The Boston Globe (circulation: 219,214)
Patrick’s shell game with the budget
Governor is pushing today’s responsibilities onto future generations
By Jim Stergios, Executive Director, Pioneer Institute
February 15, 2012
WITH HOUSE Speaker Robert DeLeo announcing his new no-tax pledge last week, we begin the age-old dance of state budget negotiations. Governor 
Deval Patrick has already announced his budget, which includes new taxes and a hefty year-to-year increase. So where does that leave us?
A top-line read of recent annual budgets suggests that Patrick-era budgets have not increased at a rate dramatically higher than under other governors. In certain years, with the revenue constraints of the recession, the increases were small.
Outwardly, the budgets seem distinct from the tenor of Patrick’s early first-term raft of multibillion-dollar proposals, such as free community college tuition and a significant rise in the gas tax.
Where the governor has disappointed is in how we contained state budget spending. Coming into office, Governor Patrick heralded a new approach - the promise of long-term thinking and a repudiation of “quick fixes, gimmicks, and sound bites.’’
A look beneath the top-line numbers tells a different story.
Rather than making cuts to state programs, the state bureaucracy protected itself through the recession, instead preferring to level the budget axe on local governments. Adjusted for inflation, aid to local communities fell by 36 percent during the governor’s first term.
Education did not evade the chopping block. One year the state failed to fund schools at “foundation’’ level - the minimum amount, as determined by formula, needed to provide an adequate education. It was the first time it had occurred since passage of the landmark 1993 Education Reform Act. The governor has called for a $145 million increase in state education aid this year, and it’s about time.
These cuts in state aid to local governments and schools have given state government room to grow even during a painful recession. So has the governor’s reneging on his promise to think long-term; to the contrary, he has kept the state from making hard program cuts by pushing today’s responsibilities onto future generations.
This type of shell game should bring the ire of budget watchdogs, yet the Massachusetts Taxpayers Foundation lauded Patrick last year for his near elimination of the structural deficit.
The fact is that the Bay State addressed its billion-dollar-plus structural deficit by pushing off the repayment date for the state’s $18.6 billion unfunded pension liability. In essence, we “refinanced’’ our pension debt by deciding that we will not repay the liability by 2025, instead electing to pay it off 15 years later, by 2040.
Worse, the pension refinancing scheme killed the tacit agreement among legislators to pay out the pension liability by 2025 so we could begin paying down our other unfunded multibillion-dollar liability - the state’s $15.6 billion liability for health care coverage for retired state employees.
If you acted similarly with your home mortgage, you’d end up paying lots more interest on your principal. And you’d increase the risk of losing your house by playing such a fiscal shell game.
The state will now pay billions of extra dollars in the future on the pension liability. That is an unfair burden to place on future generations, just so we can continue spending now.
And spend the state bureaucracy did. Despite the governor’s claims to the contrary, state headcount, based on third-party sources, has grown. The Census shows an increase of 4,365 state jobs from 2006 to 2010. A Bureau of Labor Statistics survey shows an increase of more than 7,500 jobs from January 2007 to June 2011. It’s hard to view the governor’s State of the State pledge to cut 400 positions as a credible source of savings.
Now that an end to the recession is in sight and there are few options to push other liabilities onto future generations, the governor has once again begun proposing significant increases in state government budgets. His budget blueprint of $32.3 billion constitutes a 5.6 percent increase over last year.
Where does that leave us? In some ways that’s the wrong question. The right question is: Where does it leave future generations?
Jim Stergios is executive director of the Pioneer Institute.