MUTH’S TRUTHS

One speech and 22 days does not a governor make. And the political reality is that Democrats control one house of the Nevada Legislature.

That being said, and at the risk of once again being labeled a “bad Republican” (so what else is new?), while Gov. Jim Gibbons’ still may go down in history as a fiscally conservative governor - especially if he gets a Republican-majority Assembly to work with in 2009 - his proposed 2007 budget, along with his first state-of-the-state address, sure won’t have fiscal conservatives doing the Snoopy dance in their living rooms.

A look at the good, the bad…and the ugly.

EDUCATION REFORM

The “good” appears to be an education plan called “Empowerment,” in which “Parents will be empowered with school choice for their children, while principals and teachers will be able to decide at the individual school level how best and most effectively to teach their own unique population of students.” Gov. Gibbons proposes “redirecting” $60 million to test the program in 100 schools throughout the state.

A strong component of the program, for which details remain sketchy, is merit pay for some teachers. Which, naturally, means the teachers union will oppose the program no matter how much it might improve education. In their minds, merit pay for exceptional teachers is a non-starter. If the mediocre teacher, the lousy teacher, the school secretary and the janitor don’t all get additional “merit” pay, fuggetaboutit.

That being said, any school reform opposed by the teachers union probably has something going for it. Alas, while the notion of greater local autonomy for school personnel on spending and teaching decisions is a step in the right direction, I’ve yet to hear how this program empowers parents with “school choice.” Parents will still have no choice but to send their kids to a government-run school within the public school system.

The jury’s still out on this “empowerment” concept, but at first blush it appears akin to changing the oil and putting four new tires on a rusted-out ‘63 Chevy; while it might run a little better, the car is still an old piece of junk.

Universal school choice and vouchers, where the money follows the student, to be used in any school, public, parochial or private…just like the GI Bill…THAT’S true empowerment.

HAS ANYONE SEEN MY MEAT CLEAVER?

Now let’s look at the budget.

The good news is the government has a surplus of money left over, due in no small part to the massive tax increase of 2003.

The bad news is that Gov. Gibbons has already spent it all…and there is no planned rebate to taxpayers along the lines of the Guinn/Beers $300 million rebate of 2005.

And it goes downhill from there.

The governor’s state-of-the-state address presented Nevadans with a rather extensive laundry list of new spending and new programs - the Nevada National Guard Youth Challenge; the Nevada Four Core Public Safety Radio Network; ten new public safety officers to fight meth; housing support for teachers and nurses; more money for the Guinn Millennium Scholarships; enhanced school security; University of Nevada Health Sciences Center; highway message signs and closed-circuit TV cameras; higher Medicaid physician payments; additional hospital beds; a “dynamic new economic development program;” etc. - which seems to contradict the governor’s call for “a new kind of government…that is leaner.”

Not once in the entire speech did I hear the words “cut” or “offset” when it came to government spending or programs. Not once.

This is particularly curious considering then-Rep. Jim Gibbons’ budgetary statements in 2003. “You have to justify to me why we haven’t looked at programs that need to be cut,” Mr. Gibbons said of Gov. Guinn’s huge tax hike proposal that year. He questioned, for example, why the state maintained its own paving operation and why the government was buying some state vehicles instead of renting them from Hertz or Avis.

So the question here for fiscal conservatives is obvious: If Mr. Gibbons called for substantial cuts in government spending four years ago as an alternative to the tax hike, why didn’t he propose cutting those same programs he said four years ago needed to be cut now that he’s sitting in the chief executive’s chair? Forget “Where’s the beef?” Where’s the cuts?

Instead, we got calls for new spending in “vital areas” - such as a children’s museum in Reno which was described as a “critical Nevada asset.”

Now, as a father of three young kids, I LOVE children’s museums. I’ve taken my kids to them all over the country. But to call them “vital” and “critical” to Nevada’s well-being is absurd. After all, if such children’s museums are “vital” and “critical,” then why not fund and build them in Elko, Pahrump, Ely, Fallon, Winnemucca, Hawthorne and Tonopah?

