Telegraphing Future Disappointment

Well, my fellow fiscal conservative! You come knowing that it is a well-known fact that the state of Indiana faces an $800 million structural deficit. You are desperately hoping that spending cuts are the means to solving this problem rather than tax hikes.

Bummer for you: the Republicans lack the will to cut spending.

They do not lack the tools. The GOP inaugurates a governor next month and will usher in majorities in the both houses. There are the tools. They will sit in the woodshed while the spending tools will be used. From an editorial in today's Indy Star:

"Indiana's structural deficit stands at near $800 million. The state also owes schools and universities more than $700 million in deferred payments. The rainy day fund has been largely depleted, dropping perhaps to only $46 million by the end of this fiscal year.

Factor in eventually repaying the $380 million borrowed from the Pension Stabilization Fund to keep the state afloat for the past two years. Plus rising Medicaid costs, potentially another $300 million in additional spending. Plus $160 million the state will pay out in property tax relief.

It all adds up to what some legislators are describing as, in Kenley's words, "the session from hell." Tax increases certainly cannot be ruled out. Spending cuts are likely. Kenley, chairman of the Senate Education Committee, says he's preparing for a flatline budget -- meaning no extra money for schools. Others wanting more money likely will be turned away as well."

Tax increases cannot be ruled out? Why not?

Spending cuts are likely, yet Kenley is preparing for a flatline budget? Cuts and a flatline are two different things.

Instead of really cutting spending, this is how Republicans plan to close the gap on the deficit, per the Star:

"But there's also opportunity. It starts with reforming the maze of 74 agencies and 319 boards that is Indiana state government.

Gov.-elect Mitch Daniels has proposed a government reorganization plan that must be pushed forward at the same time Espich and other lawmakers are shepherding the budget through the Statehouse."

That's all very nice and commendable, and should serve as an excellent start towards fiscal health at the state level. The other very necessary component is a real cut in spending.

I am calling for a baseline 10% cut in spending. I'm not calling for a radical slash-and-burn. I'm calling for something that can be done without the usual accusation that the Libertarian solution will leave the state in ruins. I urge my readers to write the editors of their newspapers and their representative to urge a baselline 10% cut. Make sure to tell them that you are a fiscal conservative and that you expect this sort of action from a GOP majority, and that if you don't get it, you'll vote Libertarian in the future.

If the GOP proceeds as they plan to, this will indeed be the session from hell- not for poor Luke Kenley, but for fiscal conservatives across the state.