Texas has been hailed as a lone bright star in an otherwise dreadful economy, but in a few months state lawmakers will finally come face to face with the fiscal bloodbath that has spilled over the rest of the nation.

[...]

“It’s [the massive budget shortfall] absolutely the elephant in the room,” said University of Texas political scientist Jim Henson.”Nobody can realistically declare any kind of initiative because there’s no money to do anything with and nobody can realistically talk about doing anything to get any new money.”

The state budget shortfall, which some estimates have pegged as high as $18 billion for the next two-year cycle, will be the driving force behind almost every decision the Legislature makes when it convenes in January. From state parks and highways to health care programs for the poor and disabled, state agencies are bracing for the hatchet to fall.

In essence Texas has escaped nothing, they are just have to deal with it later than other states because of their two-year budget cycle.  Each man will certainly have a different way of dealing with the shortfall.

Perry says he recognizes the severity of the shortfall but says he wants to see the official estimate of incoming revenues, expected in January, before discussing solutions.

“I’m not Pollyanna. We’re not sitting around saying we don’t have to worry about this. Sure, we’re working on it,” Perry said.

Perry did offer one promise to voters focusing on the budget: “I’m going to balance the budget without raising their taxes.”

White says he can’t lay out detailed plans now because he plans on forging a common vision with other legislative leaders. He says he doesn’t want to put “preconditions” on those negotiations by staking out hard positions during his campaign.

“I’m not being coy,” White said. “If I want to be the leader of this state, I can’t come and say that I’m going to deal with the lieutenant governor, speaker of the House … with all these preconditions. That’s not the way I was as mayor (of Houston) and that’s not the way I’ll be as governor.

“It’s going to have to be a team effort.”

In EOW’s estimation there are some key differences between how White and Perry would deal with the shortfall. White would likely work in a much more cooperative spirit with the legislature. Not being a liberal, but a moderate Democrat, he would likely trudge a more “middle” ground and, as has been said here before would be, at least, willing to consider a tax increase if the legislature sent one to him.

Perry on the other hand will do what he did in 2003, work with the far-right of his party to craft a budget full of schemes, tricks and massive fee increases. Therefore  a sore spot with the  media in Texas must be pointed out. When speaking to the Governor about the pending massive budget shortfall, and he states he will not raise taxes, there must be an immediate follow-up question – will you raise fees on Texans by billions of dollars as you did in 2003? From this point on it’s just negligence, or worse, if they don’t.

While this is an important subject in the Governor’s race, a more substantive question should be asked to those who will actually be writing the budget next year.  We’ve recently seen what Senate Finance Chair Steve Ogden (R-Bryan) proposed regarding transportation.  And on the House side here’s what the Ways and Means Chair Rene Oliveira (D-Brownsville) had to say.

“The budget will dominate the session and the cuts will dominate the session,” Oliveira said.

Since the news is not necessarily a big surprise, lawmakers have already hammered out how they’re going to fix a potential $18-billion budget shortfall for the next budget cycle.

Oliveira said making up that current deficit will be first up in January for legislators, whether it’s through emergency supplemental appropriations or making more cuts.

“If we’re not going to raise taxes, then we’re going to make significant cuts in state government. Cuts that to me are going to be very painful and hurt a lot of middle class and poor Texans,” Oliveira said.

It is amazing that all the sacrifice in Texas must come from the middle class and the poor under all the scenarios mentioned, thus far, by these committee chairs. What will those who have, and have profited so much, in Texas have to sacrifice in the upcoming budget? That has never even been mentioned. Essentially they are being given a free ride, again.  (Oliveira held hearings earlier in the year regarding ending some tax exemptions, but that talk has gone away as of late).

Texas has always been a state where those with little pay much, and those with much pay little. It doesn’t look like that’s likely to change any time soon.

The Bryan Republican (Sen. Ogden) isn’t proposing a straight-ahead state gas-tax increase. Instead, he plans to offer an amendment to the Texas Constitution to say lawmakers can raise the gas tax a few cents a gallon to pay off debt service for road bonds financed through the highway fund.

The proposed amendment, which Ogden plans to push in the coming regular legislative session, would require a two-thirds vote from lawmakers plus voter approval statewide.

“Going with a constitutional amendment does a couple of things. It provides some political cover for people who don’t want to be responsible for raising taxes, and it gives the voters a legitimate option: If you want us to continue to borrow money to improve the highways, this is how we propose to pay for it,” Ogden said. “And whatever their answer is, I’d accept.”

