Monday, March 17, 2008

A Bleak State of the State

"Recession" is the label the U of A's Eller School slapped on the state of Arizona's economy a week or so ago. Last weekend, CNBC topped that by releasing the biggest three debtor states finding Arizona second only to infamous California. At 1.2 billion bucks and rising, Arizona's deficit beat out New Jersey for the number three slot.

Second and third place finishers have something in common—they both have Democrat governors. The big difference is that New Jersey's governor is talking about cuts in spending while Arizona's Janet still champions big dollar projects such as light rail as if there were no tomorrow.

Recession, big taxpayer debt, big government spending... It's all getting too familiar and close to home for Arizona voters to tolerate. More than likely, voters will drive a reversal in Democrat fortunes in state races this year with Republicans taking back more than a couple of seats lost in '06.


Anonymous said...

Ditto for George W. Bush. Recession + big tax cuts + big spending = big deficit passed onto our kids to deal with.

How many trillion have been added to the federal debt over the past eight years?

Gretchen [I don't know how to sign on with my name.]

GOP Boomer Gal said...

The tax cuts did not decrease the tax revenues collected.

The problem was the profligate spending on unnecessary and wasteful programs and earmarks.Both parties are guilty in that regard.

Sirocco said...

"The tax cuts did not decrease the tax revenues collected."

This is manifestly untrue.

Now, the tax revenues did _eventually_ grow back to their previous level, but that's a by-product of natural economic growth.

Anonymous said...

I would like to connect Sirocco's dots just a bit more. There is no question that govt. has a ton to do with economic growth with respect to infrastructure, an educated workforce, and helping to stimulate an economy. Low tax cuts only are a teeny tiny portion of the growth equation...its a gamble. If the economy hums we get revenue with growth...but if the growth doesnt come...and the economy goes sour...we are left with no money to pay for our programs. That is just not fiscally responsible.

Some argue in an appalling way that we need to cut taxes more...and cut spending even more because of the downturn...again rolling the dice that economic growth will occur and we can spend a bit more before cutting it again in the next downturn.

No corporation would live or work this way. It would be insolvent. We need revenue...not just cuts. Gambling wont cut it anymore. And there is great reason to believe that the lack of spending on our state institutions makes them far less able to do the things needed to attract the growth and companies that we bet on moving here.

What our state faces is that we have cut taxes and have tried to cut programs as well...or at least some of them. We are behind in spending on all the things that our competitor states are doing to attract industry and create growth.

Our legislature has done its level best to both cut taxes and spending on the very items that contribute to growth. We are left with an irresponsible financial state where we only do well if the economy is humming...we get just enough revenues to pull us back some from the last downturn...before another downturn wrecks us again.

I know some hate government, but you must realize that without it, we will lose on economic growth over and over again.