Corbett defended: Fiscal discipline is a responsible state budget strategy

Guest Column by Lesley Smith

As debate over the 2011-12 state budget begins in earnest, the charge to lawmakers from the Gov. Tom Corbett administration is crafting a fiscally responsible state budget that reins in government spending and bolsters private-sector job creation in order to put the commonwealth on more solid ground financially and economically.

The governor set the stage in March by offering a $27.3 billion proposal that would take Pennsylvania back to pre-recession, 2008 spending levels. While the budget as proposed by the governor would have a significant impact on higher education and hospital communities, it is only a starting point for negotiations. Over the coming weeks, the governor and lawmakers will debate these and other cuts as they reach agreement on how best to achieve the reduced spending sought by the administration.

Budget cuts are never easy, nor are they an easy sell. Living within ones means requires tough choices, as Pennsylvania individuals and families -- and job creators -- that struggled during the recent recession know all too well. But sometimes it becomes absolutely necessary to do so, and now is one of those times for state government.

The state faces a budget deficit of $4.2 billion, plus the loss of federal stimulus dollars that, it should be stressed, temporarily padded state budgets, but were never meant to be a permanent funding source.

These are only two of several factors that necessitate the state getting its fiscal house in order, however. From 2002 through 2010, total outstanding state general obligation debt increased 39 percent, from $6.8 billion to $10.4 billion. State spending has grown faster than personal income over the past 40 years. Under the previous administration, total operating spending grew almost $21 billion, a 45 percent increase, or more than double the rate of inflation, and general fund spending increased more than $8 billion over eight years.

Taxpayers simply cannot continue to sustain government growth that has eclipsed the inflation rate and their ability to pay, which is why even though current revenues are running about $500 million above expectations, fiscal restraint should still be priority No. 1 with the new state budget.

Given the obvious need for fiscal discipline, it's not helpful to the overall budget process that the only worn-out "solution" from government union groups and their supporters is to keep raising more revenue.

These groups never met a tax they didn't like, and over the years, their message at budget time is the same -- tax more, spend more. They have called for higher personal income taxes and higher sales taxes on consumer goods and services, to name a few, in order to support unbridled government spending.

As much as these groups like to think otherwise, government does not have a limitless pot of money at its expense.

Likewise, proposing to increase the tax burden on job creators at a time when economic recovery is occurring but remains fragile is shortsighted. Private-sector job losses during the recession were devastating to Pennsylvanians. Boosting job growth in the private sector will most benefit individuals and families because it will solidify economic recovery and sustain long-term growth.

The business community supports the governor's call for fiscal restraint, and trusts that elected officials will craft a tough, yes, but responsible budget for all Pennsylvanians. As this takes place, a broader view of what the governor is proposing should be taken -- a state budget that starts to focus real-world solutions on state government; puts the commonwealth on the road to private-sector job creation that will solidify economic recovery; and opens the long-overdue dialogue about the proper role of state government.

Lesley Smith is communications executive for the Pennsylvania Chamber of Business and Industry, the Commonwealth’s largest broad-based business association. PA Chamber membership comprises businesses of all sizes and across all industry sectors. The PA Chamber is The Statewide Voice of Business™.