“The comptroller’s revenue estimate makes clear what we have suspected for several months: while Texas has positioned itself better than just about any other state, we will not be immune to the effects from this national recession.
“The Texas Legislature needs to demonstrate leadership this year by pruning state spending now. Already, there are calls by some groups to expand entitlement programs and raise taxes, but Texas must not follow the examples of other states that have wrecked their economies by letting their budgets spiral out of control. Restraining our spending now will give us more options in the event that this national recession is prolonged.
“In 2001, the legislature convened with a $6 billion surplus and the knowledge that the state’s economy was slowing. Instead of showing fiscal restraint, the legislature increased the state’s budget by 16 percent – an increase that absorbed the entire surplus. Even worse, much of the new spending went toward new programs that would become even more costly in the next budget cycle.
“Two years later, the legislature returned to a $10 billion budget deficit. The irresponsible budget adopted in 2001 forced the 2003 Texas Legislature to make deeper, across-the-board spending cuts than would have been the case had it started off with both a smaller budget hole and some cash reserves to help cover it.”
The Honorable Talmadge Heflin is Director of the Center for Fiscal Policy at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin. Heflin served 11 terms in the Texas House of Representatives and chaired the House Appropriations Committee in 2003, leading the Texas Legislature’s successful efforts to close a $10 billion budget deficit without a tax increase.
The Texas Public Policy Foundation is a non-profit, free-market research institute based in Austin. More information can be found on the Foundation’s website, www.TexasPolicy.com.
– 30 –