The LuLac Edition #2350, February 5th, 2013

 

Lt. Governor Jim Cawley looks on as Governor Tom Corbett gives his budget address. (Photo: Newsworks.com) 

CORBETT’S BUDGET 2013-2014 

Governor Tom Corbett gave his third budget address today. In a way, at least for him it was more politically expedient and less austere. Corbett who has an approval rating in the mid 30s has asked the GOP controlled Legislature for transportation investments, pension reform and an increase in that black hole, educational funding. (That is the election ploy, “The Kids!!! The Kids!!!, what about The Kids!!!!!) Corbett is asking for $28.4-billion which is is $679 million higher than this year’s budget. The Governor, doing his best Grover Norquist impression says he will not raise taxes and does not want the Legislature to do so either. 
I have to give the guy his doe on pension reform. The state pension system was blown up during the Ridge administration when the State and the Nation was flush with the Clinton era economy. Ridge increased the pensions and then the State Legislature threw gas on the fire by giving themselves a 50% pension increase. Apparently no one was thinking there would be a Wall Street meltdown or recession. Corbett said if nothing was done, the current rate of 13% would clock in at over 30% in five years. No one now will be affected but new employees would have to sign up for a 401k plan just like the rest of us normal people in private business. New workers would have to kick in about 6 percent.
The Governor wants to take over management of the profitable Pennsylvania Lottery, train about 300 new state police troopers and sell the state’s liquor stores. I don’t think Corbett will get a fight on the troopers but his plans for the Lottery and Liquor Stores may run into Legislative bargaining. i would not be surprised to see a hybrid system of Liquor where you’d have a state store system still in place but have private industry given more opportunities to sell wines and specialty items in non state sanctioned areas. The Legislature, even one of his own party has too many interests to go lockstep on this proposal. 
Corbett said he will not expand the Pa. Medicaid system saying it would cost too much money to set up. Unlike his predecessor, Ed Rendell Corbett has passed a budget on time in his first two years. Unless something crazy happens, I don’t see a change in that for 2013. 
Our Pennsylvania Constitution requires a balanced budget to be adopted by June 30.

ANOTHER VIEW 

Sharon Ward from the Budget Resource and Policy center took the Governor’s budget message to task. Here’s what that group wrote in a release later today: Sharon Ward, director of the Pennsylvania Budget and Policy Center, issued the following statement on Gov. Corbett’s 2013-14 budget proposal: “The governor’s budget does little to reduce the trend of disinvestment in Pennsylvania schools and communities. It relies heavily on speculative and one-time sources of funding, and proposes expensive new corporate tax breaks that will continue to shift costs to local taxpayers. The budget fails to provide sustainable funding to reduce class sizes in public schools, keep college affordable for middle-class students, and ensure working families can obtain basic health care.” 
K-12 EDUCATION “The governor’s budget will add only 1.7 percent to the basic education subsidy, doing little to reverse $840 million in education cuts 2 years ago. A new block grant, called "Passport for Learning," is entirely speculative, relying on liquor privatization that has failed to pass the General Assembly twice. The governor has an obligation to today's students to restore cuts that affect their lives and livelihoods. Progress on education funding should not be dependent on the outcome of other political debates. "Many education funding increases are also conditioned on pension savings and, therefore, are in jeopardy. Lawmakers did not respond with applause to the governor’s pension plan during his budget address, suggesting those savings may be hard to come by." 
HIGHER EDUCATION “The proposed higher education budget locks in cuts made in 2011. Students in Pennsylvania pay relatively high tuition and graduate with significant debt. Keeping college affordable is not a ‘nice to have’ but a key public responsibility.” CORPORATE TAX BREAKS “The budget commits the commonwealth to large new tax cuts for profitable corporations, which will undermine the next governor's ability to fund education and health care. Gov. Corbett failed to even mention the tax cuts in his budget address, reflecting the unpopularity of this approach with the general public. The governor presented no plan to close corporate tax loopholes.” 
HEALTH CARE “The governor’s short-sighted decision to reject an opportunity to expand health coverage through Medicaid to more low-income working people is a departure from other Republican governors in states like Arizona and Ohio. One of the best ways to reduce health care costs is to expand health coverage so that fewer people are showing up in ERs with serious and expensive illnesses. Research studies have also concluded that Medicaid improves health outcomes. “It is a clear statement of priorities that the governor is willing to spend hundreds of million on hidden corporate tax cuts but refuses to spend far less to expand Medicaid, which would draw down billions in federal funds annually.” 
TRANSPORTATION “Gov. Corbett understands the necessity of investing in transportation and raising taxes to do so, yet he has failed to make similar investments in other key components of the economy.”