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December 30, 2005 [LINK]

End-of-term spending spree

Gov. Mark Warner has proposed a $72 billion budget in Virginia for 2006-2008, a huge (20 percent) increase over the $60 billion 2004-2006 budget. If it seems that the popular, fresh-faced Governor is "spending like there's no tomorrow," there is a very good reason: He will be leaving office very shortly. The Augusta Free Press (link via Steve Kijak) notes the varied reactions of Valley area politicians and activists, ranging from sympathetic rationalization (State Sen. Emmett Hanger, R-Mount Solon) to mild indignation (Del. Steve Landes, R-Weyers Cave) to outrage (Phil Rodokanakis, the president of the Virginia Club for Growth. Hanger noted that the non-general fund budget (which includes entities such as public universities whose expenses are partly covered by fees) has been growing faster than the general fund in recent years. Some of the increase is not discretionary in nature, resulting from Federal (unfunded) mandates such as No Child Left Behind, and it wouldn't matter who was running the state government. Those factors cannot explain such a big increase, however. As in Washington, fiscal discipline in Richmond seems to be crumbling.

Since Warner is a lame duck, forbidden for running for reelection under the constitution of Virginia, there is no reason for him to refrain from dishing out all the goodies he can. Might this have something to do with pleasing key constituency groups as the entrepreneurial, Kennedyesque "New Democrat" prepares for the 2008 presidential campaign? After all, the tax hike of 2004 resulted in a big surplus in the state treasury, and one of the Prime Directives in the world of government is "use it or lose it." That's why I'm generally sympathetic to the tax-cutting cause, even though I cringe at the rigid dogmatism of some of those folks. I still say that if former Gov. Jim Gilmore had adjusted to economic conditions and delayed the scheduled car tax cuts in his final year in office, there would have been no budget crisis that led to the panicked overreaction in the 2004 tax hike. The fact that Governor-elect Tim Kaine is much more of a traditional tax-and-spend left-liberal than Mark Warner is means there will almost certainly be even more pressure on the state legislators to spend, spend, spend.

Posted (or last updated or commented upon): 30 Dec 2005, 11: 42 PM

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