budget cuts

Here's another budget article! [Itemlive.com]

We've just begun the calendar year 2012 and yet our state government is already gearing up for the fiscal year 2013 budget debate.  This still isn't a growth budget in the sense that programs and services cut over the past 4-5 years will not be restored and that more cuts should be expected.  Austerity wasn't a good economic and fiscal plan for growing the economy in Europe.  Why do our political leaders think the same failed economic and fiscal policies will succeed in MA?  That's a head-scratcher, for sure.

... Secretary of Administration and Finance Jay Gonzalez warns that more spending cuts will be needed to balance the [FY2013] budget.  “At the end of the day there are going to be lots of areas that are going to have to live with level funding or reduced funding or eliminated funding.”

“Most of the people coming in to meet with me are coming in saying, ‘Hey, the economy is coming back, the tax revenues are coming back, so can you put my money back,’” Gonzalez said. “What I tell all those people are that those expectations are out of whack with reality.”

Its time for a paradigm shift in the economic, fiscal and tax policies of our country.  We can't cut our way out of the Recession...austerity didn't work for the English the first time and it's not working for them now nor with the countries in fiscal crises in the Euro Zone.  Will the Administration and our legislators have the courage and political will to face down the corporations and the wealthy to help the low income and middle class survive and thrive, to the benefit of the entire country?  Let's hope so.  Let's continue with our advocacy efforts to make this a reality.

As stated in The New York Times editorial, The challenge for Mr. Obama is to translate the plight of the middle class into an agenda for broad prosperity. Congress’s inability to cleanly extend even emergency measures though 2012 — including the temporary payroll tax cut and federal unemployment benefits — underscores the difficulty. The alternative is continued decline.

More jobs. Fewer foreclosures. Less financial risk. Progressive taxation. Those policies will give the middle class a fighting chance. But the list is not exhaustive. The pillars of a healthy middle class also include public education, Social Security, unions, child care, affirmative action and, not least, campaign finance reform, since inequality is reinforced by the political power of the wealthy.

The economic prognosticators were out in force at a hearing on Beacon Hill, predicting how high/low fiscal year 2013 revenues might be.  Predictions ranged from $21.7 billion, an increase of 3.2 percent (Amy Pitter, commissioner of the state Department of Revenue), to $22.28 billion, an increase of 4.1 percent ( David G. Tuerck, executive director of the Beacon Hill Institute at Suffolk University in Boston), with other predictions in between.  These predictions still leave the Commonwealth with a budget shortfall. [Full Article: Mass live.com]

Sen. Stephen M. Brewer, a Barre Democrat and chairman of the Senate Ways and Means Committee, said that tax revenue growth for fiscal 2013 is unlikely to be enough to compensate for cuts in federal grants and reimbursements or growth in items such as the state's $10.4 billion Medicaid program. Brewer said it will be difficult to avoid some spending cuts in the state budget for the next fiscal year.

"It appears like it's going to be a very sobering year," Brewer said after the hearing. "There may be in excess of $1 billion (gap) between expected revenues and needs. The revenues are growing but not to the needs of the line items. We have a lot of tough choices to make."

Jay Gonzalez, state secretary for administration and finance, said he could not make any commitments to any spending levels in the budget including state aid to communities. He said nothing is sacrosanct at this point...."Everything is on the table again this year," Gonzalez said after the hearing. "It's another challenging year."

Paul Krugman writes - class warfare, says who?  We benefit from participating in this society in which the government is at its center; the wealthy could not have garnered its wealth without being part of this society.  They clearly have benefited greater than the lower and middle class folks.

... big cuts in top income tax rates,...there has been a major shift of taxation away from wealth and toward work: tax rates on corporate profits, capital gains and dividends have all fallen, while the payroll tax — the main tax paid by most workers — has gone up.   According to new estimates by the nonpartisan Tax Policy Center, one-fourth of those with incomes of more than $1 million a year pay income and payroll tax of 12.6 percent of their income or less, putting their tax burden below that of many in the middle class.  [Full OpEd: The New York Times]

What happens when our schools don't have the money for basic supplies that are needed in the classrooms to teach our children?  At the start of the school year, students are given a list of things to buy.  This is on top of fees for buses, music, sports and sports equipment, ... the list goes on.  What about the families that can't afford to pay for the supplies and fees?  And, let's not forget that this list of supplies does not cover all that is really needed in the class that the school district budget cut.  Our teachers, who are much maligned and disrespected, pay to supply their classrooms, and they are not reimbursed for these expenditures.

