Group Launches Drive for Balanced Budget Amendment
I applaud the efforts of the group Deficit Free to push for a Balanced Budget Amendment, but with Obama and Congressional Democrats spending money faster than the government can print it, it may be a lost cause.
The only way to stop the bankruptcy of the United States is to vote out every Congressional Democrat in 2010.
In case you're wondering which Pennsylvania members of Congress supported the Pelosi Health Care Bill, which will raise taxes and put your family's current health care coverage at risk, see the list below.
If you see any of the names on a ballot next May or November, vote for the other person:
Robert Brady (D-PA-1) Chaka Fattah (D-PA-2) Kathy Dahlkemper (D-PA-3) Joe Sestak (D-PA-7) Patrick Murphy (D-PA-8) Christopher Carney (D-PA-10) John Murtha (D-PA-12) Paul Kanjorski (D-PA-11) Allyson Schwartz (D-PA-13) Mike Doyle (D-PA-14)
The Joint Economic Committee (JEC) House Republican staff, which earlier this year created a chart mapping the bureaucratic complexity of Speaker Nancy Pelosi's original health care proposal (H.R. 3200), has combined similar analysis by the House Republican Conference with the earlier chart. The analysis details new additions to the health care bureaucracy contained in the new version of the Speaker's bill (H.R. 3962) that were not previously listed. Let's just say the Speaker's vision for government-run health care hasn't gotten any simpler.
"This is the blueprint for a taxpayer-funded mega-bureaucracy," Boehner said "The new chart is an astonishing and unsettling glimpse of the future that awaits American health care, should H.R. 3962 be passed by the House and signed into law."
The chart, completed at the direction of Rep. Kevin Brady (R-TX), the committee's ranking House Republican Member, shows that the Pelosi plan has grown even more complex in the months since it was originally unveiled by congressional Democrats.
NEWS FLASH: Pa. Legislature sends $27.8B budget to Rendell
It took 101 days into the new fiscal year, but the country's most expensive state legislatures has finally agreed on a budget for 2009-10.
From Marc Levy of The Associated Press:
A $27.8 billion state budget was on its way to the desk of Gov. Ed Rendell following a lopsided vote of approval from the Senate — a giant step toward ending Pennsylvania's 101-day budget stalemate, the nation's longest this year.
The 42-7 Senate's vote followed House approval on Wednesday.
The Senate voted without debate moments after signing off on a companion bill to tap more than $1.5 billion from the state's reserves. That bill still awaited House approval.
Rendell has said he would sign the appropriations bill, but it was unclear whether he would do so before the House passes the companion bill.
The appropriations bill cuts overall spending by more than 1 percent, while boosting spending on operations and instruction in public schools by $300 million, or 5.7 percent, a level that Rendell insisted upon.
The politically divided Legislature has been stymied by how to resolve a multibillion-dollar, recession-driven shortfall.
The final agreement relies on a blend of federal budget aid, transfer from reserve funds, spending cuts and nearly $500 million in new taxes on sales of cigarettes, little cigars and businesses that pay the capital stock and franchise tax.
The plan also relies on legalizing and taxing table games at the state's slot-machine casinos and leasing more state forest land to natural gas exploration companies.
State Rep. Curt Schroder (R-155th Dist.) voted against the long-awaited state budget that passed by a 107-93 vote in the House on Thursday.
Schroder offered the following statement on his vote:
"I could not vote for this bill. Like last year's budget, it contained inflated revenue projections and relied too heavily on stimulus funding and one-time revenues. By passing this legislation, the House is making the same mistake it made a year ago that resulted in a $3.5 billion revenue shortfall.
"This budget drains the state's Rainy Day Fund and the Health Care Providers Retention Fund. Without these critical reserve accounts we will be unable to cushion an expected revenue shortfall next year. It also, for the first time, dips into the principal reserves in the tobacco settlement fund. With revenues already $140 million below projections for the year, I believe we will face another deficit next June.
"The House Republicans had proposed a budget that is slightly leaner, balanced, did not raise taxes, funded essential state programs and services, and ensured that the state would live within its means, but it was not considered by the Democrat leadership in the House. Instead, we were forced to consider a budget bill that raises taxes by more than $1 billion during a recession.
"On the bright side, we prevented an increase in the Personal Income Tax, sales tax, taxes on small games of chance and the arts, among others."
The measure goes back to the Senate for concurrence on House amendments to the bill.
Gerlach: PA budget impasse a 'national embarrassment'
Jim Gerlach, a Republican candidate for governor, said on Thursday that Pennsylvania's broken budget process has become a national embarrassment.
On the 100th day of the state's budget impasse, Gerlach said this would never happen if he was sitting in the governor's mansion.
"We do not need to waste any more time playing political games and pointing fingers," Gerlach said in a written statement. "This dysfunctional process has resulted in a 100-day delay in enacting a budget. The Harrisburg culture of putting self-interest ahead of the public interest must end. The families of Pennsylvania understand the importance of paying your bills on time and not spending more than you can afford. For far too long Harrisburg has ignored these basic principles.
"That's why I was the first candidate for governor to propose moving to a a two-year budget cycle to cut costs, increase accountability and avoid the annual budget soap opera, which for the last seven years has resulted in increased government spending and higher taxes. And we must stop rewarding politicians in Harrisburg for failure. If the state cannot meet the Constitutional requirement of enacting a budget by July 1st of each year, then the Governor, his Cabinet and lawmakers should lose a day's pay for every day the fail to pass a budget."
In September, Gerlach released a 17-point "Pledge to Pennsylvania" that is a contract to protect taxpayers and send a very clear message that the days of rewarding failure, ignoring runaway spending and tolerating a lack of accountability in Harrisburg are over.
The entire "Pledge to Pennsylvania" is available at his campaign Web site, www.gerlachforpa.com
Rep. Curt Schroder (R-155) issued a press release late Friday stating that it appears Gov. Ed Rendell and certain House and Senate leaders are repeating the mistakes in the tentative state budget agreement that got Pennsylvania in the financial mess it is in now.
From Schroder's release:
"This budget does not solve our problems," said Schroder. "It increases spending, relies on one-time revenues and taxes businesses and citizens at a time they can least afford it. Passage of this budget will ensure another budget fiasco next year."
On Sept. 18, Gov. Ed Rendell and three of the four legislative caucuses reached a tentative $27.9 billion state budget agreement without the participation of the House Republicans, who several weeks ago, put forth their own $27.5 billion plan. The Republican plan cut spending below last year's level, did not raise taxes, covered essential government services, provided increased funding for education and preserved the state's Rainy Day Fund. Further, the plan was balanced and sustainable, but House Democrats, who hold the majority and therefore the control in the House, refused to consider it. Instead, House Republicans were left out of the budget process.
"Three months into the new fiscal year, Pennsylvania is the only state without a budget, and the budget being proposed calls for increased spending in a down economy. Ironically, it is awash in walking-around-money or WAMs," said Schroder. "This budget proposal cuts funding for libraries, social services and education. To include grants for legislators' pet projects is an affront to every group getting its funding slashed. It taxes museums, concerts and other cultural events, cigarettes and small games of chance. It expands gambling and drains the Rainy Day Fund, which leaves us without money to cover essential services should we come up short again next year.
"The most disturbing thing is the stealth, secretive way this deal was reached. We will be asked to vote on this deal within days, yet we have not seen the line-item details," said Schroder. "As I see it, the proposed budget will only serve to prolong the pain being experienced by Pennsylvania citizens, and it offers little hope for economic recovery anytime soon," he said.
Rendell, Legislature keep digging a deeper hole for PA
The first rule of holes: When you're in one, stop digging.
While Gov. Ed Rendell and the Pennsylvania Legislature are still trying to figure out what to do about last year's $3.25 billion budget deficit, Pennsylvania is facing another financial disaster for 2009-10.
Revenue collections for the first three months of the new fiscal year have fallen short of projections. That's a fancy way of saying Pennsylvania is headed for another fiscal crisis -- even while elected officials struggle to get the state out of the mess they created last year.
Pennsylvania collected $2.1 billion in General Fund revenue in September, which was $118.6 million, or 5.5 percent, less than anticipated, according to Revenue Secretary Stephen H. Stetler. Fiscal year-to-date General Fund collections total $5.3 billion, which is $140.6 million, or 2.6 percent, below estimate, Stetler reported.
Tax revenues from the state's two biggest sources of income fell short for the third consecutive month of the new fiscal year, adding to the 12-month decline in the 2008-09 fiscal year.
From the Department of Revenue's September Collection Report:
Sales tax receipts totaled $633.4 million for September, $38.8 million below estimate. Year-to-date sales tax collections total $2 billion, which is $52.2 million, or 2.5 percent, less than anticipated.
Personal income tax (PIT) revenue in September was $835.4 million, $69.5 million below estimate. This brings year-to-date PIT collections to $2.2 billion, which is $97.9 million, or 4.3 percent, below estimate.
The only bright spot is September's corporation tax revenue collections of $403.9 million, which was $5.6 million above estimate. Year-to-date corporation tax collections total $541.4 million, which is $7.3 million, or 1.4 percent, above estimate.
More from the Revenue Department:
Other General Fund revenue figures for the month included $59.1 million in inheritance tax, $3.4 million below estimate, bringing the year-to-date total to $181.6 million, which is $6.1 million below estimate.
Realty transfer tax was $23.5 million for September, $1.5 million below estimate, bringing the total to $82.2 million for the year, which is $3.7 million less than anticipated.
Other General Fund tax revenue, including cigarette, malt beverage and liquor taxes totaled $85.4 million for the month, $7.2 million below estimate and bringing the year-to-date total to $259.4 million, which is $1.2 million above estimate.
Non-tax revenue totaled $9.8 million for the month, $3.7 million below estimate, bringing the year-to-date total to $52.1 million, which is $10.8 million above estimate.
Click on the link below to view the full September report:
Inflation Could Spell End of U.S. Financial System
This is scary stuff. If the policies of Barack Obama and Congressional Democrats are not stopped, we will see the collapse of the United States.
From the National Inflation Association:
It took 25 years for our national debt to double from $257 billion in 1950 to over $533 billion in 1975. Most recently, our national debt has more than doubled from $5.8 trillion in 2001 to its current level of $11.8 trillion in just eight years. Our national debt is now growing three times faster that it did decades ago, which means we should expect a very minimum of three times faster inflation.
The Commonwealth Foundation has launched a new Web site and public service campaign called BankruptingPA to educate taxpayers about "wild and unaccountable government spending."
The Foundation is looking for feedback to help it choose the most effective message and imagery to make this effort as successful as possible, says Commonwealth Foundation CEO Matthew J. Brouillette.
Visit the new Web site at www.BankruptingPA.com, click on the "VOTE" buttons n the right side of the page and leave comments or criticisms.
"Time is of the essence. Please help us ensure BankruptingPA is successful," Brouillette adds.
Rep. Doug Reichley: Budget deal 'not in the best interest' of many PA residents
Rep. Doug Reichley (R-Berks/Lehigh), Republican vice chairman of the House Appropriations Committee, issued the following statement Monday following the announcement Friday of a tentative budget agreement between Gov. Ed Rendell and three of the four legislative caucuses:
"I think all Pennsylvanians welcome the end of the embarrassing spectacle of our budget impasse over these last three months. Not only are we the last state in the nation to reach a budget agreement, we were also the only state in the country where the governor was proposing to increase spending in the midst of the worst economy in 70 years. Regrettably, the agreement reached by the governor and Senate Republicans, House Democrats, and Senate Democrats is not in the best interest of the many residents of our state who are struggling with job losses and lower household incomes.
"The governor and these three caucuses have brokered a deal where many businesses will look at a retroactive increase in the Capital Stock and Franchise Tax. This 53 percent increase will then be continued over the next three years, instead of permanently phasing out the tax as was currently stated in law.
"Individual consumers will see a 25 cent increase per pack in the cigarette tax, a new tax on small cigars, a new 20 percent tax on the proceeds from small games of chance, such as raffles and punchcards, and a new sales tax on the ticket price for admission to concerts, museums, and zoos.
"In addition to these new taxes, the concocted plan calls for taking every last cent out of the $750 million Rainy Day Fund, and raiding the state medical insurance fund which is meant to protect health care providers from disastrous litigation awards. This is not a prescription for fiscal stability either this year or next year when we may be faced with similar budget shortfalls.
"What is even more troubling than the tax hike binge is the absolute lack of detail being provided to the general public. We still do not know how libraries, hospitals, service providers, and school districts will be impacted. The governor was pleased that an additional $300-plus million of state tax dollars will be invested in education as well as his other pet programs, but the question remains whether those funds will be distributed equitably or primarily used to benefit Philadelphia, as has happened in the past.
"For five months, House Republicans have proposed budget plans calling for greater reductions in spending than agreed to last week. Our plan balanced the budget without raising a single tax on businesses or individuals. Unfortunately, the governor has convinced the other caucuses to increase taxes and maintain spending at last year's $28 billion budget level.
The governor and the other three caucuses have made their deal. Now let them put up the votes to raise taxes and spending."
Gov. Ed Rendell said Friday night that there are no winners or losers in the compromise that ended Pennsylvania's 80-day-old budget impasse.
Don't believe him. There are always winners and losers in every budget agreement and this one is no exception.
If you smoke, you're going to pay more. If you support the arts in Pennsylvania, you are going to pay more. (The deal expands the state sales tax to cover tickets for concerts, museums, theaters, etc.)
If your church or nonprofit group uses bingo or other small games of chance as fundraisers, you're going to have to pay the state under a new tax inlcuded in the deal.
If you're a business owner, you're going to continue paying some of the highest business taxes in the country. And so on.
Although details are sketchy, (Rendell purposely declined to reveal many details until the rank-and-file state lawmakers are briefed next week), The Commonwealth Foundation offers some instant analysis based on what we do know.
The budget deal includes $821 million in tax increases and fails to address at least $1.7 billion in deficit spending from last years' budget, according to the Foundation.
The state's "Rainy Day Fund" will be exhausted with legislative leaders agreeing to spend the entire $775 million to balance the budget, according to the Foundation.
That's a risky move because the economy isn't getting any better and we could sitting on another huge budget deficit next summer.
