on. This fall try and in subsequent years try something different - Do not vote for incumbents who have been in office for over 4 years. Vote Basnight, Hackney and Perdue out of office - Let them work in the private sector for the rest of their lives. People its your money pay attention to where it goes.

GeorgiaMan 2 years, 8 months ago

What I find really sad is that no one will comment on this drivel written by Mr. Fitzsimons. Instead they comment on the lawyer pundit Mr. Rhoades.

Oh well no one pays attention to anything and that is the reason that we will continue to go down the same path as before until we go over the cliff.

blake 2 years, 8 months ago

GeorgiaMan, I appreciate your frustration.

But I think Mr Fitzsimons must be onto something. There must be absolutely no practical cuts left in the bloated budget if we have moved beyond releasing criminals from the jails and firing all the teachers. Now we are stealing peoples' limbs!

GeorgiaMan 2 years, 8 months ago

blake

do your homework how did the State of NC come up with 7 -8 Billion dollars in spending? What programs did they come up? What programs did they expand like a drunken sailor? Why did the State Government not put more aside in the Rainy Day Fund? Who made those decisions? What can be done - Review each and every Government Agency - Consolidate where you can, reduce as needed, and get the State of NC out of the hiring business and back to running the State. I would guess that over the past 5 -6 years the State of NC is one of the fastest growing, fastest hiring of new people companies in the State.

teufelhunden 2 years, 8 months ago

End programs for illegals.

blake 2 years, 8 months ago

GeorgiaMan, Sorry, I think you missed my sarcasm.

Also, Mr Fitzsimon, selling of federal buildings is not just a one time lump sum. It takes money to maintain these buildings.

Arestorer 2 years, 8 months ago

GeorgiaMan, Yea, lets go back 7 or 8 years and close NC's border to Georgians:) Just joking,, My wife is from Georgia, Macon County. Sounds like Mr.Fitzsimon ruffled some Republican feathers.You may be upset, but the new canidates arent giving any solutions to the problem of "Georgians moving here.....SORRY ..:}" solutions to the budget shortfalls. And not raising taxes is not a solution,thats like trying to keep living on the income you had years in the past. The cost of living goes up for one and all. Increasing taxes is probably a given.

GeorgiaMan 2 years, 8 months ago

Arestorer

Read the article yes the new candidates have no new ideas, but read how he heaps praise upon the Democratic establishment on their brave choices. Crap! They have had two years to offer up what are going to be painful cuts. All they have done is take Federal money which is not going to last forever and use it in the Budget. Make the painful cuts now and North Carolina will be better for it in the future.