Tuesday, June 27, 2023

On the eve of the budget vote, what do the numbers tell us?

As the full Legislature plans to take up the state budget over the next 2 days, the Legislative Fiscal Bureau released their summaries explaining where we stand after the actions by the GOP-run Joint Finance Committee.

I just wanted to give a couple of quick illustrations about what's happened to a situation where we had projections of $10 billion to play with in the state's General Fund, and still had $9.5 billion after slightly lower revenue estimates in May. I also wanted to compare that baseline to what Governor Evers' budget planned to do, and where the GOPs on Joint Finance have left us at.

In both cases, Evers and JFC have gotten rid of pretty much all of those billions, although JFC did leave a cushion of just under $600 million.

But how they spend down that balance is quite different. Evers would have continued revenue growth by offsetting tax breaks for lower and middle-income Wisconsinites with higher taxes on the rich, while Republicans on Joint Finance signed off on over $3 billion in tax cuts, with most of the benefits coming to the rich.

Conversely, Republicans don't plan to spend as much General Fund money as Evers did. Although both have sizable increases in spending in the next fiscal year, mostly through one-time measures like transfers to the Transportation Fund, and in paying cash for Capital projects instead of borrowing for them.

But I'll also note that both the Evers and GOP budgets end up spending between $1.5 billion and $1.7 billion more than is taken in for revenue as the budget ends. And that means that we might have to cut back and fix quite a bit in 2025 if the GOP budget is allowed to stand as-is. Which means Governor Evers should be using the line-item veto on those tax cuts for the rich and other GOP stunts, which would allow for more funds to be available for the rest of this budget.

And if circumstances warrant, maybe use that cushion as a chance to have a mini-budget proposal in early 2024, particularly to restore the UW System's budget cuts, child care assistance, and in giving some tax relief for lower-income/working Wisconsinites, as Evers wanted to do with his budgets. With new maps being a strong possibility, maybe that'll get the WisGOPs to focus in and have a chance of doing things that help more than a handful of donors. Or deal with facing a voting constituency that can finally get rid of them.

No comments:

Post a Comment