Dems to present an alternative budget

Wednesday, Jan. 14, 2009 | 2:01 a.m.

When Gov. Jim Gibbons enters the Assembly chamber Thursday night and delivers his State of the State address, let’s hope someone has shown him the speech.

By all accounts, Gibbons has been disengaged from the process of the most severe budget cuts in state annals — more than $2 billion below what it would take to keep services at the last budgeted levels. The debate over which projects to spare, how many layoffs need to be made, which agencies can be melded has taken part largely without the governor’s participation.

Gibbons’ cluelessness was perfectly captured by the Reno Gazette-Journal’s Anjeanette Damon, who posted two exchanges on her blog from a brief appearance Tuesday by the governor. The first came when he was asked about whether the room tax increase, approved in advisory questions North and South, was in his budget. His response: “You know, I will have to defer that to somebody who has it. But I do believe there are parts of that that have been considered.”

Then, when Gibbons was asked about the 6 percent salary cut for state employees and whether that will avert layoffs, Damon wrote, “Gibbons started to say yes when (budget boss Andrew) Clinger stepped in to correct him.”

“I think we will have avoided layoffs,” Gibbons reportedly said.

“Not completely,” Clinger answered.

“How many?” Gibbons said.

“We are calculating that number right now,” Clinger responded.

No satirist, from Swift to Carroll, from Stewart to Colbert, could find the proper way to ridicule a governor’s lack of knowledge about his own budget proposal 48 hours or so before he is scheduled to present it. The Governor Who Wasn’t There.

Many, perhaps, will cheer such news because with Gibbons, less is more. But that is the fundamental infirmity of this entire budget process since the economy started to tank last year. Gibbons has treated the recession as a math problem — calculate the shortfall and then cut, usually across the board, with no policy underpinnings.

Democrats have been reluctant rubber stamps — but rubber stamps they have been. And now, as Gibbons prepares to unveil his package of $2 billion-plus in cuts, the legislative leadership needs to present an alternative. And quickly.

It is not enough to criticize what Gibbons has done — that’s too easy. Speaker Barbara Buckley, who will provide a rebuttal after Gibbons’ budget-gutting speech, and Senate Majority Leader Steven Horsford must tiptoe through what is equivalent to a tax minefield surrounded by political quicksand. But they must address the right’s reform agenda — public employee benefits and salaries — without necessarily capitulating to the SAGE Commission recommendations, while also preserving what we must presume are their core principles — better education, infrastructure and health care funding.

We know the contours of the speech, so there should be few surprises Thursday. We will hear about those 6 percent salary cuts and how the governor wants to reinstate the pay if the economy turns around. We will hear his plan to divert tens of millions of dollars from local governments (but not much about how he will be creating an unfunded mandate for the cities and counties). We will hear about how he is counting on federal stimulus money to help balance the budget. We will hear about how he is holding harmless key parts of the human services budget — Nevada Check-Up, early childhood development, at-risk schools — so no one can say he is completely heartless (but they will say so anyhow).

And that will be it. No original thoughts. No big surprises. Gibbonsworld is not Vision Central.

But let’s be fair: Is it surprising to people that Gibbons would parrot the positions of the Chamber of Commerce (mostly) and the SAGE Commission (mostly)? Who did people think was elected governor in 2006?

But this speech will go beyond ideology — if “no new taxes” is an ideology — and present the Legislature with a clear choice. Democrats who lead both houses can simply go along — again — or they can present an alternative.

Yes, myriad political roadblocks will be erected on the path to June and the beginning of the first special session. The governor’s fevered dreams of resurrection. Buckley’s incipient gubernatorial campaign. Horsford’s first at-bats in a World Series atmosphere.

But the question for the Democratic leadership is not how they will fight the governor’s plan but whether they have a vision of their own, one that encompasses some reform/accountability measures with some way to prevent a $2 billion cut.

They better have one. They better have a way to sell it. And they better be able to find some Republicans to support it.

