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Published: Thursday, 12/4/2008

Balancing the state budget

WITH the state of Ohio's budget scenario lurching from bad to worse, Governor Strickland and members of the General Assembly have their work cut out for them, first in patching a would-be $640 million deficit by June 30 and then by negotiating a two-year spending plan geared to recessionary times.

In Ohio, deficit spending is not an option, as it is for the federal government. By law, the state budget must be balanced by the end of the fiscal year, and it will be. The question is how.

To help with an answer, here are a couple of guidelines the governor and lawmakers would do well to heed. President-elect Barack Obama should pay attention, too, because he will be involved.

First, in the matter of emergency federal aid to the states, explored this week by 40 of the nation's governors in a meeting with Mr. Obama in Philadelphia: California, which has fiscal problems arguably worse than any other state, is angling for some sort of federal bailout.

But if California is to get such federal largesse, every other state should get it. As a matter of equity, the federal government should not be in the business of deciding winners and losers among the states when it comes to revenue-sharing, or whatever a bailout might be called.

The recession is a national problem and, while the effects are being felt more sharply in some states than others, it rates a national solution. Ohio and Michigan must not be left to bear the brunt of hard times.

Back to Ohio, we believe that public employee unions, at both the state and local levels, must be ready to make sacrifices to help balance the budget. No longer can government simply bestow generous pay increases on its workers and then try to figure out where to get the money to pay for them.

Again, this is a matter of equity. Many taxpaying members of the general public are being laid off from their jobs or having their hours at work cut due to the deepening recession. At this critical juncture, they cannot be expected to foot the bill for pay raises for those who happen to work for state or local government, including the schools.

If public employee unions don't cooperate, the result almost certainly will be more draconian cuts and layoffs than would be necessary if concessions are made when contracts are renegotiated, as they are right now, for example, between the state and members of the Ohio Civil Service Employees Association. The union represents some 35,000 of 60,000 state employees.

The solution to the budget crisis likely will include deep spending cuts - on top of $1.3 billion already carried out by the Strickland administration over two years - plus some sort of moderate tax increase, such as extending the state sales tax to some services not now taxed.

Indeed, if any tax increase is to be visited upon Ohioans, the governor and lawmakers should make it contingent upon concessions from the unions.

In hard times, it's only fair.



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