PA Is in Free Fall. Where Are the Adults to Lead Us?
The Leadership Gap
Pennsylvania is in free fall. Where are the adults to pb us?
February. 17, 2016
Every year the investor oriented website 247wallst.com analyzes the best and worst managed states in terms of fiscal management and economical outcomes. The site notes discrete indicators including debt per capita, credit ratings, unemployment, median income and poverty levels.
Similar any alphabetize, it can exist challenged on methodology: which indicators are used, how qualitative information is considered, how various factors are weighted. Merely it gives a reasonable comparative impression of state economic performance.
Unlike Commerce Department press releases, the rankings do not push vanity metrics for marketing purposes. And different the chatter from politicians, the rankings do not blame or credit 1 political political party over another.
So how does the Keystone Land lucifer upwardly? In the most contempo ranking nosotros are 41 st of 50. More alarming, if you go back a few years (to the 2010 ranking) we were 21 st. We've dropped xx slots rapidly. We are losing basis in Pennsylvania.
The index slams us on pension fund liabilities, deficits, an inability to pass a budget, the absence of rainy mean solar day funds, and the potential for rating agency downgrades. Many of Pennsylvania'south economic development numbers—income, debt per capita, and unemployment—are heart of the pack. But we are brought downwardly by a public sector unable to handle its structural deficit.
The term "structural deficit" has been thrown effectually a lot during the recent budget impasse. The Governor warns of an impending $ii billion structural deficit that has been built on a history of budget tricks and i-off solutions. So what does he mean?
A structural arrears simply means that over a period of time, revenue does non come across expenses, regardless of changes in the business cycle. Structural deficits (versus cyclical deficits) occur even when the economic system is performing at its potential. Said differently, acquirement does not encompass expenses, given the current operating model.
How do yous deal with a structural deficit? Temporary fixes include borrowing money and selling assets, but only really help if additional steps are taken to address the longer-term problem. Borrowing and nugget liquidations buy time, but generally exercise not fix the structural result.
The longer-term solutions involve cutting costs or raising revenue. Cutting costs are difficult to exercise if the costs are mandated or contractual, such as pension fund obligations. But cut costs is still one way to solve structural challenges, including productivity gains through engineering, reorganization, and outsourcing.
The other manner to solve structural deficits is raising revenue through additional taxes and fees. The structural problem is solved if revenue is a recurring, equally opposed to a one-time, source to meet expenses.
The Pennsylvania budget impasse is not the cause of our fiscal decline, only its virtually visible symptom. Embedded within the impasse are different approaches to closing deficits and prioritizing spending, dissimilar approaches to the office of authorities, and flights from reality on both sides of the political aisle.
The Republicans believe we can cut our way out of structural deficits without considering new revenue enhancement revenue; they misunderstand the popularity of increased pedagogy investments at every level of schooling, and they are far too cozy to the shale industry for the new populist America.
The Democrats think the alimony fund mess will accept care of itself; they are happy to go on running a country liquor shop monopoly that is a ridiculous anachronism, and they believe the reply to every education trouble is more money, even as they continue to deride outcomes accountability like high school graduation standards.
Anger is fine in politics but it needs to be tied to strategy. If the fine art of politics involves relationship management, the State Capitol is in divorce court without an adult mediator.
Neither side is being fully transparent about the problem and potential solutions. About of the Republican pension fund changes do nothing in the short term to modify the budget math, for example. And the Governor'due south perspective on growing the overall budget at a vii percent rate is non simply nigh addressing a arrears. It reflects other priorities also. Nonetheless he is selling those priorities through the lens of addressing structural deficits.
I idea we would become a Land upkeep passed prior to the end of December 2015. I was incorrect. The Republicans in the House walked abroad from the then-called framework agreement and presented a $500 one thousand thousand smaller budget in its identify. That budget got vetoed and a temporary spending neb got passed to go on school districts and social service agencies from going under.
Now we are in month viii without a upkeep. And the prospects are non good. Last week the Governor presented a 2016-17 budget, although the 2015-16 budget has not passed.
To say Governor Wolf doubled down is an understatement. The budget address was part political lecture—telling Republican legislators to have their responsibleness seriously or get some other job— and function apocalyptic announcement: proclaiming the arrival of a arrears train wreck that will have cataclysmic consequences.
The speech communication fell flat. Fifty-fifty those who strongly support the Governor'due south upkeep worried well-nigh its tone and lack of strategy. Read the editorial lath reactions from effectually the Country from papers more often than not supportive of Wolf. Without in any way letting the Republicans off the hook, a adept many supporters are showing a niggling chip of buyer's remorse, or at to the lowest degree some buyer'south anxiety.
Anger is fine in politics but information technology needs to be tied to strategy. If the art of politics involves relationship management, the State Capitol is in divorce courtroom without an adult mediator.
Today the favorability ratings are lower for State legislators (15 percent) than for the Governor (33 percent) and more people arraign legislators for the impasse. Only that does not mean much. People ofttimes concord a legislature every bit a whole in depression esteem but notwithstanding support their ain representative. Moreover, Governor Wolf is the most visible leader and the burden remains with his office.
It is hard to know how the upkeep issue gets resolved and to what extent any of the resolutions address either the operating deficits or the longer-term and much deeper alimony fund liabilities. In the short term, if there is no movement on a compromise, the Republicans will push legislation to exempt schools and social service contractors from losing acquirement during a upkeep impasse. This would probable become some votes from Democrats equally well, particularly in the western side of the state.
Or the Republicans volition offer upwards their ain upkeep once again and Wolf will use a line item veto rather than a full upkeep veto: from there we would move back into boosted revenue and expense negotiations but at least schools, social services, and many other functions could gain a modicum of stability.
The disability to reach a budget compromise is one more stride into public sector free fall in Pennsylvania. Over the past year, the State's Attorney General was indicted and had her police force license revoked; our elected Treasurer pled guilty to extortion charges; and several Philadelphia legislators were driven from role when they accepted bribes in a sting operation.
Then there is porngate : the wearisome release of vulgar emails between land employees (including many in the judiciary), many of which are sexist, racist or homophobic. Nosotros take already had i suspended State Supreme Court Justice over the emails and other resignations from less prominent employees.
And through all this, information technology is hard to find prominent civic and political voices willing to take on the dysfunction in a bipartisan manner. In that location is no machinery or consistent voice to call out the problem. Instead we have become a democracy of political party hacks: left and correct, Republican and Democrat, unwilling to offering workable solutions, staying out of the game, and costing u.s.a. our economical future.
Header Photo: Flickr/Jim Bowen
Source: https://thephiladelphiacitizen.org/leadership-gap-harrisburg/
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