Surplus a Minus for Taxpayers

 

While I’m relieved to see that our Legislators finally completed our State’s budget process last week (nineteen days later than anyone else in the nation), I can’t help but wonder if anyone else is feeling a bit of whiplash from the latest series of spending deals coming out of Beacon Hill these days?

To go through all the numbers and machinations would take up more space than this OpEd will allow, but let me try to summarize just a few of the key points.  In mid-June, our State Supreme Court ruled that the “Fair Share” Amendment – aka Millionaire’s Tax – was unconstitutional.   This led our Legislators to declare that the ruling “hurts us all” and bemoan the fact that they had counted on this newfound tax revenue to fund our schools and repair our infrastructure. 

For example, when one Democratic House member heard the ruling he tweeted, “Nooooooooooo! This was our best hope to end the ongoing program of austerity in Massachusetts.”

Austerity? 

Austerity as in; restraint in spending?  I don’t know what numbers this Representative is working with, but a quick financial analysis of our state’s recent budgets and stats shows that our state spending has increased by 28% over the past 10 years, while our average household income has increased by only 4% during the same timeframe.  Our government is massively overspending our income creation. This isn’t austerity, it’s a spending spree.

This lack of fiscal control was on display again last week with the announcement that our state finance department is projecting that Massachusetts tax collections will surpass estimates by $1.1 Billion this budget year.  Let’s be clear, this “surplus” wasn’t achieved by cost control, it was achieved through increased collections of residents’, consumers’ and businesses’ tax dollars.  In other industries, over-billing of fees would lead to a refund to those overcharged, in our state government it just leads to more spending.

But don’t worry, this surplus didn’t last long.  According to administration officials, it turns out $300M was needed to cover spending that had already occurred and $450M is required by statute to go into the “rainy day fund” – thank goodness for statutes!  This left approximately $300M in additional money to “play with” for the fiscal 2019 budget. Of course, this surplus was spent post haste.

I find it incredibly disturbing that our state Legislature can cry poor in mid-June and spend the spoils of a billion-dollar surplus in July. They say we need to pay additional taxes to fix our roads and support our schools and then spend our taxes on additional earmarks for pet projects and increased allocations to already over-funded state programs. 

Meanwhile I’ve lost count of the number of business leaders I’ve talked to in our region who are reeling from the continuous cost hits:  EMAC, mandated wage increases and the highest industrial energy costs in the nation.  I talk to local town leaders who are struggling to keep schools open, roads passable and communities safe with diminishing local funds and tightening local tax revenues.  I hear from working families struggling to make ends meet when housing and healthcare costs are soaring and their wages are stagnating.  These towns, businesses and families know what austerity feels like – they understand and practice fiscal restraint. 

Our State Legislature cries poor and looks for more taxpayer money when they’re taking in a staggering $1.1 Billion more than expected and a total tax revenue increase of $2.2B year over year.  Is there any amount of funding that will ever be enough for our decadent Legislature?  I think these last two months have demonstrated that too much will never be enough for some on Beacon Hill. 

We deserve better fiscal responsibility from our elected representatives.  We deserve fair taxes and smart spending.  We deserve a government that lives within its means – and respects that the means of the people they represent are not limitless.