December 19, 2010 in Business

Caldwell: ‘Immoral’ cuts shine light on economic reality

By The Spokesman-Review
 

Gov. Chris Gregoire did the moral and immoral in a single turn last week: She released a balanced budget for the 2011-’13 biennium.

The 40-page summation is moral in that it meets her constitutional obligation to assure the state lives within means diminished by a sluggish economy. It is immoral, by her own definition, because thousands of Washington’s sick and disabled will not get help that the state has been providing.

These are not mere cutbacks. The word “eliminate” appears repeatedly – 80 times by the governor’s reckoning – sometimes in front of programs she holds dear.

The Basic Health Plan, for example, has been considered a model for state-subsidized medical services to those too poor to pay the bill themselves. Come July 1, the start of the next fiscal year, 66,000 people will have to find another way to pay for treatment, or stick hospitals and doctors with unpaid bills.

The positives are few but encompass activities business leaders should like, particularly ongoing spending on major infrastructure projects like the North Spokane Corridor.

The Community Economic Revitalization Board will get more money to support job creation. Spokane has been a major beneficiary of CERB loans; $6 million has gone to companies that maintain and paint airplanes at Spokane International Airport.

The state will sell $1.3 million in bonds to upgrade the Second Harvest food bank.

Not on the governor’s list: funds for a $75 million biomedical building that would be the centerpiece for the cherished four-year medical school on the Riverpoint campus.

Education, the foundation for the economy of the future, continues to absorb losses, just as students who will pay still higher tuition absorb more debt.

Also not on the governor’s list: new revenues. She got the message from voters who justifiably rejected an income tax, and foolishly rejected the tax on candy and bottled water. The $218 million the candy/water would have generated during the biennium would just about have covered the $230 million the Basic Health Plan would have cost.

Gov. Gregoire having proposed, the Legislature will dispose. Alternative plans are likely from Democratic and Republican ranks. Democrats may try shuffling the deck chairs, but titanic pain is inevitable.

Not surprisingly, GOP lawmakers like what they see from the governor. A few are grousing about service cuts – like ferries – to their constituents, but what do they expect?

Look for a renewed Republican push for privatizing state services, which a new paper from the Washington Roundtable and Washington Research Council suggests could reduce costs by as much as 15 percent but at least 5 percent. But not within this biennium.

Nor will the state capture more revenue from an improving economy soon enough to avert a lot of damage. The governor, who was too free with Olympia’s purse when times were good, sees the economy for what it is, not the way she or anybody else would like it to be.

“I hate my budget,” Gregoire said.

As should we all.

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