Editor’s note: Jon Margolis is VTDigger’s political columnist.
One by one they came, advocates for Vermont’s least powerful – the poor, the frail, the elderly, the homeless, or some combination of all four – to tell the House Appropriations Committee Tuesday that the poor, the frail, the elderly, and the homeless needed just a little more money from the state.
Not one of them said anything about where that money could be found.
But why should they be any different? The entire political-governmental establishment of Vermont seems engaged in a conspiracy of silence these days, careful not to mention the lesson of simple arithmetic: There is no way for state government to continue to do what it has been doing unless it can somehow get more money.
The reason for the silence is obvious. If anything, there is likely to be less money from the federal government for fiscal year 2014. Economic growth is far too weak to envision the likelihood of a boom that will increase tax revenues.
Leaving one more source of revenue: The ineffable. The policy that dare not speak its name: higher taxes.
A handful of left-of-center legislators did speak its name a couple of weeks ago, actually proposing higher taxes on higher earners, a suggestion committee chairs and legislative leaders all but refused to recognize.
To say that it sank like a stone would be to understate the speed of its descent.
Again, the reason is obvious, though in this case there are two reasons. One is that elected officials never like to raise taxes because neither do many of their constituents. The other is that Gov. Peter Shumlin has been adamant in his opposition to any increase in “broad-based taxes.”
True, every once in awhile, a lawmaker will indicate some frustration with the present situation in a way which suggests he or she might be wondering what can be done without resorting to the unspeakable.
“They’re all worthwhile,” Rep. Ann Manwaring, a Wilmington Democrat who is on the Appropriations Committee, said of the pleas for more social service spending. “The trouble is, the only way to get more money for one of these programs is to take it from another.”
For the most part, in the context of the multi-billion-dollar state budget Shumlin has proposed, most of the advocates of the poor and sick were not asking for all that much money. A hundred thousand dollars here, fifty thousand dollars there.
But they aren’t going to get it all. For one thing, as was becoming clear elsewhere in the Statehouse Tuesday, the Shumlin administration has come nowhere close to convincing lawmakers to accept its plan to cut $17 million from the state’s earned income tax credit or to save another $6 million by putting a time limit on how long poor, single mothers can stay on welfare.
(Abolishing the credit would be, as a plain economic fact, an increase in the broad-based taxes paid by some low-income people, an apparent exception to the governor’s stated policy.)
Without those savings, the administration and the Legislature will have to find even more programs to cut or eliminate.
The problem remains, noted Appropriations Committee Chair Martha Heath, a Westford Democrat, that the state has “to fill the gap between expected revenue and proposed spending.”
While she didn’t say that she meant only the revenue expected from today’s tax code, that’s what she did mean. Asked if the state needed to think about raising more revenue, she said, “We’ll have to see.”
The state can always cut spending. It can reduce or even eliminate programs. No doubt some Vermonters would be pleased to see them go. But all those programs are there for a reason, all have a constituency, and some of them have already been cut so deeply that they can barely function.
As Martha Heath said, “this is the seventh straight year” Vermont has faced a budget crunch and has responded largely by cutting spending.
In 2007, state government had more than 8,000 employees, said Mark Mitchell, president of the Vermont State Employees Association. Now, though the state as a whole is larger and richer, its government is down to about 6,700 employees, he said, though that does not count a few hundred temporary workers now on the payroll.
Thanks to information technology, in many enterprises fewer employees can do just as much work, if not more. By and large, state government is not one of those enterprises. Increased productivity does not improve the performance of social services or environmental enforcement. As Peter Cobb of the Vermont Assembly of Home Health Agencies put it, “We have to have one nurse going to one house; we can’t have one nurse going to more than six houses.”
Besides, at some point, state budget cuts can run afoul of federal law. That’s what happened at the Economic Services Division of the Department for Children and Families, which determines eligibility for Food Stamps, or 3SquaresVT as it’s called in Vermont.
The division was so short-handed, Mitchell said, that it was providing food stamps to some who didn’t qualify for them and denying them to some who did. Eventually, federal officials levied fines against the state, he said, though the fines might be forgiven if the agency adds workers as the governor’s budget proposal.
The established wisdom in the Statehouse is that the “no-new-taxes” attitude will prevail, at least this year. But not even Peter Shumlin can defy arithmetic permanently. Absent an economic boom which produces a torrent of extra revenue or more money from Washington, not too long from now Vermont will have to choose either to switch to a government which does a lot less or raises some more money.
