New Democrat Update

JUGGLING THE BUDGET

Despite all of the state’s fiscal problems and related constitutional straitjackets, Democrats have done an incredible job of balancing the budget, while minimizing the damage to the business climate and those Coloradans who are less fortunate. However, the day of reckoning is rapidly approaching.

After testimony from experts, along with a thorough review of the state’s economic and fiscal situation, Rep. Mark Ferrandino, now chair of the powerful Joint Budget Committee, recently said, "It's clear that families and small businesses are still struggling, but it's also clear that due to some wise planning and tough decision making, Colorado did not fall as far as other states and we continue to recover. As business leaders say, we are in a position to recover."

He has solid evidence to back it all up. In Chief Executive's annual survey of best and worst states for business, conducted in late January of this year, 651 CEOs across the U.S. again gave Texas top honors, (with Colorado moving up two spaces to 8th best state). They gave the booby prize for worst state to California, .... The business leaders were asked to draw upon their direct experience to rate each state in three general categories: taxation and regulation, quality of workforce and living environment.

In addition, according to a June 2010 study by the conservative American Legislative Exchange Council, Colorado's economic outlook now ranks 2nd best of all 50 states. Forbes magazine ranks Colorado the fourth best state in the country for its business climate.

Ferrandino added, "Colorado's budget experts today praised the Democratic-led legislature for passing a balanced and responsible budget, keeping us in the black, with a cushion. That cushion means we don't have to slash vital services, in the current fiscal year, in response to a depressed forecast. But we will keep cutting government back, just as families around the state are cutting back."

"It's interesting who the true 'fiscal conservatives' are. Some folks on the GOP side wanted to continue to give corporations special tax breaks, but we withstood the pressure. Seeing a brighter fiscal forecast at one point, some folks wanted to restore funding of pet programs. But we Democrats resisted calls to spend every last dime, and now that we are hitting the expected bumps in the road, we have a cushion to lessen the pain of those bumps: we won't have to cut hundreds of millions of dollars. We crafted a responsible budget, we were fiscally prudent and cautious, and we resisted pressure to act otherwise."

As good as a job as Ferrandino and his Democratic colleagues in the legislature have done with the budget thus far, the state will soon hit a fiscal wall. Soon, there will not be enough revenue to keep even basic services going.

The legislature’s nonpartisan economist is estimating that another $1 billion shortfall is in store for fiscal year 2012. Closing that gap will be on top of deficits that were closed by $1.3 billion deficit the prior year and $2.2 billion the year before that.

The increasingly more conservative Denver Post editorial page is also worried. A recent editorial tells just how dire the situation really is:

First, we axed all the general fund money for the state departments of agriculture, law, local affairs, military affairs, personnel, regulatory agencies, public health and natural resources. Zeroed it out.

That got us to about one-tenth of where we need to be.

Hmmm, how about getting rid of the judicial department? Who needs all those judges, courts and probation officers anyway? Still, not even half way there, and we find ourselves painfully aware of the dysfunction we've created.

All right, let's go another route. How about cuts in state worker pay and benefits? The governor's budget planners told the Post in March that total personnel costs are $590 million a year. But even if you gave every state worker a completely impractical six-month furlough, you still wouldn't get there.

PROBLEM-SOLVING OVER POLITICS

Regardless of whether the new governor is a Democrat or Republican, or which party is in charge of the legislature after November’s election, solving this budget problem should not be a political football for partisan gain. Here, politics and ideology should have nothing to do with the real problems facing Colorado. Neither side should pounce on the other when reasonable and thoughtful solutions are proposed.

Everyone in both political parties will have to start realizing that this is not a game without consequences. We are already past the point where the lack of public investment is hurting our economic competitiveness. For almost 20 years, Colorado has neglected what it takes to succeed now - investing in public education, colleges und universities, and transportation. Without them, more Coloradans will do worse when the economy nosedives and less will do well when it recovers.

Strong bipartisanship after the election will be necessary because the politics will be very tough. Large numbers of independent voters have concerns about the federal budget situation. Those who decide elections are clearly not in the mood to make any fine distinctions between state government and Washington.

That will mean that Republicans will have to practice a different kind of politics, refraining from cynical "tax-and-spend" attacks on Democrats. For decades, the right has been scoring political points by ranting and raving incessantly about state spending and taxes.

To some, that must sound like a pipe dream. They might well be right. Without control of the governor’s office or the legislature, state Republicans might mimic their counterparts in Washington and just say no to every conceivable constructive proposal.

If, on the other hand, the GOP controls state government, they should be forewarned. Further cuts in the state budget will soon start adversely affecting the middle class and also alienate many of their constituents in the business community. If they merely do their "business as usual," they will quickly be thrown out of power.

CITIZENS TAKING CHARGE

Getting the politics out of any issue requires many informed citizens getting involved. If enough do, both political parties will get more focused on real solutions, rather than just silly gamesmanship.

State Treasurer Cary Kennedy has developed a new tool called "Colorado Tax Tracks" which empowers taxpayers to do just that. With a simple visit to the Treasury’s web site, citizens can figure how their own state taxes get spent and provide input on whether they agree with how expenditure priorities have been set.

You simply enter your income and the site provides what portions are spent on different services. The results are as detailed as one wishes - up to one hundred functions of government.

As Kennedy has said, "Government can only be accountable if taxpayers can see what they are buying and how much they are paying for it. Taxpayers need to know if they are getting value for their tax dollar. When people pay taxes they are buying a service and benefit for their community. Colorado Tax Tracks shows taxpayers what they pay and what they buy for their money."