Gordon Denlinger: Pa. must stop letting surpluses disappear | TribLIVE.com
Featured Commentary

Gordon Denlinger: Pa. must stop letting surpluses disappear

1369276_web1_ptr-unemployment-072118

It was great to learn in early June that Pennsylvania took in much more revenue than expected a month before the end of the June 30 fiscal year, gathering a surplus of over $900 million. There were concerns during budget negotiations that the state surplus would burn a hole in the pockets of some state lawmakers wanting to spend it on pork-barrel projects, but they never had time to do that before most of the windfall disappeared. That’s because the Wolf administration had already overspent its 2018-19 budget by about $700 million, wiping out most of the surplus.

It is important to note that Pennsylvania is doing better financially but still pales in comparison with the success of many other states. It’s time for Gov. Tom Wolf and lawmakers to stop overspending and begin creating lean and mean budgets. While it is good that about $300 million was put into a rainy day fund, the larger surplus would have created a cushion to protect taxpayers if we run into another recession.

Yes, the American economy is surging. Unemployment is essentially nil. And, on the small business front, business owners report increased capital spending and rising expectations for sales and expansion. Earnings, job creation, and compensation remain strong. Small business optimism appears contagious. It’s been running high since federal tax reform passed and the Trump administration reduced burdensome and unnecessary regulations. Many workers are also enjoying bigger paychecks and paying lower taxes.

It is the success of these national policies that are filling the coffers of states at unexpected levels. But for Pennsylvania to fully benefit, it must take similar steps to improve its own lot. Our state’s unemployment is still above the national average, and economic growth is lagging. Future revenue is tenuous because Pennsylvania’s senior population is growing; at the same time, the number of working age people is waning. Our state’s small businesses are at a disadvantage due to the size and cost of state government and the lack of pro-growth policies needed to alter our future course dramatically.

If Pennsylvania is to join the list of states with a serious economic growth agenda, we need to enact legislation that will truly limit the future tax-and-spend impulses of leaders in Harrisburg. The Taxpayer Protection Act, introduced by Sen. Camera Bartolotta, R-Washington, would cap the growth in the state budgets at the rate of inflation with an adjustment for growth in population.

The TPA would be an amendment to our state Constitution and would need to be enacted in two successive sessions of the General Assembly before going on the ballot for an up or down vote by the citizens of Pennsylvania. If the government takes less out of our pockets, the private sector will have greater resources to invest, hire and expand opportunities in the decades to come.

Right now, there are over a million small businesses in Pennsylvania that employ 2.5 million people. If Pennsylvania constrained the size and cost of state government, that would instill confidence, and small business would grow exponentially. It would lead to even larger surpluses of state revenue — which wouldn’t suddenly disappear. Putting reasonable spending limits on Harrisburg will go a long way toward helping Pennsylvania meet current debt and pension challenges. It would also be a giant step toward a brighter economic future, not only for small business owners but for all of the citizens in our commonwealth.

TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.