"They made their numbers work on paper, but the numbers won't work in the real world," Gov. Ed Rendell said today of the budget agreement reached Friday by Senate Republicans and House Democrats.
Rendell said he will not sign the budget compromise if it reaches his desk. House Republicans are also opposed to the proposed budget, which is now 74 days late.
Read Rendell's full statement and his list of flaws contained in the budget deal at the link below:
Despite the spin from the Obama media about the U.S. has "turned the corner" on the current recession, there are ominous signs that the failed Obama economic policies of the past nine months could set the stage for even worse times ahead.
"The dollar is weakening, gold is hitting new highs and some foreign officials now want an alternative to the U.S. currency," writes Investor's Business Daily. "If you're looking for a market verdict on U.S. economic policy, look no further."
From the editorial:
As Heritage Foundation economist Brian Riedl notes, Washington is set to spend $30,958 per household this year — taking $17,576 in taxes and borrowing the rest from our kids.
If this were a temporary thing, it might not be so bad. But we're boosting federal spending from the 18%-to-22%-of-GDP range that has prevailed since World War II to 26% this year. And if Congress and the White House get their way, spending will stay at least that high forever — in effect, a 30% rise in real spending and taxes.
Investors worry about surging U.S. government debt, conservatively expected to grow by nearly $10 trillion over the next decade. Since every dollar the government spends comes from the private sector, that won't leave much for private investment here.
And this doesn't even count our exploding entitlements problem. We owe $51 trillion to Social Security and Medicare over the next 50 years or so — about $205,000 per person alive today.
By our foolish fiscal choices, we're in effect opting for stagnation and inflation over growth and prosperity. New regulations and government control of the auto, banking and financial services industries will lower corporate profits. So will higher taxes on individuals to pay for it all.
Left unchecked, Barack Obama, Nancy Pelosi and Harry Reid plan to run up higher deficits over the next 10 years than all American presidents and Congress have incurred in the last 230 years.
From DefeatTheDebt.com:
Think America is "Unsinkable?"
Every year, the government spends hundreds of billions of dollars it doesn't have, and we sink deeper and deeper into debt. We cannot afford to go down with this ship.
The national debt will grow by more than $9 trillion, according to an August 2009 report by the White House Office of Management and Budget.
How much is $9 trillion, or even $1 trillion? Confronted with enormous numbers like millions, billions and trillions, it's helpful to use comparisons with other contexts. For example, one million seconds will pass in just 12 days. One billion seconds is almost 32 years. And one trillion seconds? That’s 31,688 years. One trillion dollars is a lot of money, and over the next decade the US federal government will borrow that sum nine times over — more than $9 trillion.
In the next 10 years, the federal government will borrow trillions of dollars for spending it cannot afford. But the American people will eventually have to pay the price for this irresponsible borrowing.
The federal deficit for the current fiscal year is four times higher than it was under George W. Bush. And keep in mind that Democrats have controlled Congress since 2007 and have approved record spending and record debt since then.
Under Barack Obama, the national debt will reach astronomical and unsustainable levels as the U.S. heads toward bankruptcy and national suicide.
A non-partisan group called Defeat the Debt has launched a public service campaign to inform Americans how serious the debt problem is. Here is the first of three articles on the subject:
How Much is a Trillion Dollars?
The national debt is larger than ever before, and experts predict it will only continue to expand.
The national debt will grow by more than $9 trillion, according to an August 2009 report by the White House Office of Management and Budget.
In July of 2009, the Congressional Budget Office and the staff of the Joint Committee on Taxation released their analysis of America's Affordable Health Choices Act. They estimated the bill would add an additional net deficit of $1.042 trillion over the next decade. In January of 2008, Social Security's unfunded liabilities were estimated at $6.6 trillion, and Medicare unfunded liabilities totaled more than $36.3 trillion, according to the GAO's Fiscal Year 2008 Financial Report of the United States Government. In addition to our current national debt of more than $11.6 trillion, our future obligations to Social Security and Medicare total $43 trillion.
How much is $9 trillion, or even $1 trillion? Confronted with enormous numbers like millions, billions and trillions, it's helpful to use comparisons with other contexts. For example, one million seconds will pass in just 12 days. One billion seconds is almost 32 years. And one trillion seconds? That's 31,688 years. One trillion dollars is a lot of money, and over the next decade the US federal government will borrow that sum nine times over — more than $9 trillion.
In the next 10 years, the federal government will borrow trillions of dollars for spending it cannot afford. But the American people will eventually have to pay the price for this irresponsible borrowing.
The Pennsylvania Department of Revenue has released tax collection numbers for the month of August, the second month of the new fiscal year (although the state still doesn't have a budget for the 2009-10 fiscal year).
Without an approved budget and with last year's budget ending up $3.25 billion in the red, the state remains on shaky financial ground.
Pennsylvania collected $1.6 billion in General Fund revenue in August, which was $19.9 million, or 1.2 percent, less than anticipated, according to Revenue Secretary Stephen H. Stetler. Fiscal year-to-date General Fund collections total $3.3 billion, which is $22 million, or 0.7 percent, below estimate, Stetler said.
The state collected 5 percent less in July 2009 ($1.65 billion) than it did in July 2008 ($1.75 billion) when Gov. Ed Rendell's $28.3 billion red ink budget kicked in.
Collections from the two biggest sources of revenue, the sales tax and the personal income tax, were both down in August, as they were in July.
Translation for Gov. Ed Spendell and the dimwitted Democrats in the House who are holding up the budget in order to raise taxes: Pennsylvanians don't have jobs so they can't pay income taxes and they have nothing left after paying off their bills so they can't buy anything to increase sales tax revenues.
From a Revenue Department Press Release:
Sales tax receipts totaled $662.7 million for August, $13.4 million below estimate. Year-to-date sales tax collections total $1.4 billion, which is $13.4 million, or 1 percent, less than anticipated.
Personal income tax (PIT) revenue in August was $683.5 million, $28.3 million below estimate. This brings year-to-date PIT collections to $1.3 billion, which is $28.4 million, or 2.1 percent, below estimate.
August corporation tax revenue of $50.2 million was $3.9 million above estimate. Year-to-date corporation tax collections total $137.9 million, which is $2.1 million, or 1.6 percent, above estimate.
Other General Fund revenue figures for the month included $59.2 million in inheritance tax, $2.6 million below estimate, bringing the year-to-date total to $122.5 million, which is $2.7 million below estimate.
Realty transfer tax was $29.1 million for August, $2.2 million below estimate, bringing the total to $58.7 million for the year, which is $2.2 million less than anticipated.
Other General Fund tax revenue, including cigarette, malt beverage and liquor taxes totaled $91.5 million for the month, $8.5 million above estimate and bringing the year-to-date total to $174 million, which is $8.4 million above estimate.
Follow the link below to read the rest of the revenue report:
Taxpayers must fight Rendell and the 'spending interests'
Lowman S. Henry has some sound advice for Pennsylvania taxpayers: "If YOU don't speak up now, then the outcome of the budget crisis will be determined by those who do."
While it appears nothing much is happening while the state budget impasse marks its ninth week, Gov. Ed Rendell and the "spending interests" are working feverishly to weaken the resolve of Republican lawmakers, who have taken a "No New Taxes" stance.
From Henry's most recent post at his Lincoln Blog:
The spending interests are deploying a new tactic in their effort to inflict higher taxes on the working families of Pennsylvania: they are picketing the offices of their local state senators and state representatives and calling a compliant news media in for coverage.
In an effort to put pressure on fiscally responsible legislators, the spending interests are now resorting to pickets and demonstrations all the while chanting the mantra that it is time to end the stand-off.
I agree the budget stalemate should come to an end - but it should do so with state government living within OUR means and not raising any taxes. Otherwise, the budget crisis can go on until Easter if necessary.
Rendell has been manufacturing all sorts of doomsday scenarios for weeks now. In recent days school district officials - whose coffers are currently flush with local tax revenue - have be whining like spoiled children over the delay in state money, and over the fact Republicans want to give them less of an increase in their allowance, er, subsidies than they want.
Henry suggests Pennsylvania taxpayers give Rendell and the "spending interests" a taste of their own medicine.
"The tactic of demonstrating in front of legislative district offices is one taxpayers and taxpayer groups should emulate. Why should the spending interests be the only ones who make their voices heard?"
It would benefit every taxpayer to take time to call, write, visit - or take to the streets - in front of his/her legislator and senator's offices to either thank them for standing firm against tax hikes, or call upon them to put taxpayers first.
Six months of failure under the Democratic leadership of Barack Obama, Nancy Pelosi and Harry Reid has convinced 7 in 10 Americans that big government liberalism is not the way to go, according to a new poll.
From the latest Rasmussen Reports:
Seventy percent (70%) of likely voters now favor a government that offers fewer services and imposes lower taxes over one that provides more services with higher taxes, according to a new Rasmussen Reports national telephone survey.
That’s up five points over the past month and is the highest level measured in nearly three years.
Just 19% would prefer a government that provides more services in exchange for higher taxes, down five points from July and the lowest level in over two years. This marks the first time the percentage of voters who prefer this type of government has fallen below 20%.
Most Republicans (88%) and voters not affiliated with either major party (78%) like a government with lower taxes and fewer services, and 48% of Democrats agree. However, one-in-three Democrats (34%) prefer more government services and higher taxes.
White House estimates of a $9 trillion budget deficit over the next 10 years ($2 trillion more than the White House predicted just a few months ago) are still way off the real deficit projections, according to an editorial in The Wall Street Journal.
The Congressional Budget Office predicts that debt held by the public as a share of GDP, which was 40.8% in 2008, will rise to 67.8% in 2019 — and then keep climbing after that, says the newspaper.
The CBO says this is "unsustainable," but even this forecast may be optimistic, the newspaper says.
From the editorial:
The real fiscal crisis in Washington is that neither Congress nor the White House are offering any escape from these trillion-dollar deficits. Mr. Obama has not called for automatic and immediate spending cuts. He has not proposed eliminating hundreds of wasteful programs. To the contrary, the White House still hasn't ruled out another fiscal stimulus, as if a $1.6 trillion deficit isn't Keynesian stimulus enough. The Administration's celebrated scrub through the budget this summer identified $17 billion in agency savings. That's what Uncle Sam is borrowing every three days.
Obamanomics has turned into an unprecedented experiment in runaway government with no plan to pay for it, save, perhaps, for a big future toll on the middle class such as a value-added tax. White House budget director Peter Orszag promises that next year's budget will have a "plan to put the nation on a fiscally sustainable path." Hide the children.
Read the full editorial, "The Pelosi-Obama Deficits," at the newspaper's Web site.
Rep. Rohrer blasts Rendell plan to expand sales tax
For the past six years, Gov. Ed Rendell has opposed efforts by state Rep. Sam Rohrer's efforts to expand the state sales tax in order to eliminate school property taxes.
Now that Gov. Rendell is floating the idea of expanding the state sales tax to help cover his $3.2 billion budget deficit, Rohrer is among the first state lawmakers to publicly condemn the idea.
From a press released issued today by Rohrer, a Republican who represents the 128th District in Berks County:
"The governor seems unable to understand that, on taxes, no means no," Rohrer said. "There is only one acceptable solution to the ongoing budget stalemate. The state must reduce spending to match its income. State government should not be adding to the burden of working families by raising taxes during this economic recession. That would be cold-hearted and wrong. Pennsylvania taxpayers deserve a compassionate government that does not kick them while they're down."
Rohrer is the Republican chairman of the House Finance Committee and the sponsor of the School Property Tax Elimination Act (SPTEA), a plan to free Pennsylvania homeowners from the burdensome property tax. Rohrer's plan would use an expanded sales tax, among other revenue sources, to fund education in the Commonwealth.
Rohrer warned residents not to be confused by the governor's proposal. While Rohrer's is about eliminating property taxes, the governor's is about expanding the state budget.
"My plan offers the hope of a property tax-free Pennsylvania," Rohrer said. "The governor's proposal is just another attempt to dig deeper into the pockets of taxpayers. He just wants more money to spend on more government."
Rendell is proposing the sales tax expansion after his earlier proposal to increase the state income tax was shot down by the General Assembly.
"The governor just doesn't get it," Rohrer said. "Whether it's an income tax, a sales tax or any other tax hike proposal he cares to offer, people just can't afford it right now. Instead of always expecting taxpayers to sacrifice and do more with less, the governor might actually have to sacrifice for a change."
Rohrer also noted it would be interesting to see which House Democrats would rise to support the governor's call for an expansion in the state sales tax to pay for additional state government spending.
"In the past, some House Democrats have adamantly opposed my plan to use a sales tax expansion to eliminate school property taxes," Rohrer said. "Will those same lawmakers now rise to support the governor's proposal to expand the tax to pay for more government? If that's the case, they would essentially be saying that they'd support a sales tax expansion to help the governor, but not to help homeowners. That's one heck of a message to send to property taxpayers in your district."
Rohrer said he will encourage his colleagues in the General Assembly who have supported the SPTEA to oppose the governor's sales tax expansion.
"The sales tax was instituted in 1953 for education only. It should remain for education only," Rohrer said. "It should not be used as a back door into the pockets of taxpayers to pay for more government spending."
We all know about the $3.25 billion deficit Gov. Ed Rendell ran up in the General Fund budget for the 2008-09 fiscal year, but Pennsylvania is drowning in red ink when you take into account all other state and local debt.
The Commonwealth Foundation has a terrific post at its Web site about the state of "Debtsylvania."
Pennsylvanians owe $115 billion in state and local government debt, according to the Foundation, which reviewed spending from 2002 to 2008.
No surprise here, but the debt has skyrocketed during the tenure of Gov. Rendell.
"Under Governor Rendell, total state general obligation debt outstanding has increased from $6.8 billion to a projected $9.5 billion with his 2009-10 budget proposal, a 40% increase in seven years," The Foundation says.
To read the full report visit The Commonwealth Foundation Web site.
Rep. Sam Rohrer on state budget: 'What's Really at Stake?'
State Rep. Sam Rohrer, Republican chairman of the House Finance Committee, has released the first in a series of videos where he will lay out the facts underlying the ongoing budget stalemate between Gov. Ed Rendell and the General Assembly.
