Friday, May 2, 2008

Wisconsin Poised to Punt their Budget Deficit 

Filed As:  Budget and Tax

Due to a slumping economy and virtually no rainy day fund on which to draw, Wisconsin legislators have been struggling to fill in a $527 million general fund budget deficit. Rather than using the shortfall as an opportunity to make changes to avoid future revenue and spending problems, Governor Doyle and legislators proposed gimmicks like pushing off school aid payments, borrowing one-time funds from the transportation fund (and bonding to replace those funds), and instituting a new $400 million hospital tax.

For months, budget watches have criticized legislators for their attempts to patch together a budget repair bill with the same smoke and mirrors that got Wisconsin in this mess in the first place. Yet as it turns out, those critics might have actually been giving legislators too much credit.

Today the Wisconsin State Journal verifies that the legislature may just punt the deficit until past the November elections. From the article (in which I am quoted):

Rather than fixing the state's $527 million budget shortfall, lawmakers and Gov. Jim Doyle instead are poised to push most of the problem off until after the November elections, longtime budget watchers said.

The short-term fixes negotiated behind closed doors Thursday leave the state vulnerable to a further downturn in the uncertain national economy, they said.

"The bottom line is still the same. It's accounting tricks," said Todd Berry, president of the Wisconsin Taxpayers Alliance. "How many times can I say it? We've never solved (these budget) problems."

[...]

"Everybody's just trying to get out of town" ahead of the summer and fall election season, said Christian Schneider, a fellow at the Wisconsin Policy Research Institute, a conservative think tank. "But the effects of what they do are going to be felt for years down the road."

A few weeks ago, I wrote a WPRI commentary that makes a similar point in... well.... more "vivid" terms. As it turns out, I actually overestimated the desire of Wisconsin legislators to do the fiscally responsible thing.

RSS feed