Wednesday, March 5, 2008

Governor releases new list of proposed budget cuts

Maine Gov. John Baldacci revealed his suggestions today on ways to further reduce the state’s ailing budget. Maine has a nearly $200 million income shortfall for its current budget. Now the governor and the state Legislature is seeking ways to resolve the problem.

Like he did in his first suggestions, the governor has chosen areas that will bring about emotional responses rather than areas that probably could stand some cutting and no one would notice. The governor’s office released his complete statement today. The new proposed cuts would reduce some funding for local school districts, the University of Maine, the community college system and the Maine Maritime Academy although leaving an increase of a lesser amount in each. Baldacci also proposes additional cuts to the state Department of Health and Human Services (DHHS). The governor blamed the national economy for the problem. He said, “But the same factors are also hurting Maine families and businesses. Now is not the time to add to their burdens. We must prioritize State spending, restructure government and make sure that our State is on firm financial footing going forward.”

“The temptation is to rush forward, use our reserves now and avoid the toughest choices,” Governor Baldacci said. “We can’t do that. We don’t know how long the current economic trends will continue, and we won’t know until April just how bad circumstances are. Things could still get worse.”

The report continued, “The budget revisions include a reorganization of the Department of Health and Human Services, changes to Medicaid and job reductions. Slightly more than 71 State government positions will be cut, including 20 as part of the DHHS reorganization.

“Every State department and agency was required to make reductions. Efforts were made to limit the impact of cuts to health and human services, to protect Maine’s poorest, oldest and sickest, and to reduce the effects on local school districts.”

Baldacci kept at least part of his promise to Mainers by not including any tax increases in his savings plan, but he failed the taxpayers in raising some fees. Among them would be an increase in the cost for criminal background checks and fees that out-of-state liquor companies pay. He also continued his earlier promise not to raid the state’s “rainy day” fund.

The Legislature will now hold hearings on the proposals. When it held its hearings on earlier suggested cuts, people receiving services in some of the areas went to Augusta to attend them. Naturally, they appealed to what they called the unfairness of the cuts and urged lawmakers to keep those budgets intact. The current suggestions are of the same type, I think designed to elicit strong protests.

The government folk want a hue and cry so it will have a false reason to eventually raise taxes. If they do go that route, and most observers feel they will because they don’t have the courage to face the reality that real spending cuts are needed, then they will be flying in the face of a poll released Monday (see my Monday post below) that showed 8 out of 10 Mainers oppose any tax increases and most Mainers want the Legislature to cut spending. You can also read that poll here.

There are many of us in this state that believe there are layers of mid-management positions that could easily be eliminated. But now that I’ve said that, I’m beginning to think it’s not the middle management, the people who actually do the work, but perhaps the political appointed department leaders, some of whom are just that, political appointments and not necessarily qualified for the positions.

Perhaps raising taxes would help the problem in the short term, but I seriously doubt it, in the long term it could exacerbate the problem. The nation’s highest taxes now are part of the problem now. It is partially the incorrect tax revenue projections that are a factor in the shortfall. Raise those taxes even more and the state could find itself in an even bigger shortfall.

At some point in time, the people who put us into this situation with voodoo economics are the only people who can get us out of it. Remember, as I said a few days ago, we the people didn’t create the problem and we have no power (except at the ballot box next November) to do anything about it. Only the Legislature and governor who created the financial crisis have the power to fix it.

I would also remind those of you who would ask me where I would cut, what I could live without, that you didn’t ask me where I would spend the money when the outrageous budge was created. Therefore, you alone own the problem.


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