Senate Republican Majority Leader Dominic Pileggi and State Rep. Mario Civera, R-164, the Republican chairman of the House Appropriations Committee, met with the editorial board of the Delaware County Daily Times to discuss the state's seven-week-old budget stalemate. The two Republican leaders placed the blame for the budget mess on the shoulders of Democratic Gov. Ed Rendell.
As long as Rendell insists on raising taxes and increasing state spending, don't look for the Republicans to budge.
This comment from Pileggi doesn't sound like a budget deal will come any time soon:
"The governor is still actively going around the state saying we need to increase the personal income tax by $1.5 billion and we need to increase our spending in the state by close to a billion dollars over last year. This isn't maintaining services. This is massive new taxation and massive increases in spending at a time when we're going through the worst recession in Pennsylvania since the Great Depression ... The problem, and the reason we're so far apart, is that the governor hasn't changed his objective even though the bottom has fallen out of the economy."
Pennsylvania is 40 days into a new fiscal year, but state officials are no closer to agreeing on a new budget than they were on June 30, the last day of the 2008-09 fiscal year.
In a recent poll, 30 percent of the state's voters placed the blame for the budget impasse on Gov. Ed Rendell, but 17 percent blamed the Republicans in the Legislature while 11 percent blamed the Democrats and 28 percent blamed everyone equally.
Pennsylvania finished the 2008-09 budget year with a #3.25 billion deficit, but Rendell wants to spend even more money for 2009-10. And a newspaper is now reporting that Rendell has also spent more than $360 million in borrowed money.
The man has a serious problem, which is why he is being referred to more often as "Ed Spendell."
From a story by Debra Erdley in today's edition of The Pittsburgh Tribune-Review:
Faced with the growing impact of a prolonged recession and revenue shortfalls, Gov. Ed Rendell last fall froze state hiring, ordered spending reductions and hunkered down for a coming budget battle.
On the surface, it appeared Pennsylvania was mired in a financial morass that would affect spending at all levels.
But records obtained by the Tribune-Review show one thing hasn't been hampered by the state's revenue woes: Rendell's ability to spend borrowed money.
While he was battling revenue shortfalls and lobbying for an income tax increase, Rendell was running his own economic stimulus program, quietly handing out $361 million in bond money across the state.
Read the full story, "Pennsylvania Governor Rendell doles out $361 million in borrowed money," at the newspaper's Web site.
You keep going down the same road and you end up in the same place.
The Pennsylvania Department of Revenue has released tax collection numbers for July, the first month of the new fiscal year.
Without an approved budget and with last year's budget ending up $3.25 billion in the red, it's hard to figure out where the state stands financially.
Let me just take a wild stab and predict Pennsylvania is on a path to an ever bigger deficit than the one recorded last year.
The news is all bad. The state collected 5 percent less in July 2009 ($1.65 billion) than it did in July 2008 ($1.75 billion) when Gov. Ed Rendell's $28.3 billion red ink budget kicked in. The small monthly deficits at the beginning of the fiscal year turned into a runaway train as the year finished.
(And Rendell actually wants to spend more ($29 billion) for 2009-10 than he did the previous fiscal year. This is why the state does not have an approved budget five weeks into the new fiscal year. Rendell still hasn't come to his senses.)
The Associated Press says the July 2009 revenue total is the 11th straight month in which Pennsylvania's tax collections have fallen short of the same month in the previous year.
Collections from the two biggest sources of revenue, the sales tax and the personal income tax, were both down. Translation for Ed Spendell and the dimwitted Democrats in the House pushing for higher taxes: Pennsylvanians don't have jobs so they can't pay the income tax and they don't have money to spend so they're not paying the sales tax.
From a Revenue Department Press Release:
HARRISBURG -- Secretary of Revenue Stephen H. Stetler today reported that the state collected $1.7 billion in General Fund revenue in July, the first month of the 2009-10 fiscal year.
Sales tax receipts totaled $735.2 million; personal income tax revenue was $639.9 million; and corporation tax revenue was $87.7 million for July.
General Fund revenue figures for July included $63.4 million in inheritance tax and $29.6 million in realty transfer tax. Other General Fund revenue, including the cigarette, malt beverage and liquor taxes, totaled $82.5 million for the month. Non-tax revenue totaled $12.6 million for the month.
In addition to the General Fund collections, the Motor License Fund received $319.8 million for the month.
The Gaming Fund received $59.9 million in unrestricted revenues for July. Gaming Fund receipts include taxes, fees and interest. Of the total for the month, $59.8 million was collected in state taxes for property tax relief. Other gaming-related revenues collected for July included $1.9 million for the Local Share Assessment; $8.8 million for the Economic Development and Tourism Fund; and $21.1 million for the Race Horse Development Fund.
Gov. Ed Rendell released a rambling statement today about the state's budget impasse, blaming the Republican-controlled state Senate for blocking his efforts to raise the state income tax by 16 percent.
Contrast Rendell's rant with the most recent survey of voters and you'll see that Rendell is not dealing with reality.
GOV. RENDELL: "GOP Senators are isolated in their position. The people of Pennsylvania are fed up with their government right now, and I'm fed up that the majority party in the state Senate shows so little regard for getting the job done."
REALITY:Gov. Ed Rendell's job approval rating has shrunk to its lowest level ever, 39 percent, and voters see him as most responsible for the state's budget mess, according to a Quinnipiac University poll. Also, 63 percent of voters reject Rendell's call to raise the state income tax temporarily to balance the budget, the Quinnipiac poll says.
More from the Quinnipiac poll:
Only 28 percent of voters approve Rendell's handling of the state budget and only 33 percent approve of his handling of the economy.
"Voters clearly don't want their taxes raised to solve the budget mess," said Peter A. Brown, assistant director of the Quinnipiac University Polling Institute. "Given a choice between raising taxes to maintain the level of services, or cutting spending and leaving taxes the same, 55 percent favor spending cuts and 35 percent say raise taxes."
To read more of Rendell's nonsensical statement, follow the link below.
From a disturbing report by Eamon Javers in Politico about Barack Obama and Congressional Democrats leading the U.S. to economic suicide:
A series of bailouts, bank rescues and other economic lifelines could end up costing the federal government as much as $23 trillion, the U.S. government’s watchdog over the effort says – a staggering amount that is nearly double the nation’s entire economic output for a year.
If the feds end up spending that amount, it could be more than the federal government has spent on any single effort in American history.
For the government to be on the hook for the total amount, worst-case scenarios would have to come to pass in a variety of federal programs, which is unlikely, says Neil Barofsky, the special inspector general for the government’s financial bailout programs, in testimony prepared for delivery to the House oversight committee Tuesday.
The Treasury Department says less than $2 trillion has been spent so far.
Read the full story at POLITICO and call your representatives in Congress and tell them they will be out of a job in 2010 if they continue to follow Obama over a cliff.
First Joe Biden, then Barack Obama and now Fed Chairman Ben Bernanke are fessing up they don't know what they're doing when it comes to the U.S. economy.
The Federal Reserve predicted today that unemployment will top 10 percent, despite earlier assurances from Obama that it would not go higher than 8 percent if his stimulus package was approved.
With more than 15 million Americans out of work and an additional 500,000 losing their jobs every week, there's no end in sight for the Obama recession.
Writing in The Wall Street Journal, Mort Zuckerman, chairman and editor in chief of U.S. News & World Report, says the unemployment picture is much worse than the government is letting on.
From his column:
Job losses may last well into 2010 to hit an unemployment peak close to 11%. That unemployment rate may be sustained for an extended period.
Can we find comfort in the fact that employment has long been considered a lagging indicator? It is conventionally seen as having limited predictive power since employment reflects decisions taken earlier in the business cycle. But today is different. Unemployment has doubled to 9.5% from 4.8% in only 16 months, a rate so fast it may influence future economic behavior and outlook.
How could this happen when Washington has thrown trillions of dollars into the pot, including the famous $787 billion in stimulus spending that was supposed to yield $1.50 in growth for every dollar spent? For a start, too much of the money went to transfer payments such as Medicaid, jobless benefits and the like that do nothing for jobs and growth. The spending that creates new jobs is new spending, particularly on infrastructure. It amounts to less than 10% of the stimulus package today.
Read the full column, "The Economy Is Even Worse Than You Think," at the newspaper's Web site.
Tax Hike Not the Answer to Pennsylvania's Spending Crisis
By Rep. Curt Schroder R-Chester County
Gov. Ed Rendell has announced plans to raise the Personal Income Tax of Pennsylvania taxpayers by 16 percent, or a half percentage point increase as his answer to the state’s $3.2 billion budget shortfall.
The Rendell administration is spending a lot of time selling the idea that we have a revenue crisis in this state and more money is needed. We don't have a revenue crisis in Pennsylvania. We have a spending crisis and it's time we acknowledge it and begin dealing with it responsibly.
The state Senate recently passed a budget bill that was widely criticized for the depth of cuts it proposed. While the Senate bill was far from a perfect solution, it did reflect the economic realities facing lawmakers and Pennsylvania citizens.
Now is the time to scale back state government, to cut non-essential services and discretionary grant programs, and hold the line on spending. Yet, the governor's original budget proposed $700 million in new state spending even in the face of a massive deficit, at a time when people are losing their jobs and losing their homes to foreclosure. Now he proposes to take even more out of their paychecks. This is not a responsible or acceptable solution.
Last year, before passage of the 2008-09 budget, we were warned by Senate budget analysts that the proposed spending plan would result in a $1 billion deficit this year. They warned that revenue estimates were too high and unrealistic, and one-time revenue sources were being used. I rejected that budget, as did 31 of my House colleagues.
The taxpayers of this commonwealth need to know what is at stake. In order to maintain the level of state spending the governor is proposing, a broad-based tax increase like the one he has proposed would be necessary. Our current economic crisis could have been avoided if Pennsylvania's spending increases had stayed within the rate of inflation during the Rendell years. Under Rendell, the state budget has increased nearly 40 percent -- double the rate of inflation. Had we held spending to a modest 3 percent in each of the past six years, our spending would be in line with the revenues coming in today. Our budget would be balanced, important programs would be retained and there would be no danger of a tax increase.
Instead we are in a budget crisis. We are left with no easy choices, but the choices are clear. We must live within our means or prepare for a major tax increase. I will not vote for a tax increase, and I challenge those members of the General Assembly who are critical of efforts to budget responsibly to come clean with taxpayers and let them know which taxes they will raise in order to pass a budget that increases spending to the levels proposed by the governor.
Rep. Curt Schroder is a Republican who represents the 155th House District in Chester County. For more information, visit his Web site, www.curtschroder.com
The Pennsylvania Cable Network will dedicate Wednesday evening's programming to the state budget impasse.
Beginning at 5 p.m. on Wednesday, July 8, PCN will air a block of special "On the Issues" programs featuring key lawmakers involved in the budget process.
Following these one-on-one interviews, Lieutenant Governor Joe Scarnati and Governor Ed Rendell will take viewers' calls during two separate LIVE PCN Call-In Program specials set to air starting at 6 p.m.
Each hour-long Call-In program will give viewers an opportunity to talk directly to the featured guest by dialing toll-free at 1-877-PA6-5001.
The schedule, including replay times, for this special PA budget programming block is as follows:
Wednesday, July 8:
5:00 p.m. – On the Issues: Rep. Mario Civera (R) – House Minority Appropriations Chair Replays – Wednesday, July 8 at 8:00 p.m. and 11:00 p.m.
5:15 p.m. – On the Issues: Rep. Dwight Evans (D) House Majority Appropriations Chair Replays – Wednesday, July 8 at 8:15 p.m. and 11:15 p.m.
5:30 p.m. – On the Issues: Sen. Dominic Pileggi (R) – Senate Majority Floor Leader Replays – Wednesday, July 8 at 8:30 p.m. and 11:30 p.m.
5:15 p.m. – On the Issues: Sen. Jay Costa (D) Senate Minority Appropriations Chair Replays – Wednesday, July 8 at 8:45 p.m. and 11:45 p.m.
6:00 p.m. (LIVE) – PCN Call-In program: Sen. Joe Scarnati, Lieutenant Governor/PA Senate Pro Tempore Replays – Wednesday, July 8 at 9:00 p.m; Thursday, July 9 at 12:00 a.m. and 9:00 a.m.
7:00 p.m. (LIVE) – PCN Call-In program: Governor Ed Rendell Replays – Wednesday, July 8 at 10:00 p.m; Thursday, July 9 at 1:00 a.m. and 10:00 a.m.
For updated information about special budget programming and other programming information, visit the daily schedule at pcntv.com
Balancing the state budget is not rocket science. You simply spend less money than you take in. Pennsylvania families and businesses have to live within their means every day. Why can't Ed Rendell?
"Contrary to the Governor's rhetoric, there are a plethora of reforms and spending cuts that can balance the budget without firing our police, evicting our elderly, or dumbing down our kids," says POLICY BLOG, which offers 10 Ways to Balance the Budget Without Tax Hikes.
Some of the suggestions:
1) Eliminate corporate welfare. The Governor's latest General Fund budget contains over $410 million in corporate welfare.
2) Eliminate, privatize, or implement user fees for "private goods" - such as museums, parks, and the arts. The Governor's budget spends almost $500 million to maintain non-core functions of state government.
3) Control self-service government programs expenses like legislative leadership accounts used to fund illegal bonuses. A number of state programs and expenditures work to benefit of government official and the detriment of citizens. Rendell's revised General Fund budget about $200 million on self-benefiting expenses.
Pennsylvania finished with a $3.25 billion budget deficit for the 2008-09 fiscal year ending June 30, according to the Department of Revenue, which released estimated final tax revenue numbers today.
The state collected $2.3 billion in General Fund revenue in June, $415.3 million, or 15.5 percent, less than anticipated, according to Secretary of Revenue Stephen H. Stetler
Fiscal year 2008-09 General Fund collections totaled $25.5 billion, which is $3.25 billion, or 11.3 percent, below estimate, Stetler said.
Tax revenues, which were in the red for all 12 months of the past fiscal year, were down significantly in almost every category in June.
From a Pennsylvania Department of Revenue release:
Sales tax receipts totaled $675.6 million for June, which was $67.6 million below estimate. Sales tax collections for the fiscal year totaled $8.1 billion, which is $595.3 million, or 6.8 percent, less than anticipated.