“It’s understood that with budget cuts, teachers have to do more on their own,’’ said Stephanie Powers, 25, a first-grade teacher in Whitman. “If I didn’t, the classroom wouldn’t look good, and it wouldn’t be organized.’’  Even before she began teaching, Powers saved up to furnish her first classroom, buying more than 100 books and the bookcases to put them on. With school approaching, she picked up personalized desk plates for each student, so they would feel at home on the first day.  [Full Article: The Boston Globe]

This editorial explores the consequences of reducing the funding for free flu vaccines...it's not only about the dollars saved for having less vaccines available; there's an even larger economic cost.  Are we being penny wise and pound foolish?

Investment in free vaccination saves lives and greatly reduces the economic toll of the flu in terms of lost hours of productivity, income, and sales. Tough economic times only make it more important for the state to be sure that its budgetary priorities provide the broadest benefit for the greatest numbers of people .  [Full Editorial: The Boston Globe]

There seems to be a disconnect in our country.  We don't understand (or dare I say, appreciate) that it was federal agencies - FEMA, Federal Emergency Management Agency, and NOAA, National Oceanic and Atmospheric Administration’s , that helped save lives and protect property during this latest natural disaster Hurricane Irene.  If we continue to let Congress reduce funding of these necessary agencies, lives and communities will be destroyed...literally.

Tea Partyers who denounce Big Government seem to have an abstract notion that government spending means welfare programs and bloated bureaucracies. Almost certainly they aren’t thinking about hurricane tracking and pre-positioning of FEMA supplies. But if they succeed in paring the government, ... may be surprised to discover that they have turned a Hurricane Irene government back into a Katrina government.  [Full Article: The Washington Post]

Budget and deficit reduction decisions in Washington, DC have substantive (and potentially harmful) consequences for local cities and towns, not only in the current year but for decades.  It now seems that some in Congress now want to play "chicken" with the transportation department as part of the deficit reduction debate.  We need to stay informed and engaged with this issue...

Federal transportation policy shapes, in a profound way, the way Americans connect to their communities and to the economy. When the feds get it right, cities flourish. And when they get it wrong, the consequences can last for decades.   [Full Op-Ed: The Boston Globe]

In the past three years, Lawrence lost $12 - $15 million in local aid.  The lack of these funds have severe reprecussions. Lawrence lost one-third of their police ranks due to these budget cuts and layoffs , so consequently when emergency services recently were faced with a large and unruly crowd, they were forced to call in reinforcements from the state and another town to assist in handling the situation. Clearly Lawrence residents have been adversely affected by State and Municipal budget cuts.  It seems they don't have what we all strive for - a safe community to live and work. We all need to work to change this...all communities in MA should be safe to live and work, supporting healthy families, and with the opportunity for providing quality education for all our children.

"I feel pretty positive we will be able to restore some of those cuts," [State Rep. David] Torrisi said. "It's not consolation to the people suffering right now, but we're trying our best to deliver the resources."  [Full Article: Eagle-Tribune]

When faced with a potential $3 billion deficit in fiscal year 2003, the Massachusetts legislature took a balanced approach including approving a revenue package worth $1.1 billion.   Our current Senator Brown doesn't recall this bit of history, but we're hoping he takes this correct Mass model to Washington, DC for a balanced approach to addressing federal deficit.  Now, if only we could replicate this model for the Mass budget for fiscal year 2013.

“Every time we ran into a bump, no matter whether the year was ’01, ’02, ’03, or ’04, it was a combination of stuff,’’ recalls former House Speaker Tom Finneran, a fiscal conservative. “We would draw down the rainy day fund, we would do cuts, and we did revenue.’’  [Full Op-Ed: The Boston Globe]