States Facing Economic Hardships Ahead
Over the weekend, the National Governor’s Association held its annual meeting to discuss the challenges the states face and the tactics governors might employ to resolve their respective issues. The news coming out of the meeting didn’t start off on a positive note:
On the recession’s front lines, governors are struggling to chart the road ahead for states staggered by unrelenting joblessness and cut-to-the-bone budgets even as Washington reports signs of economic growth. ‘‘The worst probably is yet to come,’’ warned Gov. Jim Douglas, R-Vt., chairman of the National Governors Association, at the group’s meeting Saturday. He called the situation ‘‘fairly poor’’ in most states, adding that it ‘‘doesn’t look too good.’’
This sentiment is a stark contrast to assumptions Maine’s state government made about the trajectory of our economy over the next year. The tactics Augusta is using have only deepened our problems. Already our elected officials have borrowed tens of millions of dollars from future budgets in the hope that things will turn around before long. Few now predict that will be reality. Our economy faces the very real possibility of staying sluggish for the foreseeable future.
The first step to getting back on track is to ask ourselves what services Maine state government should be providing its citizens. We can’t be all things to all people and expect our taxpayers and businesses to pay for it all.
The most glaring example is Maine’s Medicaid program, MaineCare, which has become a middle-class entitlement. In some cases, the program is two and a half to three times as generous as most other states. MaineCare was intended to help the most vulnerable. Now, many with middle incomes are receiving benefits. Programs like MaineCare should be brought in line with national averages, and be reformed so they are not magnets for individuals coming from out of state to take unfair advantage of our taxpayers.
Once we decide what we should be providing, we need to make the tough choices about what we can actually afford based on realistic revenue projections. Our current crop of elected officials have been making decisions based on a two- or four-year election cycle, which is why our budget is riddled with borrowed money, waste, and gimmicks like furlough days and a “payroll push”.
While we can’t change the legislature overnight, we can hire a competent manager as our next Governor who will appoint other professional managers to run government departments and agencies. It will send a strong signal to Augusta and the people of Maine,that our state will no longer follow business-as-usual. Mainers are demanding that experienced, qualified managers be put in charge of state finances.
And finally, when our fiscal house is in order, we should lower taxes on families and businesses. This will provide a direct incentive to all Mainers – employers and workers – to stay in Maine, raise their families, and build their businesses here.
Most families and successful companies adhere to similar principles of fiscal responsibility. Our state government should be making the same responsible choices.
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