Ogden’s idea is another sign of the seriousness of the money problems facing transportation, with the gas-tax-fueled highway fund projected to run out of money for new projects in 2012.

The increase would apply only to Proposition 14 bonds, which are paid off by the highway fund. The Texas Department of Transportation has authority to issue $6 billion in such bonds; it has issued $4.6 billion.

According to TxDOT, the state is expected to pay $272.5 million from the $6.45 billion highway fund for debt service in the 2011 fiscal year and nearly $290 million in 2012. Between 2013 and 2032, debt service for the bonds will cost more than $400 million a year.

The 20-cent-a-gallon state motor-fuels tax hasn’t been raised since 1991; efforts to increase it have been seen as politically risky. Each penny yields about $155 million, with one-fourth going to education. Ogden would propose having the extra pennies fund only debt.

Ogden’s idea is not a sign of seriousness, Ogden’s idea is a sign of cowardice. Not only that but he wants to lay the blame off on voters instead of taking it on himself. Oh how we long for the day when we had real leaders in Texas. Leadership means sometimes you have to stand up and do what’s right and unpopular, consequences be damned. Trying to hide the GOP’s neglect of Texas highways since taking control of our state’s government, and attempting to lay the responsibility of paying for their neglect on the taxpayers, is anything but. Hopefully voters would reject such shenanigans. Sen. Ogden if raising taxes is what you want to do then offer a “straight up” tax increase.

If Ogden’s fairy tale amendment was to pass in the next legislative session, there wouldn’t even be a vote on this until November 2011.  So the money wouldn’t be available until 2012 at the earliest.  No word in the article about what would happen if it didn’t pass.

The statement came up again recently when Dewhurst was interviewed by the Texas Tribunes’ Evan Smith.

Smith: But the difference would have been that you would have had to go find the money that you got from the federal government that you got presumably in the form of cuts.

Dewhurst: No, we wouldn’t have had the spending level that we did. We would have had to trim the budget. We still would have been able to put some money into public education, some money into higher education, but we wouldn’t have been able to put as much money into public education and higher education and into Medicaid as we were able to do with the stimulus dollars. That’s a true statement. At the same time, we were able to create a better budget by having some access to the federal funds

In essence what Both Dewhurst and Dunnam are saying is that Texas’ budget would have been balanced, with or without the stimulus, it’s the law. But life in Texas would be much different then it is now. And that’s the reality that the elected Texas Republicans will not admit to. Without the help of the federal Texas, and their political futures would be in much worse shape.

As the recent CBO report shows the stimulus has worked, and worked well, CBO says stimulus a bigger success than expected. This is important because as Perry, Dewhurst and the rest of the GOP in Texas crow about their budget slashing prowess, they didn’t do any in 2009, because of the federal stimulus.

Without the $16 billion dollars Texas used in 2009 to balance the state’s budget, without slashing it to the bone and without raising taxes, Texas would be in extreme circumstances and unemployment would be considerably higher then it is right now. Heading into another budget cycle that would be even more dire.

The point of all of this is, for the GOP members in Texas to be running around saying how much they hate the federal government and all it’s spending, is extremely dishonest. Without the stimulus money in Texas these politicians would be in a much more dire political situation, and they have the federal government to thank for the fact that they are not.

But as we continue to find out the TEF is not living up to its billing, Recession Pounds Perry’s Jobs Fund.

Key findings of TPJ’s analysis reveal:

* The Governor’s Office has awarded $363 million to 45 TEF recipients to create or maintain 47,735 jobs. These projects claimed 31,319 jobs in compliance reports covering 2008.

* Just 13 of the 45 job-related projects reviewed were performing well.

*As of October 2009 the Governor has penalized 11 TEF grantees for defaulting on their job creation commitments. These penalties, totaling $647,100, amount to just 1 percent of the $64 million in TEF funding that they received.

* The Governor has imposed the “death penalty” on just two TEF projects despite the fact that many other TEF recipients have qualified for termination.

* In February 2009, Perry declared that the TEF program had created 54,000 jobs since 2003. More than one-third of these jobs are pledges that have yet to materialize.

There’s much more. The Texas Observer had this story earlier in the year, Slush Fun, which shows that several companies that received money from the TEF, gave money to Perry in the form of campaign contributions.

Many companies that have received money from the fund have, in turn, aided the governor. An Observer investigation has found that 20 of the 55 Enterprise Fund companies have either given money directly to Perry’s campaign (through their political action committees or executives) or donated to the Republican Governors Association, a Washington, D.C.-based group that Perry presided over in 2008.

