A Democratic Governor Gets It, So Why Don’t We?

AS HOUSE BUDGET PROPOSAL BORROWS FROM MEDICAID AND ELSEWHERE, GOV. SANFORD POINTS TO DEMOCRATIC GOVERNOR WHO IS CUTTING SPENDING

Columbia, S.C. - March 5, 2008 - Saying that responsible spending and sound fiscal management shouldn’t be a partisan issue, Governor Mark Sanford today called on the House to look to the example of New Jersey’s Democratic Governor Jon Corzine - who has just proposed $2.7 billion in budget cuts for his state.

Last week, Corzine appeared on The Glenn Beck Show - a clip of which can be found at www.youtube.com/governorsanford - to discuss his “cold turkey therapy for [New Jersey’s] troubled spending addiction.” During the segment, Corzine called New Jersey’s longstanding practice of borrowing from one-time revenue sources to pay for new employees and programs “crazy.” In addition to spending cuts, Corzine is proposing limits on spending and borrowing.

“While Governor Corzine and I would see many things differently, I very much agree with him on the need to cut government spending rather than borrowing to sustain it when times get tough. This is what families and businesses do across our state and I don't think we should have a different standard for government,” Gov. Sanford said.

In contrast, the S.C. House Ways and Means Committee has proposed a budget that borrows from a number of places, including more than $100 million from an important Medicaid reserve fund. The House proposal would spend the majority of that money on non-Medicaid items, including on a variety of local projects. Meanwhile, the House budget protects the legislature’s pet projects fund - the Competitive Grants program - which the Committee left untouched with over $18 million.

“When times get tough, making cuts is what families and businesses do across our state and I don't think we should have a different standard for government,” Gov. Sanford said. “Sound budgeting doesn’t have to be a partisan issue. At the end of the day, it’s about a couple of simple principles that apply in the home just as they should in government: not spending one-time money to pay for ongoing needs and recognizing that cutting across the board doesn’t make sense because all spending isn’t created equally. When times are tough, you set priorities and you don’t treat the mortgage the same way you’d treat going to the movies.

“At some point the lesson needs to be either learned from what other states are doing or from our state’s own past experiences with robbing from Peter to pay Paul - because this peaks-and-valleys approach to budgeting doesn’t protect taxpayers, and doesn’t serve well the people who depend most on government.”

This year, state revenue growth is essentially flat, and the state is dealing with a $270 million budget hole created by budget writers paying for ongoing expenses with one-time money last year. The Committee’s proposed budget continues this unsustainable practice to the tune of $179 million in one-time money to pay for ongoing expenses, meaning that next year the state will face even more painful cuts.