The effort by Gov. Haley Barbour and state legislators to put their special spin on the state budget shortfall and what to do about it has skirted the real issue.
In our opinion, the real issue is the state does not have the money to pay for all its basic services—public education, mental health treatment, highways and corrections to name a few.
Barbour has said he plans to cut $211 million on top of the $225 million he cut in October and December. The governor, supported by the Senate, has asked for authority to cut most agency budgets by 10 percent. The Corrections Department would be limited to 3 percent.
The governor has suggested that if the corrections department were cut as much as other agencies he would have to release up to 4,000 inmates from prison. We doubt the governor is going to release 4,000 inmates under any circumstances, but that is the scare tactic he is using to try to get his way.
Under the plan approved by the state House, the governor would have to spend $50 million from the state’s rainy day fund and $61 million in federal stimulus funds that he controls before making any other cuts. Supporters of that plan say that would reduce the impact of cuts on education programs and mental health agencies. It’s probably the better alternative of the two for the short term.
What both plans ignore, because of our weak-kneed politicians, is any discussion of increasing revenues. We can suggest two areas to consider: the state income tax rate tops out at 5 percent. Establishing a 6 or even 7 percent bracket for the rich is something to look at. A number of other states have the higher brackets and rich folks still live there.
And let’s take another look at the cigarette tax, which is still well below many states even with the recent increase.
We can’t cut our way to prosperity. Cutting state spending by huge amounts has the potential to make our economy worse, not better. It’s time to consider both sides of the balance sheet.