Friday, June 20, 2008

Goldwater Institute: Governor Should Support Spending Cuts, Not Gimmicks

Tom Jenney

There's a lot of talk about Governor Janet Napolitano leaving Arizona for Washington, D.C. But before she leaves, she should clean up the mess she has made of our state budget.

Since taking office in 2003, Napolitano has prodded the legislature to grow state budgets at an average rate of 12 percent annually, much faster than the growth rate of the state's private economy, which grows at 7 or 8 percent annually during economic boom times.

With spending growing so fast, it was inevitable that a deficit would emerge. That gap is now up to $2.2 billion-proportionally, the biggest state deficit in the country.

To address the deficit, Napolitano has proposed fund shifts and accounting gimmicks, but very little in the way of net spending reductions. The combined impact of her measures would be to temporarily reduce the deficit by roughly $1.2 billion-one billion dollars short of actually balancing the budget.

Napolitano also wants to increase state debt. Of course, taking on debt will not be the end of the story. If Napolitano moves to D.C. in 2009, she will be gone when the state begins paying $200 million annually in interest on that debt.

The Legislature's appropriations chairmen, Sen. Bob Burns and Rep. Russell Pearce, have found $1.5 billion in spending reductions that would allow the state to balance next year's budget without taking on debt or raising taxes. Napolitano should be able to support those reductions, which would shave the overall state budget down to the size it was just two years ago.

Instead of leaving a gigantic fiscal mess for someone else to clean up, Napolitano should work with legislative leaders to make spending reductions now.

Tom Jenney is the Arizona director of Americans for Prosperity, A longer version of this article appeared in the Arizona Capitol Times.

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