Given recent comments about our state's budget, I feel it is time to separate fact from political fiction. The fact is, in stark contrast to the U. S. Congress, the Texas Constitution requires the Legislature to balance the state budget every two years, and that would have happened with or without any federal stimulus dollars.
In 2007, I led the effort to save $7 billion to balance the revenue shortfall we anticipated this year.
So it's simply political fiction that stimulus dollars were necessary to balance our budget.
Although we tried to use the federal stimulus dollars on one-time expenditures, in some cases the federal government made us use the money on recurring costs that actually add to the cost of state government.
While other states struggle with overwhelming deficits, Texas has created a model for the rest of the nation to follow that is based on living within its available revenue. The state cut taxes a net $4 billion per year in 2007 while fostering a predictable regulatory environment that allows business to thrive and continue to make Texas the No. 1 job creator in the U.S. over the past two years.
Although this year's session took place in the context of significant turmoil in the global marketplace and economic upheaval in Texas and across our country, the Legislature successfully shaped a balanced state budget that meets the needs of Texans and sufficiently funds essential programs and agencies through the next two years.
Working together, we crafted and Gov. Rick Perry signed a balanced budget that has left our state prepared to tackle the challenges that lie ahead. Not only did we balance our budget without raising taxes, we cut taxes for more than 40,000 small businesses and left our Rainy Day Fund untouched so we can once again balance our budget in 2011.
The fact remains that Texas is one of only six states whose budget isn't in the red, even though our state is among the fastest growing in the nation. The state has an unemployment rate well below the national average, it continues to attract jobs from companies that have relocated or expanded in Texas, it has one of the healthiest housing markets in the nation, and Texas cities are consistently recognized for their healthy job markets, high quality of living and resistance to the recession. Here in Texas, we live within our means and create a climate that gives individuals and businesses the opportunity to succeed.
Texas has faced and overcome tough financial situations in the past by tightening our belt, just like Texas families are doing today. In 2003, Texas encountered a $10 billion budget shortfall. Instead of raising taxes, we cut discretionary spending and implemented sound fiscal policies that helped us generate a multi-billion dollar surplus over the next six years, before the national recession hit Texas.
Unlike Washington, we balance our budget every session, control spending, keep taxes low and ensure our children and grandchildren aren't saddled with the kind of crippling debt that our federal government has irresponsibly created.
Paul Burka practically blows a gasket (link). Excerpt follows...
I have already received a couple of calls from friends who wanted to be sure that I noticed the Dew’s op-ed piece in today’s American Statesman about how Texas balanced its budget. His salient characteristic is on full display here: There is no depth of cravenness so low that he will not seek it out in pursuit of self-promotion.
"Friends" called? I heard from a reporter buddy that Kay's team was putting a full court press on to discredit this op ed by Dewhurst because it undermines their entire come back to the hit against her that she voted for the bailout. Do they really spend that kind of effort and time courting Paul Burka though? I suppose Rick's peeps do too? What a waste of time, no offense to Paul.
Burnt Orange Report was also in a tizzy (link). Excerpt follows...
If David Dewhurst really wants to claim that Texas didn't need the stimulus funds, then he should produce a budget that shows what he would have cut. But he'll never do that, because this isn't about leadership or fiscal responsibility or being honest about how Texas Republicans play a shall game with Texas' taxpayer dollars.
It's about political power, and political wars -- and Dewhurst, Perry, Strauss, and every other Texas Republican is going to rally against Big Bad Washington while silently singing President Obama and the Democratic Congress' praises that they bailed Texas out of a massive $14 billion budget hole.
Michael Quinn Sullivan, whom I trust far more than Paul Burka or Phillip Martin... no offense to either of them... blogged about this too (link). Excerpt follows...
The simple fact remains that it is absurd for anyone to claim the Texas budget wouldn't have been balanced without federal dollars. It demonstrates a striking ignorance of Texas' budget laws, or a willful disregard for the facts.
This whole issue is a lot of inside baseball, but it is an important battle because these claims will be made in campaign advertisements next year and the groundwork has to be laid to support those claims today.
It reminds me of a famous phrase... everyone is entitled to their own opinions, but not their own facts...
What are the facts? I think there are a lot of ways to look at it, but I think Michael Q. Sullivan and David Dewhurst make valid points... Texas used stimulus dollars because the money was there... although really Texas still gives more than it gets back from the federal government...but the legislature still would have produced a balanced budget without it. It is mandated as such by the Texas Constitution.
I think looking at the last budget shortfall scenario from 2003 is also informative. Texas never ran a deficit and never raised taxes, it just cut spending. Both sides certain can glom on to certain facets of this debate, but the big picture should not get lost and that is that Texas is broadly speaking besting the nation and every other large state in a lot of economic and government fiscal indicators...