Biennial Budget 2.0: Pathetic

You would think that an elected official, his last campaign behind him, would exhibit some independence and leadership. You would expect a willingness to confront tough issues head-on and to develop long-term solutions. No posturing, no sugar-coating. A termed-out executive has a rare opportunity to concentrate on the job at hand without the distraction of the next election--to do what is right, not just what is politically expedient.

If you think Maine's governor is rising to such an occasion, think again. John Baldacci seems content to go out not with a bang, but with a whimper, the lamest of ducks. Yesterday Baldacci released a do-over of his proposed 2010-11 budget after reviewing new projections that state revenues will likely come up a half-billion dollars short during the biennium. "This budget makes serious and difficult reductions," he insisted, yet in the same press release he observed that "there are no additional layoffs in this proposal." Say what?

Republicans were perplexed. "I was surprised not to see more significant structural changes going forward," said Senate minority leader Kevin Raye. Current economic and demographic trends suggest that we will not soon be able to afford the level of government spending to which we became accustomed during the past decade. If revenues in Fiscal Year 2010 are going to decline by $200 million, then spending needs to be reduced by the same amount. Yet Baldacci's proposed cuts address only 15% of the shortfall. Where will the rest come from?

$68 M of federal stimulus money (originally targeted for new jobs)
$24 M from the "Rainy Day" fund (none left for Baldacci's successor)
$35 M from income- and property-taxpayers
$16 M from more aggressive collection of tax receivables
$9 M from reduced payments to healthcare providers
$7.5 M from phantom savings yet to be identified
$6 M in "shared" revenues from cities and towns

If that looks like smaller government to you, I have a great deal on a bridge that I would like to sell you.

The latest revenue projections, attenuated though they may be, still look unrealistically high. FY2010 is going to be a real house of horrors, as credit-card defaults, commercial real-estate foreclosures (did you see the winning bid on Boston's John Hancock Tower?), and bank failures will wreak considerable havoc in the national economy. All those "green shoots" that the Fed chairman has been talking about are about to get napalmed. There is no way that Maine's general-fund revenues in FY2010 and FY2011 will remain nearly flat with FY2009, as the Governor currently expects.

But that's O.K., a politician's best friend--a New Commission (fanfare, please)--will do the heavy lifting, tasked with "streamlining" state government. Baldacci, a politician to the end, will do the spotting.