Personal income tax (PIT) revenue in June was $818.4 million, which was $207.1 million below estimate. This brought fiscal year PIT collections to $10.2 billion, which is $1.3 billion, or 11.2 percent, below estimate.
June corporation tax revenue of $411.6 million was $82.2 million below estimate. Fiscal year corporation tax collections totaled $4.8 billion, which is $613.9 million, or 11.3 percent, below estimate.
Other General Fund revenue figures for the month included $67.7 million in inheritance tax, $10.6 million below estimate, bringing the fiscal year total to $772.2 million, which is $105 million below estimate.
Realty transfer tax was $27.1 million for June, bringing the total to $294.5 million for the fiscal year, which is $117 million less than anticipated.
Other General Fund revenue including cigarette, malt beverage and liquor taxes totaled $101.3 million for the month, $5 million below estimate, bringing the fiscal year total to $1.1 billion, which is $26.2 million below estimate.
Non-tax revenue totaled $155.9 million for the month, $30.9 million below estimate, bringing the year-to-date total to $235.2 million, which is $506.4 million below estimate.
In addition to the General Fund collections, the Motor License Fund received $161.7 million for the month, $38.6 million below estimate. Fiscal year collections for the fund totaled $2.6 billion, which is $175.8 million, or 6.4 percent, below estimate.
Are you better off today than you were six months ago?
It's a shame we can't cast a vote of no confidence against the Obama Administration. Six months into the era of "hope and change," we've gotten "despair and more of the same."
More than 3 million Americans have lost their jobs since Obama took office, bringing the nation's unemployment rate to nearly 10 percent.
Gas prices are creeping toward $3.00 per gallon.
The trillion-dollar "stimulus" bill turned out to be what many predicted: A Democratic Party pork bill to reward the special interests who helped get them elected.
The government has taken over the banks, the car companies and now wants to run the health care system.
If Cap and Trade passes the Senate, electricity rates will skyrocket.
And what about the price of potatoes? Yes, potatoes.
That's what tipped off Mark Cour at the Circumlocution for Dummies blog that something is terribly wrong with America in the age of Obama.
From Circumlocution:
I'm not sure if anyone other than myself noticed, but the price of practically everything you may set out to purchase has escalated of late. Escalated and then some, I’d say. On Friday I paid $6.99 for a 10-pound bag of potatoes. That same bag of spuds would have set me back for $2.99 as little as a year ago.
And as I was exiting the supermarket with my overpriced veggies in hand, I passed a guy wearing a T-shirt with that “Yes we can” bit emblazoned on it. And after a quick mumble to myself, I thought, Yes we can? Yes we can, what?
Exactly what are we doing?
It get much better. It's one of the best commentaries I've read anywhere about the current state of affairs in this country.
All the propaganda. All the back room deals. All the pork amendments to buy votes.
And all Barack Obama and Nancy Pelosi could get was a 219-212 margin to pass the cap and trade energy tax in the House?
Don't be surprised if the $1.9 trillion global warming tax fails in the Senate.
A 7-vote margin in the overwhelmingly Democratic House? That's pathetic. A total of 44 Demcorats voted against cap and trade! It took 8 GOP House members to pass it.
It's not looking good for Obamacare or other future Obama spending sprees.
House Democrats are beginning to worry about their re-election chances in 2010 as the Obama recession continues, unemployment is reaching record levels and the unprecedented debt Obama has piled on the U.S. takes its toll.
Rep. Curt Schroder, R-155, on the Rendell drumbeat for higher taxes to help the governor dig out of the $3.2 billion deficit he created:
"The Rendell administration is spending a lot of time selling the idea that we have a revenue crisis in this state and more money is needed," Schroder said in a written statement. "We don't have a revenue crisis in Pennsylvania. We have a spending crisis and it's time we acknowledge it and begin dealing with it responsibly."
Schroder said the Senate's budget bill, which was killed by Democrats in House committee, was widely criticized for the depth of cuts it proposed. While acknowledging that the bill was far from perfect, he said it reflected the economic realities facing lawmakers and Pennsylvania citizens.
"Now is the time to scale back state government, to cut non-essential services and discretionary grant programs, and hold the line on spending," said Schroder. "The governor's budget proposes $700 million in new state spending at a time when people are losing their jobs, and losing their homes to foreclosure. Now he proposes to take even more out of their paychecks. This is not a responsible solution. It's time to cut spending now!"
Business leaders: Rendell's $4.5B tax hike will cost 24,000 jobs
Somebody should tell Gov. Ed Rendell there's a recession going on.
With tens of thousands of Pennsylvania residents out of work and businesses closing their doors every day, the last thing the state needs to do is raise taxes on workers and small business owners.
That's the message a group of business leaders want to send to Gov. Rendell and the Pennsylvania Legislature as state officials get closer to the state's annual budget deadline.
The National Federation of Independent Business/Pennsylvania, the Pennsylvania Business Council, the Pennsylvania Chamber of Business and Industry, and the Pennsylvania Manufacturers' Association issued a joint statement warning that a 16-percent increase in the state's personal income tax would result in the loss of 24,000 jobs.
And that's the short-term consequences, warn business leaders. Higher taxes will worsen the Commonwealth's budget and financial problems, and extend them deeper into the future, the business coalition says.
Gov. Rendell's tax hike also would reduce Pennsylvanians' disposable income by an estimated $1 billion, the group estimates.
Along with the personal income tax increase, Rendell also wants to impose new taxes on tobacco and the fledgling natural gas industry, the business leaders said. There is also a movement in the Legislature to allow counties to raise the state sales tax.
"When you tax something, you get less of it," NFIB state director Kevin Shivers said in a written statement. "The decline in sales tax revenues and income tax collections are a stark reminder that consumers are afraid to spend because they are worried about their jobs and economic uncertainty. Proposing new taxes now would have a chilling effect on Pennsylvania's economy."
More from Shivers:
"Pennsylvania businesses already are being asked to pay $400 million in new payroll taxes to help pay down the $1 billion deficit in the state's unemployment fund. Raising the state income tax -- which is THE business tax for most small businesses -- would be especially harmful in the current climate and impede our ability to recover. Business will be forced to adapt to such dramatic losses in revenue by postponing new hiring, equipment purchases and upgrades; reducing work hours for current employees; and unfortunately cutting jobs."
Stop me if you've heard this one before: Gov. Ed Rendell wants to raise your taxes.
The same governor who signed the second biggest income tax hike in state history when he first took office in 2003 wants to raise the state's personal income tax again.
It seems Gov. Rendell has spent all of the money the first tax hike brought in, so he'd like you (the few Pennsylvania residents who still have a job) to send more of your paycheck to him so he can spend it before he leaves office at the end of 2010.
Some good early reaction to Rendell's idiotic plan to raise taxes during a recession from conservative bloggers.
Governor Rendell announced today that to satisfy his appetite for more spending, he would like to increase Pennsylvania's Personal Income Tax (PIT) by 0.5 percentage points - to 3.57%.
As we announced yesterday, a PIT increase would cost thousands of Pennsylvania jobs.
Our updated analysis reveals that Rendell's latest proposed increase would cost 24,000 Pennsylvanians their jobs. This is on top of those jobs already lost during the current recession.
The movie "Hangover" continues to top the box office charts, and here in Harrisburg Governor Ed Rendell's pursuit of a new state budget is about as, well, juvenile.
Like the schoolyard bully given a wedgie, the governor is threatening to take the budget ball and hide in his room until he again gets his way. And he's willing to stay there until at least Labor Day, or so he says.
Yep, that's the latest from Rendell. Give me what I want or nobody gets anything. That is his response to legislative Republicans who have refused to roll over and give him new taxes, and who are insisting that the state trim the budget and spend within our means.
I don't call him "Rundown Rendell" for nothing. Fast Eddie continues to try to destroy the state of Pennsylvania with his old tired "tax and spend" philosophy. His latest idea: a 16% personal income tax increase. Another liberal-genius way to lose tens of thousands of Pennsylvania jobs that Pennsylvania doesn't have to lose to begin with.
While Gov. Ed Rendell and House Democratic leaders are pushing for more spending and higher taxes, a group of Pennsylvania lawmakers will unveil an alternative plan called 'Pact with PA' on Tuesday. Th Pact is an "agreement with taxpayers offers principles for a sound state budget."
Here's some more information about the plan from state Rep. Sam Rohrer, R-Berks:
WHAT: A news conference to unveil the "Pact with Pennsylvania," a proposed agreement between fiscally responsible lawmakers and the taxpayers they represent in the state Legislature that offers commonsense principles to deal with Pennsylvania's looming budget deficit and bring spending into balance with revenues.
WHO: Rep. Sam Rohrer (R-128), Republican chairman of the House Finance Committee; Sen. Pat Browne (R-16), Republican chairman of the Senate Finance Committee; Rep. Gordon Denlinger (R-99), Republican chairman of the House Policy Committee Task Force on Budget and Economic Issues; Rep. Mike Turzai (R-28), House Republican whip; and Sen. John H. Eichelberger Jr. (R-30), member of the Senate Finance Committee and chairman of the Senate Local Government Committee.
DATE: Tuesday, June 16.
TIME: 9:30 a.m.
WHERE: Capitol Media Center, Harrisburg, Pennsylvania.
Brad Bumsted of the Pittsburgh Tribune-Review does a nice job of putting the state budget process into the right perspective in his latest column.
Gov. Ed Rendell and House Democrats want to increase state spending (and raise taxes) even though the current budget is more than $3 billion in the red and tens of thousands of Pennsylvanians are out of work.
Republican lawmakers want minimal cuts in state spending and have introduced a $27 billion balanced budget.
From Busted's latest column:
What's at stake between $27 billion and $29 billion is quite simply whether you pay higher state taxes. And talk is aplenty of a state income tax increase to close a projected $3.2 billion deficit.
Rendell's propaganda campaign lays the groundwork for an income tax boost by pointing out all of the "devastating" consequences of spending less.
Busted also questions the use of taxpayer dollars by Rendell to promote his deficit, higher-taxes budget.
"How many hundreds of employee hours and state tax dollars went into preparing these news releases, which are all aimed at spending even more of your tax dollars?" Busted asks.
And how much did the recent propaganda bus tour orchestrated by Rendell cost taxpayers?
Poll: 45% want to cancel rest of failed stimulus spending
The American people are no longer being fooled by the Democrats' "stimulus" boondoggle, which has failed to create jobs or jump-start the U.S. economy.
From Rasmussen Reports:
Forty-five percent (45%) of Americans say the rest of the new government spending authorized in the $787-billion economic stimulus plan should now be canceled.
A new Rasmussen Reports national telephone survey found that just 36% disagree and 20% are not sure. According to news reports, only $36 billion of the stimulus plan had been spent as of late May.
According to news reports, only $36 billion of the stimulus plan had been spent as of late May.
Just 20% of adults say the tax cuts included in the stimulus plan should be canceled while 55% disagree. The stimulus plan includes $288 billion in tax cuts.
The House Appropriations Committee, voting along party lines Monday, rejected the Senate's $27.3 billion no tax increase budget.
That leaves Gov. Ed Rendell's $29 billion deficit budget (with a variety of tax increases) on the table. And Rendell's budget does not address that $3.2 billion deficit in the current fiscal year.
Rep. Doug Reichley (R-Berks/Lehigh), Republican vice chairman of the House Appropriations Committee, issued the following statement:
"Today we saw firsthand the commitment of House Democrats to avoid passing a budget bill that reins in state spending and averts a state personal income tax increase. Senate Bill 850 spends significantly less than Governor Ed Rendell's budget proposal. The budget supported by Democrats has not been introduced yet, but will likely spend more money than Pennsylvania is capable of taking in without a tax increase amounting to hundreds of millions of dollars. They have not offered their own budget, or legislation detailing which taxes they would increase and by how much.
"None of the taxes the governor relies on for his budget have been detailed in bill form. No new proposal has been put forth by the governor now that his proposed budget from February is seriously out of balance.
"There are 22 days until the end of the fiscal year. Republicans will not be voting for tax increases to pay for more spending during this recession no matter how often Democrats tell us that we need to be taxed more.
"I put forth the idea that we can advance the budget process by reporting Senate Bill 850 from committee with a negative recommendation, which is permitted according to House rules, but this attempt to move forward was blocked with a partisan vote to defeat the bill. Now, we're back at square one, no closer to having a budget bill to debate on the House floor and with the governor touring the state to promote higher taxes."
Columnist: Don't believe Rendell on 'temporary' tax increase
Lowman S. Henry, writing at Lincoln Blog, is skeptical of a proposal floated by Gov. Ed Rendell and House Democrats for a "temporary" increase in the state income tax to deal with the $3.2 billion deficit Rendell and the Legislature created.
When was the last time a "temporary" tax was repealed? Never. When has Ed Rendell kept a promise to taxpayers? Never.
From Lincoln Blog:
Sensing there is virtually no chance of getting a broad-based tax hike approved by the legislature, Governor Ed Rendell floating a new trial balloon: a temporary 1% rate hike in the state personal income tax.
Temporary, right, uh huh. The Governor wants the tax hike just to get us through the recession and to cushion the loss of federal stimulus money in two years and then it would go away. (Wink, wink.)
Come on governor, we all know there is no such thing as a temporary tax hike. We are still paying a special levy imposed to help finance recovery from the great Johnstown flood. And Johnstown hasn't been flooded in generations with anything but John Murtha's pork-barrel spending.
Despite the propaganda from the White House and the white-washing of the severity of the current recession by the state-run Obama Media, the latest economic numbers paint a clear picture of failure on the part of Barack Obama and his advisers.
Most Americans are worse off today than they were five months ago when Barack Obama moved into the White House. Obama has managed to make the economic crisis worse. So much for that "hope and change" so many American voters fell for in November.
From a new column by Dick Morris and Eileen McGann:
The stimulus package was a total and complete failure. As predicted, as happened with Bush's 2008 tax cut, as happened with the Japanese stimulus packages of the '90s, fearful consumers sat on their money and wouldn't spend it. Keynesian economics didn't work. Again.
But the debt sure piled up. The deficit quadrupled and is sending interest rates soaring, as the government elbows aside businesses and consumers at the loan window, all in a desperate effort to borrow enough money to spend enough money to stimulate the economy, which isn't happening.