MORE BUDGET BLUES

Back to the overall budget…

To boil this down to the simplest of terms, the taxpayers are the “boss” and the government is the “worker.” The boss pays the worker a salary, called the budget. Now if I’m reading the governor’s proposed budget figures correctly, the he’s calling on the “boss” (taxpayers) give the “worker” (the government) a hefty 18 percent pay raise - significantly higher than the rate of population growth plus inflation over the last biennium.

How many of you got an 18 percent pay raise this year?

Again, if I’m reading the governor’s proposed General Fund Operating Appropriations budget correctly, it appears the cost of government over the next two years is going to skyrocket by over a BILLION dollars. That’s “billion” with a capital “B.”

In his speech, the governor said: “We simply cannot run the government the same way we’ve been doing it.” Yet that’s exactly what his budget appears to do. Government will continue to grow, grow, grow and spend, spend, spend.

Back in a speech before the Nevada Legislature in 2003, then-Rep. Gibbons told legislators that as “stewards of the precious tax dollars,” they needed to make “very difficult decisions.” That, he said, “is why many of you chose to run for office, to make the tough decisions. I know I did.” Gibbons added, “Quite simply, you cannot demand the taxpayers to discipline themselves…if the same has not already been completely and thoroughly demanded by government.”

We agreed with those sentiments back then - though Republican legislators apparently didn’t - and we agree with them today. However, Gov. Gibbons’ proposed $7 billion budget simply doesn’t appear to have made any “tough decisions” in the ol’ spending department. A budget which exceeds even the overly-generous spending cap of population growth plus inflation isn’t my idea of completely and thoroughly demanding spending discipline.

READ HIS LIPS

Here’s some good news…

On taxes, Gov. Gibbons continues to stand by his “no new taxes” pledge - though it was easier to swear off tax hikes this year thanks to the monster tax hike of 2003. The problem, though, is that if spending continues to grow, grow, grow like it did in 2005, and is proposed to do in 2007, that “no new taxes” pledge is going to become extremely difficult to keep without some serious budget cuts in 2009.

Nevertheless, the governor did propose a couple of minor tax cuts - a small reduction in the payroll tax and elimination of the per-branch excise tax on banks; a combined cut of about $33 million. And while that’s barely a drop in a $7 billion budget bucket, Gibbons speechwriter Greg Ferraro rightly pointed out that it was better than a $34 million tax HIKE.

No argument there. However…

Four years ago, then-Rep. Gibbons was very critical of the $833 million tax hike, suggesting in no uncertain terms that it wasn’t needed. “Now, more than ever, we must carefully determine where we draw the line between balancing a government program’s checkbook against the taxpayer’s checkbook” Mr. Gibbons said in his speech before the Nevada Legislature. “As families all across Nevada realize, you base your spending on how much you earn; you don’t base your earnings on how much you want to spend.”

So a legitimate question to ask here is this: If, as Gov. Gibbons contended four years ago, the $833 million tax hike wasn’t necessary, then why isn’t he now proposing to cut taxes by $833 million instead of just $34 million? If the additional revenue wasn’t needed then, it shouldn’t be needed now, right? Cut taxes back by $833 million…and then base the budget on the money you’re given, not on what you want to spend, right?

There goes my invitation to the Governor’s Christmas party.

MISCELLANEOUS OBSERVATIONS

* For all the talk of new programs and new spending without any new tax increases, there was one glaring issue missing from the governor’s speech: Illegal immigration. Considering what a prominent issue that was in the governor’s and many other races last year, that it didn’t even merit an honorable mention in the state-of-the-state was an interesting omission.

* The governor is proposing putting an additional $5.6 million into the Guinn Millennium Scholarships. Why? When these scholarships were set up eight years ago, it was understood that the program would be funded ENTIRELY by the tobacco settlement money. If the money isn’t there from the tobacco settlement, then we need to look at perhaps means testing the program, raising the qualification standards, or limiting the scholarships to specific areas of study, as Gov. Gibbons suggested, which fulfill a particular need in Nevada, such as nursing and teaching. It cannot and should not become a taxpayer-funded entitlement.

