Gov. Brewer’s ‘Arizona Comeback’ is the light of an oncoming train
Posted by AzBlueMeanie:
In yet another "I told you so moment," I told you so. 'The Arizona Comeback,' Guv? Not so much:
By the way, that budget surplus Brewer is touting is illusory. The
package of tax cuts enacted for businesses that begin to phase in this
fiscal year will begin to erode that "surplus" quickly, as the tax cuts
were meant to maintain a structural revenue deficit so that
Tea-Publicans can make the argument that we need to cut the state budget
even more.
If the Tea-Publicans in Congress continue to pull money out of the
economy with their "austerity" automatic sequester cuts, or worse, blow
up the economy by defaulting on the federal debt ceiling, the economic
downturn which will result will quickly dissipate Governor Brewer's
illusory budget "surplus."
This week, the Arizona legislatur'e JLBC agreed with me. State
heading into financial hole within next two years:
The state is headed into another financial
hole, the combination of already approved tax cuts and required annual
spending increases.
Members of the state's Finance Advisory Committee predicted Friday that revenues will grow 3.5 percent this current fiscal year over
what they were last year. And the following year there will be another
5.3 percent increase.
But Richard Stavneak, staff director of the Joint Legislative Budget
Committee, said none of that is keeping pace with already built-in
requirements for annual spending. In fact, even the budget for the
current year is $330 million above what's coming in the door.
Stavneak said the state can survive for the next
two fiscal years because of sharp spending cuts in prior years, coupled
with leftover cash from the now-expired 1-cent surcharge on the state
sales tax.
But Staveneak said that will be gone by the 2016
budget year, with the state ending up $202 million in the red. And if
that deficit is not cured and spending proceeds apace, he figures the
red ink could hit $505 million by the 2017 budget year.
Even that may be optimistic.
Especially if the Tea-Publican economic terorists in Congress actually do default on the U.S. debt in a couple of weeks. The 2008 financial crisis is going to look like a Sunday walk in the park compared to the economic catastrophe to be unleashed by a default on the U.S. debt.