I saw this story about Gov. Scott Walker borrowing a billion dollars to avoid a tax increase first at the Democurmudgeon.
It is in that context of borrowing "to avoid a tax increase" that really popped my memory from a few months ago when Walker gloated how the state will finish with a $342 million surplus resulting however from a budget that required $558 million in borrowed money.
But this latest mathematical narrative about borrowing a billion is even more spectacularly insane if you consider that Walker is borrowing while claiming the general fund is awash in enough revenue that it can afford a $343 million state income tax cut. Where's the rationality? Well, there is only one possible explanation.
To recap, in the last biennium Walker borrowed $558M, kept $342M and called it a surplus. To be fair, it should be noted that in January the $342M surplus has been upgraded to $484M, but keep in mind both the amount of borrowing and the polarizing class war budget act Walker imposed on the state just to reach that one-time surplus.
As one political blogger recently termed Walker's Act 10 budget fiasco a "one-trick pony," the effects from it are one and done. It's also beside the point but worth noting that the $484M "surplus" (borrowed money) is a moving projection from which Walker took $109M from and added to the state's so-called "rainy day" fund.
OK. Now we enter into the next biennium and this time Walker wants to borrow $1 billion to shore up the state's sagging transportation fund. Oddly, there appears to be some resistance to the borrowing.
JS Online Excerpt:
Members of the Legislature's Joint Finance Committee had raised concerns about the borrowing in Walker's budget. "I'm not comfortable with the level of bonding," Rep. Dale Kooyenga (R-Brookfield) said. "It's inconsistent with the message I ran on and the majority of this body ran on."
Is that so?
Well Hello Rep. Kooyenga. Do you recall signing the Grover Norquist tax pledge? You know you did. That means just like Gov. Scott Walker, you took a vow to never raise taxes on individuals or corporate profits under any circumstances, even if the alternative means borrowing massive amounts on the grand kids credit card. Got it?
Not surprisingly, this new borrowing proposal comes less than two months after Walker and leaders in the state Assembly, Vos (R-Rochester) and Suder (R-Abbotsford) shot down tax and fee recommendations from a bipartisan transportation committee meant to shore up the state's transportation fund. Yet at the same time, Walker is proposing a $343M state income tax cut?? It doesn't add up and it doesn't make sense until ...until we realize that Scott Walker, Vos and Suder also signed the Norquist pledge. That's why they rejected the committee's proposals outright. They had to.
On the messaging side, Scott Walker desperately wants that $343M income tax cut talking point for his campaign even if he has to borrow twice the money to do it - which by the way he practically does!
Here's a simple perspective on what just happened. When Walker increased state spending in the last budget, what was Norquist's response? Nothing. When Walker again proposes increasing state spending by $3B for the next biennium, again what did Norquist say? Not a word. Dead silence. But when a state legislator proposed a tonnage tax on extracted state natural resources, Norquist immediately injected himself into Wisconsin politics and warned pledge signers the tonnage tax would be in violation of their oath. Walker of course was one of the first to bow to Lord Norquist and reject the idea.
Now Walker wants another billion to maintain state roads and instead of raising the revenue through progressive tax mechanisms, he proposes borrowing the money. And from Norquist? ...crickets. See, Norquist's pledge was never about spending because spending is inevitable. The pledge is not about stopping (over)spending money we don't have AND it was never about preventing borrowing. Never was. It's all about preventing progressive taxation to raise the revenue necessary to avoid mounting debt. Again, government spending is inevitable. It's gonna' happen even under the best of circumstances and best of intentions. Therefore, signing the Norquist pledge is a promise to ensure that government fails to meet its fiscal obligations regardless of intentions. It's a guarantee to make sure government doesn't work. Period.
Hey everyone. See? Government is in debt, it can't pay its bills and it doesn't work. It's all government's fault. It's a failure.
I don't blame Grover Norquist for this as he is merely one man with a crazy idea. I do blame every D.C. congressional, state governor and legislator who were too cowardly to raise the revenue necessary to pay the bills and instead signed a pledge to one man who would rather jeopardize our state and nation's future by building an unsustainable mountain of debt that is sure to collapse on all of us.
Our nation's $17 trillion debt did not have to be that way. The same goes with Walker's billion dollar debt proposal. It's not the spending. It never was. It's the borrowing stupid.