Budget Battles Expanding

The budget battles have started ay both the state and federal level. In Washington, Congress is dealing with the soon-to-expire continuing resolution that has funded government operations up till now. The GOP representatives are trying to trim $100 billion from budget for the remainder of the fiscal year, and moving to trim the bloated budget proposed by President Obama for the coming fiscal year.

Here in New Hampshire the governor put forth a budget that will bring spending down to pre-2008 levels in FY2012, trims the state workforce by 1100 jobs (10%), though only 255 jobs actual will be lost (the balance are jobs unfilled due to a hiring freeze), lowers the amount of state aid to towns and cities, pushes back the retirement age for state employees, and delays funding for hospital expansions. The new proposed two-year budget is $800 million lower than the present biennial budget, which helps fill the $800 million deficit created by the formerly Democrat majority legislature over the past 4 years.

To read some of the comments about the slimmer budget, you'd think the governor and the legislature is proposing stealing bread from the mouths of the poor at the behest of the rich. Some are proposing a state income tax or sales tax to fill the budget gap despite plenty of history showing the tax monies raised would only be wasted and, in the end, leave the state even more vulnerable to economic downturns. (All one needs to do is look at the states with such taxes to see what an unmitigated financial disaster was created by dependence on those taxes.) Far too many of the economic ignoramuses seem to thing we have a revenue problem when the truth is we've had a spending problem. As one commenter put it, “This is less than a 10% reduction in state spending. I know families that have reduced their spending by 10%, and some by as much as 40%.” If we can do it, so can the state.

Other states, like Wisconsin and Ohio are seeing push-back by their state employees despite the fact that both states are facing huge budget deficits and raising taxes any further would cause far more economic harm.

In Wisconsin, state employees protested at the state capitol building, decrying Governor Scott Walker's push to limit the public employees unions' grip on state payrolls in an effort to deal with an $8.3 billion budget shortfall. Listening to some of the protesters you'd think they believe they have the right to a job for life and that the state's taxpayers had better come up with the cash to pay their salaries and benefits, or else. They complain about measures the state has taken that private businesses have had to take in the recent past in order to survive, like increasing the the amount employees pay towards their health insurance. What makes them think they are somehow immune from the effects of a bad economy and state cash flow problems? As if that isn't bad enough, Wisconsin State Senate Democrats have fled the state and hidden themselves in Illinois in order to prevent any further legislative action from being taken on the matter.

Similar scenes are taking place in Ohio as well, where the state faces a similar $8 billion budget shortfall.

The question is, when will the state legislatures and employees start listening to the taxpayers, who have said “Enough! We can't afford any more!” The answer? Not any time soon.