Tag Archives: budget

While We Are Wringing Our Hands….

While we wait for the impact of sequestration to hit, we might ponder this: In an interview with Spiegel Online, a Harvard economist insisted that we could save an amount equal to the sequestration cuts every year  just by ending the War on Drugs.

“The prohibition of drugs is the worst solution for preventing abuse,” said Professor Jeffrey Miron. “Firstly, it brings about a black market that is corrupt and costs human lives. Secondly, it constrains people who wouldn’t abuse drugs. Thirdly, prohibiting drugs is expensive.”

I have made this point before.

The direct costs of our counterproductive drug war have been estimated at more than 60 billion dollars a year. And yet, in all the years we have pursued this war, we have not reduced the percentage of Americans using hard drugs. Instead, that sixty billion dollars a year has destroyed lives, incentivized criminal activity, increased police corruption, laid waste to several South American countries, and decimated inner city neighborhoods.

If our elected officials are really so intent upon reducing the national debt, wouldn’t it make more sense to stop spending enormous sums for a failed policy, and use at least some of the savings for treatment? Better still, we could legalize marijuana–which medical experts tell us is less dangerous than booze–and tax it.

I don’t know whether we’d save more than the sequester, but abandoning a failed, horrifically expensive program would be a far more rational approach than taking an indiscriminate, meat ax approach to the budget.

The Politics of Pay

Whatever the merits of Mayor Ballard’s decision to give his staff huge pay raises, the “optics,” as they say, are terrible. The upcoming city budget will be more than painful, thanks largely to the ill-conceived “tax caps,” and the cuts to services will be draconian in some places. Giving your buddies in the Mayor’s office 20% raises at a time like this is simply tone-deaf. (Someone reminded me yesterday that former Mayor Peterson actually cut pay for his office staff at a time of tight budget constraints.)

For all I know, the raises were an effort to keep people from fleeing the administration; Michael Huber–far and away the most effective member of the Mayor’s staff–has already announced his departure, and this is the time in most second terms when people who can leave–who are actually employable elsewhere–begin their job hunting.

Whatever the calculus, this was a bone-headed move that will make it much harder for the Mayor to get the sort of political concessions he will need during the give-and-take of budget negotiations. It is one more bit of evidence–as if we needed any–that the “Mr. Smith Goes to Washington” American delusion is just that. Delusional.

Ballard may be a nice enough fellow, but he ran for office proudly proclaiming his “outsider” status. He asked people to vote for him because he wasn’t a “politician”–in other words, because he wasn’t someone who understood how the system worked. Voters bought it; they elected him over two opponents who actually did understand urban issues and politics. The results have been mixed, to put it mildly, and Ballard has relied heavily on outside “advisers” who have had their own interests to advance.

Cities can function with inept leadership when times are reasonably good–when we can afford the learning curve. But when the fiscal belt tightens, we need leadership that understands how cities work, what the priorities must be and how to achieve important goals.

It’s no time for the tone-deaf.

The Bottom Line

“Keep your eye on the bottom line” is good advice. But it is also a good idea to consider the definition of “bottom line.” In business, the term refers to profitability; too much red ink and the enterprise fails. In government, however, the “bottom line” is generally defined as doing the people’s business while at least balancing the books.

Indiana—like other states—is just emerging from a very challenging fiscal period. When resources are scarce, citizens can learn a lot about the priorities of our lawmakers. What will they protect, and what will they consider expendable? Will they play fast and loose—robbing Peter to pay Paul, as my grandmother used to put it? Will they use the crisis as an excuse to starve out political opponents?

What, in other words, is their political bottom line?

In Indianapolis, the Ballard Administration has chosen the Peter/Paul option: they structured the sale of the Water Company, for example, so that they could cash out up front. That allowed them to pay for street and sidewalk repairs without using property tax dollars—an upfront windfall to be paid for (with interest) by future ratepayers. Ballard also traded a significant percentage of parking meter income and control over the next fifty years for some immediate cash.

At least Indianapolis streets are getting paved. The Republicans who now control both houses of the legislature have chosen a different bottom line, elevating ideology over both fiscal and social common sense. This has been a truly shameful session.  (One of my students who is interning with the legislature told me he calls it the “hate-house” rather than the statehouse.)

