Friday, June 22, 2007

The Art Of The Deal: Dems, Repubs And The Budget

A state budget soon will be reported out of the legislature – a little late, say some – and it will be yet another “let’s make a deal” budget.

Here in Connecticut, it is virtually impossible to get folks focused on state budgets. Town budgets are a different animal, largely because municipal tax payers are occasionally given the opportunity through referendums to vote budgets up or down, a rare concession in Connecticut politics to direct democracy.

There is no state budget referendum, which means that final decisions on budgets are left to duly elected legislators -- the deal makers. If the public does not like the budget, it is assumed it will vote out of office the deal makers who, so far, have conspired to raise the bottom line of the state’s budget from a modest pre-income tax budget of $8 or $9 billion – the figures are rounded and near accurate; what’s a billion or two among friends – to about $18 billion today.

Now, we know for certain, through casual conversations over beer and pizza and through the results of multiple town referendums, that generally people are edgy about tax and spending increases. “I’d like to be sure,” said a spry but elderly lady who had just voted down a third unacceptably high Vernon town budget, “that the teachers are not going to use the increases in the budget to pay for a Florida vacation or a second house.” The lady went on to explain that she was on a fixed income and could not afford more tax increases. She was, so to speak, at the end of her rope. And glistening in her eye was the fervent hope that, before she reached the poor house, she would see dangling at the end of her rope the architects of her despair.

Well now, even the most icy-hearted and isolated legislator, listening to this discourse, would reason to himself, “Here we have a problem. Let’s do something.”

This year, Democrats in the legislature had hoped to relieve the lady’s distress – without reducing net spending or taxes – by adding a progressive feature to the state income tax that would take more money from the wealthy in Connecticut, always inured to the pain of the little people, while allowing the protesting lady to retain more of her fixed income.

Sure, spending and taxes and the bottom line of he state budget would have gone up had the Democrat plan been implemented. However, not you or me “but the guy behind the tree,” in Huey Long’s immortal phrase, would have borne the burden of paying for increasing services.

Both Democrats and Republicans wanted to spread the joy because bread and circuses have, since the good old days of Caligula, soothed the people while permitting their overseers – disguised in representative democracies as “servants of the people” -- to get away, quite literally, with murder.

Even in Democratic Greece, Pericles was swept into power, and kept there, by a super majority he carefully caressed. Aristole says that Pericles dished his more wealthy opponents by distributing public moneys, “and in a short time, having bought the people over, what with moneys allowed for shows and for services on juries, and with other forms of pay and largess, he made use of (the people) over the Council of Areopagus.”

The more things change, the French say, the more they remain the same.

In the end, both Greece and Rome fell because of imprudent demagogues: The money coming in – especially when the outer edges of the empire began to collapse – could not pay for the promises going out. In the name of the people, demagogues always bite off more than they can chew.

This year, promises came fast and heavy from state Democrats. They would provide bread to the people -- and not a few three ring circuses -- but payments would come from Connecticut’s wealthy class, not all of whom had yet changed their primary residences from Connecticut to a more welcoming state, like Florida for instance. The people could gorge themselves to their heart’s content on services they did not have to pay for, said the new demagogues. The tribunes of the people, naturally, lapped up this milk like cats with two stomachs.

The Republicans did not meet this devilish temptation head on and say unambiguously, “Look, we believe that everyone should bear an equal burden in taxes because no other measure will effectively control spending, and spending is the problem we must attack if our state is to remain prosperous.” That would have taken a degree of courage the average moderate politician in the state does not possess.

Some Republicans, however, did notice that the state was running an obscene surplus. The state has run surpluses every year since the imposition of the not quite flat income tax. This year, bucking their governor, some Republicans called attention to the surplus and questioned the need for new revenue enhancements, which effectively killed Democrat plans for a more progressive income tax.

The bread and circus crowd will have to wait their chance until next time. Assuming the Republic does not fail, there will always be a next time.
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