The 20 companies have received a combined $174.2 million from the Enterprise Fund. During the same time period, those 20 corporations have donated $2.2 million to Perry and the governors association. Several companies made donations around the time they received grants from the Enterprise Fund. It’s even possible that taxpayer money from the fund came full circle into Perry’s own campaign.

Over the weekend Kuff had this from, More Enterprise Fund failures, a recent HCrhon article on more corporations that have received Perry’s TEF welfare that are not living up to their potential. And today the Texans for Public Justice (TPJ) have word of more problems with the TEF, TPJ Calls on Perry, Dewhurst & Straus To Investigate State Grant to Sematech.

Texans for Public Justice today urged Texas’ top three officials who oversee the Texas Enterprise Fund (TEF) to investigate if Sematech, Inc. violated the 2004 contract it signed to obtain $40 million in state funds. Governor Rick Perry’s highly-touted Enterprise Fund awarded the high-tech consortium $40 million in 2004 to establish the Advanced Material Research Center (AMRC) in Austin. Sematech’s subsequent dealings with the State of New York strain the terms of its TEF contract—arguably to the breaking point. In a letter today to Governor Perry, Lieutenant Governor David Dewhurst and Speaker Joe Straus, TPJ called for a probe into Sematech’s contract compliance, urging the officials to either “enforce compliance or recover the scarce funds that failed to deliver the promised benefits.”

[...]

“The Enterprise Fund is crying out for greater accountability, transparency and oversight. The Sematech fiasco highlights Governor Perry’s conflicts in both awarding and enforcing Enterprise Fund grants,” said Craig McDonald, director of Texans for Public Justice. “The governor is quick to tout the promised jobs but slow to make corporate welfare recipients live up to the terms of their handouts.”

[...]

“If Sematech is two-timing Texas, Perry needs to get our $40 million back,” added McDonald.

View TPJ’s letter to Perry, Dewhurst and Straus.

Of course Democratic candidate for Texas Governor Bill White has proposed an audit of Perry’s TEF, and Texans agree it is needed.

This is one area where Texans can see the unchecked powers that Perry has accumulated from being in office for too many years. Perry believes, because he’s been in power for so long, that like a King he can do as he pleases. He also thinks that because he’s been returned to office, over and over again, that whatever he does it right and Texans will go along. If Perry is returned to office again we can only imagine how much more of our money, for four more years, will go to corporations in this manner.

In May 2009, the 10 occupations with the highest employment levels represented more than 20 percent of total employment, and the number of workers in these occupations ranged from 1.9 million workers to 4.2 million workers.

[Chart data]

Most of these occupations were relatively low paying: 9 of the 10 largest occupations had median wages between $8.28 per hour and $14.56 per hour. Median wages for all occupations in the United States were $15.95 per hour in May 2009. The one exception among the 10 largest occupations was registered nurses, whose median wages were $30.65 per hour. Employment among registered nurses was 2.6 million in May 2009.

This comes from a recent report from the Bureau of Labor Statistics, Occupational Employment And Wages –May 2009 [PDF], released last Friday. Unfortunately it looks like these types of low paying jobs will continue to be most prevalent in the future.

As the economy recovers and Americans get back to work, the wage gap between white- and blue-collar work is expected to grow. According to new data from the Bureau of Labor Statistics, 60 million people—46 percent of the American workforce—in 2009 worked in the service sector as cashiers, office clerks, cooks, nurses, retail salespeople, or customer-service representatives.

Here’s a common story for those who had to change jobs in the last decade.  From a Newsweek article back in December 2009, The New Working Reality.

By the time Kelley Krostoski was laid off from her job as a management consultant this past February, she assumed that she’d be able to find another position closer to her Oregon home, perhaps even something that would not require her to travel.

Ten months later, her initial optimism has given way to resignation. She landed another gig in September as a consultant that required her to take an 11 percent wage cut. She still travels up to three months a year, though that’s better than the six months a year spent on the road at her previous job. Overall, Krostoski says she’s relieved. “There aren’t many jobs in Oregon,” she says, noting the state’s 11.3 percent unemployment rate. “I [know] folks who have been looking for a job for a year or more.”

In the current economy, many Americans have had to lower their expectations for their career and work lives. Like Krostoski, they’ve taken pay cuts to secure new jobs. They’ve postponed retirement to help struggling family members, and millions of Americans remain underemployed, working part-time or low-wage jobs to pay the bills. “There’s a reluctance to settle,” says Andrew Gledhill, an economist with Moody’s Economy.com. “In these once-in-a-generation types of recessions, you don’t have a choice.”