Are Indiana citizens struggling to find jobs? Add a ban on same-sex marriage to the state’s Constitution. Do we have corporations trying to compete globally? Send a message that we don’t like immigrants, especially those who don’t look like us.

Many Indiana citizens have been hit hard by the recession, and the General Assembly has reacted by kicking them while they’re down.  During what one friend of mine has dubbed “this reverse-Robin Hood session,” our lawmakers have consistently favored the haves over the have-nots. Although people who can afford to make contributions and pay lobbyists have always had an edge, this year the favoritism has been nothing less than brazen.

At the beginning of the session, there was a good deal of talk about “shared sacrifice.” Now we know what that meant: when lawmakers reduced corporate tax rates, they proceeded to make up the difference by requiring “shared sacrifices” from the most vulnerable Hoosiers.

The legislature has eliminated dental coverage for disabled Medicaid recipients. It has cut the number of children who will be eligible for CHIP, the Children’s Health Insurance Program (despite the fact that 75% of that money comes from the federal government). It has increased co-pays for infants and toddlers with developmental disabilities. It has deprived poor, largely rural women of desperately-needed healthcare by de-funding Planned Parenthood.

The attack on Planned Parenthood was a particularly egregious bit of theater. The current GOP is virulently anti-choice. Planned Parenthood does offer abortion and does defend reproductive choice. But it does not use a single cent of tax money to do either—such use of public dollars is forbidden by law. The majority was willing to deny poor women pap smears and breast cancer screenings to make an empty statement.

This was going to be a rough budget year, even with a legislature determined to work in the interests of all Hoosiers. Unfortunately, our legislature’s “bottom line” was all about ideology, politics and partisanship. Charlie White, anyone?

File Under “Kick Them When They’re Down”

The more we see of Paul Ryan’s “innovative” budget proposal, the more mean-spirited it gets.

Take Food Stamps–another target for “savings.” According to Meteor Blades over at Daily Kos, Ryan would change food stamp dollars to block grants, which would be funded at only 80 percent of the current level of spending. “That means cuts of $127 billion between now and 2021. To achieve that would require dropping millions of low-income Americans from SNAP rolls or cutting their benefits or some combination of both. Ryan doesn’t specify. This “reform”—astonishing what gets that label these days—would also impose new restrictions on recipients, including time limits on how long they would be eligible to receive food stamps.”

We are just beginning to emerge from the most significant economic downturn since the Great Depression. Thousands and thousands of hardworking, taxpaying Americans lost jobs and home, and a significant number of people who had always been self-sustaining found themselves on food stamps. Their needs, however, cannot compete with the need to protect the Bush tax cuts for the top 2% of earners.

Ryan’s defenders will claim that these historically low tax rates will generate investment and translate into jobs. The evidence against that is overwhelming and compelling.

This is really an effort to dismantle the remnants of our already dangerously frayed social safety net–by self-proclaimed “Christians” who have no understanding of their own religion’s teachings, and no empathy for anyone who doesn’t look just like them. And it is unforgivable.

Balancing the Books

When most of us talk about “balancing the books,” we have a mental image of a bookkeeping ledger (for those of you too young to recall keeping financial records on paper, those ledgers were books filled with graph-like paper, on which one recorded assets and liabilities). The point was to balance revenues with expenditures.

Somehow, our discussions of the federal budget has operated on a different premise. Even David Stockman, Reagan’s first budget director, has noticed the change, and I think it is fair to say he isn’t especially impressed with the House Republican budget plan, which deals with only the “debit” side of the ledger.

“It doesn’t address in any serious or courageous way the issue of the near and medium-term deficit,” Stockman told Brian Beutler. “I think the biggest problem is revenues. It is simply unrealistic to say that raising revenue isn’t part of the solution. It’s a measure of how far off the deep end Republicans have gone with this religious catechism about taxes.”

I’m old enough to remember when David Stockman was considered impossibly conservative. But I am also old enough to remember that the real Ronald Reagan–whether you agreed with all his positions or not–looked very little like the icon that contemporary Republicans worship.