Pursue better choices for state budget

I cannot stand quietly by and only watch what is happening to Arizona. It is time to speak out.

Barely three years ago, we were talking about Arizona’s future, its spectacular growth potential and how we would best manage and leverage that growth. We were talking about transportation, better jobs and more jobs in important growth sectors: high-tech, bio-tech, innovation, science and sustainability.

Then the national economy tumbled. Since so much of our economy has been driven by construction and tourism, Arizona has been hit especially hard and more than ever we need clear heads and leadership from our elected representatives.

Unfortunately, the governor has not proposed a budget and is still muddling through, trying to decide whether she will offer one. Republican legislative budget negotiators are stuck. They are conducting their talks in secret, excluding even members of their own party.

Worse yet, their priorities are wrong.

PROTECT SCHOOLS AND JOBS

To most Arizonans, the answers are common sense: We need strong public education and we need jobs. But this governor and the current Legislature continue to shoot blindly, with no apparent plan or rationale.

They have put forward a $9.5 million cut to the Arizona Department of Revenue — the very people who collect tax money from corporations that don’t or won’t pay up — which will, over the course of the next two years, cost taxpayers an estimated $174 million.

They have also proposed a tax cut, which can be good, except that their tax cuts benefit corporations over individuals by an 8-1 margin; not a good way to increase individual consumer spending. They even managed to mishandle federal stimulus money so we are now in jeopardy of having to return $1.6 billion.

This should come as no surprise, since Gov. Jan Brewer skipped high-level briefings on stimulus funding.

This poor management has devastatingly real consequences for the future of our state. Rather than think the state’s budget through, they slashed $133 million from K-12 education and another $141 million from Arizona universities. This will keep our children from being competitive with the states around us that are governing smarter, and certainly undercuts their ability to compete for good jobs in the new global economy.

There is another way to do things.

FOCUS ON BEST INVESTMENTS

In business — an area I know very well — there are a few guiding principles that can and should apply to government. For example, when budgets are tight, does it make sense to fire everyone, hunker down and hope for the best? Of course not.

The best business leaders focus on what matters. During economic downtimes, you invest in priorities, so you are ready to move swiftly when the markets recover.

Education is one of those priorities. Over the past five years, Arizona built voluntary full-day kindergarten and made it available to every family statewide. We need to protect that investment and build on it — making a better second grade, then a better third grade, and so on — until we are graduating high school seniors who are ready for more training, whether it is in our community colleges, trade schools or universities.

We need to continue to create students who are ready to take the jobs of the future. Our universities and medical schools are a key part of that job-creation engine. In the long term, research brings technology, which creates jobs. The construction of much-needed university buildings — along with other state projects — boosts the economy in the short term, allowing thousands of construction workers to get back on the job.

MAKE THE RIGHT CUTS

Yes, we have to cut the state budget; there is no doubt of that. We need to scrub it for all unwise, unnecessary expenses and eliminate them, and we need to make it easier for small businesses to operate and to create jobs.

It is not easy to balance the budget for this fiscal year or the next, but it can be done. Arizona had — and still has — budget options. There are ways to bring the state budget into balance without the kinds of devastating cuts this Legislature has already passed, and is likely to enact again for the next fiscal year. Instead, let’s start by closing tax loopholes, and then take common sense steps like bonding for capital projects.

As Arizonans, we can do the work necessary to protect our state, invest in its future and ensure that when the economy rebounds, we are on track to resume the remarkable, inspiring and successful course we have charted. But to protect education and create jobs, Arizona needs a voice — in fact, many voices — to speak truth to Jan Brewer and our leaders at the Legislature, and to demand rational, careful approaches to solving our problems.

Jim Pederson of Phoenix is CEO of the Pederson Group, a former Democratic candidate for the U.S. Senate and a community leader.