No government has ever spent its way to prosperity. Our proposals help governments be fiscally responsible so citizens can be prosperous.
Last week the Legislature made some long overdue spending reductions after three years of gimmicks, one-time cash grabs and borrowing. Amidst the cries of Armageddon, it sometimes helps to back away and look at the big picture.
As I have traveled the country recently promoting the need for fiscal responsibility many people have asked me: Are we Greece?
Over the past 40 years, U.S. government spending has grown by almost 300 percent after adjusting for inflation, and our revenues haven't kept pace. Our current deficits are the highest as a percentage of our economy since World War II.
Many local governments in Arizona want us to believe they have gone to extreme lengths to tighten their budget belts. But when you hear that Tucson is using its sign laws to squelch artistic murals on the historic Rialto Theater because the murals aren’t purely for artistic purposes—they also promote shows at the theater—you realize budgets can’t be that bare. Then there are the pool cops of Maricopa County, who are aiming to shut down weekend pool parties used by Phoenix-area resorts to boost their business during this recession.
I’m confused. I know the United States and Russia present starkly different economic systems. Faced with crushing recessions and government debt, they’re pursuing dramatically diverging paths. But in the Alice-in-Wonderland world we’ve inhabited for the last few years, Russia is the country that’s downsizing its national bureaucracy while the U.S. is dramatically expanding ours.
Last week in the Arizona Republic, I urged Mesa to provide details of its plan to pay for a new spring training stadium for the Chicago Cubs. A day later, the city released a page and a half of bullet points outlining those “details.” Unfortunately, that list raises even more red flags.
In the opening scene of Raiders of the Lost Ark, Indiana Jones overcomes a series of dangerous obstacles to grab a golden idol from an ancient temple. Suspecting a trap, Jones carefully replaces the idol with a bag of sand and smiles with satisfaction for a job skillfully done. Then, all Hell breaks loose, Indiana Jones is lucky to escape with his life, and his rival steals the idol.
At least one state agency is in the holiday spirit.
Check out the website for Arizona’s Citizens Clean Elections Commission and you’ll see a nicely wrapped gift of $20 million that was “donated” to the state’s general fund. “This badly needed transfusion of funds,” proclaims executive director Todd Lang, “would not be available were it not for the existence of the Citizens Clean Elections Commission.”
Well, that’s true, sort of, in the same way as chemotherapy wouldn’t exist if not for cancer. That’s not exactly something to put in a gift basket.
Editorialists throughout the state have waxed eloquent calling for restoration of funding to various parts of the state budget. University presidents complain of too little funding to universities and community colleges. School administrators complain that schools are short-changed. We’ve all seen the horror stories about reduced health benefits affecting organ transplant recipients and behavioral health services.
Last year, the Arizona Legislature and Governor Jan Brewer passed a state budget they claimed was balanced, although three ballot measures had to pass to make it so. A sales tax increase was approved in a May special election. Two other measures, worth about $450 million, failed in November. As a consequence of “balancing” the budget on a gamble, Arizona now faces a budget deficit of $763.6 million with less than six months left in the fiscal year.
When Governor Jan Brewer released her “Four Cornerstones of Reform” proposal on Jan. 21, she included some good suggestions to change tax policy that would help to spark economic growth in Arizona. Yet it doesn’t go as far as it should.