The story of someone losing a job, and having to replace it with one with a lower salary, has become all too familiar since the turn of the century.  While there are many reasons for this one is certainly the fact that workers don’t have the education they need.  Today the Texas Association of Business (TAB), whose main goal is to keep taxes low on businesses and corporations in Texas, released a new report.

The Texas Association of Business (TAB) today released a report entitled Dream Big Texas: Educating a Globally Competitive Workforce, detailing the improvements needed to maintain our state’s status as an international economic powerhouse.

“The Texas economy has been the beneficiary of extraordinary natural resources, fiscally conservative leadership and hardworking men and women who form the core of our workforce,” said TAB President Bill Hammond. “Yet for all our progress in building the best business climate in America, the threat Texas faces if we do not produce well-educated graduates who can fill increasingly sophisticated jobs, puts all that at risk.

While TAB is correct about the need for a well-educated workforce, they don’t mention the inherent dichotomy in what they state. The reason Texas has the “best business climate in America” – if that’s possible without a well-educated workforce – is because that climate is created by sustenance taxation of the wealthy, big business, and corporations which have starved education in this state. Ironic isn’t it?  TAB also doesn’t offer much in the way of a solution other than using some sort of a performance based funding mechanism for funding post-secondary education.

With the decline of well-paying union manufacturing jobs in this country, it looks like these kinds of low-paying service jobs are what’s likely to take their place and become the norm. Unless we begin to take education seriously and are willing to pay for it. A well-educated population is the best investment for future economic development there is, and we must be willing to give it the necessary funding. The money will be paid back and then some by future economic growth.

Laying off prison guards and slicing college financial aid proved to be politically unpalatable to state leaders as they directed agencies on Tuesday to trim $1.2 billion from their current budgets.

But it might not be so easy for legislators to pass over such items next year as they face a shortfall in the 2012-13 budget that could be as big as $18 billion.

Republican leaders have vowed to close that gap without raising taxes, so it is likely that billions more would need to be sliced from the state budget to cover a portion of that gap.

“The leadership has been promising the State of Texas something for nothing for a long time,” said state Sen. Kirk Watson, D-Austin. “It may not work this next year.”

The upcoming shortfall stems from the economic recession as well as past legislative decisions that were not fully paid for at the time, such as the school property tax cut in 2006.

The budget-trimming effort initiated by Gov. Rick Perry, Lt. Gov. David Dewhurst and House Speaker Joe Straus in January is widely seen as a harbinger of cuts to come.

[...]

n February, agencies proposed a total of $1.7 billion of potential cuts in response to the mandate. The legislative leaders combed through the proposals over the past four months to determine what should be spared the knife.

The $483 million in exemptions announced Tuesday include money for border security, job creation programs, state mental health hospitals and other items.

“These savings will protect taxpayers’ hard-earned money while maintaining essential services vital to the people of Texas,” Dewhurst said in a news release.

But the cuts represent only about 1.4 percent of the state’s $87 billion general revenue budget, which is funded with tax dollars and over which the Legislature has control.

Democrats are doubtful that legislators will be able to cut their way out of the budget hole without hurting Texans.

“Texas is a conservative state,” said state Sen. Leticia Van de Putte, D-San Antonio . “If we really thought that all these programs were fluff to begin with, they would have been cut before.”

Van de Putte said it is unrealistic to expect the state to overcome this budget crisis without a combination of more cuts and more revenue.

About half of the total $1.2 billion in mandated reductions will be in education, despite the exemptions for school districts and financial aid. In total, $655 million was cleaved from the budgets of Texas colleges and universities and Texas Education Agency programs. Those reductions include layoffs, hiring freezes and program trims.

[...]

“What are the value judgments that are being made to determine what gets cut and what doesn’t?” Watson asked. “Do they think they have left a lot of waste after this set of cuts they’ve just made?”

With an election coming up those things are “politically unpalatable”, but once they’re safely reelected they will be their first best option. We’re already seeing headlines like these, UTMB to lay off 363 prison health care workers (which could land the state in court), and , 122 laid off so far, and scores more at risk.

Essentially what the “big 3″ are trying to do is show they’re doing something ahead of time while not causing themselves too much political pain in the process. Or as Dewhurst likes to put it:

The overall goal, he said, is to achieve reductions while avoiding “cutting into the muscle” of state government. “We’re determined to protect all essential services,” he said.

But when layoffs start coming like gangbusters, and Straus has already said that he wants to look at unpaid furloughs for state workers, that’s cutting into not just muscle but bone.

