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By Stacy Drake
According to Roger Simon, any headline that ends with a question mark can always be answered “no.”
Over a week ago, the Perry-friendly Redstate published a presumptuous piece titled “Rick Perry, our next President.” The author listed a few items that he or she (anonymous author) felt are Rick Perry’s strongest selling points. With regards to the way Perry handled the Texas state budget, he or she wrote:
[Perry] Presided over 10 years of balanced budgets, including two times where Texas was faced with serious shorfalls, and despite the usual liberal handwringing and demands to deplete the Texas rainy day fund and raise taxes, Perry and the Republicans in the Texas lege did neither, keeping the spending in check.
The State of Texas (like most states) is required to balance their budget. They have a balanced budget amendment, so technically it would have been unconstitutional for Perry not to have balanced the Texas state books. But just how did Perry “despite the usual liberal handwringing” keep “the spending in check?” According to a report from CNN Money (emphasis):
Texas Gov. Rick Perry likes to tell Washington to stop meddling in state affairs. He vocally opposed the Obama administration’s 2009 stimulus program to spur the economy and assist cash-strapped states.
Perry also likes to trumpet that his state balanced its budget in 2009, while keeping billions in its rainy day fund.
But he couldn’t have done that without a lot of help from … guess where? Washington.
Turns out Texas was the state that depended the most on those very stimulus funds to plug nearly 97% of its shortfall for fiscal 2010, according to the National Conference of State Legislatures.
Texas, which crafts a budget every two years, was facing a $6.6 billion shortfall for its 2010-2011 fiscal years. It plugged nearly all of that deficit with $6.4 billion in Recovery Act money, allowing it to leave its $9.1 billion rainy day fund untouched.
“Stimulus was very helpful in getting them through the last few years,” said Brian Sigritz, director of state fiscal studies for the National Association of State Budget Officers, said of Texas.
Even as Perry requested the Recovery Act money, he railed against it. On the very same day he asked for the funds, he set up a petition titled “No Government Bailouts.”
Perry used the same money he spoke out against from Obama’s stimulus package to close his state’s deficit in 2010. And just how is that “keeping the spending in check?”
During the last budget signed by Governor Perry, he didn’t have the option to utilize stimulus funds to close the deficit. Instead he used accounting gimmicks, very similar to the ones we’ve become so accustomed to seeing coming out of Washington. Reason reported:
According to a report by ABC News, Perry’s budget also closed a big part of its budget gap by delaying a $2.3 billion education payment a single day. Thanks to that one-day delay, the payment will fall into the next budget year, and therefore will not technically affect the current year’s budget.
From the ABC report:
Gov. Rick Perry signed a budget that was balanced only through accounting maneuvers, rewriting school funding laws, ignoring a growing population and delaying payments on bills coming due in 2013. It accomplishes, however, what the Republican majority wanted most: It did not raise taxes, took little from the Rainy Day Fund and shifted any future deficits onto the next Legislature….
Much of the overall savings came through cuts to university and state agency budgets, but the bulk of it came from accounting sleight-of-hand and putting off the biggest problems until lawmakers come back in 2013. At that point, lawmakers will be bound by the balanced budget law to tap the Rainy Day Fund to cover any existing deficit and House rules will require fewer votes to do it….
But all the deferred bills and payments will come due eventually, and the Republican victory in not tapping the $6.5 billion Rainy Day Fund is for this year only. Conservative lawmakers readily admit that one of the first things they’ll do when they come back in 2013 is tap that resource.
Perry’s handling of the budget appears to be all smoke and mirrors. He didn’t take bold steps like Governor Palin did when she reduced Alaska’s liabilities and SAVED surplus money instead of letting lawmakers spend it. As Whitney reported:
Governor Palin was a frugal budgeter as the Governor of Alaska. During her tenure, she cut spending 9.5% while also vetoing nearly half a billion dollars in spending. She did this during strong economic times. It should be noted that in addition to the traditional budget and capital budget that states are responsible for implementing, state governors are also responsible for managing their state debts and liabilities. These are often tied to bonds (both state and municipal) and state worker pensions […] Compared to all other candidates and potential candidates, Governor Palin increased the debt at a much slower rate and reduced total liabilities at a much higher rate than any of her fellow governors.
Governor Palin was and is a fiscal conservative. She went to great lengths to get Alaska’s financial house in order, while Perry used a national handouts and gimmicks to balance his state’s budget. By doing these things, Perry didn’t solve any problems, or address why his state has budgetary shortfalls in the first place. He simply kicked the can down the road, leaving these issues for others to contend with at a later date.
It appears Perry has also created some problems with the overall Texas debt. According to PolitiFact, he doubled it (emphasis):
“Debt has almost doubled in Austin under Gov. Perry,” White said. “They think you will not notice this!”
Game on. Is White right?…
Perry is one of four members on the Bond Review Board, which ultimately approves most state debt transactions. And over the years, we found, he was a leading advocate for expanding state debts to pay for transportation projects and to combat cancer.
It turns out that transportation is responsible for most of the added debt load under Perry, increasing from basically nothing in 2000 to $11.8 billion outstanding as of Aug. 31 2009. That’s because before 2001, the Texas Department of Transportation lacked the authority to borrow money to pay for road projects. Voters gave it that power in 2001 when they approved a constitutional amendment that Perry supported.
Addressing transportation in his 2001 state of the state speech, Perry said, “I would like for both chambers to pass a bonding program to jump-start construction across our state.”
In 2007, voters also passed a constitutional amendment to create and fund the Cancer Prevention and Research Institute of Texas with $3 billion in bonds over 10 years, starting in January 2010. Perry had championed the cause with cyclist and cancer survivor Lance Armstrong and others.
Where does that leave us?
It’s clear the amount of state debt has more than doubled since Perry became governor.
Perhaps the thing that stuck with me the most after looking through these aspects of Perry’s record is the difference between his words and his actions. On the very same day that he “railed” against government bailouts, he also took $6.4 billion federal tax-dollars to balance his own budget shortfall. Perry talks a good game about fiscal responsibility, but when you sit down and read through his actual record, it doesn’t exactly match his rhetoric. If Rick Perry says one thing and does another on state level, what makes us think he wouldn’t do it nationally?
Update: I realize that some of you have a problem with the fact that I used Politifact as a source. Perhaps you had good reason considering PolitiFact has been skewed in the past. Point taken.. However, please note that the report I posted by Whitney backs up what PolitiFact wrote. They reported that Perry “more than doubled” the Texas state debt during his tenure. In fact Perry tripled the Texas debt:
During the fiscal years for which Rick Perry exercised budgetary authority as Governor of Texas (FY02 through FY10)
• Debt outstanding increased 184.2%, or 20.5% per year
• Per capita debt outstanding increased 140.4%, or 15.6% per year
• Total liabilities increased 60.6%, or 6.7% per year
• Total liabilities per capita increased 35.8%, or 4.0% per year
So that’s a total debt increase of 184.2%.
The numbers come from reports published on the official State of Texas website: