It’s a moment of truth for Ohio’s government.
The Legislature and Gov. Ted Strickland are supposed to agree on a two-year budget before Wednesday. The world won’t come to an end if they don’t; they can work out something temporary. But that would prolong the agony, foster a sense of dysfunction, further upset the people who set Ohio’s credit ratings and get Ohio compared to floundering California.
The task at hand is not easy. When lawmakers unanimously agreed upon a two-year, $52 billion budget two years ago, it was widely hailed as the most conservative in a long time. Yet it has been cut three times since then, by almost $2 billion, as state revenues have nosedived.
Meanwhile, though, demands on the state were increasing, as more people lost jobs, stopped paying taxes and started needing various forms of aid, such as Medicaid.
The federal stimulus has helped, but the fiscal problems are intense, not only here, but in states across the country.
When Gov. Strickland submitted his new two-year spending plan, he assumed more decline in revenues. The House and the Senate have each passed their own budgets. But now the governor’s budget people say another $3.2 billion must come out of the $54 billion budget, because of worsening revenue projections.
The governor proposes raising maybe $900 million by allowing slot machines at horse racing tracks. The rest of the shortfall would be made up with spending cuts.
The list of cuts is highly focused on whatever the governor hasn’t made big promises about. He has promised to improve higher education and hold down tuition. He’s promised to upgrade Ohio’s K-12 schools. So the cuts are generally elsewhere.
Libraries take a historic hit of 30 percent, on top of a recent 20 percent loss in state money. The impact is particularly huge for those libraries — most in the state — that get all their funding from the state.
There’s a 17 percent cut for the Department of Mental Heath. The state support for preschool education would be eliminated. The program to prevent abuse of seniors and children would be cut by 70 percent. A youth services facility would close.
Various scholarships would go away, with private trade schools being hit particularly hard. Medicaid would curtail paying for over-the-counter drugs. State money to fund public defenders would be reduced by 40 percent. There’s much more.
The list is appalling. The Legislature should be less concerned with the governor’s previous commitments and more concerned with protecting the most vulnerable people, who have already been hit hard by cuts in the current budget, as by changes in the economy.
Even libraries, to some degree, should be seen in that light. Some have excellent collections and facilities. But many are places for poor children to go to read, or for children whose parents won’t buy them books. And they’re places for people to go who need jobs. Job-seekers can use the computers and can search for information available about salable skills and how to attain them.
Clearly, too, the state needs to raise more money. However, the Strickland proposal on slot machines is a last-minute desperation concoction that ignores too much and is, some think, too optimistic about the money that would be raised.
If Ohio is to suddenly allow something that would be an awful lot like casino gambling after voters have turned down casino gambling four times, it ought not do so suddenly, under such pressure.
A far better way to raise revenue: suspend the last year of a phased-in 21 percent cut in the state income tax. That would raise about as much as the Strickland people project from the slots.
Too, a 75-cents-a-pack increase in cigarette taxes could raise about a half-billion, while leaving Ohio in the mainstream on such taxes (at $2 a pack, same as Michigan), and also reducing the number of people who smoke. (Studies are conclusive about that.)
The Legislature needs to be creative about both revenue and spending. A half-cent increase in the sales tax could raise more than $1 billion. It could be made temporary, for this economic crisis.
Serious tax increases could work against the impact of the federal effort to get people and companies spending — the stimulus. But a half-cent sales tax is not likely to affect many plans or decisions.
At any rate, spending cuts could undermine the stimulus, too.
The politicians in Ohio have to get past their silly game on taxes, wherein nobody wants to go first in proposing them.
Ohio has a combination of tough decisions to make. It does not have an insolvable problem. The right guidelines:
Flexibility; spreading the economic burden; sharing the political responsibility; and protecting the most vulnerable.
Cox News Service
