From the Indianapolis Star:
An old saw, "The more things change, the more they stay the same," has renewed currency around the Statehouse these days.
A new governor delivered his first State of the State speech to a room full of first- and second-term legislators. In this speech Gov. Mike Pence argued that the state's ample budget surplus afforded an opportunity to further reduce taxes and still meet the desire to spend more on education, roads and Medicaid.
It's an echo of the last governor who succeeded someone from his own party, Democrat Frank O'Bannon, who had about $2 billion in reserve and a legislature clamoring for more money for important programs.
The results of the 1997 session and a subsequent recession wiped out those reserves in short order.
While we should heed the echo, it's worth considering the main question to arise from Pence's speech last week: Can Indiana afford a tax cut and more spending in key areas?
The answer, especially in light of some creative proposals floated last week, is yes.
Before departing, members of former Gov. Mitch Daniels' administration even published a, ahem, fiscal "roadmap" to do so. It's buried deep in the State Budget Agency's website, but the projections made by the departing administration closely resemble those used by Pence's people to construct their budget proposal (www.in.gov/sba/2604.htm).
These projections provide the rationale for implementing a tax cut and at the same time boosting funds for education, roads and several other areas, albeit at modest levels.
But if the economy doesn't reach the anemic growth forecast for it or, heaven forbid, re-enters recession, we'll likely close the loop on the O'Bannon echo and lawmakers will find themselves thinking about how to reduce budget deficits in 2015.
Given all the goofy legislation that's gotten attention so far this year, I am encouraged that those charged with fiscal policy are thoughtfully and creatively considering the state's best interests. Internally they're debating whether it's better to further reduce an already low tax burden or to spend more money in critical areas with an eye toward investing in the state's future.
This is a question of fundamental importance, the kind of philosophical debate we expect from grown-up elected officials. If they can avoid larding the budget with outside issues, Hoosiers will have a clear idea of our fiscal philosophy, which should help the state economy's recovery.
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See the full article here:
http://www.indystar.com/apps/pbcs.dll/article?AID=2013301280304
