Tuesday, May 5, 2009

I keep wondering if it can get worse.

I should stop that.

From a report published late last night by the Columbus Dispatch:
State officials are expected to announce Tuesday that the current state budget is falling significantly short of income, causing some legislators to fear that some or all of the state rainy-day fund will be needed to keep the budget in balance.

That is the same $948million rainy-day fund that Gov. Ted Strickland and House Democrats already have planned to use to balance the next two-year, $54 billion budget, which begins July 1.
In other words, the Republican Senate is being left with the responsibility to find $1 billion more in cuts for the next budget since the Democrats misjudged this year's tax revenue.

And to put it even simpler: We're screwed.

Could this have been avoided? Yes, if they had only listened to their own budget office.
Democrats gave themselves some help in part by choosing rosier revenue and Medicaid caseload estimates from the Legislative Service Commission rather than ones projected by the state budget office.
I may do things different than you, but when I'm budgeting for a big purchase, I consider the absolute worst case scenario and work my spending around that.

Democratic State Senator Dale Miller was quoted as saying:
"I know that people are starting to say maybe the economy is starting to turn around, and the stock market is going up 33 percent, but so far in Ohio, we're just not seeing any improvement yet."
So things are getting better nationally, but not in Ohio?

Wow. What a mystery that is.

:cough: 4th worst business tax climate in the nation :cough:

:cough: 7th worst state/tax burden in the nation :cough:

Oh, excuse me. Had something in my throat. Could have been the hopes and dreams of Ohio or something. I dunno.

But don't worry, everyone. Things are going to get better. After all, the stimulus dollars Governor Strickland begged for from the federal government will save us.

Orrrrrr not.
Consequently, the costs of accepting federal dollars from the ARRA will be a long-term drain on the private sector. The ARRA will increase the government expenditure wedge from 49.16% to 52.41% for an overall 3.25% increase. This increase will reduce the growth in real net business output by 2.5%, which translates to a reduction of 1.7 million jobs nationally - of which between 66,400 and 91,200 jobs will be lost in Ohio.
Check out the link - it's a bit more nuanced then a bumper sticker and it will scare the bejeezus out of you, but it will make you smarter. Promise.

If only we had someone running for Governor whose entire career in government focused on balancing a budget...

That's right, we do.

1 comment:

  1. Great article! Somebody pretty smart must have sent it to you!


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