We must not tax our way out of a spending problem
Since the beginning of the year, rumors and rumblings have been echoing through Madison about the state of Wisconsinís economy. As you know, state government relies on your tax dollars to fund our public schools and universities, health care programs for the needy, economic development initiatives and law enforcement. A weak economy impacts families and businesses throughout the state. Government feels the same sting.
Last week, those rumors and rumblings turned into reality, creating a real problem for Wisconsin. According to the nonpartisan Legislative Fiscal Bureau, if nothing changes, our state will face a $650 million deficit when the biennium ends in 2009.
My legislative colleagues and I, as well as Gov. Jim Doyle, have been looking at ways to address the shortfall since the whispers began. Republicans in the Assembly will remain open to every solution but one: we will not raise your taxes to fix the governmentís problem.
As it appears in the ledger, that $650 million hole is the result of lower-than-expected revenues from the stateís three largest taxes: individual income tax, corporate income tax, and sales taxes. Because of the economic slowdown, tax revenues from these sources are well below projections. When the budget was assembled last summer, we made the intentional decision to estimate tax collections conservatively, using an anticipated growth figure lower than the one used in previous budgets.
But the way it appears in the ledger isnít reality here in Wisconsin. We arenít facing a deficit because tax collections are too low: that money doesnít belong to the government. It belongs to the people who earn it: hard-working men and women. When the government doesnít receive the money it expects, the solution isnít to take moreóitís to spend less.
Think about your familyís budget, or your own personal one. If you come up short one month, do you have the opportunity to simply give yourself a raise? Of course you donít. And in my opinion, the government shouldnít have that option either. My fellow Assembly Republicans and I are going to respond the same way you or your family has to: tighten our belt and find ways to spend less.
Unfortunately, some in Madison view this shortfall as an opportunity to raise taxes. Last week, Gov. Doyle and Senate Majority Leader Russ Decker, D-Weston, announced that they will be looking first at higher taxes as the solution to the governmentís woes.
Let me be clear: thatís the wrong direction. We arenít in this budget shortfall because taxes are too low, itís because spending is too high. When times are tough, the way to solve a problem isnít raising taxes to the level the government thinks it deserves, especially when people and businesses paying the tax are the ones already being squeezed by the slow economy.
To me, it comes down to responsibility. We have a real responsibility to be good stewards of taxpayersí money. Nobody, not even the government, can tax its way out of a spending problem.
Assembly Speaker Mike Huebsch, R-West Salem, represents the 94th state Assembly District. Phone 1-888-534-0094 or e-mail Rep.Huebsch@legis.wisconsin.gov.