This article originally appeared in the Austin American-Statesman on 5/19/2013.
Conservatives have encountered a lot of turbulence during the current legislative session. Many of the expectations we began with in January have been grounded. There have been some victories, though, and with one week left in the session, there is hope for more. Here’s a brief look at what conservatives should focus on during the last week of legislative debate.
One of the top priorities conservatives had heading into session was to keep Texas from joining in the expansion of Medicaid under ObamaCare. Texas has faced the opposite problem of states such as Florida and Ohio, where governors were pushing for expansion against reluctant legislatures.
In Texas, Gov. Rick Perry has stood firm despite some legislators seeking to grow government by pulling down more federal dollars. For instance, a bill opening the way for expansion died in the House of Representatives. But this hasn’t stopped efforts to expand.
Senate and House budget conferees are trying to keep expansion alive with a rider attached to the Senate Bill 1, the general budget for the state.
Though couched in the language of a restriction, the rider includes a set of “principles” meant to guide the state toward expansion; its provisions are all allowable through waiver or state plan amendment under current Medicaid law.
If this is included in Senate Bill 1, it will be difficult to stop. The only way for members to do so would be to defeat the entire budget. However, it could face a gubernatorial line item veto after session. With the strong stance Perry has taken on this issue, one could reasonably expect that Texas will be one of the many states that reject expansion of this costly and ineffective program.
Holding the line on spending is also a conservative priority this session. The results here haven’t been as positive.
Though the state currently has a spending cap that limits increased spending in certain areas to the growth in Texan’s personal income, the Texas Public Policy Foundation has long favored limiting the growth of all non-federal state spending to the rate of inflation and population. As of this writing, an amendment added to a House bill that would put this limitation in statute is still in play. Such a provision would protect Texas taxpayers from excessive growth in government.
There is a possibility that spending may come in under the current limitation; legislators seem reluctant to take the politically difficult vote to” bust” the spending cap.
Nevertheless, there is a move afoot to raid money for additional spending from the state’s saving account, the Economic Stabilization Fund – popularly known as the Rainy Day Fund . The amount will likely be at least $2 billion — maybe more — to increase spending on water, and perhaps transportation and education. If this happens, spending will certainly exceed the spending cap.
To get around this problem without having to take responsibility, legislators may well punt this issue to the voters by creating a new fund through Senate Joint Resolution 1. If voters approve this new fund through a constitutional amendment this November, money could be transferred from the ESF to the fund, bypassing the state’s spending limit.
The results for taxpayers would be the same. Higher spending, less savings, and increased pressure to raise taxes when future revenues can’t keep up with the excessive spending. Stay tuned.
Instead of spending more of our money, the Legislature should be focused on tax relief.
The Texas economy is doing better than most. The problem is that we are caught in the ongoing economic malaise created by the runaway growth of government in Washington, D.C. The only way to inoculate Texas against the consequences of this is by letting Texans keep their own money so they can invest it to keep the Texas economy growing.
Perry has repeatedly said that legislators will be in for a long, hot summer of special sessions unless they come up with $1.8 billion of tax relief. So far, they are nowhere close.
This could be easily achieved through a permanent reduction in either the state’s margin tax or sales tax. A bill to provide margin tax relief is being considered in the Senate this week, while a ¼-cent reduction in the sales tax would yield about $2.2 billion in tax relief for Texas citizens.
Keeping Medicaid in check, protecting the Economic Stabilization Fund, and providing significant tax relief would result in a pretty good, though not perfect, session. All are still achievable.
Conservatives — and taxpayers — will know pretty soon how they have fared.