Op-Ed: Budget

A few weeks ago, Governor Wolf was asked at a National Governor’s Association event in Washington DC what is the biggest economic challenge facing Pennsylvania. His answer? “Our self-esteem.” After listening to our new governor’s budget address last week, I fear our most significant economic challenge may very well be the Wolf spending, borrowing, and massive tax plan.

I was elected to represent the interests of northern Lancaster County and to work with my colleagues in the General Assembly to advance policy that promotes earned success and helps to create an opportunity society in Pennsylvania. During the last four years, we have made significant progress by controlling spending, reducing the debt limit, and allowing you to keep your hard earned tax dollars. This has resulted in significant job growth in Pennsylvania. In fact, the unemployment rate has dropped to 4.8% from 8.6% in 2010. I think this is one of the many reasons the voters sent back to Harrisburg overwhelming Republican majorities in the State Senate and the State House.

The governor is right to claim a mandate following his election in November, but this must be balanced with the mandate given to the Republican-led General Assembly. The residents of this Commonwealth expect that we will work together and find solutions to the issues confronting us. Governor Wolf’s budget proposal is a very bad, and certainly not a very “fresh” start.

Specifically, Governor Wolf has proposed a $33.8 billion spending plan, which represents a 16.1% increase. This increase is well above rate of inflation. To fund this historic spending plan the governor proposes to increase taxes by $4.7 billion in 2015-2016 and $12 billion over two years. These taxes will largely be paid by our working families and small businesses. The personal income tax is proposed to increase by 20.5%. The sales tax is scheduled to increase 10%. The sales tax would also be broadened to cover 40+ previously untaxed items such as newspaper subscriptions, baby diapers, day care, realtor services, financial services, non-prescription drugs, and more. Other increases include taxes on cigarettes, other tobacco products, Marcellus Shale Severance, and Bank Shares. Not to be outdone with tax and spending increases, Governor Wolf also proposes to add $6 billion in new debt for our children to pay.

We must do better.
If we enact a massive tax increase without addressing significant cost-drivers such as our public sector pensions, history informs us that this can only result in higher income, sales and property taxes.

Our state budget should promote earned success and upward economic mobility in Pennsylvania. Specifically, we should start by addressing the public sector pension crisis and adopt a fair and equitable education funding formula, a formula that appropriately accounts for growing school districts. We should adopt a sustainable spending plan that limits an increase to a factor of the rate of inflation and population growth. Furthermore, a spending plan should be based on outcomes such as performance.

I am hopeful that we will ultimately be able to find some common ground with the governor, but his budget proposal does not represent a productive start to the conversation. Let’s start by protecting taxpayers and promoting economic opportunity for all Pennsylvanians.

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