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Lowman S. Henry

Lowman S. Henry

Chairman & CEO
Lincoln Institute
of Public Opinion Research

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Town Hall Commentary

Irresistible Force Meets Immovable Object

by Lowman S. Henry
 

It looks like Ed Rendell will go eight for eight.

As in, eight missed budget deadlines in eight years. I haven't checked the records, but I am willing to bet the mortgage that no other governor in the history of Penn's Woods has failed to perform his primary fiscal duty on time for the entirety of his administration.

As he did in triggering last year's 101-day budget stalemate, the governor is insisting on increasing spending despite a budget deficit that likely will total well over $5 billion. He wants to spend the additional money on basic education, an area of the budget that has for decades experienced annual increases well above the annual inflation rate.

The fact this is a legislative (and gubernatorial) election year complicates the budget process. Most Republicans, and more than a few Democrats, would imperil their re-election bids if they vote to increase taxes. The political will does not appear to exist to exact the significant cuts needed to bring the budget into balance. And the state has exhausted nearly all the one-time revenue sources and gimmicks available to bring the spending plan into balance.

For Republicans the risk is especially great. Already there are whispers in some quarters that it would be better to accept a tax hike now - and blame it on Ed Rendell, rather than have to raise taxes under a possible Corbett Administration next year. Of course Tom Corbett has taken the "no new taxes" pledge, so if he is a man of his word tax hikes next year are already off the table.

Republicans have taken this path in the past, with disastrous consequences. During Ed Rendell's first term Republicans controlled both houses of the General Assembly. Former (and now indicted) House Speaker John Perzel was highly effective in rounding up GOP support for Rendell's profligate spending. The Republican grassroots, aghast at their elected representatives behaving like Democrats, booted many legislators from power or sat home on Election Day allowing Democrats to edge into a majority in the state House.

In recent years legislative Republicans, particularly in the House, have become more fiscally conservative and have drawn bright lines of difference between themselves and the spendthrift ways of Ed Rendell and most of his Democratic colleagues. If Republicans cave on taxes now, they will again tarnish the GOP brand, and that could jeopardize both their likely return to power in the House and harm Tom Corbett's gubernatorial bid. But don't bet against Republicans fowling their own nest. As happened last year, Senate Republicans are the most likely to blink when the pressure builds later this summer.

For Democrats, given that they control both the state House and the governor's office, another late budget will be laid at their feet. Rendell, of course, doesn't care as he is not on the ballot this year. But most Democratic lawmakers would like to keep their jobs, so they may be less than willing to walk off a cliff for Rendell.

Some Democrats though don't believe they are at the precipice. State House Transportation Committee Chairman Joe Markosek (D-Westmoreland) claims there is public support for raising taxes and fees to fix the state's roads and bridges. He told the Harrisburg Patriot News that people would: "support funding no matter how we got it. They would support that politically, support the legislators or state senators who voted those tough votes."

In other words, Representative Markosek feels we the people are willing to pay higher taxes for better roads. He thinks that during this time of economic recession — and with a rebound recession looming — Pennsylvania's working families and small businesses are willing to pay more in taxes while the legislature avoids making the truly "tough votes" to reign in spending. My suspicion is that any legislator in a competitive district who casts such a "tough vote" will rapidly find himself or herself back in the private sector.

The Markosek approach is, however, illustrative of what we should expect in the coming weeks. The governor and legislators will pick spending projects that enjoy popular support and claim we must raise taxes to prevent them from being cut. All the while ignoring the fact that bloated spending on non-core government functions and unneeded projects could be cut instead.

At the moment, it all appears to be a case of irresistible force (spending) meeting immovable object (limited revenue). But something and someone will have to give (hint: keep an eye on a severance tax for Marcellus shale drillers) as another extended budget crisis could result in political carnage for incumbents of all political stripes at the polls this November.

(Lowman S. Henry is Chairman CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal. His e-mail address is lhenry@lincolninstitute.org.)

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