Our Pastor

Rev. Debra Tompsett-Welch

Need a Daycare?

Hearts

Minds

Doors

Krusin' the Capitol

By Nebraska State Senator Lowen Kruse

2003
Week 22
June 3, 2003

Hi

Enough about this year. What of the future?

As I have noted, future budgets are far more scary than the present year. If we do not make serious changes we will be in huge trouble within ten years. Put another way, our present increases are due in large part to not making changes 5-10 years ago.

Those saying "Cut, Cut, Cut" -- like a chicken trying to cackle -- think they are in opposition to those of us who overrode the governor. Not really. I believe I feel more strongly than they that changes must be made. Real changes. Our difference is they want to do it for now, by not paying our bills (as I see it), and a goodly core of us in the Legislature want to make long-term changes in systems as well as tax structure. It simply must happen.

A deficit is sort of like getting a very high electric bill. One wants to say "I won't pay it" but that is not the option. Pay it and change what caused it.

The following chart will get screwed up by email format, so I will keep it real simple with short lines. Even though they will not line up, the first row of figures is the average percentage increases in Nebraska for 15 years, 1990 through 2005, to the end of our next budget. One year %. The second row of figures is our TWO year budget percentages for 2003-05.

The third row is the total percentage increase over the next 15 years if we make no changes. The World-Herald, June 1, had an excellent article on past budgets and I used many of their figures. I could cynically wish the writer of their negative editorials would read his own paper, but that would be getting back to old stuff. [I am in the Public Pulse tomorrow, 6/4.]

Comments:
Property taxes are not out of line compared to inflation.
General Fund is very close to growth in personal income.
Medicaid and Corrections are the budget-busters.
K-12 schools figures are state portion only, so do not give a good picture of what is happening there, or what will happen to education budgets. The average total schools budget increase is 5% per year.

Higher Education is not the budget problem, as it stays under the growth in personal income. Some have thought we unfairly protected the University from large cuts. We saw, in early analysis, that the University is not where the big money is and is not the cause of our deficit. So whacking there is unfair. The basic operation of the state, with 50 agencies, the governor and all the other offices, plus the Legislature, has not caused the problem. No evidence of a big expansion of services by the general agencies. [We had to cut them anyway.]

Where we need to focus our attention is fairly clear: Medicaid and Corrections because of the ongoing increases, and K-12 schools because they are the largest part of our total tax picture. Also, people spend and invest their money in such different patterns than 50 years ago so we must examine the tax structure.

It is imperative that we plan for economic development and the incentives for that, plus examine the comparative disincentives of various taxes. In a state that cannot grow more people we must grow the economy. The latest figures show that Nebraska is #24 among the states in total taxes per capita. A good first step would be to tackle straight on the downgrading myth that Nebraska is a high tax state.

Following are my ideas for study and inspiration to think outside the box. Any ideas and/or data which can help will be most welcome!!!!!

Medicaid needs a change in public attitude, which is driving up costs. Is it honest to spend down large fortunes to get Grandmother on Medicaid? Can Medicaid for young children be justified as preventive health care? If so, how could the effectiveness be enhanced? Prescription drugs are a major budget-buster, but that is a federal matter. We cannot make rules state by state.

Community Corrections, with halfway houses for nonviolent offenders and intense counseling for young adults, will cut prison costs. Drug addiction is presently our major cause of escalating public budgets. Who pays for treatment? For how long? Again, the public acceptance of drugs is costing us dearly. How change that?

We heard an outcry when we proposed to close a prison, but we could think of no other way to force the parole board into taking seriously the value of parole for offenders who are near release. Is there any other way to build a fire?

Services could be more client centered. The institutions need persons who are not building empires, and providers who would rather cooperate in order to help a client. Presently, for one small example, application forms abound. Persons who in the beginning would like to get well and find employment simply become tired of it all.

What is adequate treatment for an expensive chronic illness? We have decided as a society that the state is responsible for the health care of thousands of persons, but we have little discussion and no agreement on what is a standard of care. Even wealthy families have recognized in certain painful situations that just because modern medicine can do a procedure does not make it wise for every patient. Where do we draw the line, how does the family participate in decisions, and at what point is all additional care a family expense?

I have stated some thoughts on taxes. What is fair? What is competitive with other states? How can we collect Internet sales tax? Levy caps and aid formulas reward those who levy higher taxes. How change that?

What would bring more efficiency in local school budgets? Will we get cut down on the testing of "Leave No Child Behind?" Much more here!

What tax rate is fair for tobacco and alcohol? Cigarette manufacturing is shifting to new companies, to avoid paying into the settlement. Alcohol causes the most public expense, is taxed the least.

How do you hold corporations accountable without stifling growth? I have not said much about it, but I am a strong supporter of 775 incentives. There is good accountability here and we get money back if they do not perform. However, the closed attitude of the business community is extremely disappointing.

Finally, would privatizing some services save money? So many attempts have been a disaster. How could one be sure of savings without putting some clients at the mercy of the greedy?

My commitment is to focus on tax structure, Medicaid and K-12 in interim study. I welcome material.

Signing off for a while. Hang in there.

Lowen

Upcoming Events