As stated before on Montana Headlines, the basic structure of the budget Schweitzer proposes is sound: some one-time infrastructure spending, some increase in ongoing spending, some tax relief, and some saving for a rainy day. It is the specific composition and the temporary vs. permanent nature of various proposals that need to be hammered out.
Philosophically, the GOP would want to have no increases in government spending, and would want to translate the surplus entirely into tax cuts. Philosophically, Democrats would want to translate it all into permanent spending increases.
The Governor's proposed budget shows a willingness to cut taxes (albeit only on a one-time basis) and to have some spending be one-time rather than permanent. Republicans have expressed a similar willingness to spend extra money this session, but prefer it to be one-time.
House Majority Leader Michael Lange, R-Billings, proposes to make certain spending proposals sunset in two years. This is a good proposal, since it would significantly limit the amount of spending that future legislatures are obligated either to fund or to cut. Any increases beyond those needed to account for inflation should by default come under that heading.
Gov. Schweitzer told the Helena Independent Record's editorial board that Republican claims to want to make tax cuts permanent are false because they can't bind future legislatures, and that therefore his proposed tax cut/rebate proposals are every bit as permanent as are the GOP's.
Not exactly. For tax relief to continue under the Governor's plan (leaving aside the fact that the relief under his plan is not fairly apportioned according to who has been paying the most for years), the next legislature would have to vote again to rebate taxes. This is not the kind of fundamental tax relief that is needed.
The hardest thing in politics is to cut spending. Because it is hard to cut spending, the second hardest thing to do in state government (where, unlike the Federal government, budgets must balance) is to cut taxes.
For that reason, Republicans need to push now, while the coffers are full, to do the second hardest thing -- institute a permanent property tax cut across the board. And they should insist that most spending be either one-time or that it have a two-year sunset provision. This will make it easier for future legislatures to to the hardest thing -- cutting spending, since they would only need to do nothing to accomplish it.
If the coffers are still full in 2009, the legislature will have the joy of being able again to make Democrats happy by voting new (temporary) spending, and making Republicans happy by voting for additional modest but permanent tax cuts.
