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Lavish spending caused state's budget crisis

| Monday, March 17, 2003

Laissez Les Bon Temps Roulez. Let the good times roll. It was a favorite expression of former Democratic Gov. Edwin Edwards of Louisiana.

Harrisburg is a long way from Baton Rouge, but that hasn't stopped lawmakers and governors of the Keystone State from engaging in a care-free philosophy about spending taxpayers' hard earned dollars.

Pennsylvania's state government's per capita spending, accounting for inflation, increased 53 percent from 1986 to 2000, according to a recent study by the National Federation of Independent Business, which represents primarily small and medium sized businesses. The 1986-2000 period covers Democrat and Republican administrations.

The number cited in the study is virtually meaningless in a vacuum. But the average increase in spending of all states during the same time span was 41 percent --12 points less than Pennsylvania.

A lot of state policy makers, including Democratic Gov. Rendell and his aides, are taking solace in the fact that Pennsylvania's $2.4 billion deficit is dwarfed by the huge deficits in California, New York and New Jersey, to name a few.

The NFIB study is worth a look, considering the propensity to make national comparisons about Pennsylvania's deficit.

Pennsylvania's spending is about $3,900 per person, according to the study.

.Only 13 states had higher per capita spending, adjusted for inflation, than Pennsylvania from 1986-2000. All were, obviously, above the 41 percent average increase: Connecticut, Mississippi, Arkansas, New Hampshire, North Carolina,, Missouri, Kentucky, Florida, Oregon, Delaware, Vermont, Tennessee, Indiana.

Pennsylvania's state government spending increase was higher than all but one neighboring state, Delaware. The states of Ohio, New York, Maryland, West Virginia and New Jersey spent at a less rapid clip. All were below the national average, except for Ohio at 42 percent.

Keep in mind that each state's needs and situations are different. Specific rankings would not be meaningful. But a broad view of the results -- the states above and below the national average -- provides a fair view of what's going on.

Former aides of Republican Gov. Tom Ridge would argue that budgets were leaner and increases smaller during the eight years that Ridge and his successor, former Gov. Mark Schweiker, held office. However, a recent Commonwealth Foundation study found that there was not a whole lot of difference in total inflation-adjusted operating fund increases between the Ridge budgets and those of the late Democratic Gov. Robert P. Casey. Former Democratic Gov. Milton Shapp's budgets, in relative dollars, grew by the largest percentage —nearly double the rate of former Republican Gov. Dick Thornburgh's, this separate study said.

OK, why should we care• Because there may soon be a state tax hike, and big boosts in state spending, proposed by Rendell. He will portray any prospective tax increase as a trade-off for local property taxes and increased education spending. But critics say if it walks like a duck and talks like a duck -- it's a duck.

Rendell presented a no-tax-hike budget on March 4. It makes significant cuts in some areas and increases spending only 1.3 percent. But Rendell doesn't want that budget. He presented it as a stopgap measure before his real spending plan is announced March 25.

The problem for Rendell: the GOP-controlled Legislature liked his first, austere budget plan a lot, and passed it. Now Rendell faces the prospect of whether he should veto his own budget.

Put in the context of the NFIB study, the cuts Rendell proposed in his first budget are only a nick in the overall growth rate of state spending since 1986.

"Pennsylvania's state budget problem is the result of lavish spending —not low tax revenues," said Kevin Shivers, the association's Pennsylvania director. "For some bureaucrats, the thought of spending cuts are incomprehensible. The fact is these are the decisions made by families and small business owners all across the Commonwealth."

The NFIB study was released March 3, on the eve of Rendell's budget address. While Rendell's first budget may have been lean, it was a product of decades of excess state spending.

Now there's a staggering deficit, according to Rendell.

No one seems to be asking how we got to this point.

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