Arizona Republicans were all smiles and high-fives on Election Night. But Democrats too seemed happy now that Republicans are in complete control of policy-making in our state. They think Republicans have been trapped into facing tough choices and unpopular decisions when they get down to the business of balancing the budget in January.
They’re right. Those charged with balancing Arizona’s $1.7 billion budget have several things going against them. There’s no more federal stimulus money. The dedicated funds have nothing left to steal. Nobody can think of any more cool accounting tricks. We’ve racked up $10 billion in unconstitutional debt, but that hasn’t accomplished much, other than a kick in the teeth to the children we supposedly care so much about.
We even took the extraordinarily foolish step of raising taxes in a recession, which will delay our recovery. So far, the deficit has resisted all attempts to tax, borrow or conjure it away. That leaves spending cuts.
Ironically, the same voters who elected a legislature obviously committed to spending reductions also took away a tool that would have helped minimize the harm. By defeating Prop. 302, they elected to retain a private bureaucracy (First Things First) funded with taxpayer money rather than use the funds for much higher priority items in the budget.
What’s done is done. Now responsible legislators need to have a frank public discussion about what lies ahead. It starts with debunking some of the false impressions out there about state government finances.
For example, we’ve heard a lot about the draconian cuts we’ve already endured. But the fact is that state government and its workers have been affected much less by the economic downturn than the rest of us. The Joint Legislative Budget Committee reports that in the just concluded fiscal year 2010, general fund spending ($9.7 billion) was slightly higher than in 2007 ($9.6 billion), the peak year of the housing bubble. However, in 2010, there was only $6.2 billion in available revenues (other than one-time stimulus grants and accounting gimmicks), leaving a gigantic 56 percent gap between permanent income and current spending.
The task now is to unwind the spending extravaganza that occurred under Gov. Janet Napolitano. From 2003 to 2006, the budget grew an astounding 60 percent, from $5.8 billion to $9.3 billion. That was profoundly short-sighted, as many vainly pointed out at the time, but at least then we had the income to pay for it. Now we don’t.
So just like any family or business that falls on hard times, Arizona needs to adjust its standard of living. Projected revenue for this year is $7.6 billion, which would support state spending at the level we had in 2005 ($7.7 billion) or 2004 ($6.6 billion) adjusted for population and inflation.
Would that really be so bad to use those years as the baseline for this year’s budget? Interest groups claim that things have changed since then. Really? The biggest change has been in our ever-growing appetite for government benefits.
We have to change the way we think about government in recognizing that our scarce resources may force some changes that would otherwise yield to political opposition. Do we still need to grow our super-sized research universities when community colleges can educate many students just as well? Must we incarcerate non-dangerous offenders? Do we still need school districts at all when charter schools seem to thrive without another layer of “educrats” telling them what to do?
You can be sure that any proposed cuts will be subject to a fire storm of bitter criticism. Local media will have a field day. So we need to identify and support those lawmakers willing to make the tough choices to get us out of this mess, which wasn’t of their own creation.
East Valley resident Tom Patterson (firstname.lastname@example.org) is a retired physician and former state senator