With Gov. Ed Rendell and House Democrats pushing for higher taxes to dig themselves out of the fiscal hole they created, it's time for Pennsylvania taxpayers to be heard.
Join the State Capitol Taxpayers' Protest on Tuesday, June 9
Here is some basic information courtesy of The Commonwealth Foundation:
WHAT: Concerned citizens who will descend on Harrisburg for the all-day Pennsylvania State Capitol Taxpayers' Protest, will be welcomed by a united coalition led by State Representative Daryl Metcalfe (R-Butler) and more than 30 fiscally conservative state lawmakers, state and national watchdog groups and radio talk shows hosts.
WHO: Some of the outstanding confirmed speakers and organizations participating will include: Jim Broussard, Citizens Against Higher Taxes; Josh Culling, National Taxpayers' Union; Bob Durgin and R.J. Harris, WHP 580; Patrick Gleason, Americans For Tax Reform; Kevin Shivers, NFIB; David Taylor, Pennsylvania Manufacturers' Association; Susan Staub, Right to Work; Matt Brouillette, Commonwealth Foundation; Jeffrey Trimbath, The Heritage Foundation; Colin Hanna, Let Freedom Ring and many others. State Senator John Eichelberger and Representatives Kerry Benninghoff, Karen Boback, Paul Clymer, Jim Cox, Tom Creighton, Scott Hutchinson, Rob Kauffman, Tim Krieger, Bob Mensch, Donna Oberlander, Tom Quigley, Kathy Rapp, Mike Reese, Brad Roae, Todd Rock, Sam Rohrer, Curt Schroder, Jerry Stern, Rosemarie Swanger, Will Tallman, Katie True, Mike Turzai, Matt Gabler, Stan Saylor, Sheryl Delozier, Carl Metzgar, Seth Grove, John Payne, Gordon Denlinger and Keith Gillespie are also scheduled to participate.
Brouillette to Counter Rendell's 'Tax You More' Bus Tour Present the truth about taxes and spending in our public schools
Harrisburg, PA — Gov. Rendell's week-long, state-wide bus tour to scare and mislead Pennsylvanians into thinking they pay too little in taxes and don't spend enough on public education will be met head on by Commonwealth Foundation president and CEO Matthew Brouillette.
As Rendell burns tax dollars in the gas tank of a giant campaign bus to lobby for higher taxes for public education, Brouillette — a former teacher, football/baseball coach, and school board member — will be at each stop along the way to present the truth about education funding under the proposed Senate budget.
"The governor's education half-truths, misleading rhetoric, and inaccurate characterizations will be met with the reality about Pennsylvania's public school funding and performance," said Brouillette. "Contrary to what will be stated in the governor's campaign to raise taxes on working Pennsylvanians, public education spending would still be the highest it has ever been under the Senate's proposed spending plans—despite a severe recession and a $3 billion deficit."
"The people of Pennsylvania deserve the truth about taxes and spending in their public schools," Brouillette noted, "so we'll be following the governor's 'Tax You More Bus Tour' to provide the facts to local communities and media in the wake of the governor's fallacies."
Brouillette will hold informal news conferences immediately following each of Rendell's bus stops across Pennsylvania. Monday's tour stops include:
EVENT #1: U.S. Sen. Casey, Secretary Zahorchak to discuss education funding TIME: Noon LOCATION: East Pennsboro Area High School, 425 Shady Lane, Enola, Cumberland County
EVENT #2: Secretary Zahorchak to discuss education funding TIME: 3 p.m. LOCATION: Hollidaysburg Area Junior High School, 1000 Hewit St., Hollidaysburg, Blair County
EVENT #3: Secretary Zahorchak to discuss education funding TIME: 6 p.m. LOCATION: Baldwin High School, 4653 Clairton Blvd., Pittsburgh
Check CommonwealthFoundation.org for event updates throughout the week, as well as specific information on public education funding.
With one month to go in the current fiscal year, Pennsylvania's General Fund budget is $2.8 billion in the red.
The Pennsylvania Department of Revenue released the May tax revenue numbers today and the state's bottom line is not looking so good.
Pennsylvania collected $1.6 billion in General Fund revenue in May, which was $287.5 million, or 15.1 percent, less than anticipated, according to Revenue Secretary Stephen H. Stetler. Fiscal year-to-date General Fund collections total $23.3 billion, which is $2.8 billion, or 10.9 percent, below estimate, Stetler reported.
Gov. Ed Rendell, who signed the deficit budget last July knowing it would never come close to balancing, now projects a deficit of $3.2 billion by the end of the current fiscal year on June 30.
Here's the blow-by-blow breakdown from the Revenue Department:
Sales tax receipts totaled $607.4 million for May, $106.4 million below estimate. Sales tax collections, year-to-date, total $7.5 billion, which is $527.7 million, or 6.6 percent, less than anticipated.
Personal income tax (PIT) revenue in May was $721.4 million, $55.7 million below estimate. This brings year-to-date PIT collections to $9.4 billion, which is $1.1 billion, or 10.4 percent, below estimate.
May corporation tax revenue of $81.6 million was $38.8 million below estimate. Year-to-date corporation tax collections total $4.4 billion, which is $531.4 million, or 10.7 percent, below estimate.
Other General Fund revenue figures for the month included $65.3 million in inheritance tax, $10.8 million below estimate, bringing the year-to-date total to $704.5 million, which is $94.4 million below estimate.
Realty transfer tax was $18.6 million for May, $12.2 million below estimate, bringing the total to $267.3 million for the year, which is $105.2 million less than anticipated.
Other General Fund tax revenue including cigarette, malt beverage and liquor taxes totaled $83.3 million for the month, $10.4 million below estimate, bringing the year-to-date total to $958.2 million, which is $21.2 million below estimate.
Despite more than $19 billion in taxpayer dollars that was suppose to keep GM from going under, the giant auto maker is expected to file for bankruptcy on June 1.
Barack Obama promised that the government bailout would allow GM to restructure without filing for bankruptcy. Guess what? He lied. What's next? Will Obama do to health care what he did to the banks? To the car companies? With his track record, can bankruptcy for the U.S. be far behind?
Robert Romano, writing at GetLiberty.org, says the Treasury will now finance GM with another roughly $30 billion while in bankruptcy, which would last 60 to 90 days, bringing taxpayers' burden to $50 billion to "save" the company.
And, of course, the Obama Administration will nationalize one-third of the "Big 3," Romano says.
More from Romano:
Simply put: The fact is, GM was failing just fine without government assistance. And left to tried and true free market devices, the problems between bondholders and GM brass could have been effectively resolved, without presenting taxpayers with the tab. But since bankruptcy was not averted—despite a $19.4 billion infusion of taxpayer capital—the only thing that has now been achieved is that GM is now a de facto agency of the federal government, just like Chrysler.
In short, both are now line items on the federal budget. All at taxpayer expense.
There really is no description for what is taking place other than redistributionism. A new favored political class is being built under the guise of law, and it is all happening under the auspices of his imperial, impervious majesty, Barack Obama. So corrupt is this new system that even the courts are going along with it. Lawmakers speak nary a word against it. And the American people are left only to watch in horror as their own government turns against them, leaving them to wonder if they are next in line for wholesale asset confiscation.
Ed Rendell began his tenure as governor in 2003 by signing the second largest income tax hike in Pennsylvania history. Rendell then proceeded to spend $8 billion over the next six years, increasing state spending at twice the rate of inflation.
The results of Rendell's failed fiscal policies is a $3.2 billion budget deficit for the current fiscal year. With less than two years before he leaves office, Rendell is pushing for another massive income tax hike to make up the huge deficit he created.
The Democratic doormats in the House of Representatives will do whatever Rendell wants. Raising taxes during a recession is a bad idea, but that hasn't stopped Democrats in the past.
"That would be the quick, easy, and most destructive resolution possible to the budget crisis currently gripping the state. The real issue here is not financial; rather it is the unwillingness of state Democrats to make the hard decisions demanded of those governing in tough times. The real issue here is the unwillingness of state Democrats to begin living within our means."
It's time to let your Democratic state House member know that he or she will be out of a job in 2010 if they support a tax hike to bail out Rendell.
Read more about the state's sad state of financial affairs and how Rendell and House Democrats are working on a tax hike in The Pittsburgh Tribune-Review.
Imagine if Pennsylvania voters had the power of initiative and referendum, like their counterparts in California do. Gov. Ed Rendell's disastrous fiscal policies could have been stopped six years ago before Rendell ruined the state's economy with tax increases and record deficit spending.
Harvard economist: Obama tax hikes could kill recovery
"The barrage of tax increases proposed in President Barack Obama's budget could, if enacted by Congress, kill any chance of an early and sustained recovery," writes Martin Feldstein, chairman of the Council of Economic Advisers under President Reagan and a professor of economics at Harvard University.
From Feldstein's latest column in The Wall Street Journal:
Even if the proposed tax increases are not scheduled to take effect until 2011, households will recognize the permanent reduction in their future incomes and will reduce current spending accordingly. Higher future tax rates on capital gains and dividends will depress share prices immediately and the resulting fall in wealth will cut consumer spending further. Lower share prices will also raise the cost of equity capital, depressing business investment in plant and equipment.
The Obama budget calls for tax increases of more than $1.1 trillion over the next decade. Official budget calculations disguise the resulting fiscal drag by treating Mr. Obama's proposal to cancel the 2011 income tax increases for taxpayers with incomes below $250,000 as if they are real tax cuts. The plan to modify the Alternative Minimum Tax to avoid increases for some taxpayers is also treated as a tax cut.
But those are false tax cuts in which no one's tax bill actually declines. In contrast, the proposed tax increases are very real. And despite the proposed tax increases, the government's new spending and transfer programs would cause the annual budget deficit in 2019 to exceed $1 trillion, or 5.7% of GDP.
The Heritage Foundation has a terrific Web site offering clear and concise information on the path Barack Obama is taking this county. Hint: It's a steep drop over the cliff.
Gov. Ed Rendell imposed a hiring freeze last fall to help deal with the state's massive budget deficit. The ban has been violated at least 100 times, including by Rendell himself.
Rendell also imposed a ban on out-of-state travel. That's been violated too.
The latest example of government workers taking expensive trips was uncovered by a Pittsburgh television station.
From the station's Web site:
A Team 4 investigation finds pension fund employees staying at five-star resorts in London, Paris and even Monte Carlo -- and the way they're paying for these trips is raising concern with top state officials.
Earlier this year, Team 4's Paul Van Osdol found state employees spending hundreds of thousands of dollars on trips after Gov. Ed Rendell ordered a travel ban.
Officials of the two big state pension funds say they've been able to get around the travel ban because taxpayers are not paying for most of their trips. Instead, the investment managers hired by the state are covering the cost.
Here's the catch: The state employees traveling to these exotic places are the same people whose job it is to keep an eye on the money managers paying for the trips.
Read the full story, "Team 4 Investigates: Pa. Pension Workers Taking Lavish Trips," or watch the actuall report at the station's Web site.
Take away this man's credit card!!! Four months in office and Barack Obama has set new records for deficit spending. And it's going to get worse. The government can't print enough money to keep Obama's head above the pool of red ink bleeding from Washington, D.C., under Democratic Party control.
From The Associated Press:
WASHINGTON – The government will have to borrow nearly 50 cents for every dollar it spends this year, exploding the record federal deficit past $1.8 trillion under new White House estimates. Budget office figures released Monday would add $89 billion to the 2009 red ink — increasing it to more than four times last year's all-time high as the government hands out billions more than expected for people who have lost jobs and takes in less tax revenue from people and companies making less money.
The unprecedented deficit figures flow from the deep recession, the Wall Street bailout and the cost of President Barack Obama's economic stimulus bill — as well as a seemingly embedded structural imbalance between what the government spends and what it takes in.
As the economy performs worse than expected, the deficit for the 2010 budget year beginning in October will worsen by $87 billion to $1.3 trillion, the White House says. The deterioration reflects lower tax revenues and higher costs for bank failures, unemployment benefits and food stamps.
Just a few days ago, Obama touted an administration plan to cut $17 billion in wasteful or duplicative programs from the budget next year. The erosion in the deficit announced Monday is five times the size of those savings.
For the current year, the government would borrow 46 cents for every dollar it takes to run the government under the administration's plan. In 2010, it would borrow 35 cents for every dollar spent.
Barack Obama said today he wants to cut $17 billion in wasteful spending from the federal budget by eliminating 121 programs.
The proposed cuts equal less than one-half of 1 percent of the total $3.4 trillion federal budget approved last week by the Democrats in Congress.
And 40 percent of the cuts were proposed by George W. Bush, but were rejected by Congress.
Obama said Americans are tightening their belts in these difficult times and Washington should do likewise. This is Obama’s idea of belt-tightening?
This is the same man who has spent $4 trillion during his first three months in office. This is the man who signed a $400 billion stop-gap budget that contained more than 8,000 pork projects in it. The same man who is planning to double the national debt over the next 10 years if his spending plans are approved by Congress.
The words "fiscal responsibility" and Barack Obama should never be spoken in the same sentence.
So pay no attention to the crazy man talking to himself, children.
Pennsylvania took in nearly $1 billion less than anticipated in tax revenues for the month of April, sending the state's already massive budget deficit to historic levels.
The state collected $3 billion in General Fund revenue in April, but that was $941.5 million, or 24.2 percent below what state officials projected, according to the Pennsylvania Department of Revenue.
The state has been operating in the red every month since the fiscal year began last July 1, but the April numbers were much higher than previous monthly deficits, which were running about 7 percent below estimates.
Fiscal year-to-date General Fund collections total $21.7 billion, which is $2.6 billion, or 10.5 percent, below estimate, Secretary of Revenue Stephen H. Stetler said.
Gov. Ed Rendell had been predicting a $2.3 billion deficit by the end of the current fiscal year on June 30, but the April numbers will probably send the deficit past the $3 billion mark.
"Tax revenues in April are sobering evidence of the harsh effect the national recession has had on Pennsylvania's workers and businesses," Rendell said in a written statement issued late Friday afternoon. "Though Pennsylvania's Personal Income Tax rate is one of the lowest in the nation, it still accounts for nearly 40 percent of our General Fund revenues, and that category alone was 30 percent below estimate."
