Thanks to Sound Politics ever alert readers, I learned something new and more than a little disconcerting. All these years including my time in the Legislature, I was comforted by the knowledge that Washington State had a constitutional provision requiring a balanced budget. But Stu in response to my last SP posting "Budget Crisis in Olympia" called that belief "an urban myth." After researching the state constitution and using God's gift to mankind, Google, to uncover a Seattle Times editorial on the subject, I find he is right! Worse, the Democrats have tumbled to this reality too. California, here we come, whistling through the valley of the shadow of debt.
I just wish I believed, though, that Democrats cared as much about educating our kids as they do about buying votes with low-priority spending that they're too selfish to cut.
Posted by: Reailty on April 8, 2009 09:48 PMAnd didn't George W. Bush run deficits of several hundred billion dollars during each year that he was in office? Of course, Barack Obama is now running bigger deficits than that. But even without Obama's spending increases, the deficit for this fiscal year would be well over a trillion dollars, just based on what was passed while Bush was still in office.
So deficits aren't solely a Democratic weakness. Republicans are just as capable of spending government, whether state or federal, into massive debt.
Posted by: Richard Pope on April 8, 2009 09:57 PMThe supposed grown up administration spent away...so therefore its ok and no one has to be accountable for a balanced budget ever. Anywhere. Period.
Sucks to be our grandkids.
Posted by: Andy on April 8, 2009 11:26 PMHas anyone heard anything definitive on deficit financing for this budget cycle? Or is this also some thinking out loud?
Posted by: deadwood on April 8, 2009 11:44 PMI'd compare it being a clairvoyant knowing you're going to die in a plane crash the next day and instead of choosing not to fly, end up showing up at the airport with your luggage in tow the next day anyway. As the saying goes, "Stupid is as stupid does".
...and Washington state, citizens and elected officials alike, are indeed Stuck on Stupid!
Posted by: Rick D. on April 9, 2009 05:29 AMPope, California may have a Republican governor, but guess which party controls the rest of the state? You know, the party that proposes all the spending. With over a 60% majority, it wouldn't matter if God was the governor.
Posted by: Pete on April 9, 2009 05:31 AMI am still amazed there has been zero press on this Underfunded Liability. It's borrowing. The State Pension Investment Board lost $15.6 BILLION in 15 months, Joe Dear (Executive Director) quit and ran to California...and NO ONE has been held accountable. Heck, the Public doesn't even really know what has happened and the implications.
Our comfort is that Governor Gregoire assured us the Marke goes Up and Down.
How shallow.
Where is the info?
Where is the accountability?
PS--
Lots of Union Bosses are part of the State Investment Board.
Need to shine the light on this.
What good are Sunshine Laws...when the Press closes their eyes??
I was told this Pension thing is "not a priority" because the current Budget is more pressing.
WTF!???
Sweep a massive future liability under the rug...and worry about short-term issues only?
Where are the Republican leaders on this?
Posted by: Mr. Cynical on April 9, 2009 07:46 AMI am really surprised Barry hasn't offered him a cabinet positions yet.
Sorry for being off-topic but the mention of Arnie in the same breath as Republicans sets me off.
Deficit spending? I am waiting for the inflation and then I plan on selling assets and going to retire in nice, quiet low tax areas.
Posted by: swatter on April 9, 2009 08:27 AMIt's unbelievable the pass they have been given.
They took credit during the good times and have disappeared now when accountability is due.
You are quite right about Dave Ramsey's view. Debt is wrong; borrowers are slaves to those they are in debt to.
The sick thing is that when the government is in debt, we are all in debt. Hence, we need to reform the politicians. Tea Party anyone?
Don't forget about Dave Ramsey's live and online Town Hall Meeting of Hope (this is real hope) taking place on April 23rd at 5PM PST. A local church or other organization will be showing it in your area. Spread the word, and spread the Word.
Posted by: Easycure on April 9, 2009 09:45 AMZero. Used the name only to get elected.
Posted by: Medic/Vet on April 9, 2009 10:04 AMYes, and what is remarkable is during the "good times" the debt to the pension system was allowed to grow while spending on social programs increased to unsustainable levels. What is the matter with the people of this state? Why do we continue to elect such losers?
Posted by: Saltherring on April 9, 2009 10:23 AMNotice the projected shortfall for Washington State of $2.8 billion. Not $9 billion as the legislature, governor and local media would like you to accept. The reality is that the $3.8B in cuts proposed by the Legislature to their original 22.5% increase in spending (EFF) still means a pretty significant INCREASE in state spending over the last biennium.
Related Story
More States Look to Raise Taxes
http://itsonlywords55.wordpress.com/2008/12/08/mythbusters-olympia-edition/
And can someone please tell me...how do I get links to work in these comments?