As Bob Moser points out at the Texas Observer, Will Next Budget Be Worse Than 2003?, these guys did some really bad things in 2003 that was the big driver of their party’s loss of support since then.

Those of us who lived through the 2003 session remember the damage inflicted on the state by the deep budget cuts that year. Refusing to raise taxes—though they did hike a number of “fees,” but that’s a separate issue—Gov. Rick Perry and the Legislature closed the gap mainly through accounting tricks and spending cuts. Lawmakers sliced more than $1 billion out of education and $6 billion from health and human services, according to state budget analysts (hat tip to the Statesman). Other key state functions were privatized—in some cases, with disastrous results.

The 2003 budget didn’t do the state well. One of the most famous consequences was that hundreds of thousands of kids lost state-sponsored health insurance. But the budget cuts affected nearly every corner of Texas life.

Perry said during the primary debate that, if reelected, he plans to do the same thing he did in 2003.  The cuts then were disastrous for Texas and took a toll on many GOP members of the Texas House. Most of the likely cuts will hurt those most in need and without lobbyists, like working Texans. Whether it’s in public and higher education, health care, government oversight and regulation, and of course failed privatization schemes, all things that were tried and failed then.

It’s taken seven years for the Children’s Health Insurance Program enrollment to return to its 2002 levels (and all the while, the state’s uninsured population has grown).

Meanwhile, the system that enrolls people in food stamps and other government programs is still a mess, reeling from a disastrous plan that laid off thousands of state workers in favor of privately run call centers. The plan was hastily abandoned, but the damage had been done. Before 2003, the Texas food stamp program was a model of efficiency. It regularly won awards from the federal government for its low error rate. Now, the food stamp program is an embarrassment, as Corrie MacLaggan’s excellent reporting in the Statesman has shown.

House Speaker Joe Straus said this week he favored closing the budget gap without raising taxes. Surely, lawmakers will have to seek out new revenue sources—legalized gambling seems to be popular once again. But, if Straus is to be believed, the emphasis once again will be on reduced spending. And they can’t cut Medicaid and CHIP, like they did in 2003, because the newly passed national health care bill likely won’t allow it. That means deeper cuts in other programs.

[...]

This is just the beginning. I honestly don’t know where lawmakers will find the cuts, and how bad the consequences will be. Texas already spends less per citizen than any other state in the nation.

I do know that cutting that much from the state budget—$10 billion, $15 billion, $18 billion, whatever the final figure—will negatively affect nearly everyone in this state for years to come.

The point is there’s nothing left to cut without causing a serious negative effects to Texans and Texas for years to come. It’s called economic scarring. Economic scarring is what I saw in my grandparents, and to a lesser degree my parents, who lived through the Great Depression. It effected them for the rest of their lives.

Dewhurst’s quote above stated that, “..they are determined to protect all essential services”. That’s a very careful political statement, and of course open to interpretation of what exactly an essential service is.  (For Dewhurst steroid testing in public schools is essential). Texas is a low tax state, and it’s exactly at times like this, to keep from setting our state back for years, we must raise taxes. It’s time for all of us to pay a little more, but especially those who have not been paying their fare share in Texas – the wealthy, big businesses, and corporations – to keep Texas from sinking into an even worse economic situation.

It was a tax born in a barbecue joint, the story has it, and now it’s giving state budget writers heartburn.
The Texas business tax comes due again today, and no one’s suggesting it will yield anywhere near the approximately $6 billion it was initially forecast to produce annually.

It yielded $4.5 billion when first collected in 2008, based on the previous year’s business activity. Last year, collections dipped to $4.3 billion. State Comptroller Susan Combs predicts the same amount will be collected this year.

“I think it was set up to fail,” said Sen. Kirk Watson, D-Austin, noting the levy was passed to help cover the cost of a cut in property tax rates for school districts. “I think when it was passed, they knew that it would not provide the appropriate swap that they were looking for, that it would not cover the reduction” in property taxes.

Senate Finance Committee Chairman Steve Ogden, R-Bryan, said the school finance package was a net tax cut — back when the state had a surplus.

“To date, it’s been very successful in reducing the school property taxes and increasing the state share of funding public education,” Ogden said. “Going forward, it could be a problem because the state’s economy is in recession.”

The shortfall in expected collections has made things worse for lawmakers confronting a budget shortfall as big as $18 billion through the next two-year budget period.

The business tax was part of a package championed by Republican Gov. Rick Perry and approved by legislators to meet a court order to revamp school funding in 2006.

