Ralston Math

Patrick Gibbons

Ralston Math is kind of like New Math, it doesn't have to make sense but you get an A for effort.

In the second phase of Ralston's missive, Ostriches are isolated, he criticizes NPRI's math with some pretty bogus reasoning.  On at least three occasions Jon Ralston has claimed that Nevada currently faces a $2.5 billion shortfall. Ironically, it's a claim only he has made. In early December NPRI emailed Mr. Ralston and asked him to explain his math. On December 9th he responded,

"Closer to 2.3, probably. To get to levels approved by 2007 legislature – no increases in services – is 8 bil. Eco Forum is 5.65."

This is simply nonsense. The legislature approved $6.8 billion from the general fund in 2007, not $8 billion. As we explained to Mr. Ralston, he is confusing apples and oranges – while mixing up single years with biennia, while also forgetting that this is FY 2009. The general fund is NOT a budget, as Mr. Ralston assumes, it is a fund – think of it as one of many accounts in the overall budget. NPRI explained this to Mr. Ralston. Apparently he ignored us.

The $6.8 billion general fund figure was an amount of money that was projected to come in over the course of two years, not one. The $8 billion figure comes in from the overall budget and in a single year. To make matters worse, the Economic Forum's $5.65 billion projection is for the general fund for the 2009-2011 biennium, it's not even this fiscal year.

We explained all this to Mr. Ralston in a follow-up email, but in his new article he again confuses apples and oranges – claiming that the government spends less per person today than it did in 1978. The state legislature's figure that Ralston references is talking about general fund revenue, NOT overall government spending. At best, he can only claim that the general fund collects less per person than it did in 1978 – this is possible since the government has added hordes of other fees, taxes, and fund sources for the overall budget since 1978 making the general fund less important over time.

If Mr. Ralston was interested in facts and not adherence to his strict "We Must Tax Everyone More Regardless of the Facts" dogma, he would have noticed that we explained that the general fund is not a budget, saying:

"The overall budget includes the highway fund, federal fund, and "other" fund as well as the general fund. It totals more than $8 billion for a single fiscal year."

Basically Ralston is floundering, but he isn't the only one. Jim Rogers has upped the ante, claimed a $4.5 billion shortfall – a figure that bizarrely adds the current shortfall to his own projected 40-percent-plus increase in spending over the 2007-2009 biennium, despite the fact that the money simply isn't there.

Ralston also attacks NPRI when we pointed out that some of the budget cuts were not resulting in lower spending than under the last biennium. Ralston seems to think that once the money is appropriated it belongs to the state agencies and not the taxpayers. This is nonsensical. If someone asks for a 15 percent raise, and then doesn't get it because company revenues were lower than expected, can he legitimately claim a 15 percent, or more, cut in pay? Ralston seems to think so, and that is how he does his math.

Nevermind the fact that the general fund revenue is projected to be down only 2 percent from the 2005-2007 appropriations, and that is after adjusting for inflation.

Basically, these guys are deciding what they think would be appropriate spending, and claiming anything less is a budget cut. By this logic, those of us who didn't get 15 percent raises this year must have gotten, instead, 15 percent pay cuts.

Of course, if we had the long arm of government to force Mr. Ralston and Mr. Rogers to make a very "generous" donation this holiday season, we would not be facing these "cuts."