New Democrat Update - August 2004
OPTIMISTIC POPULISM
With no positive record and agenda for the country, the Bush-Cheney campaign is sure to go very negative on the Kerry-Edwards ticket. Count on Republicans’ painting Kerry and Edwards as old-fashioned populist liberals. That attack will fail because it is just plain false.
While populist, the Kerry-Edwards’ brand is about empowering Americans who work hard and play by the rules, as opposed to the few who rely on privilege and connections. Their unifying, forward-looking governing philosophy places the national interest, as embodied in the values and aspirations of the American middle class, above special interests, including those operating through government, who seek to use public policies to feather their own nests.
Such populism especially makes a lot of sense at a time when the federal government is in the hands of an administration that is determined, as a matter of principle and practice, to reward privilege, solidify its power, and protect its friends from both public oversight and the rigors of market competition. Under Bush, our political system has become nothing more than a selfish clash of narrow and moneyed interests.
Betrayed and abandoned by those at the top, America’s middle class - the greatest engine of social and economic progress the world has ever known - has been further burdened under this administration. Our private sector has been shaken by the worst corporate scandals in a century.
It is just as important to define what Kerry-Edwards’ populism is not. Unlike other versions in our party, it neither vilifies capitalism nor decries success. It does not call for class warfare or rejection of economic and social progress. It rejects that the primary mission of government is to redistribute wealth.
Kerry-Edwards’ optimistic populism is a time-honored and productive political tradition. Our nation serves an important purpose - to make sure everybody has the chance to rise as far and as high as his or her hard work and natural ability will take them. The promise of America cannot be the province of the privileged few.
This New Democrat presidential ticket strongly believes we can do much better than Bush’s partisan divisiveness, broken promises and non-existent agenda for the future. Paraphrasing Edwards, the goal is to make one America, not keep it divided into two.
As President Andrew Jackson said, the mission of our nation is clear: "Equal opportunity for all, special privilege for none." Republicans will never beat that time-honored value.
KEEPING THE AMERICAN DREAM ALIVE
At the heart of the American dream is a simple bargain - if you work hard and play by the rules, you will get the opportunity to build a better future for you and your children. Going to college has been a big part of that dream. Over a lifetime, graduates of higher education institutions earn $900,000 more than those with a high school diploma.
Not surprisingly, a state’s future economic prospects are also dependent on the health of its higher education system. In an economy powered more and more by technology, the ability of a state to create an environment in which innovation thrives is critical to its economic growth. Companies must have the skilled workers they need to grow and create well-paying jobs.
Unfortunately, the doors to Colorado’s colleges and universities - the very institutions that many middle-class families rely on - are rapidly closing. Despite enrollment growth and inflation over the past two years, the legislature has reduced higher education funding by nearly 22 percent, five times the national average. The state’s share could shrink another 88% to a mere $83 million by 2009 - half of what the University of Colorado itself received last year!
Combined with the recent recession (which dramatically reduced state revenues), two state constitutional mandates - the Taxpayer Bill of Rights (TABOR) and Amendment 23 - caused this fiscal train wreck. TABOR limits state revenue growth every year to inflation plus population growth while Amendment 23 mandates annual increases in funding for public K-12 education. Balancing the budget each year is also a constitutional requirement.
In other words, the legislature must cut taxes, increase spending and balance the budget - all at the same time! If state revenues dip, making the numbers work is even more difficult. After the economy does pick up, it takes a long time to restore funding to past spending levels because of TABOR’s “ratchet effect” - the new spending limitation is based on the prior year’s decreased revenue level. These clamps, combined with other federal mandates in the budget, have effectively made higher education the “odd man out” of state finances.
As a way to avoid TABOR restrictions and temporarily hold off a fiscal catastrophe for a year or two, the legislature made Colorado the first state in the country to discontinue direct subsidies to public institutions and convert the funds into stipends for individual students. For the 2005-06 school year, each student will receive $2,400 toward tuition for public colleges and universities, while $1,200 will be provided to low-income students who attend these private schools - Colorado College, Regis University or the University of Denver.
To make public institutions more responsive to customer needs, New Democrats support injecting choice and competition in marketplaces like higher education. When properly structured, the resulting market forces can help drive change, promote improvement and increase institutional accountability. A student-driven funding system might spark healthy competition.
These stipends have some positive reform potential down the road. However, for now, they are really just state budgetary “workarounds” that buy a little time to avoid TABOR/23's tightening financial squeeze. Even legislators who supported stipends admit tuition increases and school closures are likely on the way.
Going to college will become impossible for many more Coloradans. Tuition hikes this year at public institutions range from five percent to 19 percent, far above other cost of living increases. State budget constraints could soon cut stipends from $2,400 to only $1,600. Low-income students attending private universities get a $1,200 stipend but that helps very little with tuition that averages $23,000.
Preserving and improving TABOR/23 will help with all of the above. Two related proposed ballot initiatives, backed by the Campaign for Colorado, will enforce fiscal responsibility while allowing for public investments - including K-12 and higher education - that spur economic opportunity, make Coloradans more productive, and promote upward mobility.
Fiscal discipline will still be enforced by requiring a vote of the people to approve future tax rate increases - the toughest state requirement in the country. The Campaign for Colorado’s initiatives also replace TABOR’s current impractical, arbitrary spending limits with one that places the same kind of budget constraints faced by families and businesses everyday. That ensures that government will never grow faster than the taxpayers’ ability to pay for it.
Just as important, these fiscal fixes will allow wise public investments that increase people’s incomes. To compete and win in the global economy, Colorado must build a knowledge infrastructure - world-class education, training, and technology, as well as top-flight communications and transportation systems. With those important ingredients in place, companies will have the skilled workers and cutting-edge tools they need to grow and create well-paying jobs.
Opening up the opportunity of college to more Coloradans will be just one of many important positive outcomes resulting from TABOR/23 reform. Voter approval will brighten the state’s future on a number of other fronts.
Without reform, our lackluster economy and stagnant living standards are sure to continue.