Betting on the donkeys, elephants, the governor and us

Remember “us”? We are the folks who go to work every day and add value to life in Louisiana. We run small businesses, work shifts, raise our kids, dote on our grandchildren, and pay the sales taxes, income taxes, property taxes, and fees that have fed the huge growth in the state budget during the last decade.

We have reached the point where the growth of state government spending is poised to exceed the growth in the average of all of our total incomes in Louisiana. That shouldn’t be allowed to happen, but it might take place the next time the legislature returns to Baton Rouge unless “us” folks let our legislators know we won’t tolerate it.

The taxpayers of this state have a fantastic ally in the presence of the cap on state expenditures that they passed into law back in 1990. It requires a two-thirds vote for any state expenditure in excess of the three-year average increase in the total personal income growth of Louisiana citizens. That means that, unless two-thirds of our elected officials vote to do otherwise, state spending can’t increase faster than our earnings.

The spending cap had never come into play in state budget deliberations until the recent explosion of state revenues, much of which came from “us.” As long as that cap stays in place, there is less of a reason for state officials to either raise our taxes or engage in excessive spending that could later increase the pressure to raise taxes. State government will have to conduct its financial affairs much like the way it is done by “us”: live within its means and be prudent in spending uncertain revenues.

It will be interesting to see how the governor and the Legislature approach the question of the spending cap the next time around. If all sides work together, a way can be found to give teachers and first responders a pay raise, shore up the under-funded state retirement systems, increase the amount of road construction in the state priority road program, and give meaningful tax cuts to “us” folks who have obviously been over-taxed—and all of it can be done without raising the expenditure cap higher than it should be in this fiscal year or the next.

Part of any such plan should also ensure that all of the excess revenues certified for the current (and next) budget year are not spent. If a significant amount of the excess dollars is held in reserve, it could be available for a meaningful solution for the insurance crisis (if a sure-fire plan can be developed) or for any emergencies arising from another disaster striking the state (heaven forbid).

If any of the money is not spent in the ’06 or ’07 budget years, it eventually becomes surplus and can be used to build more highways, further shore up the retirement systems, or aid in the coastal erosion fight. Those spending possibilities are much more meaningful and more fiscally sound uses of the money than pork-barrel spending that would likely follow any significant breach of the expenditure cap.

It is time for the governor, the donkeys and the elephants to act like wise old owls instead of creatures of prey. How these unforeseen revenues are used will be a meaningful chapter in Louisiana’s political history. That chapter can be another dismal one of opportunity lost, or it can signal a more progressive way of doing things in state government.

Let’s hope they give a hoot.