Spending limits needed

Patrick Gibbons

As previously mentioned in this space, had a Tax And Spending Control (TASC) amendment been part of Nevada's constitution – a measure akin to the one State Senator Bob Beers repeatedly proposed – it would have eliminated most of Nevada's current budget shortfall. That's because TASC would have limited government spending increases to the rate of population growth plus inflation.

But you don't have to take NPRI's word for it.  Since some people reflexively reject our research because of our policy recommendations, we went out and found a left-wing organization that came up with the same conclusions.

The Center on Budget and Policy Priorities (CBPP) found that had a TASC-like amendment been in place starting in 1993, Nevada would have spent $4.6 billion less  through 2007 than it did. Indeed, in FY 2007 alone, state spending would have been at least $780 million less. Those savings would have been far greater than the FY 2008 budget shortfall. TASC spending limits would have prevented state politicians from over-committing taxpayers to spend on projects the state could not really afford.

Of course, Karen Lyons, author of the CBPP report, did manage to get some things skewed. She wrote that "Each year legislators would have had to make cuts in public services, such as education, health care, and public safety, in order to comply with the limit. The severity of these cuts would increase over time."

This is incorrect:  The budget would have grown during those years, but because spending would have been limited to the rate of population growth plus inflation, budget cuts would never have been necessary. The state, while growing, would have simply maintained the same per-capita expenditure levels every year as had existed in 1993.  

Lyons incoherently assumes that even under TASC, the state would continue to pass bloated budgets, only to suddenly realize it couldn't spend that much and then cut from what was promised.  Obviously, the constitutional amendment would have prevented the bloated budgets from ever being passed.

Sadly, similar silliness is trotted out regularly by Nevada's pundits and policymakers.  For example, if the state found that it needed to cut the expected budget by 10 percent, many would assume instinctively – and incorrectly – that the state budget would become 10 percent smaller than the previous year's.  But if the expected budget was already, say, 9 percent larger than the previous year's, this would not be the case. 

Heading into the 2009 Legislature, Nevada is seeing a lot of such scrambled pseudo-thought.