The Republic of T.

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Tax and Spend Conservatives, Pt 1. — Texas

This entry is part 1 of 2 in the series Tax and Spend Conservatives

A funny thing on the way to state budget solvency in Texas and Mississippi, which are among the reddest of the red states. You can’t get much more conservative than Texas’ and Mississippi’s governors, Rick Perry and Haley Barbour. The same goes for their budget solutions, which are firmly based in conservative budget orthodoxy: tax cuts and spending cuts will cure all budget ills.

So, why are Texas and Mississippi having serious budget problems? And why are the state’s governors breaking promises about taxes and spending?

Spending in Texas

In Texas, Republicans have held the governor’s mansion since George W. Bush defeated Democratic incumbent Ann Richards, then handed the keys to Rick Perry in 2000. The legislature is in Republican hands, with solid GOP majorities in the Texas  House and Senate. Unfortunately, the resulting conservative economic agenda hasn’t been good to Texas.

Chris Tomlinson, at the Huffington Post, reports the shine has worn off the “Texas economic miracle.”

Some in Texas had talked tough about solving the state’s budget problem by austerity alone, but lawmakers finally faced a hard fact: Texas is in serious financial trouble.

The severity of the state’s $27 billion budget crisis was evident in the furrowed brows, sad eyes and pained expressions of legislators. They fidgeted in their seats as hundreds of teachers, parents and disabled people explained in testimony in recent weeks how proposed budget cuts would ruin their lives.

Legislatures elsewhere are facing budget problems, but most are blending cuts with asset sales, increased fees and tax modifications to soften the impact. Texas prides itself on lean government so Republicans here promised to solve the crisis here by budget cuts alone.

Then rhetoric hit reality this week. The result was the latest and most vivid example of a state taking steps it had fiercely resisted.

At least one of those steps could be breaking into the state’s piggy bank — the $92 billion Rainy Day Fund that state legislators have campaigned on the promise of preserving — at the urging of Republican committee chair, who told members:

“If you want to close this shortfall through cuts alone, you have to either (completely) cut payments to Medicaid providers, cut payments to school districts or lay-off a substantial number of state employees,” said state Rep. Jim Pitts, chairman of the House Appropriations Committee. “You would have to do these things immediately.”

This is the same Rep. Jim Pitts, by the way, who just this past November seemed to be in favor of Medicaid cuts even if it meant Medicaid recipients would be “thrown out in the street.”

Some Republicans who talk about Texas potentially opting out of Medicaid are quick to say the changes wouldn’t throw people out on the street – but not House Appropriations Committee Chairman Jim Pitts.

Pitts didn’t advocate the change in health care for the poor at a meeting of the Ellis County Tea Party, just noted that it will be discussed by lawmakers.

But unlike others who’ve painted a rosy picture of a potential health-care restructuring without filling in the details, Pitts gave a stark answer when an audience member asked about an ill friend who is on Medicaid.

The questioner reacted with concern when Pitts said the state’s looking at getting out of the program. What will my friend do then? Will you throw him out in the street?

“If we did exactly what we’re doing today, we wouldn’t be throwing him out in the street. But if we have any savings in getting out of Medicaid, we will have to throw some people out in the street,” said Pitts, R-Waxahachie. He noted, “I’m not telling you that your friend would be.”

Something has changed in Texas; something serious enough to send Texas Republicans scurrying to Gov. Rick Perry — state’s longest serving governor, and the guy who’s signed the last 10 budget — to beg him to support tapping into the Rainy Day fund.

And by “tapping,” I mean spending, which is what adding part of the Rainy Day fund to the state’s budget amounts to. Just last year Perry boasted that Texas had balanced its budget, but according to Scott McCown of the Center for Public Policy Priorities, “[T]he state only has about three-fourths of the money it needs to continue doing what it is doing now.”

In fact, Texas’ budget woes are among the worse in the nation. Just a year after Perry crowed about balancing the budget, Texas’s deficit estimate came in worse than the worst expectations. Even stimulus money from Washington couldn’t save Texas’ budget.

All those tax cuts and spending cuts haven’t balanced Texas’ budget  or spurred economic growth.

With the stimulus expiring, and their fellow GOP members in Congress working hard to cancel plans to spend what’s left of the stimulus, while also cutting federal aid to states, what are Texas Republicans to do?

Spend, apparently.

Next up: Taxing in Mississippi

Series NavigationTax and Spend Conservatives, Pt. 2 – Mississippi

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