To close the potential $3 billion gap, Rendell said he wants the Legislature to tap into the state's Rainy Day Fund, which contains about $750 million, and the Healthcare Provider Retention Account.
"There are signs the overall economy is heading toward recovery, but this is a very volatile time and the pain of this recession is widespread," Rendell said.
Previous measures Rendell took to control state spending include a hiring freeze, which has been violated at least 100 times by his administration, and a ban on out-of-state travel, which has also been ignored by some state officials.
April tax collection revenues were down in every category.
POLICY BLOG is reporting that the state's projected budget deficit has grown by nearly $1 billion, following a historically low tax revenue collection month in April.
In other words, the mess Gov. Ed Rendell and the Legislature created is far worse than anyone could have imagined.
"Quite frankly, I am a bit astounded," writes Nathan Benefield, who has been monitoring the state's red ink for months. "This shortfall is almost three times the estimated shortfall the Office of the Budget provided us in mid-March. How did they get it so wrong? I will be curious if there is any explanation."
The official April tax revenue numbers have not been released yet, but lawmakers have said the April General Fund revenue shortfall is $941.5 million.
That means the state spent nearly $1 billion more than it took in during a single month!!!!
The projected deficit for the fiscal year ending June 30 had been $2.3 billion but the April figures will send the deficit past $3 billion.
Georgia Congressman Tom Price, who is chairman of the Republican Study Committee, offers a scathing critique of Barack Obama's first 100 days in office.
From a column published at HumanEvents.com:
The President, with a gleeful seal of approval from his liberal allies in Congress, has already managed to bury future generations of Americans beneath a mountain of debt. Sadly, the President’s hallmark policies -- the $787 billion non-stimulus, the meddlesome bailouts, and the budget plan working its way through Congress -- all send a clear signal that attempts at more generational theft will continue for the foreseeable future.
In just 100 days, President Obama has laid the groundwork for the most intrusive federal overreach in the country’s history, all funded with money we simply do not have. This agenda will not proceed uncontested. As President Obama and Congressional Democrats continue to treat taxpayers like their personal ATM, conservatives will continue to offer bold, positive ideas that prove that we are, once again, the party of solutions.
Obama Doesn't Make It Through 100 Days Before Running Out Of Money
Debt Day falls three days before 100-day mark
Republican Congressman Joe Pitts (PA-16) took to the House floor today to explain how much spending and borrowing President Obama and Democrats in Congress have undertaken this year.
For 2009, Debt Day (the day on which the government runs out of revenue and starts borrowing to pay for spending) fell on April 26 -- three days before President Obama's 100th day in office.
As Barack Obama marks his 100th day as president, the United States has witnessed the most debt-riddled first 100 days of any administration in history, according to the Republican Study Committee.
Obama has vaulted far past the debt numbers accumulated by his two predecessors in their first 100 days (in fact past their entire first years!), the RSC says.
In just 100 days, Obama has left future generations $564 billion in new debt. Unfortunately for taxpayers, this is only a preview of what is to come, the RSC says.
More from the RSC release:
As American taxpayers continue to hand over their money to pay for President Obama's reckless spending agenda, it is appropriate to compare his first 100 days to those of previous administrations. The chart above shows the debt accumulated in President Obama's first 100 days compared to those of Presidents Bill Clinton and George W. Bush. Even given the size and scope of President Obama's reckless spending agenda, the figures are sure to surprise. (Source: Bureau of Public Debt)
Obama even blows away the competition when comparing his first 100 days to his predecessors' first full year.
Veronique de Rugy, writing in the May issue of Reason magazine, notes that the federal deficit is three times higher than it was under Ronald Reagan, who is still blamed by Democrats for raising the national debt to historic levels.
From de Rugy's column:
Now, three decades later, Democrats have changed their minds about the dangers of deficit spending. In February 2009, the nonpartisan Congressional Budget Office estimated that the deficit will reach $1.2 trillion this year — roughly 8.3 percent of GDP. That giant increase is attributable mainly to Washington's September 2008 bank bailout and the federal takeover of mortgage lenders Fannie Mae and Freddie Mac.
And that figure assumes that the 2009 budget issued last year by the Bush administration will stay at its proposed level, which it surely won't. The calculation does not include the cost of the Iraq and Afghanistan wars, and it doesn't include the chunk of the new $787 billion stimulus bill that will be spent in 2009. Add all these numbers together, and the deficit swells to $2 trillion, or roughly 13.5 percent of GDP (see Figure 1).
This is by far the highest share of the economy that deficits have taken up since World War II. It is well over twice the record set by Ronald Reagan in the 1980s. Yet we don't see Democrats denouncing the deficit explosion on the network news, like they did two decades ago.
A senior research fellow at the Mercatus Center at George Mason University, de Rugy believes there will be severe consequences to the Democrats' unchecked spending:
From her column:
Deficits certainly do matter if you care about shrinking the size of the state. Budget gaps are a kind of Ponzi scheme. Any year the federal government spends more money than it collects in tax revenue, we have a budget deficit. That means the citizens through their taxes authorize politicians to spend a certain amount yet the government spends more.
The plan is to pay this additional spending back with future taxes, just as Bernard Madoff figured he'd pay off early investors with dollars from pigeons he conned down the road. As with any Ponzi scheme, there will inevitably come a time when the con is exposed, along with all the participants' losses.
John Maynard Keynes, the 20th century's preeminent defender of deficit spending, famously quipped, "In the long run, we are all dead." Keynes did not give much guidance, though, on how we would pay for the funeral.
Admitted swindler Bernie Madoff is an amateur compared to the U.S. government, which has been running the largest Ponzi scheme in the world for more than 70 years.
We've been hearing for decades how Social Security is going broke. The scheme simply can't sustain itself because more people are retiring than are entering the work force. Fewer people paying into the system and more people collecting is a recipe for disaster.
The part of the scheme is that politicians (mostly Democrats) have been raiding the Social Security system for decades to fund other government programs.
The dramatic decline of the U.S. economy in the past year has put more pressure than ever on the Social Security system, says the Pittsburgh Tribune-Review, which warns that the day of reckoning is fast approaching.
From an editorial in today's edition:
America's job losses are taking a toll on the surplus from government's favorite Ponzi scheme. That means the feds will have to look elsewhere, and a lot sooner, for the cash that's being borrowed from Social Security.
With the ongoing decline in payroll tax revenues, the Congressional Budget Office projects that Social Security's surplus could drop to $16 billion this year and about $3 billion next. The surplus projection for '09 was $80 billion.
Liberals are quick to point out that the dwindling surplus doesn't affect current Social Security recipients. It's the same head-in-the-sand reasoning that has allowed Social Security to reach this precarious state.
Based on the CBO's projections, the government will have to borrow another $700 billion over the next decade to cover what it would have borrowed from Social Security. And perhaps as early as 2017, the Treasury will have to start paying back the billions it has taken from Social Security for the past 25 years.
Gov. Ed Rendell has violated his own hiring freeze -- again.
Reporter Charles Thompson of the Harrisburg Patriot-News has confirmed that Rendell has hired has hired an attorney from Philadelphia to fill a vacancy in the Office of General Counsel -- the solicitor's office for state government.
Since when are lawyers considered essential personnel?
The latest case of "do as I say, not as I do" is a familiar one. The hire is a politically-connected friend or colleague of Rendell and the pay is at least $100,000.
It's the four time Rendell has done this since he imposed a hiring freeze in light of the $2.3 billion budget deficit he put the state into by years of uncontrolled spending.
All total, 110 people have been hired by the Rendell administration since the governor ordered the "hiring freeze."
You see why it's so hard to take this guy seriously.
From Thompson's story:
General Counsel Barbara Adams announced via e-mail this week that she has hired Patrick Lord as an executive deputy general counsel, effective April 13.
Chuck Ardo, press secretary to Gov. Ed Rendell, said Lord has been hired as a replacement for Nora Winkelman, who has moved on to work as chief counsel for the House Democratic Caucus.
Lord has "many but not all of her duties while also assuming many new duties for which the office has a need," Ardo said, adding the administration has not filled 14 attorney positions vacated since the statewide hiring freeze took effect in September.
The threat of furloughs for state workers is no longer in Gov. Ed Rendell's bargaining arsenal.
Rendell announced today he reached a tentative agreement with some of the state's largest employees' unions to eliminates the immediate need for rolling furloughs of employees in those unions to help close the state's growing budget gap.
Pennsylvania has run up a $1.6 billion budget deficit as of the end of March and Rendell projects a $2.3 billion deficit by the end of the current fiscal year at the end of June.
The agreement to temporarily reduce the commonwealth's health care benefit contribution rate by 20 percent will generate up to $200 million in savings over the next 15 months, Rendell said in a press release.
"This agreement is truly a win-win for employees and the state," Rendell said. "The temporary reduction in our health care contribution rate will provide us with enough savings to eliminate the immediate need to consider rolling furloughs for participating unions. This ensures that state government will keep running at the same pace for the people of Pennsylvania."
Rendell used furloughs last year to bully the Legislature into passing his deficit budget. Without the threat this year, expect the Harrisburg bunch to spend all summer haggling over the budget.
The March tax revenue numbers are in and Pennsylvania continues to hemorrhage red ink under Gov. Ed Rendell.
With three full months left in the current fiscal year, the state has already spent $1.6 billion more than it took in. (Rendell projects the deficit will reach $2.3 billion by the end of June.)
Pennsylvania collected $3.9 billion in General Fund revenue during March, $334.6 million, or 7.9 percent, less than anticipated, according to Revenue Secretary Stephen H. Stetler.
Fiscal year-to-date General Fund collections total $18.7 billion, which is $1.6 billion, or 7.9 percent, below estimate, Stetler says.
March is usually the biggest tax collection month of the year, but nothing could slow the runaway train of deficit spending under Rendell and the current Legislature.
Here's the monthly recap from the Pennsylvania Department of Revenue:
Sales tax receipts totaled $589.2 million for March, $51 million below estimate. Sales tax collections, year-to-date, total $6.2 billion, which is $350.4 million, or 5.4 percent, less than anticipated.
Personal income tax (PIT) revenue in March was $763.6 million, $59.8 million below estimate. This brings year-to-date PIT collections to $7.2 billion, which is $376.5 million, or 5 percent, below estimate.
March corporation tax revenue of $2.3 billion was $192.5 million below estimate. Year-to-date corporation tax collections total $3.9 billion, which is $366.7 million, or 8.7 percent, below estimate.
Other General Fund revenue figures for the month included $66.7 million in inheritance tax, $10.5 million below estimate, bringing the year-to-date total to $569.6 million, which is $74.9 million below estimate.
Realty transfer tax was $17.4 million for March, $13.4 million below estimate, bringing the total to $230.3 million for the year, which is $79.7 million less than anticipated.
Other General Fund tax revenue including cigarette, malt beverage and liquor taxes totaled $102.1 million for the month, $16.2 million above estimate, bringing the year-to-date total to $785.8 million, which is $9.1 million below estimate.
Non-tax revenue totaled $14.1 million for the month, $23.6 million below estimate, bringing the year-to-date total to -$76.4 million, which is $350.6 million below estimate.
In addition to the General Fund collections, the Motor License Fund received $184.1 million for the month, $14 million below estimate. Fiscal year-to-date collections for the fund total $1.9 billion, which is $109 million, or 5.5 percent, below estimate.
The Gaming Fund received $54.9 million in unrestricted revenues for March. Fiscal year-to-date collections for the fund total $434.2 million. Gaming Fund receipts include taxes, fees and interest. Of the total for the month, $56.8 million was collected in state taxes for property tax relief, bringing the year-to-date total to $434.3 million.
Other gaming-related revenues collected for March included $6.7 million for the Local Share Assessment, for a net total of $50.2 million for the year; $8.3 million for the Economic Development and Tourism Fund, for a year-to-date total of $63.9 million; and $20 million for the Race Horse Development Fund, bringing the total for the year to $153.3 million.
'Obama's budget spends too much, taxes too much and borrows too much'
From Gov. Haley Barbour, who delivers the weekly Republican address:
"In this budget season we have choices. While states are controlling spending and balancing their budgets, the Obama budget spends too much, taxes too much and borrows too much. It's not the right choice for America."
Read a transcript of the full address at the link below:
There is no pot of gold at the end of the Obama rainbow, says the Republican National Committee, which predicts massive deficits, high inflation and tax increases if Obama's economic follies are followed.
The president of SEIU Local 668, the Pennsylvania Social Services Union, has a few choice words for Gov. Ed Rendell, who earlier this week gave state workers an ultimatum: Find ways to reduce costs or face furloughs and/or layoffs.
Kathy Jellison said in a statement that the governor is "negotiating though the press" and "not being honest with taxpayers."
Jellison said the union has "repeatedly given (Rendell) suggestions on ways to cut the budget, and he has ignored all of our ideas. Instead, he wants to focus on the most extreme option - laying off workers."
State workers are upset with Rendell because he has awarded more than $1 billion in outside contracts since he became governor in 2003. "Many of those contracts cover work that had been done by state employees," Jellison says.
"The first thing the governor can do to stop wasteful spending in the state budget," Jellison said, "is to cut out some of the private contracts he has given to outside companies to do work that our members can do better and at a lower cost."
While Rendell is threatening to implement a system of "rolling furloughs" to reduce personnel costs, the union wants the state to offer early retirement options to workers.
Rendell threatens 'rolling furloughs' of state workers
With the state facing a projected $2.3 billion budget deficit in its General Fund budget, Gov. Ed Rendell is looking to save money by putting the squeeze on state workers.
The Harrisburg Patriot-News reports Rendell is giving the unions representing state workers until the end of March to come up with concessions or face furloughs or layoffs.
From a story by reporter Charles Thompson:
"We've agreed to give the unions a couple of more weeks to look at the options and get back to us," Rendell said during a Capitol press conference. "But by the end of March, if we don't have an agreement ... I'm going to have to act."
Rendell said again that he is leaning toward a system of "rolling furloughs," in which certain, nonessential aspects of state government would close for a day at a time, causing cuts in hours for thousands of state workers.
"If there's a way that I can do this and minimize the number of layoffs, I will take that way," Rendell said. "I think it's better for everyone to lose X percentage of their wages than for 2,000 people to be thrown onto unemployment."