Experts cite several reasons why the tax failed to live up to expectations.

It’s a one-of-a-kind tax, unique to Texas, and therefore hard to forecast. It’s complicated, and businesses have ended up taking bigger exemptions in one area in particular, cost of goods sold, than originally projected. And the lagging economy has played a role.

The article goes on to talk about how the business tax is a “unique tax”, uniquely bad it should be said. And Sen. Watson is dean on, this tax was setup to fail. Now the GOP, with the help of John Sharp, have put in place a disastrous economic policy, that will allow the Texas GOP if left in power to bring draconian budget cuts that will harm poor and working Texans the most. It’s all just part of the plan.

As far as the poll goes, EOW doesn’t get too up, of too down on any polls just yet.  The one thing I see that’s a constant in the last two polls that White should be working on is that Perry has a 55% approval rating.  White should be hammering Perry on his negatives like his posh living quarters in Westalke, Gov. Perry’s temporary digs costs Texas big bucks, and doing everything he can to drive up Perry’s negatives, and there are many.

“Ignorance is not knowing. Stupidity is knowing and doing it anyway.” In other words, ignorance has to do with a simple lack of knowledge or education, but stupidity results when a person already possesses the necessary knowledge, yet continues to engage in behaviors that are patently illogical.

Over the next few months heading to the November election, and 2011 legislative session in Texas, there will be much discussion about the budget shortfall that our state will be facing.  The publicized estimate grew yesterday from what was an $11 billion shortfall to an $18 billion shortfall.  In order to have a serious discussion about this it’s key for us not to be ignorant of how we got here.  It’s not an accident, or a perfect storm, this is all part of a plan.

By and large most people are for what government does for them, and only think it’s “too big” when it does things that don’t directly benefit them.  And often times politicians are not good at explaining to the people how and educated population, health care, clean water and air, roads, etc…benefit everyone as a whole and that we should all pay something for them.  It’s much easier for a politician to make silly jokes about it, (“I’m from the government and I’m here to help”), or blame all the problems on the government.  It’s much harder to educate the electorate and bring about workable solutions.

But key to finding a solution is knowing how we got where we are, knowing the history.  Back to the plan referenced above.  Anyone who is a regular reader likely already knows what the plan is.  Republicans since Reagan devised a scheme of how they wanted to “shrink government”.  It’s was supply-side economics, nicknamed “Voodoo/Trickle-Down Economics”.

(There’s much more in the extended entry).

As with any good sales pitch it had to be too good to be true, and this one was, that’s has a hint of truth in it. Voodoo Economics said that if tax rates were lowered, it would actually bring in more tax revenue.  There’s a modicum of truth to that but only when tax rates are really high, which they haven’t been since the 1960′s.  But instead it was really just a scheme to run up massive deficits, while giving tax cuts to the wealthy, and force cuts in programs.  Which also gave it the nickname “Trickle-On Economics”.  But Republicans always chickened out, deciding it was better the stay in office, than cut programs voters like and get thrown out.  Instead they would blame the deficits on big spending Democrats, and by and large the ignorant electorate, kept electing those politicians abetted by a compliant corporate media.

And as a recent poll shows, while Americans are eager to cut government spending, they’re ignorant as to where there money is spent.  And the programs they are willing to cut, would hardly put a dent in the deficit. And the programs that make up a large part of the budget they like the most. So it appears that most Americans agree that we want certain government programs that are expensive (Defense, Social Security, and Medicare), but don’t want to have to pay for it. And no politician is willing to tell them if they want it, they’ll have to pay for it. The Futility of Budget Cuts.

The poll highlights the conundrum: Americans want to solve the long-term deficit program and want the federal government to run a balanced budget. They are willing to make budget cuts. But the government cannot cut enough from discretionary programs to bring the budget into check and ultimately to reduce the deficit. (Half of Americans still believe the government can.) Entitlement programs — Medicaid, Medicare, and Social Security — are at the heart of the problem, with spending growth in health care programs the single biggest culprit. The lone solution — save for politically improbable radical spending cuts to defense, health care programs and social security — is tax hikes. Most economists agree on the point, reiteratedstrongly by Fed Chair Ben Bernanke in a speech yesterday. But the promise of tax increases is hardly a savvy campaign platform, and it will be up to members of Congress to sell the necessity and prudence of tax hikes to an economically distressed citizenry.

