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Thursday, March 17, 2011

Texas - Where Talk Is Cheap And Reality Is A Painful Dose In Politics

Politicians in Texas have talked tough about solving the state's budget problem by austerity alone, but lawmakers finally faced a hard fact: Texas is in serious financial trouble - Texas needs to find $27 billion. 

That $27 billion shortfall represents about "three-fourths of the money it needs to continue doing what it is doing now," explained F. Scott McCown, director of the Center for Public Policy Priorities, an advocacy group for the poor. "And every single thing the state does now is something that the governor previously agreed it ought to be doing."

How do you solve a budget shortfall of $27 billion?  Texas Republicans, among the most vocal in the nation, have said cuts and austerity alone MUST be used.  Texas does have a $9.2 billion Rainy Day Fund, which in theory could be used to help solve this crisis, but ....  "I remain steadfastly committed to protecting the remaining balance of the Rainy Day Fund, and will not sign a 2012-2013 state budget that uses the Rainy Day Fund," Gov. Rick Perry warned.

You know Rick Perry, the outspoken Governor of Texas who returns Federal money and talks of austerity and how great Texas has done being fiscally conservative.
"Texas is better off than practically any state in the country," Perry said in September, well after the coming problem was identified. When asked about the budget deficit in December, Perry dismissed the question as speculative.

But reality does suck.  Texas' budget shortfall is among the worst in the nation, but Perry says Texas remains an example for other states.  An example of exactly what he didn't say.

Democrats question why Perry and Republican lawmakers would tap the Rainy Day Fund to pay bills to creditors due in August, but not to save jobs.  Using the fund, which is made up of revenue from oil and gas taxes, could "mitigate the cuts to our children's education, the zeroing out of pre-kindergarten, the zeroing out of college scholarships for all freshman starting in 2012 and 2013," Democratic state Rep. Mike Villarreal said.

But there is little for Democrats to do. Republicans hold every statewide office in Texas, two-thirds of the state House seats and 19 out of the 31 seats in the Senate. The main political division is between veteran conservatives and ultra-conservative Tea Party Caucus members.  Texas prides itself on lean government so Republicans here promised to solve the crisis here by budget cuts alone.

So now Perry and his Republican cohorts must face reality.  And what is that reality?  Rep. Jim Pitts, chairman of the House Appropriations Committee, acknowledged that making $23 billion in cuts for the next budget would be devastating. 
"If you want to close this shortfall through cuts alone, you have to either (completely) cut payments to Medicaid providers, cut payments to school districts or lay-off a substantial number of state employees," said Pitts. "You would have to do these things immediately."

According to Huffington Post, the severity of the state's $27 billion budget crisis was evident in the furrowed brows, sad eyes and pained expressions of legislators. They fidgeted in their seats as hundreds of teachers, parents and disabled people explained in testimony in recent weeks how proposed budget cuts would ruin their lives.

I believe we have entered a phase in our country where there is a war between the haves and have nots.  We will see how long the haves (see my Article from Sunday - Wealth Disparity - Damn The Middle Class - Plutocracy Reborn, for an account of the wealth disparity in the US), who control the media, and seemingly our politicians, can force deeper and deeper hardships on the have nots.

Too strong a statement?

In his New York Times article, Paul Krugman says that Texas imposes a low tax burden on the wealthy, relative to other states, but a higher than average tax burden upon the poor and their families.
"Facing budget deficits, however, the Republican Governor of Texas and his colleagues in State Government are resorting to deprivation of the already poor and suffering - for example, Medicare is particularly diminished, leading to lack of services for the elderly and the severely economically less advantaged and essentially certain to lead to excess deaths in that group, a predictability that renders the decision to cut Medicare - as opposed to taxing the already wealthy - tantamount to premeditated murder."
Krugman says premeditated murder!  I tend to agree.


  1. Good follow-up to your blog about disparity between wealthy and poor. This drastic cutting is only going to get worse. Reform the tax code. Westport.

  2. I agree the tax code must be reformed. It needs to be a sales tax that way those who buy much pay much those that buy little pay little. But, don't be fooled there is MUCH that could be done to decrease spending that could actually improve the quality of life of some of the less fortunate. I've been working with a state agency watching the foolish waste for 20 years. I find it strange that every time "cut" is mentioned or actually done the money isn't "cut" from the well paid elite that heads the agencies. Example: when the school budget is cut why does the administration keep their jobs and pay but the class room looses teachers and equipment. Why not reform the school system and give us one where the students actually learn how to think for themselves instead of regurgitating information. This system actually cost less and the student becomes better educated. If you can find it read the book Utopian Society to understand how over 150 years ago the demise of our educational system was systematically plotted. And this is only one example. In my opinion I believe if we eliminate the politically elite class (Democrat and Republican alike) and start using some common sense we could actually start fixing our problems. Reinstating the Constitution would be a good start WITHOUT party politics.