Government Spending

No government has ever spent its way to prosperity. Our proposals help governments be fiscally responsible so citizens can be prosperous.

<p>No government has ever spent its way to prosperity. Our proposals help governments be fiscally responsible so citizens can be prosperous.</p>

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.

If termites were eating your house, would you do what it takes to stop the damage, or would you sweep the termites’ trails off your foundation and pretend the problem doesn’t exist?

Unfortunately, the latter appears to be the strategy some lawmakers want to follow in dealing with Arizona’s woefully under-funded government employee pensions.

Memorandum

To: Governor Jan Brewer

From: Arizona taxpayers

Subject: Fiscal and Economic Reality

Over the last two years, you have laid out a vision that government, through tax subsidies, will pursue certain high-skilled industries for the state and make sure these industries will have the workforce they need with funding for education. That’s a laudable goal, but there’s an overwhelming problem with this vision: The numbers do not add up.

The good news is the Arizona Legislature, with the cooperation of Governor Jan Brewer, has passed a balanced budget for the first time since 2007. State lawmakers deserve credit for making some difficult decisions to reduce spending by more than $1 billion.

Governments facing a financial pinch generally have five options. They can print money, borrow, raise taxes, cut spending, or spend fund balances. State governments cannot print money, so were down to four choices.­ Because a two-thirds vote is required for the Arizona legislature to raise taxes, practically speaking, that alternative should also be taken off the table.

Pages