Union leaders have vowed not to take wage concessions back to their rank-and-file, making the case that they have accepted wage freezes and sacrificed in other ways during past contract negotiations with Rendell.
Read the full story, "Rendell gives unions ultimatum," at the newspaper's Web site.
With four months to go in the current fiscal year, Pennsylvania has already spent $1.3 billion more than it has taken in.
The fiscal hole Gov. Ed Rendell and the Pennsylvania Legislature started digging last July keeps getting deeper.
Pennsylvania collected $1.5 billion in General Fund revenue in February, $196.8 million, or 11.6 percent, less than anticipated, according to the Department of Revenue.
Fiscal year-to-date General Fund collections total $14.8 billion, which is $1.3 billion, or 7.9 percent, below estimate, says Acting Revenue Secretary Stephen H. Stetler.
The numbers are down across the board:
* Sales tax receipts totaled $561.2 million for February, $60.9 million below estimate. Year-to-date sales tax collections total $5.6 billion, which is $299.4 million, or 5.1 percent, less than anticipated.
* Personal income tax (PIT) revenue in February was $742.7 million, $40.8 million below estimate. This brings year-to-date PIT collections to $6.4 billion, which is $316.7 million, or 4.7 percent, below estimate.
* February corporation tax revenue of $62.9 million was $21 million below estimate. Year-to-date corporation tax collections total $1.5 billion, which is $173.9 million, or 10.2 percent, below estimate.
* Other General Fund revenue figures for the month included $53 million in inheritance tax, $17.5 million below estimate, bringing the year-to-date total to $502.9 million, which is $64.4 million below estimate.
* Realty transfer tax was $12 million for February, $11.5 million below estimate, bringing the total to $212.9 million for the year, which is $66.3 million less than anticipated.
* Other General Fund tax revenue including cigarette, malt beverage and liquor taxes totaled $76.4 million for the month, $4.3 million below estimate, bringing the year-to-date total to $683.8 million, which is $25.2 million below estimate.
* Non-tax revenue totaled -- $5.8 million for the month, $40.8 million below estimate, bringing the year-to-date total to -- $90.6 million, which is $327.1 million below estimate.
The Department of Revenue report is full of gloomy statistics:
* In addition to the General Fund collections, the Motor License Fund received $146.6 million for the month, $22.5 million below estimate. Fiscal year-to-date collections for the fund total $1.7 billion, which is $95 million, or 5.3 percent, below estimate.
* The Gaming Fund received $49.1 million in unrestricted revenues for February. Fiscal year-to-date collections for the fund total $379.2 million. Gaming Fund receipts include taxes, fees and interest. Of the total for the month, $48.9 million was collected in state taxes for property tax relief, bringing the year-to-date total to $377.6 million.
* Other gaming-related revenues collected for February included $5.7 million for the Local Share Assessment, for a net total of $43.5 million for the year; $7.2 million for the Economic Development and Tourism Fund, for a year-to-date total of $55.5 million; and $17.2 million for the Race Horse Development Fund, bringing the total for the year to $133.3 million.
The current fiscal year ends June 30 and Rendell has predicted the deficit will grow to $2.3 billion by then.
If the irony of using debt-based spending to solve a problem caused by debt-based spending has escaped you (I doubt it has), perhaps these fun facts will put things into perspective:
If you spent $1 every second, you'd have to keep spending for 412,000 years to get to $13 trillion. That means you'd have to start shortly after the time human beings first starting using stone tools and fire to get to $13 trillion today.
$13 trillion in one dollar bills weighs 28 million pounds. That's as much as 87 blue whales or 462 Statues of Liberty.
If you laid 13 trillion one-dollar bills end-to-end they'd reach from the earth to the sun and back...five times over. That's 946 million miles of greenbacks.
The amount we're looking at now—roughly $2 trillion between the Secretary Geithner's new bank bailout plan and President Obama's stimulus package—isn't small potatoes either. So what is $2 trillion?
$2 trillion is bigger than the entire Gross Domestic Product of our neighbor to the north, Canada. In fact, according to the IMF, only Japan, Germany, China, the United Kingdom, France, and Italy have bigger total economies than the combined bailout/stimulus plan—all other countries on Earth have economies smaller than $2 trillion per year.
Then there's the interest on this staggering debt, which isn't exactly small. Paying the interest on the current $10.7 trillion debt cost Americans $451.1 billion last year alone. How big is that?
That's $1478 dollars in interest for every man, woman, and child in the United States.
That's bigger than the annual budgets of New York ($121.1 billion), California ($111.1 billion) and Texas ($83.8 billion) combined
Gov. Ed Rendell's first term in office will be remembered for three things: 1) one of the largest income tax hikes in state history; 2) the legalization of slot machines; and 3) signing the infamous pay raise into law.
Not exactly a stellar record of accomplishment, but Rendell conned enough Pennsylvania voters to give him a second term.
What will Rendell's second term be remembered for? He still has two years to go, but Pennsylvania is facing a historic budget deficit. The state budget is expected to finish $2.3 billion in the red by June and the next fiscal year is downright apocalyptic with the state facing a $5 billion to $6 billion revenue shortfall.
What is Gov. Rendell's solution to the problem he largely created with uncontrolled spending over the past six years? It appears that he will ask the federal government for a handout and make up the rest by expanding gambling in Pennsylvania.
Rendell wants to legalize video poker machines, according to The Pittsburgh Tribune-Review. The selling point for expanded gambling is "tuition assistance" for working families in Pennsylvania.
You'll recall Rendell sold the initial foray into slots by promising "substantial property tax relief" for all Pennsylvania taxpayers. That hasn't happened in the nearly five years since gambling was approved by the Legislature.
Pennsylvania homeowners are paying higher property taxes today than they did when Rendell took office in 2003. Whatever minor reduction in taxes homeowners saw in 2008 will be eaten up shortly by another round of tax hike by local school boards.
From the Tribune-Review:
Critics in the Legislature say providing tuition relief is a laudable goal, but legalizing video poker machines is an expansion of slot machine gambling.
"The reality of it is, they are slot machines," said Rep. Mike Vereb, R-Montgomery County. "We're being barbaric. We're going into neighborhoods with gambling when we don't have gambling under control."
If the administration's logic is that it's OK to legalize practices that take place illegally, said Republican Rep. Doug Reichley of Allentown, "The Chicken Ranch in Reno, Nev., is looking forward to the day we open prostitution in the Capitol."
Through the Local Law Enforcement Grant Program, the state recently spent more than $3 million to combat illegal slots and video poker machines.
Rendell may have fooled enough lawmakers in 2004 when he won approval to bring 71,000 slot machines to Pennsylvania, but don't bet on Fast Eddie pulling another fast one on the current Legislature.
Another month, another depressing tax collection report from the Pennsylvania Department of Revenue
Acting Secretary of Revenue Stephen H. Stetler announced Monday that Pennsylvania collected $2.2 billion in General Fund revenue in January, which was $261.7 million, or 10.7 percent, less than anticipated.
Fiscal year-to-date General Fund collections total $13.3 billion, which is $1.1 billion, or 7.5 percent, below estimate, Stetler announced.
With five months left in the 2008-09 fiscal year, Pennsylvania may have to revise its projected deficit yet again. The most recent guess by Gov. Ed Rendell is that the state will finish the fiscal year with a $2.3 billion deficit.
A few highlights (or should I say lowlights) from the January revenue report:
* Sales tax receipts totaled $799.6 million for January, $55.9 million below estimate. Sales tax collections, year-to-date, total $5 billion, which is $238.5 million, or 4.5 percent, less than anticipated.
* Personal income tax (PIT) revenue in January was $1.1 billion, $141.2 million below estimate. This brings year-to-date PIT collections to $5.7 billion, which is $275.9 million, or 4.6 percent, below estimate.
* January corporation tax revenue of $103.3 million was $18.1 million below estimate. Year-to-date corporation tax collections total $1.5 billion, which is $152.8 million, or 9.4 percent, below estimate.
For a Republican perspective on the massive budget debt under Gov. Ed Rendell, check out recent posts containing information from Rep. Sam Rohrer (R-Berks) and Rep. Curt Schroder (R-Chester).
Don't forget to thank your nearest Democratic member of Congress for voting to add $2,700 in debt to every member of your family.
Missouri Congressman Roy Blunt explains why he voted against the Obama "stimulus" bill:
"Just 7% of the trillion dollars in this legislation is slated for immediate use and the rest funds everything from buying bureaucrats cars to refurbishing federal buildings," Blunt says. "That's certainly not a package that will help our economy recover any time soon, but it is a package that our children and grandchildren will be repaying for generations to come."
The Democrats' plan will cost every American more than $2,700, Blunt says in a statement.
"The size of the package passed by the House is staggering compared to past stimulus plans," Blunt says. "When President Franklin Roosevelt was facing 25 percent unemployment during the Great Depression, his entire 'New Deal' proposal would cost just half of the current trillion dollar package after being adjusted for inflation."
The House of Representatives passed the Obama economic stimulus bill today by a vote of 244-188. Every Republican in the House and 11 Democrats voted against the $819 billion measure loaded with pork projects and expanded government programs that many economists say will have little impact on the nation's economic woes.
Rep. John Boehner of Ohio, the Republican leader, said bill will create few jobs, but "it will create plenty of programs and projects through slow-moving government spending."
Remember how Obama blasted George W. Bush for deficit spending? The Obama bill will send the federal deficit into the stratosphere.
A GOP alternative plan to cut taxes on middle class families was defeated by the Democrats, 266-170.
The Obama plan consists of $544 billion in new federal spending and just $275 billion in tax cuts for individuals and businesses.
So how much will you get? A $500 break for single workers and $1,000 for couples, far less than the Bush "stimulus" checks sent out last year. That government handout failed to slow down the recession or keep tens of thousands of Americans from losing their jobs.
The Obama plan also includes tax refunds for those who don't earn enough to owe federal income taxes. There's another word for that: Welfare.
The only hope to restructure the Obama government expansion bill is in the Senate, but with Democrats holding a solid majority there, don't hold your breath.
Just keep printing more money until the dollar is worthless.
Here's a perfect example of how massive Pennsylvania government has grown, especially in the past six years under Gov. Ed Rendell.
Auditor General Jack Wagner announced that the Pennsylvania Department of Public Welfare, through its county assistance offices, failed to make proper Medicaid eligibility determinations on more than 1,600 Medicaid applicants between January 2005 and March 2008, resulting in $3.3 million in improper payments made on behalf of ineligible recipients.
"A dollar wasted is a dollar that could have gone to help a truly needy person receive the medical assistance he or she deserves," Wagner said in a statement. "With the commonwealth facing widening budget deficits, the Department of Public Welfare must do all that it can to monitor the state's Medicaid program, to make sure all funds are being spent efficiently, effectively, and for their intended purpose. I strongly urge DPW to take immediate steps to tighten its administration and oversight of this vitally important program to ensure that people who are eligible for Medicaid benefits will be able to receive every dollar they're entitled to for their care."
PA businesses: 'Government cannot tax its way back to prosperity'
The Pennsylvania Business Council, representing organizations whose members employ most of the state's 5 million private-sector workers, weighs in on the state's current fiscal crisis.
Business leaders are worried that Harrisburg politicians will resort to higher taxes to dig themselves out of the financial hole they had a hand in creating.
"We can't have 1991 all over again when the government tried to tax its way back to prosperity," said David N. Taylor, executive director of the Pennsylvania Manufacturers Association. "Increasing business taxes or business fees to pay for General Fund spending will only exacerbate the economic downturn and cost more jobs. We must get a handle on spending." In 1991, the state turned a $1 billion deficit into $3 billion of spending and new taxes. Most of that new tax burden fell on Pennsylvania's business community making Pennsylvania less competitive and less able to retain and attract jobs to the state."
Pennsylvania is facing a fiscal crisis with a projected $2.3 billion budget deficit. Some state lawmakers have called state finances an economic disaster.
So are state leaders doing to address the crisis?
The Legislature has been on vacation since last October and Gov. Ed Rendell has been moonlighting as a TV analyst after Eagles games. In other words, it's business as usual.
Another indication that Rendell and lawmakers are living in la-la land is the fact that Rendell has postponed his annual budget address to the Legislature by a day in anticipation of a Steelers' Super Bowl win.
Rendell will deliver his annual address on Feb. 4 to allow time for Steelers fans to return from Florida and hold a victory parade on Feb. 3.
Rendell will be attending the Super Bowl on Feb. 1, according to a spokesman. He will probably find his way to Pittsburgh on Feb. 3 if the Steelers win.
So let's continue to fiddle while the state burns.
To be fair, a handful of Republican lawmakers have proposed swift action on the state's fiscal crisis: See Taxpayer Protection and GrassrootsPA for more.
The Pittsburgh Post-Gazette is reporting today that Pennsylvania's fiscal picture has significantly worsened, with the General Fund budget deficit now projected to reach $2.3 billion by June 30.
Gov. Ed Rendell announced at a press conference that continuing job losses and other bad economic news from the ongoing recession have reduced state revenues such as personal income taxes and sales taxes, according to reporter Tom Barnes.
The budget deficit has been a moving target since Rendell first acknowledge last fall that the state's budget was in the red.
Rendell's previous estimates that the deficit would reach $1.6 billion was replaced by another guess that it could top $1.9 billion, Barnes reports.
Rendell now says the deficit will reach at least $2.3 billion, according to Barnes, who says Rendell disclosed two additional steps to erase the added $700 million in deficit.
The first is a handout from the federal government to cover the state's out-of-control Medicaid spending.
Rendell anticipates the state's allocation of federal aid for Medicaid to be more than the previous $900 million over two years -- perhaps as much as $2 billion to $4 billion over a three-year period, Barnes writes.
Secondly, Rendell wants the Legislature to give back $175 million of its current $200 million "budget reserve" that it has been hording in recent years, Barnes say.
Rendell may also propose layoffs or unpaid furloughs for state workers in fiscal 2009-10, which starts July 1, according to Barnes.
Don't you think Rendell wishes he had some of that $8 billion he squandered over the past eight years? That would cover the state's deficit and then some. Can we lay off Ed Rendell for the last two years of his term? And sending the Legislature home would save taxpayers $300 million a year. Anybody have a better idea?
