New Math vs. Old Math vs. Government Math

(Chuck Muth) – I’m pretty bad at math, but let me take a crack at the numbers put out on Wednesday by the state’s Economic Forum.

According their crystal ball, Nevada’s government will have $5.3 billion worth of revenue to spend the next biennium. Our state government is currently costing us around $6.4 billion. Which means Nevada’s overspending problem is $1.1 billion, not the much ballyhooed $3 billion.

But let’s consider why we still even have this $1.1 billion overspending deficit in the first place.

It’s because the 2009 Legislature increased spending over and above what Gov. Jim Gibbons had proposed in his original budget, and used “temporary” tax hikes and federal stimulus money to cover it and avoid making any serious cuts.

Had the Legislature made the necessary and long-overdue cuts to non-essential government two years ago instead of kicking the can down the road by raising taxes and foolishly spending one-time stimulus money on ongoing government programs, we’d actually be looking at a budget SURPLUS this year!

That’s right. Gov. Gibbons’ original budget presented in January 2009 was around $6.2 billion – including a $300 million room tax hike. If the governor had cut $300 million instead of increasing taxes by $300 million, he proposed budget would have been $5.9 billion.

Now if the governor and the Legislature had taken that $5.9 billion figure and cut spending by an additional $800 million instead of raising taxes an additional $800 million….we’d be looking at a $200 million budget surplus right now instead of $1.1 billion over-spending deficit.

Of course, the powers-that-be will try to cloud this simple, old-fashioned math by tossing around “roll up costs” and “federal mandates” and such, but the inescapable fact remains that the 2009 Legislature could have and should have made the same kinds of serious, and often painful, cuts to state government the way most businesses in the private sector started doing in 2008.

And had the Legislature taken its fiscal medicine two years ago we wouldn’t be needing triage this year. If the 2011 Legislature is facing budget Armageddon, it has only the 2009 Legislature to blame.

That’s just how it adds up, no matter what mathematical formula you use.