With Governor Patrick releasing his FY 2012
state budget today, I guess I need to write about the state of
the commonwealth, which I'd been trying since November not to
even think about.
I've been a Massachusetts taxpayer activist
since the mid-1970s. It seemed to me that if taxes were limited,
and tax hikes resisted, the politicians would have no choice but
to stop the expensively outrageous practices that made our
commonwealth uniquely dysfunctional, even within the normal
government paradigm that doesn't work real well anywhere.
There were battles won and battles lost, but
in the end, here we are, swimming in scandal and mismanagement,
facing yet another fiscal crisis.
But let's look at the bright side of
potential disaster. President Obama's chief of staff Rahm
Emanuel was criticized for saying, "You never want a serious
crisis to go to waste; and what I mean by that is an opportunity
to do things you think you could not do before."
He was referring to national concerns like
health care, energy, and fiscal, tax and regulatory problems.
It's probably better not to dwell on the Obama administration's
first two years, during which it tried to do things that really
shouldn't be done at all; but Emanuel's point is still
well-taken and applicable here in Massachusetts.
Government by its very nature — big and
unwieldy, with incentives having little to do with effective
management — isn't inclined to reform or improve itself unless
there's a crisis; and I've lived through two such crises here
that didn't go to waste.
The first was the crisis after fed-up voters
passed Prop. 2½ in 1980, dramatically cutting and/or limiting
property taxes for the next fiscal year. While some public
employee unions asked the courts to stop implementation,
Citizens for Limited Taxation, which had created the initiative
petition, joined forces with the Massachusetts Municipal
Association to lobby for more local aid from the state to cover
half the required cuts.
Feisty legislative Republicans soon collected
almost enough Democrat votes in the Massachusetts House to cut
the state budget and share freed-up state revenues with their
cities and towns. Then Senate Ways & Means Committee chairman
Chester Atkins took on the challenge and found the money to
"make Prop. 2½ work" until the communities themselves had time
to get their acts together.
New local aid became an annual tradition
until the next fiscal crisis, created when then-Gov. Michael
Dukakis ran for president in 1988 on "the Massachusetts Miracle"
— which was partly created by the improved economic climate
after property taxes were cut, and partly fabricated by the
Dukakis administration exaggerating state revenues and hiding
state bills. By the time Dukakis returned from the campaign
trail, the commonwealth was "the Massachusetts Mess" and once
again there was opportunity in crisis.
Unfortunately, the governor and Legislature
took the opportunity to panic and pass the biggest tax increase
in state history (until then). This of course only delayed
necessary reforms until a new governor was inaugurated: Bill
Weld's "no new taxes" pledge prevented further tax increases and
demanded a restructuring of state government instead. This was
when badly needed welfare reform was enacted with bipartisan
My experience states that, when push comes to
shove, and the taxpayers refuse to be pushovers, someone in
government steps forward to lead. In 1980, it was certain House
members and the Senate leadership; in 1990, it was the House
leadership working with Gov. Weld. This year, it might have been
new-Gov. Charlie Baker, but let's not dwell on that.
Pardon my habitual optimism, but without
having yet seen Gov. Patrick's initial budget, experience tells
me to expect some serious reform by the beginning of the new
fiscal year in July. Once again the Massachusetts Municipal
Association is lobbying hard; but since the current crisis is
actually cutting, not increasing, local aid, this time mayors
and selectmen are looking for the legislated tools to manage
their communities past union intransigence.
Voters last November at least added some
feisty new Republicans to the legislative mix. And both the
governor and the legislative leadership seem to recognize that
new taxes in this economy would be a bad idea, leaving only
reform as a viable option.
Across the country, public employee pension
and health insurance benefits have become unaffordable; there is
even discussion of allowing states to declare bankruptcy in
order to nullify union contracts. In this crisis environment, a
strong leader can get things done.
The Massachusetts legislative leadership is
as clueless as I've ever seen it, leaving great opportunity for
Gov. Patrick to lead the way. Coming from the private sector, he
hasn't seemed to fear the public employee unions as many
Democratic politicians do; with backup from municipal officials,
taxpayers, media and business leaders, and conservative think
tanks, he may yet get a grip on the problem.
Putting off fully funding liabilities until
2040 isn't leadership, of course; but the governor's proposed
pension reforms, and giving municipal officials the ability to
control their health insurance costs, are a beginning.
Our job as citizens is to keep saying "no new
taxes" until that beginning can turn a satisfactory start into
genuine, ongoing change.