And you wonder why Pennsylvania is facing a potential $2 billion budget shortfall?
Gov. Ed Rendell continues to defend the hiring of political crony Dan Surra to a $95,000 patronage job despite a hiring freeze that has left 5,000 other state jobs unfilled.
Rendell himself admitted this week that the state's General Fund deficit will likely reach $1.6 billion to $1.9 billion by the the end of June. Republican lawmakers say the deficit could top $2.1 billion.
"Everyone has to understand that what has happened leaves us no option," Rendell said this week. "We're going to have to cut virtually every program that there is."
But giving a $95,000-a-year-job to an ousted state lawmaker is not among the cuts Rendell is willing to make.
Reporter Brad Bumstead has more on Rendell's hypocrisy and "Go to hell" attitude toward Pennsylvania taxpayers in the Pittsburgh Tribune-Review.
From Bumstead's article:
"Let me stress, I reserved the right when I announced the hiring freeze to make exceptions," Rendell told reporters while visiting the Pennsylvania Farm Show. During a speech at the farm show, he boosted his predicted budget deficit for 2008-09 from $1.6 billion to $1.9 billion.
Rendell said he did not create a special job for Surra, but he acknowledged the DCNR job was not posted and others weren't considered.
The Democratic governor's decision to hire Surra, a Democrat who failed to win re-election to the state House of Representatives in November, has been universally panned by the state's newspapers.
THORNS to Gov. Ed Rendell for creating a job for a former state legislator, violating a hiring freeze imposed during the current state budget crisis ... Rendell also has slashed hundreds of millions of dollars from the budget to help offset a projected $1.7 billion shortfall this fiscal year. Creating a job for an ousted legislator in this fiscally-stressed environment was a slap in the face to state taxpayers. The governor should know better.
POLICY BLOG has an interesting post about the fact that more people are leaving Pennsylvania than are moving into the state.
The United Van Lines 2008 migration study, detailing shipments into and out of each state, shows 58% of movement leaving Pennsylvania, ranking as the 4th highest outbound state, POLICY BLOG reports.
The main reason people move is economics. There simply are not enough opportunities for people to support themselves in Pennsylvania, thanks to seven years of fiscal mismanagement by the Rendell administration. High property taxes are also forcing older residents to abandon their homes.
Despite increasing state spending by nearly $8 billion, Pennsylvania is losing thousands of jobs and the state is projecting a $2 billion budget deficit. That's Rendell-onomics for you.
From POLICY BLOG:
"Despite what Governor Rendell may claim about his success restoring Pennsylvania to prosperity, this is the continuation of a long trend in which Pennsylvania's economic and tax climate drive residents and businesses away."
Read the full post at POLICY BLOG, which also features links to other articles about the state's economic and tax climate.
It could be worse, I guess. Maybe the governors of California or New York would love to have a budget deficit of just $2 billion.
But this is Pennsylvania, where the state Constitution requires a balanced budget.
That means the state can't run up huge deficits, although Gov. Ed Rendell has been working toward that goal for the past six years, increasing state spending at twice the rate of inflation.
The latest fiscal news may leave Rendell and state lawmakers with a huge hangover. A combination of tax increases and cuts in state services await Pennsylvanians in 2009.
Pennsylvania ran up a $156.6 million budget deficit in December, the eighth month in a row the state has spent more money that it took in.
The budget deficit for the current fiscal year has reached $814.5 million.
The projected budget deficit for the fiscal year that runs from July 2008 to June 2009 is $2 billion. That's 'b' as in billion.
Pennsylvania tax revenues are down in almost every category.
Among the worst showing is collection of corporate taxes as the economy continues to tank.
Year-to-date corporation tax collections total $1.4 billion, which is $134.7 million, or 9 percent, below estimate, according to the PA Department of Revenue.
And with more people losing their jobs, the government can't tax their income anymore.
Personal income tax (PIT) revenue in December was $734.3 million, $58.1 million below estimate, the state says. This brings year-to-date PIT collections to $4.6 billion, which is $134.7 million, or 2.9 percent, below estimate, according to revenue officials.
For more on the state's sagging tax revenues, click on the link below:
While nearly every corner of Pennsylvania is hurting during the current economic decline, the pain has not reached the Pennsylvania Legislature, concludes The Mercury in an editorial published in today's edition.
The Legislature not only spent $316 million on itself last year, but it has managed to siphon off more than $200 million in taxpayer dollars in private legislative accounts.
Those numbers are sobering considering that Pennsylvania has spent $658 million more than it took in as of Nov. 30. The projected budget deficit is between $1.6 billion to $2 billion by next spring.
From The Mercury's editorial:
How can state lawmakers possibly justify keeping that much money in the bank when services are being cut across the board, when the city of Philadelphia is closing libraries and swimming pools used by children, and when places like Pottstown are forced to make decisions on cutting economic development and fire protection?
Pennsylvania stands out in its inefficiency and wasteful spending within state government. Nearly all other states return their legislative surpluses to the general fund at year's end. That's in any year.
In a year like this when spending is being slashed in municipal, county, and state-funded services, there is no excuse for the Legislature sitting on a surplus.
No excuse except the one we hear too often — because that's the way things are done here.
For the past two Sundays, Eric Heyl, a columnist for The Pittsburgh Tribune-Review, has been urging readers of the newspaper to clip a coupon at the end of his column and send it off to Harrisburg.
Heyl wants members of the Pennsylvania Legislature, among the highest paid in the nation, to take a 5 percent pay cut in light of the state's massive budget deficit, which is projected at $1.6 billion to $2 billion. (Nearly every member of the Legislature voted in favor of Gov. Ed Rendell's $28.3 billion budget despite warnings that it would bleed red ink before the fiscal year is out.)
While some lawmakers have volunteered to give back the 2.8 percent cost-of-living pay rise that kicked in Dec. 1, Heyl said they need to go further and take a salary cut.
The coupon reads as follows:
YES! I want more than political posturing from my elected state officials.
Quit patting yourselves on the back for not accepting your COLA and show people you're really willing to sacrifice. Take a 5 percent pay cut like your brethren lawmakers in Florida.
Then roll up your sleeves, get to work, and save the people you work for -- that would include me -- some real money.
Do I have your pledge that you will start by cutting some of the $300 million budgeted this year just to operate the state House and Senate?
I expect a response at your earliest convenience.
Heyl got the idea for the pay cut request after a reader informed him that Florida state legislators volunteered to reduce their salaries.
Florida legislators earn about $31,000 annually, Heyl writes. The base salary for Pennsylvania lawmakers is $78,315 if they accept the COLA, $76,313 if they decline it, Heyl says.Read Hey's initial column, "Send this coupon to your legislator," here.
Read Heyl's follow-up column, "Not too late to send this coupon to legislators," here.
Amazing when Gov. Ed Rendell signed the $28.3 billion General Fund budget back in July he had no inkling that it would sink the state into a huge fiscal hole.
The red ink is flowing to the tune of $658 million so far and is expected to top $1.6 billion by the end of the fiscal year in June 2009.
For more on Rendell's budget shenanigans, check out "Rendell's wicked game" by Matthew J. Brouillette posted at the Capital Domes blog on the Central Penn Business Journal Web site.
Where is the public outcry over the growing pension scandal involving the retirement funds of state workers in Pennsylvania?
That's what the Pittsburgh Tribune-Review wants to know.
From an editorial pointing out that taxpayers will end up getting stuck with the bill for reckless investments:
Despite warning flags -- heck, these folks had foghorns blasting in their ears -- the geniuses at the state pension fund six years ago decided to park billions of dollars in a very risky hedge fund. Long story short -- the pension system by next year will be on the hook for $2.5 billion to cover its high-fee bad bets.
How unfortunate for those poor state retirees, right? Nope, not at all. That's because under state law, benefits can't be reduced. Taxpayers, who already fund the pension system, could be tapped for this chapter of multibillion-dollar recklessness.
Gov. Ed Rendell has spent months going over the state budget and has come up with $439 million in proposed cuts to stem the massive red ink pouring from the 2008-09 General Fund budget.
The current budget deficit has already topped $658 million in just the first five months of the fiscal year. Projections have the deficit reaching $2 billion by the end of the fiscal year in June 2009.
At a recent press conference the governor asked for help in finding more cuts.
Eric Epstein, coordinator of RocktheCapital.org, a Harrisburg-based reform group, has answered the call. Epstein has released a list of $313 million that can be cut in state spending without impacting Pennsylvania residents.
Among the cuts:
Liquidate non-lapsing, leadership accounts $241.5 million
Eliminate Public Service Announcements by lawmakers: $1.35 million in annual savings
Reduce PHEAA funding by the amount spent on "lobbying fees": $1 million
For the full list, click here. Also visit RocktheCapital.org for more on the group's efforts to reform state government.
Gov. Ed Rendell must be running out of fingers to plug the leaks in the budget dike he and Pennsylvania legislators created this year.
Just five months into the current fiscal year, officials are reporting a $658 million deficit in the state's General Fund budget. If the current trend continues, the state would be facing a deficit of $2 billion by the end of the fiscal year.
Acting Revenue Secretary Stephen H. Stetler reported Monday that Pennsylvania collected $1.6 billion in General Fund revenue in November -- $93.1 million, or 5.4 percent, less than anticipated.
It is the fifth month in a row the state took in less than it spent.
Fiscal year-to-date General Fund collections total $9 billion, which is $657.9 million, or 6.8 percent, below estimate, according to Stetler.
"In light of the economic downturn that is affecting state revenues across the nation, Gov. Rendell asked staff to identify additional spending cuts on top of the $311 million identified in September," Budget Secretary Mary Soderberg said in a written statement, adding that Pennsylvania is weathering the "economic storm better than many states."
The tax revenue news is bad across the board.
From the monthly recap of tax revenues released by the Pennsylvania Department of Revenue:
Sales tax receipts totaled $648.3 million for November, $24.7 million below estimate. Sales tax collections, year-to-date, total $3.6 billion, which is $115.8 million, or 3.1 percent, less than anticipated.
Personal income tax (PIT) revenue in November was $765.1 million, $4.2 million below estimate. This brings year-to-date PIT collections to $3.8 billion, which is $76.6 million, or 2 percent, below estimate.
November corporation tax revenue of $51.2 million was $28.6 million below estimate. Year-to-date corporation tax collections total $815.7 million, which is $149.5 million, or 15.5 percent, below estimate.
Other General Fund revenue figures for the month included $60.3 million in inheritance tax, $1.8 million below estimate, bringing the year-to-date total to $330.6 million, which is $24.3 million below estimate.
Realty transfer tax was $24.3 million for November, $4.3 million below estimate, bringing the total to $157.2 million for the year, which is $27.7 million less than anticipated.
Other General Fund tax revenue including cigarette, malt beverage and liquor taxes totaled $93.7 million for the month, $2 million below estimate, bringing the year-to-date total to $443.7 million, which is $10.8 million below estimate.
Non-tax revenue totaled -$2.1 million for the month, $27.6 million below estimate, bringing the year-to-date total to -$124 million, which is $253.3 million below estimate.
In addition to the General Fund collections, the Motor License Fund received $256.9 million for the month, $43.2 million below estimate. Fiscal year-to-date collections for the fund total $1 billion, which is $112.5 million, or 9.8 percent, below estimate.
Republican lawmakers, including Mike Turzai, Curt Schroder and Sam Rohrer warned Rendell and their colleagues during the budget debate in June and July that the $28.3 billion General Fund budget would lead to massive deficits.
Teachers, government workers line up for pension bailout
The very last line in a story The Associated Press moved this week about the hit pension funds for teachers and state workers have taken in the recent stock market collapse should make every Pennsylvania taxpayer cringe.
"... state tax revenues for the current year are running hundreds of millions of dollars below expectations, and the decline in pension fund investments raises the likelihood taxpayers will have to pump in billions more to balance the retirement funds even without a cost of living adjustment," The Associated Press writes.
Pump billions more to balance the retirement funds?
Where do you think these billions will be coming from?
Pennsylvania taxpayers better get ready to dig deeper into their wallets.
There's a comment at the end of the article posted at The Mercury Web site from a woman who asks about the fairness of bailing out public sector workers when private sectors have to suffer.
Here's the comment:
"My husband and I have also posted high losses in our retirement (investments) fund (a fund which we had to save because we had no retirement fund). Who is going to bail us out, like we are expected to bail out the teachers and government workers??? We are 69 years old and have paid taxes all our lives and now we are expected to pay more taxes to bolster these pensions. It doesn't seem quite fair."
Gov. Ed Rendell and the Pennsylvania Legislature, the same people who have saddled the state with a potential $2 billion budget deficit, are giving themselves a pay raise.
These are the same people who have failed to take action on the state's transportation and health care needs. The same people who have done nothing to prevent skyrocketing electricity rates once caps expire. The same people who have failed to do anything about property taxes for the past 30 years.
But they will be getting an annual cost-of-living raise, effective Dec. 1.
House and Senate members will receive a 2.8 percent raise, setting lawmakers' base pay at $78,315, according to The Harrisburg Patriot-News.
Pay for the 30 legislative leaders will range from $89,300 to $122,254 after Dec. 1, when the annual COLA raise kicks in, the newspaper says.
The Legislature passed a bill in 1995 that automatically gives its members a pay raise unless a majority votes against the annual COLA. To date, lawmakers have never rejected the money.
Gov. Rendell, his cabinet and state judges will get the same 2.8-percent increase, effective Jan. 1. The governor's salary will rise to $174,956.
From The Patriot-News article:
For lawmakers, who according to their attorneys have no right to forgo the raise, it will keep their fourth-place national ranking in legislative salaries. California at $116,208, Michigan at $79,650, and New York at $79,500 pay more.
Pennsylvania is one of four states that grant lawmakers automatic cost-of-living raises, according to Morgan Cullen of the National Conference of State Legislatures.
Tony Phyrillas is the city editor and political columnist for The Mercury, a two-time Pulitzer Prize-winning daily newspaper in Pottstown, Pa. Phyrillas has won several national and state awards for his columns. Phyrillas has been featured on National Public Radio (NPR) and in The New York Times and is a frequent commentator on radio and television programs. He co-hosts "Talking Politics with Tony Phyrillas & Mike Pincus" Thursdays at 5 p.m. on WPAZ 1370 AM.
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