Back to those several things from yesterday. Texas House Speaker Joe Straus laid out the usual GOP canard that everything is on the table…except for what isn’t…a tax increase, of course. Now nobody wants a tax increase but if that’s what we need to keep our schools running well, or build new roads, then that’s a different story. How many are aware of the budget tricks the legislature and the governor have been playing for years, including the diversion of transportation money? While they’ve kept from “raising taxes” every fee in the state has been raised over the last decade, some by quite a bit. How many are aware of that?

There was also this report yesterday, (link via BOR) Tax bills in 2009 at lowest level since 1950.

Federal, state and local taxes — including income, property, sales and other taxes — consumed 9.2% of all personal income in 2009, the lowest rate since 1950, the Bureau of Economic Analysis (BEA) reports.

And here’s why taxes are so low now:

Why the tax bite has eased:

•Stimulus law. One-third of last year’s $862 billion economic stimulus went for tax cuts. Biggest reduction: The Making Work Pay tax credit reduced income taxes $800 for married couples earning up to $150,000.

•Progressive tax rates. Presidents Clinton and Bush pushed through a series of tax changes — credits, lower rates, higher exemptions — that slashed income taxes for poor and middle-class families. A drop in income now can trigger big tax breaks and sharply lower rates, sometimes falling to zero.

•Sales tax. Consumers cut spending sharply in this downturn, thereby paying less in sales taxes.

What that shows is that we’ve cut taxes over the last ten years, and not cut spending, and the deficits have soared. Who would have thought that was going to happen? That kind of makes a mockery of all the tea party rage that’s been sweeping the country.  But the deficits, remember, are the plan.  See McBlogger’s thoughts on the tea partiers, and this video from BOR:

It’s apparent that our current state leadership, all GOP by the way, is willing to cut any program and even institute gambling statewide – which wouldn’t do anything to solve the near term problem – to avoid having to raise taxes on the wealthy in Texas, who do not pay their fare share. But Kate Alexander points our very succinctly why the budget shortfall go so big, so fast in Texas.

As Alexander correctly notes, this budget crisis was caused in large part by a couple of decisions the Legislature made in 2006. For one, lawmakers passed a sizable property-tax cut without the money to replace those dollars. Then, the replacement source they had — the state’s revised franchise tax — woefully underperformed. And all this came while the Legislature was increasing spending on education with a sizable pay-for-performance plan and a new allotment for high schools.

That’s essentially right our of Reagan’s playbook. Run up a huge deficit, or in this case a tremendous pending shortfall, and use it as an excuse to cut programs that help working Texans the most while keeping the wealthy’s taxes as low as possible.

The difference between ignorance and stupidity is just about gaining knowledge and using it in a productive manner, learning from past mistakes, or history.

Progress, far from consisting in change, depends on retentiveness. When change is absolute there remains no being to improve and no direction is set for possible improvement: and when experience is not retained, as among savages, infancy is perpetual. Those who cannot remember the past are condemned to repeat it.

We went from massive deficit (Reagan, Bush, and tax cuts), to surplus (Clinton and a tax increase), to massive deficits again (Bush and tax cuts). It’s ignorant for us to think we can get out of our current situation without increasing taxes.

It’s simple really. We want government – federal, state, and local – to do certain things, and do them well. But many of us are  unwilling to pay for them. That’s just stupid.

First this from Texas Politics, House Speaker: No-new-taxes budget essential, will mean significant cuts and a look at ideas like unpaid furloughs.

Among ideas that Straus mentioned:

–A blanket moratorium on all new programs and services that require state funding
–A halt to issuing bonds because of the cost of debt
–Efforts to contain personnel costs and payroll growth, including consideration of the effect of freezing higher- level salaries and limiting new hires to those who are essential for Texan’s welfare and safety.
–Personnel containment costs used in other states, including unpaid furloughs to save salary costs and four-day work weeks to save operating costs.

Straus emphasized he’s not advocating any of those choices but said every cost-saving idea must be on the table.

Straus is going California with those “unpaid furloughs”. Of course the big questions are left unanswered like how to we make up for the neglect of the last fifteen years of public education and transportation infrastructure neglect.

In a SP story from April Castro Straus was quoted as saying some already debunked and false information on the effect of the new health care bill on the state budget, Straus says state must get creative with budget.

Straus said the federal health care overhaul will only exacerbate the state’s budgetary woes.

“Over the next few years, Texans will face higher federal income taxes and other increases in federal levies, including for Social Security and Medicare as result of the federal health care reforms,” Straus said. “Our work on the budget will begin in an environment of uncertainty as the federal government grapples with spending and tax measures to reduce the federal debt. This makes it even more imperative that the state of Texas cover its budget shortfall without a tax increase.”

