It's not the economy, stupid!
Former Ehrlich budget secretary Cecilia Januszkiewicz, whose tenure ended far too soon after I learned to spell her name, is out with a well-timed op-ed in today's Examiner about the role the state's Spending Affordability Committee has played (or failed to play) in managing state budget growth over the years. The committee, which holds its decision meeting today, is supposed to act as a brake on state spending increases, making sure the budget doesn't increase faster than the economy.
She argues that Maryland's budget problems have everything to do with spending and nothing to do with the economy: "Our elected officials would like us to believe that the state's budget problems are because of the dismal state of the economy. The reality is that budget crises are created by making new commitments without any plan to pay for those new commitments even as the state has insufficient resources to pay for its existing commitments."
There's some truth in that -- she points correctly to the passage of the Thornton education plan without any money to pay for it -- but saying the economy has nothing to do with the state's budget woes is a little hard to swallow. The Board of Revenue Estimates is also set to meet today and is all but certain to write down (again) the amount of money Maryland is expected to collect in taxes. And it's not like Maryland is some crazy exception to the good times everywhere else; dozens of states are now facing similar budget problems, some much worse than Maryland's.
As further evidence of Annapolis' spendthrift ways, C.J. also points to the recent adoption of a committee report on higher education funding in Maryalnd that calls for a $758 million annual boost for colleges and universities. That's also a bit of a red herring in that the chances it will actually pass anytime soon are somewhere slimmer than none. She also ignores the hundreds of millions the state has cut in the last two years -- more than her boss cut during his term -- with state worker furloughs and more cuts on the way.
But she's definitely on solid ground in questioning just how much the spending affordability committee has done over the years to keep spending affordable. As I mentioned in an earlier post, the committee has never recommended that the state budget stay steady or shrink. In the last 25 years, it has never recommended less than 2.5 percent growth and has averaged more than 6 percent.
C.J. writes: "Rather than avoiding deficits or limiting state spending, the spending affordability process has contributed to the creation and perpetuation of deficits. It has provided a false sense of fiscal restraint and has facilitated continued budget growth -- even when structural deficits appear as far into the future as estimates are made."
So when the fiscal wise men of Annapolis meet this afternoon, what's the over-under on how much they think Maryland's budget can grow during the worst fiscal crisis in 75 years? I'd peg it at 3, maybe 3.5 percent.