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The Unsustainable Trajectory of State Spending

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There’s no question that state government spending growth over the last two decades has far outpaced the growth of traditional variables, like inflation, population, and economic growth in some instances, leading the Legislature to consider commensurate budgetary increases. This dissonance is what lies at the heart of Texas’ continued budgetary problems, and as time progresses the problem has only appeared to worsen.

As the Foundation has noted in previous research, from fiscal year 1990 through fiscal year 2012, state government spending has risen from $23 billion to $94.3 billion, an increase of 310 percent. By contrast, Texas’ population and general inflation increases over the same period are expected to grow by just a combined 132 percent. Had Texas’ constitutional Tax and Expenditure Limit (TEL) been applied to all areas of government spending instead a few select areas of the budget, the FY 2012 budget would have totaled a much smaller $53.2 billion—a difference of about $41 billion.

As the next legislative session draws near and lawmakers consider fiscally responsible ways to balance the state’s budget, the onus is on lawmakers to enact long-term policy changes, like broadening and strengthening the TEL, to slow the trajectory of government spending that we’ve seen over the last twenty years.