Posted by: Paula on April 9, 2009 12:51 PMThe state can borrow to cover operating expenditures, if it has room under its debt limit; but there isn't much room right now.
Article VIII allows borrowing above the debt limit if approved by the voters to pay for specific things, like building schools, renovating or remodeling them, etc.
"SECTION 3 SPECIAL INDEBTEDNESS, HOW AUTHORIZED. Except the debt specified in sections one and two of this article, no debts shall hereafter be contracted by, or on behalf of this state, unless such debt shall be authorized by law for some single work or object to be distinctly specified therein. No such law shall take effect until it shall, at a general election, or a special election called for that purpose, have been submitted to the people and have received a majority of all the votes cast for and against it at such election. [AMENDMENT 60, part, 1971 House Joint Resolution No. 52, part, p 1836. Approved November, 1972.]"
If this scheme is implemented, the state would exceed its normal debt limit to continue spending more than we can afford--assuming "we" approve the scheme by voting "yes" come November.
Posted by: Micajah on April 9, 2009 01:01 PMBased on the data provided by the Wall Street Journal referenced above, the top 10 states (including DC) with the largest per-capita budget gaps are... yes you guessed it... all governed by Democrat legislatures. Connecticut is number one with a $1,142 per citizen gap, followed by DC, New Jersey, California, New York, Delaware, Minnesota, Hawaii, Massachusetts, and Wisconsin with $462 per-capita gap.
Only 2 in the top 20 states with the largest per-capita shortfalls are Republican states, Arizona and Kansas.
Washington falls at #14, but only because the shortfall is based on shortfall relative to 2009 budgets with no growth. Of course, here in Washington the Dems have proposed a massive spending increase as their baseline, creating the perception that courageous spending cuts are not the massive spending increases that they really are.
Disclaimer: 12 states are left out of the conclusion since Projected 2010 Budget Gaps were N/A.
Posted by: Reality on April 9, 2009 01:06 PMDidn't the Republicans control one or both houses of the state legislature, when the state decided to make drastic cuts in the level of funding for state employee pensions?
Sure, the legislature is pretty solidly Democratic these days. But I believe that legislative power was far more balanced, when the state decided to cut the amount appropriated to the pension fund each year.
And I bet, if we look at the legislative bills which reduced the state contributions to employee pensions, we will find a virtually unanimous vote in both the state house and state senate to approve the legislation. With almost no Republicans (and almost no Democrats) voting against the bill.
Do the Republicans have any solution to this problem? The state would have to cut spending on other programs, raise taxes, or borrow money to deal with the pension underfunding problem. Or simply put the matter off, so long as the pension fund actually has money in it.
Somehow I don't think so.
Posted by: Richard Pope on April 9, 2009 02:52 PMA proposal for Dope-a-Pope:
Run the state budget like YOUR home budget.
This concept seems to be beyond too many politicos
in Olympia.
Of course this won't work if Pope's home budget is as FUBAR as the state's. **Notice I'm not holding my breath.**
Posted by: Sam Adams on April 9, 2009 03:40 PMDon't Buy Stuff You Cannot Afford
Posted by: Paula on April 9, 2009 04:23 PMIf you take the government's $9 billion deficit for real, and compare that to California's $42 billion shortfall, which gave California the perceived distinction as the most out-of-control state government in the country, but then divide the numbers by state populations, what do you think you see?
Yup, Washington's per-capita gap is $1,374 per citizen, compared to California's $1,142.
California, stand aside for the reigning champions of out-of-control state spending growth.
Posted by: Reality on April 9, 2009 05:13 PMLooks like Paula figured out how to embed a link from PIFan's link that shows probably cryptic stuff for many people (sorry, PIFan, this is not a knock on you.)
So, for many people who are challenged by HTML syntax, here is how to embed a link:
Replace http://www.soundpolitics.com below with your web link address.
<a href="http://www.soundpolitics.com/" target="_blank">Sound Politics Link</a>
and italicized words Sound Politics Link should be replaced with the title of the link you are adding.
Note that I added target="_blank" so that the click on the link would launch a new window rather than navigating to the link in the current comment window.
Posted by: DoppioLover on April 9, 2009 05:25 PMSomehow I don't think so.
Posted by Richard Pope at April 9, 2009 02:52 PM"
Richard--
A DEMOCRAT Governor signed every Budget the past 24 years.
The first thing that needs is a complete vetting of the problem and the LOSSES generated by the State Investment Board.
There are plenty of Hedge Fund losses Richard.
Plenty of Red Flags.
They were targeting an 8% positive return in the face of a recession. Ridiculous.
I would look to see if there is any corruption and any opportunity to sue the Board members personally for their actions.
I would hold the Governor responsible too.
She should resign.
Yet this debacle has gotten close to ZERO press.
Don't you find that outrageous Richard??
Posted by: Mr. Cynical on April 10, 2009 08:55 PM