Across the board and over the cliff

By John Frary | Jan 20, 2010

Here's the problem: You have just retired. Your social security, pension and savings income is 10 percent below the salary to which you have grown accustomed.

Here's the solution: A 10-percent across-the-board cut in your expenses. Cut your property taxes, car payments, insurance charges and health-care costs along with expenditures on gas, restaurants, DVDs, oatmeal, truffles, filet mignon, champagne, beer, tobacco, chewing gum, bread, butter, shoe polish, bottled water, toilet paper, cologne, baked beans, Bhutanese buffalo-knee casseroles, etc. by 10 percent.

Inspired by our governor, I informed Farmington's tax collector that I was cutting my taxes 10 percent, notified my insurance agents that I was cutting premiums 10 percent, notified my doctor and dentists that I needed to reduce their fees 10 percent. No use. The heartless swine just told me to quit smoking and cut my beer and scotch rations. No understanding of non-prioritized budget-cutting at all. I tried to get John Baldacci to explain the concept to them, but failed to get through to him.

Here's the problem with the 10-percent solution. You may be able to spend less on gas, but you may wish to spend more. Cologne and toilet paper are not equally necessary. Bread, butter and oatmeal are less expensive and more nutritious than truffles and filet mignon. You may enjoy beer more than chewing gum. You have to make a slew of separate decisions.

Here's your challenge: Explain to me why a 10-percent across-the-board cut in state government expenditures is not idiotic. I need help on this. I just don't see it.

Near as I can see, the case to be made for this method is the need to share the pain — equal shares of suffering for the useful and the useless, the efficient and the incompetent, the profitable and the pointless, the harmful and the harmless.

Not much of a case, is it? Mind you, it may well be possible to achieve a 10-percent cut in any state operation or program by raising the standard of efficiency. In the same way, it may be possible for you to cut personal expenditures by paying closer attention to sales, coupons and bargains. But devoting the same attention to enhanced efficiency in ineffective or counter-productive government programs and bureaus and operations as to useful and effective ones is plain silly.

Yet this is the approach now being advocated and adopted by Maine's state government. This is far from unique. Politicians, both Republican and Democratic, often advocate such a method. It is easily explained to the public and has the flavor of fairness.

Our fiscal problems will not be solved by the 10-percent solution. I've spoken with a representative who sat through a recent Appropriations Committee hearing and kept count of the number of times the phrase "over the cliff" was used — 21. Our legislators are coming to the realization that, in the absence of fresh stimulus funds or a vigorous economic recovery, they may be facing a 30-percent cut in the next biennial budget. That is the cliff towards which the state is heading. Think about a 30-percent across-the-board cut, and you can see the mindlessness of this approach.

The special-interest groups who feed off the state have a simple solution. It's the same solution every time. Raise taxes.

The argument against this is equally simple. We can't afford a New Jersey government with a Maine income. Am I exaggerating? Here are some numbers to ponder. Maine's median family income in 2007: $50,740. New Jersey's $67,142. Maine's per-capita government expenditures in 2006: $5,943.43. New Jersey's: $6,197.83.

Let me do the arithmetic for you: In 2006 Jerseyites earned $16,402 more than Mainers and paid $254.40 more in taxes. And now we have people who look forward to Mainers' drawing even with Jerseyites in taxes. No ideas of how we are to draw even with them in income. Apparently no interest, either.

Actually, it turns out that New Jersey can't afford a New Jersey government, either. Down there the new governor has announced his intention to cut the budget 25 percent. No more caviar for them.

Professor John Frary of Farmington is a former congressional candidate and retired history professor, a board member of Maine Taxpayers United and an associate editor of the International Military Encyclopedia. He can be reached at jfrary8070@aol.com.

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