To treat Washington’s spending addiction, the November elections are the taxpayer’s best chance to stage an intervention. But until then, President Obama and the Democratic Congress are determined to keep pushing strung-out state governments to take one more fix.
Witness yesterday’s 247-161 largely party-line House vote to approve a Senate bill shovelling another $26.1 billion out to state education and Medicaid programs. The White House has promoted the bill as emergency assistance for strained state budgets. But this unique brand of therapy drives states to spend more, not less. The “assistance” is so expensive that several governors were begging for relief even before Mr. Obama signed it into law.
Standing with teachers yesterday in the White House Rose Garden, Mr. Obama said, “We can’t stand by and do nothing while pink slips are given to the men and women who educate our children or keep our communities safe.” Maintaining the salaries and generous benefit plans for members of teachers unions is indeed a top Democratic priority. That’s why $10 billion of the bill’s funding is allocated to education, and the money comes with strings that will multiply the benefits for this core Obama constituency.
Specifically, the bill stipulates that federal funds must supplement, not replace, state spending on education. Also, in each state, next year’s spending on elementary and secondary education as a percentage of total state revenues must be equal to or greater than the previous year’s level.
Governor Haley Barbour of Mississippi did the math and figured out his state will be worse off. Mr. Barbour says the bill will force his state “to rewrite its current year [fiscal 2011] budget. Preliminary estimates of the Mississippi Department of Finance and Administration show that we will now have to spend between $50-100 million of state funds—funds that must be taken away from public safety, human services, mental health and other state priorities and given to education—in order for an additional $98 million of federal funds to be granted to education. There is no justification for the federal government hijacking state budgets, but that is exactly what Congress has done.”
For Texas, and only Texas, this funding rule will be in place through 2013. This is a form of punishment because the Beltway crowd believes the Lone Star State didn’t spend enough of its 2009 stimulus money. Apparently Texas politicians have been clinging to the quaint notion that the government should try to live within its means.
Texans also seem to have an old-fashioned appreciation for the rule of law. On Friday, 22 GOP Members of the state’s Congressional delegation sent a letter to House Speaker Nancy Pelosi. “This provision would have Texas violate her own State Constitution,” they wrote. “The Texas Legislature has sole authority to determine State appropriations. Moreover, one Legislature cannot bind a future Legislature. Requiring the State to assure that a future Texas Legislature would commit to spend funds in accordance with these provisions would violate the Texas Constitution.”
Texas Governor Rick Perry is also opposed to this new “assistance” from the federal government. He understands that one-time payments that force permanently higher state obligations are a windfall for government employees. But if given the choice, taxpayers would just say no.
That’s because taxpayers are figuring out that these state bailouts are only making unions more reluctant to share their sacrifice. While Mr. Obama quotes the union figure of 160,000 potential lost teacher jobs, those don’t have to come out of the classroom. According to research by Eric Hanushek of Stanford University, student enrollment grew by 22% from 1990 to 2007, but teacher employment grew by 41%. Since 2000, enrollment has grown by 5% but teacher employment by 10%.
[View Complete Article →]
