Obenshain explains budget vote

By JR Hoeft | Thursday, February 19th, 2009 | Policy

Sen. Mark Obenshain (who recently participated in our podcast, Virginia Politics On-Demand) was one of only four senators yesterday to vote against the Senate’s proposed amendments to the budget. Here’s his explanation:

As the Senate debated Virginia’s budget on Wednesday, several senators thanked certain of their colleagues and staff for their hard work and cooperation. One of my Democratic colleagues, however, stood and extended her thanks to thank President Barack Obama and to Congressional Democrats. She thanked them for the passage of the “stimulus bill,” asserting that it was only through their generosity that we were able to balance the budget without deeper cuts.

That was more than I could bear silently. I felt compelled to rise to add that our gratitude is more appropriately extended to our children, our grandchildren and their children, as it is they who will be forced to pay for the excess represented by the “stimulus package.”

With mere hours set aside for review and deliberation, the U.S. Congress authorized an $800 billion spending spree, and today President Obama asked for nearly $100 billion more. If anyone deserves our thanks, it is certainly those who will be footing the bill tomorrow that we might ignore painful realities today.

The reality is that this country is in a recession, and Virginia is not immune. Last year, over my objection, the Virginia Senate approved a budget predicated on revenue projections of over six percent growth per year for the biennium – despite the obvious fact that we were in the middle of a severe economic downturn.

Neither the governor’s office nor my colleagues who supported last year’s budget were truly caught off guard by plummeting revenues or a declining economy; they simply found it easier to exchange winks and nods while jockeying to include their own pet programs in that irresponsible appropriation. Far from learning from the experience, the members of the Senate offered an encore this year, adopting a budget that has only the most tenuous relation to current economic conditions.

In addition to funds dedicated to education, transportation, and Medicaid, some of which may not be realized for some time, the federal stimulus package appropriates $216 million in un-earmarked funds to Virginia. That sum has been touted as the solution to all the problems we now face.

Unfortunately, the sobering realities of our present fiscal straits did not prevent the Senate from approving a budget predicated on implausible revenue projections and the promise of a one-time infusion. In order to “balance the budget,” the Finance Committee relied on revenue projections from the Governor that predict that Virginia’s economy will rebound by July of 2009 and that, starting then, Virginia will experience 4.5% annual revenue growth. These bloated projections came only hours before the Federal Reserve sharply downgraded its outlook for the economy this year.

Even as most senators voted for the Senate Finance Committee budget, not a single member of the Senate defended the revenue projections upon which it has been built. Many defended as laudable the expenditures it contained, but none expressed any confidence that we would not be facing a clear shortfall as early as July or August. I hope that I am wrong; however, I sincerely doubt it.

Until recently, Governor Kaine’s office criticized those saying that by the time we took up the budget, the shortfall would run $3.5 to $4 billion. Now the governor admits that the shortfall grew 25% in December and currently stands at $3.7 billion, but he maintains that the stimulus package will cover the difference.

All this year’s budget does is delay the inevitable. It is tempting to put off the hard choices by seizing upon the federal stimulus program – too tempting, as it turns out. The money allocated to Virginia will help, but it cannot last forever; the program is intended to be a temporary fix. If we wish to avoid finding ourselves in the same situation – or worse – a year or two down the road, we need to reevaluate our spending priorities, something we failed to do this year.

I wanted to vote for the budget this year. I really did. In fact, it is a better budget than it might have been. However, I just could not do it. I voted against the Senate budget because Virginians expect and deserve a forward-looking budget that addresses the shortfall head on and helps position the Commonwealth on the road to economic recovery. What we adopted is a stop-gap, a bill that allows us to muddle through another year by mortgaging the future.

Sadly, this budget repeats last year’s mistakes. As in 2008, we will likely have to return to Richmond later this year to reconsider the budget when revenues fail to meet the Governor’s excessively optimistic forecast.

Each time we take the easy out and push the reckoning back another year, we make Virginia’s economy a little weaker and the crisis a little larger. The federal stimulus package may help us get through the year, but if we do not address the budget’s larger, structural issues, we will have nowhere to turn when that money is gone.

Faced with difficult choices, the Senate punted. For the sake of all Virginians, it is a mistake we must not repeat.

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