You Can’t Have A “Balanced Approach” If You’ve Never Cut Spending

Maryland Reporter editor Len Lazarick’s analysis piece on Maryland’s dire budget outlook provides an excellent picture of the willful blindness that is the progressives “balanced approach” meme.

Public employee unions, nonprofit groups and education advocates have been huddling in recent weeks to organize support for what they call “a balanced approach” to the continuing fiscal mess facing Maryland.

“Balanced approach” means balancing next year’s budget with its continuing billion-dollar shortfall not just with spending cuts but with more revenues: tax hikes. These include tax increases on millionaires, corporations, internet sales and a long list of consumer services, not to mention cigars and gasoline – a pretty inflammatory mix in all.

“States are facing the worst financial crisis since the Depression,” said Jon Shure of the Center for Budget & Tax Policy in Washington and a Bethesda resident. The states are experience “the biggest drop in revenues that they ever seen,” he said.

“There are some people who want to take advantage of this crisis to shrink government,” Shure said. But like someone who has lost his job and can’t pay his mortgage, “you don’t have a spending problem, you have an income problem.” (This flips the mantra of Republican legislators, who like to say, “We don’t have a revenue problem, we have a spending problem.)

Shure argues that “cutting makes it harder to build a strong economy,” and state governments can quickly put revenues back into the economy.

Neil Bergsman of the Maryland Budget and Tax Policy Institute – an affiliate of the Maryland Nonprofits Association — said “we need government to step up and provide some demand.” The state has already “cut services” – scaled back increased spending – and reduced government jobs.

Balanced approach? Cuts? Where exactly are the cuts? We know Governor O’Malley likes to claim he’s “…cut the state budget by more than any governor in Maryland history.” Yet that claim ranks right up there on the BS scale with “If you like your health care plan, you can keep your health care plan.”

Maryland’s total budget has increased over 16 percent since O’Malley first took office in 2007. O’Malley increased general fund spending by 11 percent this fiscal year—one of the largest increases in the nation.

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Progressives can try to reverse the conservative spending versus revenue argument, but the data lays bare their fallacy. Since 1997, Maryland general fund spending has increased 97 percent while revenues increased by only 78 percent. Those revenues include O’Malley’s $1.4 billion worth 2007 special session tax increases. Of course, during that special session he increased spending by the same amount.

Sorry Mr. Shure, but spending nearly 20 percent more than you take in isn’t an “income problem.”

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