January 20, 2003

How Refreshing

After eight years of fiscal madness accompanied by deceptive spin and a governor who woke up every morning trying to break a solemn promise, our new governor's comments on the budget, taxes and his intention to keep his campaing promise are quite refreshing. Here are some quotes from Gov. Phil Bredesen, as reported in a Q&A with The Tennessean:

I think we got ourselves in a difficult position by spending too much money over the last two or three years so that we're going to have to end up with some of the cutbacks and stuff that other states started doing a couple of years ago.

We just had the largest tax increase in our history. We know the revenue estimates are overly optimistic, and we're falling short. So it's hard to escape the conclusion that you have to pare our state government in some way and, when you talk about paring state government, it's hard to talk about that without at least saying that the issue of layoffs or cutbacks or furloughs or something like that would have to be on the table in some fashion.

I'm going to have to make the best estimate that I can of what those obligations are and do it on the pessimistic side. If that requires reducing budgets in other places to make it happen, that's what I'm going to have to do. I'm not going to bankrupt the state. I'm not going to lie to people about what the situation is. I'm not going to push the problem off into next year by grabbing some sort of fund balance somewhere. TennCare is something that ought to be competing with other needs for money in the state — whether you put your extra dollars in TennCare, in K-12 education, in higher education, in incentives for companies.

TennCare has gotten to be the dragon that eats everything. One of the things we're trying to accomplish was giving the state a little more in the way of some levers that they can use to decide how much money they were going to spend on TennCare. The dragon has got to be put in its cage and kept there with the other animals of the zoo.

(The Tennessean then asked about the "Independent" Tax Study Commission and what Bredesen will do with its recommendations. But Bredesen apparently isn't fooled by the paper's calling the commission "Independent" when it clearly is nothing of the sort.)

It was created by the legislature, but I will certainly read it carefully. I was asked by some people who were thinking about serving on it what my attitude was, and did I think they were wasting their time. I said if they're taking an objective look at the tax structure and how to correct taxes and not thinking how could we quickly raise another billion dollars of revenue, then it could be useful.

If what this thing is, just to bring the income tax again two years down the line, I just feel I ran for this office on a promise not to implement an income tax in my first term, so don't look at it as something which is going to box me into a corner. I will certainly listen to what they say with respect, and I think it will be a useful contribution for discussions.

The paper then asked how Bredesen would react of the commission recommends a revenue-neutral income tax.

I genuinely feel that I ran for this office and was elected on the premise that I was not going to propose an income tax during my term as governor and I have no intention of doing it. I guess if I were convinced that was far and away the best way to do something, I would want to give people a referendum chance and by making it clear that I intended to explore that alternative in a second term in governor and making it clear during the campaign.

UPDATE:
The Tennessean also interviews David Goetz, Bredesen's new Finance & Administration commissioner. Notice how the questions are biased in favor of higher taxes generally, and the income tax.

Goetz, who as a lobbyist for business argued against higher business taxes, is asked if in his new job he is now on the "other side of the fence." And when Goetz talks about economic development and the goal of increasing Tennesseans' personal income, the paper immediately asks "If you get the personal income to rise again, how do you take advantage of that increase without a personal income tax?"

Goetz should've slapped the reporter for asking such a stupid question. If people earn more they spend more, and sales tax revenue rises. Duh.