States cp ddi 2012


Texas will barely survive Obama care with budget limits



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Texas will barely survive Obama care with budget limits


Young 12(MICHAEL E. YOUNG Dallas News Staff Writer Texas Gov. Rick Perry touts budget limits as crucial to state’s future at Plano chamber 18 April 2012) http://www.dallasnews.com/news/politics/state-politics/20120418-texas-gov.-rick-perry-touts-budget-limits-as-crucial-to-states-future-at-plano-chamber.ece

In a room packed with members of the Plano Chamber of Commerce and more than a few sitting or would-be state legislators, Gov. Rick Perry set the parameters for crafting the next state budget by presenting what he called the five simple tenets to his Texas Budget Compact.? Those principles – truth in budgeting, a Constitutional limit on spending tied to population growth and inflation, rejecting new taxes or increases and making the small business tax exemption permanent, preserving a strong Rainy Day fund, and cutting unnecessary or duplicative programs and agencies – will help assure that Texas remains atop the other states in job creation and other economic categories, Perry said.? He paused at one point and directed a comment at new Plano Schools Superintendent Richard Matkin, whose background is in accounting. “Superintendent, if you did your budgeting like the Texas Legislature did in recent years, you’d be in trouble,” the governor said.? Matkin quickly assured him he wouldn’t.? Perry underscored that with the business crowd – how revenue and income determine how they operate, and how they live.? It has to be the same with the state, Perry said.? “As we focus on the next Legislative session, we’re going to continue to be thoughtful in our budget process in Austin, Texas,” he said.? Truth in budgeting will give the state’s residents’ faith and trust in government. And to reinforce that, setting state budget limits based on population growth and inflation rather than on personal income is crucial, Perry said.? So is making the small business tax exemption permanent, he said. “Why should [small business owners] have to come to Austin every two years and beg for it?” Perry asked.? With those kinds of guarantees in place, Texas can continue as a leader in job creation, the governor said. But the future also rests on decisions in Washington, D.C. – notably Medicaid and President Obama’s health plan, “the ticking time bomb” for state spending, Perry said.? Medicaid “already consumes a massive amount of our budget,” he said, and spending “will accelerate if the Supreme Court doesn’t find Obama-care unconstitutional.”? A few minutes later, in a brief chat with reporters outside the Collin College Conference Center, Perry warned that the president’s health plan and Medicaid costs “will bankrupt a substantial number of states.”? Texas will survive, he said, but “it bankrupts California. There’s no way around it.”? Perry also mentioned his abortive campaign for the Republican presidential nomination, telling the crowd he worries when he sees a stage with more than one podium on it, alluding to his debate performances.? But he pointed out that for a while at least, he was the leading Republican contender in the race.

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Texas Spending will create budget problems


Deshotel 7/3/12(Texas State Rep. Joe Deshotel District 22Texas' Stymied Budget Could Hurt Future Economic Growth, Jul 03, 2012, http://www.burntorangereport.com/diary/12447/texas-stymied-budget-will-hurt-future-economic-growth

Texas is the nation's fastest growing state but consecutive biennial budget deficits threaten its long-term economic competitiveness. On June 4th state leaders hinted at additional cuts to education and healthcare services by asking agencies how they would go about cutting another 10% from their general revenue. According to the Center for Public Policy Priorities the request ignored increases in population and inflation while using the 2011 reduced funding levels as its General Revenue baseline. This fiscal year Texas is projected to have the 3rd largest budget deficit as a percentage of revenue, one spot ahead of California and only out-shorted by New Jersey and Nevada. The structural budget problem has persisted since a 2006 reduction in property taxes was replaced by an underperforming franchise tax. John Heleman, chief revenue estimator for Republican Comptroller Susan Combs said,? A $10 billion budget shortfall will reappear in future legislative sessions again and again unless lawmakers better align how much money comes in and how much goes out,? Last year House Speaker Joe Straus acknowledged the structural deficit,? We have no choice, unless we want to continue to try to grow our population and continue to shrink spending significantly…I think at some point you can't cut your way to prosperity.? Others disagree, 5 state Senators, US Senate candidate David Dewhurst and Gov. Rick Perry have all signed the 'Taxpayer Pledge' to "oppose and vote against any and all efforts to increase taxes." Straus has been targeted as a 'moderate' by Empower Texans the same group promoting the pledge and a force behind the legislature's recent push to the right. Under the name Texans for Fiscal Responsibility the group is coordinating, as it did in 2011, with other conservative organizations as Texans for a Conservative Budget. Joshua Trevino spokesman for Texas Public Policy Foundation, another of the aligned groups, referred to last session's cuts as "a good start".? Fact: If all of the state's 6.5 million uninsured were placed in one city it would surpass Houston's metro area as the nation's 4th largest.? Texas officials have pledged to fight the expansion of Medicaid in Texas. For states that choose not to opt-out the federal government will cover a majority of the new spending. That could be a loss of 186 billion in Federal dollars over the next decade says State Representative Garnet Coleman. Medicaid is chiefly how poor children, elderly and disabled gain access to care. How this demographic has faired during these cuts has been part of the soft underbelly of the Texas economic model, that is propped up by the state's unmatched natural resources. A study by Feeding America revealed that 18% of all Texans and 27% of Texas children face food insecurity. Short-tern costs related to insecurity include, "greater odds of being hospitalized, and the average pediatric hospitalization costs approximately $12,000" and long-term costs as, "contribut[ing] to high health care costs throughout life" and "greater absenteeism." A growing population of underserved youth combined with cuts to education funding is creating a negative outlook for Texas' ability to sustain economic growth. Bill Hammond, president of the Texas Association of Business was recently quoted saying, "If we are going to remain competitive in the world's market, we are going to have to have an educated workforce. We do not have one today." At least one prominent Texas politician is willing to ask his constituents for a tax increase to cover the state' insufficient appropriations. Mayor Julian Castro of San Antonio is proposing a 1/8th cent sales tax to help pay for full day Pre-K for predominantly low income children. The council will vote in August to give voters the chance to approve the measure in November. The proposal has the support of local businesses, education leaders and HEB CEO Charles Butt. Should it pass legislators can take it as a sign that the cuts are being felt and the economy adversely impacted. A Texas A&M cost-benefit analysis of Pre-K concluded:? The benefits of universally-accessible, high-quality pre-kindergarten for four-year- olds in Texas greatly outweigh the costs. Program participants benefit from increased graduation and retention rates and increased lifetime earnings. Mothers of participants also receive increased lifetime earnings and increased income. Benefits to the State of Texas are lower juvenile crime, less child abuse, and increased tax revenue. The benefits of pre-kindergarten are particularly large for children from low-income and minority households.? Just a decade ago Texas ranked 25th nationally in per pupil spending while today it ranks 37th. The 82nd legislature's $4.5 billion cuts from education did not include an estimated 160,000 new Texas students in its formula. Many advocates for cuts argue there is no correlation between spending and results but a 2011 study showed Texas ranking "below average" in math and science, skills that will be needed as we move towards a more information based economy. Companies may appreciate Texas' low tax atmosphere for business but they will think twice before moving higher paying jobs here if they will have to import talent from other states or countries.

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