It will actually help to reduce the deficit.  The effect of the health care bill on state budgets will be negligible,  and starting in 2014, and will not effect the 2011 budget. And the rest of that about income taxes, Medicare and Social Security is just scare tactics and wing-nut rhetoric.

Once again, the main problem facing Texas is the the most valuable assets of our state in the past, and educated population and a top notch transportation infrastructure, are at a breaking point and the current leaders in our state, like Straus, would rather use scare tactics than try and work for an equitable solution.

State law requires all counties to provide a program for patients whose incomes are no more than 21 percent of the poverty level and don’t qualify for Medicaid. The program must allow patients to spend $30,000 a year on specified medical costs.

WilCo Care has provided services to people whose incomes are at 25 percent of the poverty level, and has allowed them to spend $35,000 a year. Effective immediately, those have been changed to match the state’s requirements.

Lowering the income level (from 25% of poverty to 21%), and the annual allowance (from $35,000 to $30,000). The other change that’s made news is the fact that they will now require a valid Social Security number before someone can receive care.  The article goes on to state the two changes (eligibility and allowance) will save about 5 percent.

Claire Osborn covered this issue in more detail in the AAS over the weekend, Williamson County to stop footing health care bills of ID-less indigent people.

Williamson County commissioners have decided to stop paying health care costs for indigent adults and children who don’t have valid Social Security cards.

County Judge Dan A. Gattis said last week that he wanted to ensure that there was enough money for the residents of Williamson County who qualified for indigent care to remain covered. In the first five months of the current fiscal year, 265 people who didn’t have Social Security cards received county-paid health care out of a total of 1,153 indigent patients , said Bride Roberts , the coordinator for Williamson County’s indigent health care system.

The decision — which came in a unanimous vote on April 27 — was not based on race, Gattis said.

“We are running out of money,” he said.

[...]

Roberts said there were several reasons for the increased expense, including a large number of “very sick” people and new hospitals in the area identifying more people who may qualify for the program.

Williamson County residents without legal Social Security cards can still get care at four clinics in Georgetown, 10 clinics in Round Rock and one in Granger, all operated by Lone Star Circle of Care, a nonprofit community health organization, said Rebekah Haynes, the group’s communications director.

Roberts said patients without valid Social Security cards accounted for 12 percent of the $3.7 million spent under the program in the first five months of the fiscal year. During fiscal year 2009, 1,505 people were covered, and 331 of those didn’t have valid Social Security cards , she said.

The county estimated that it can save $1 million a year by denying coverage to people without legal Social Security cards, Roberts said.

One thing that was rarely, if ever, discussed in the recent health care debate was who ultimately pays for health care.  In the end those with health insurance, in the form of higher premiums, and ultimately taxpayers, wind up paying for the for cost of health care.  But what’s not being discussed here, regarding indigent health care, is what would be the most efficient and healthy way to provide health care to the indigent, and produce the best health outcomes for these people.  If taxpayers and those with health care are paying anyway, it would be best if we take care of the indigent in the most economical way possible.

While not giving indigent care to those without valid Social Security cards will save the county some money, it’s unlikely to save tax payers and those paying health insurance premiums a dime.  These people will show up in the emergency rooms now, instead of a doctor’s office, where the cost of health care is exponentially higher.  And we’re back to the same old argument of whether health care is a human right or a commodity, and how best to pay for health care.

One myth that should be dispelled is that “illegal aliens” pay nothing for the public services they use.  In Texas in particular, (since we have no income tax), they pay the same taxes as a legal resident does.  And as the Texas Comptroller pointed out in 2006 they are actually a boon for the Texas economy.  But they do cost at the local level in terms of medical care and incarceration.

But it doesn’t appear that those without cards are the main reason for the rising cost of indigent health care in Williamson County.  From what Roberts stated it looks like the main causes are more sick people and more people qualifying for the program.   That, more than likely, has quite a bit to do with the sagging economy and the sorry state of our country’s overall health care system.  (Some of which will be fixed by ending rescissions and pre-existing conditions in the recently passed health care reform.)  Also adding to the problem is that the county has less money because of lower property values and lower sales tax receipts over the last couple of years.

The WCCC will likely be faced with more decisions like this in the coming months as they work on the budget. Unfortunately many times those on the low end of the earnings spectrum take the brunt of the budget cuts.  Let’s hope, as they move forward, that the cuts will be spread evenly, and not made in areas that only hurt the low and middle income residents the most.

Anyone without health care in Williamson County and in need of health care should check out Lone Star Circle of Care and their locations around the county.