Some might be tempted to think of Governor Perry’s proposed budget and spending reforms as election-year gimmicks. After all, we get them from Washington all the time.
In 2003, Governor Perry sent the legislature a budget with nothing but zeroes and a $10 billion projected shortfall was handled without a major tax increase. Everyone thought spending was under control.
Then came 2005. The biennial all-funds budget soared that session by 18 percent. The actual spending numbers for the 2006 fiscal year are not out yet, but there is no doubt they will be up considerably over 2005.
Right now, Texas state and local governments tax away 9.4 percent of Texans’ personal income. This understates the actual economic impact, though, because a lot of revenue is not tax revenue.
Now we are entering a period of even greater peril for Texans’ pocketbooks. The state legislature has decided to fund a larger share of education spending. Its share of education spending was considerably greater in 1991. For the state to have maintained that share would have required spending increases even greater than we have seen in the last decade. Instead of inflation-adjusted spending per Texan increasing 19 percent from 1991 to 2005, it would have increased 27 percent.
Those who foot the tax bill have only those they elect to protect them. By comparison there is a veritable army of lobbyists doing all they can to badger elected representatives into giving up more of our money. All too often, those in office have proven weak and have succumbed to the urge to spend.
Budget reforms put forward by Governor Perry would more easily allow taxpayers to reassert their voices in determining the fate of their pocketbooks.
Among the reforms Governor Perry has proposed is a stricter state expenditure limit. Texas’ current expenditure limit dates back to 1978. It was watered down to the point that it is no real limit at all. Thus, state and local government spending in Texas consumes almost 9 percent of our personal income.
A second proposal would require state agencies to post their individual expenditures on the internet. Basically, the state’s checkbook would be open for all to see. Expenditure records are already a matter of public record, just expensive to get. This would make it far less costly for taxpayers to see where their money is going. Every level of government – state, city, county, school district, or special district – should post its checkbook online.
The state’s budget would become clearer under Perry’s proposed reforms. Currently, individual government programs are often combined with a number of other programs into a single expenditure. If individual programs were budgeted individually, as proposed, the budget would be clearer. With clarity, it would be easier to identify and eliminated wasteful programs.
Senate Finance Chairman Steve Ogden recently pointed out that $1.8 billion in revenues from dedicated fees and taxes were budgeted for purposes other than that for which those monies were dedicated. The governor’s reforms would end that practice and make sure the money is either spent for its original purpose or is returned to taxpayers.
Finally, Governor Perry proposes returning surplus funds to the taxpayers. Exactly how this would work is up for debate, but it is a worthwhile effort. Taxpayers might have more of an incentive to make a case for spending restraint if there was a reward for their efforts.
Regardless of ideology or party, everyone must agree that government should be accountable to the people. All of these reforms, regardless of who proposes them, passes them and implements them, would greatly enhance that accountability.
Byron Schlomach, Ph.D., is the chief economist for the Texas Public Policy Foundation, a non-profit institute based in Austin (www.TexasPolicy.com).