Proposing Spending Cuts Isn’t Enough

Tuesday, June 29, 2010 4:27 PM by Robert Woodsum

While most state legislatures are scrambling to raise taxes to sustain their bloated budgets, the debate raging in Delaware sounds a bit different. After a year of decreased tax receipts from the recession, revenues are starting to outpace projections as the economy slowly recovers. Rather than decreasing the tax burden on the burgeoning economy to allow taxpayers to realize these “savings,” state lawmakers are arguing how to spend the “extra” revenue. Sen. Colin Bonini (D-Dover South) believes that in this time where “money is tight” the correct path should be to cut government spending. Instead, state lawmakers replaced Democratic Gov. Jack Markell’s spending cuts with arguments on how to spend the extra revenue.  This ethos that plagues state governments is becoming increasingly more evident as states struggle to hammer out their budgets before the end of the fiscal year. In the same vein, state governors are calling on the federal government to include a $50 billion FMAP, since budgets have already been written that rely on these federal subsidies. This constant bailout of states who fail to recognize their spending habits need to change with the flux of their revenues does nothing to promote fiscal responsibility at the state or federal level. If Delaware serves as any type of model, it seems the states did not learn the lesson from the recession that spending cuts are the only way to ensure fiscal solvency. Given how quick lawmakers are to spend the state back into the ground, it whatever “recovery” the First State was experiencing won’t last long.

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