* While Gov. Gibbons affirmed his support for protecting private property from being confiscated by the government for the purpose of giving it to another private entity or individual for the purpose of boosting tax revenues for the government, he basically called for the repeal of a ballot measure on just that issue which the people themselves approved just last November. It seems the governor is asking the Legislature to draft a competing version of Question 2 for the 2008 ballot, a move which will inevitably result in the same kind of voter confusion the two separate smoking ban proposals caused on last year’s ballot. I’m not sure poking the voters in the eye like this is a wise political move - but the local government bureaucrats are sure gonna love it!

* It’s hard to argue with the fight against methamphetamine; however, to call it the “the colossal struggle of our times” sounds a little Reefer Madness-ish to me. The fact is, before meth the colossal struggle of our times was crack. Before that, coke. Before that heroin. Before that, speed. Before that, hash and flakes. Before that… You get the point. Drug abuse is a serious problem, but colossal struggle of our times?

* The governor has rightly nixed the idea of expanding full-day day care…er, I’m sorry, full-day kindergarten statewide, saying he wanted to utilize “the next 24 months to assess its benefits.” However, here’s the problem: “If the results are positive,” the governor said, “we will pursue it next session.” I GUARANTEE the teachers unions, the school bureaucrats and the Democrats will show positive results…EVEN IF THEY HAVE TO MAKE THEM UP. Instead of shutting this door on this proposal of dubious merit, Gov. Gibbons left it wide open.

* Referring to a Las Vegas school shooting just a couple weeks ago, the governor said, “I will work with the Legislature to increase funding for school security throughout the state.” Curiously, he didn’t mention Sen. Bob Beers’ cost-free proposal to increase school security statewide by allowing properly trained teachers to pack heat in the classroom.

* The governor announced that he was “providing $110 million for the University of Nevada Health Sciences System.” That’s the program that former Democrat congressional candidate Tessa Hafen was hired to lobby for. I guess I was wrong about hiring her. Apparently she’s already done one hell of a job! Mission accomplished.

* The governor acknowledged the need for a lot of new highway construction, but said he “will not support raising the gas tax” to pay for it. And that’s a good thing. But if the governor REALLY wants to get more bang for our highway construction bucks, he ought to push for the elimination of union-only project labor agreements and the cost-inflating prevailing wage law. Allow non-union construction companies paying market labor rates to compete for highway projects. That’ll allow us to build and repair miles of additional roads for the same money.

* The governor talked about various matters relating to the cost of health care, but if he really wants to try something bold and exciting to bring down health insurance premiums, he might take a look at a free-market proposal from one of his former congressional colleagues. Rep. John Shadegg (R-Arizona) is pushing to allow the residents of one state to buy an approved health insurance policy from another state. This would spur competition and dampen the never-ending calls by elected officials to heap new “mandates” on insurance policies. Nevada need not wait for federal action on such a reform; we could, instead, lead the nation on it.

* The governor’s calls for earlier and more frequent reporting of campaign contribution and expense reports is right on the money. However, the best campaign finance reform measure would be to remove all contribution caps and require immediate reporting of all donations on the Internet within 24 hours. Current contribution limits are limiting the number of people who can successfully run for office to the personally wealthy and the politically well-connected. That’s not healthy and needs to change.

Overall, there just wasn’t very much in this speech to get this conservative very excited. Then again, it’s early…and there is the reality of Democrat control of the Assembly. But I’d have preferred if the governor had at least put forward some meat behind his admonition that “We simply cannot run the government the same way we’ve been doing it.”

One final note: The most meaningful part of the state-of-the-state address, for me, was Gov. Gibbons recognizing Tina Cline and her two young sons, Dillon and Dakota. Tina lost her husband, and Dillon and Dakota lost their dad, Marine Lance Corporal Donald J. Cline, in Iraq. It’s because of Americans like Lance Corporal Cline that people like me can criticize our government and public officials without fear of being hanged at the gallows for it.

For that, I am eternally grateful.

Posted on January 23rd, 2007 by Chuck Muth
Filed under: Nevada