Otherwise, The Governor Who Wasn’t There will be the only one who matters.

Discussion: 31 comments so far…

By cnev

1/14/09 at 5:36 a.m.

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"Otherwise, The Governor Who Wasn't There will be the only one who matters."

That is one frightening thought...
By Future2012

1/14/09 at 8:08 a.m.

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Finally Jon Ralston is admiting what has been known for a long time,

Gibbons can only propose a budget

The veto proof Democratic Nevada lawmakers lead by Speaker Barbara Buckley, and Senate Majority Leader Steven Horsford are the only ones who can pass a budget.

They can pass a tax and spend budget over Gibbons veto.

Jon needs to quit the "more than $2 billion below what it would take to keep services at the last budgeted levels" cut trash talk.

We adjusted down the current approval budget by the $2 billion.

Against the current June 2008 to June 2009 Budget/actual, what are the cost account increases and decreases that the Lawmaker will approve.
By jfnance32

1/14/09 at 8:12 a.m.

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The Gibbon's budget will only generate a few government layoffs.

The Democrat's version will generate many government layoffs and via taxes many private sector layoffs, too.
By ksand99

1/14/09 at 8:34 a.m.

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WOW! Jfnance32 has seen a budget that not even Jon Ralston has seen! He knows what the Democrats are going to propose!

Tell us, jfnance32, what does the Democrat version of the budget say?
By jfnance32

1/14/09 at 9:23 a.m.

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ksand99:

You are right that the Democrats are currently hiding under rock and not revealing their offical position.

It is my guess from reading news articles on what they will do. Of course, they could just accept Gibbon's budget recommendation.

Do you want to make a bet that the Democrat's version will include more government sector layoffs than Gibbon's version and tax increases?
By ksand99

1/14/09 at 9:36 a.m.

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Oh, it was a guess, huh? Cause it really looked like a statement of fact.

If the Democratic budget mirrors PLAN's proposals for revenue generation, then no, it will not include more government sector layoffs than Gibbons. Since Gibbons has refused tax increases of any kind, then of course, any other plan that has more than the room rate tax increase passed by the voters would have more tax increases than Gibbons.

But then, I could go off and make all kinds of predictions and guesses, but that would be assuming things, and you know what they say about assuming!
By nurseancy

1/14/09 at 10 a.m.

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John:

This is a message from a fellow Cornellian. I wish you would comment about the true nature of this 6% "wage cut." It is really a state income tax from the "no new taxes" guv. The guv said he has a way to keep services at the same level while cutting spending. The only way to do that is by raising taxes. He is too frightened of the business community to tax our for profit hospitals, construction, mining, and other entitites that extract money from LV and export it out of state, so he is going to tax state employees. This is outrageous. What's the next step? Mandatory volunteer work for the state? Work 5 days and get paid for 4? The Thirteenth Amendment abolished slavery a long time ago.
By harvey1

1/14/09 at 10:24 a.m.

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The proposed pay cut for teachers is shameful. Teachers have not even received cost of living raises in years, and have only earned more money after investing in their own education. Now the governor wants to deny them that too. Many teachers have even gone into debt to increase their salaries. Other state employees have enjoyed decent raises, while teachers get a measley one or two percent year after year. Has no one thought of raising property taxes? Nevada's are some of the lowest in the nation. Even a very small percentage would generate substanial state income. As a homeowner and a teacher, I would much rather see that. Honestly, if Gibbons gets that six percent, I will feel that a very clear message has been sent to just how valuable I am. And it will only make me more determined to finish my own education and leave education behind.
By jfnance32

1/14/09 at 10:45 a.m.

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ksand99: If you think that PLAN's plan will be implemented then I have a tanker ship full of koolaid to sell to you. Their plan includes a state income tax.

Gibbon's plan is the plan that will have the fewest government sector layoffs.
By Future2012

1/14/09 at 11:16 a.m.

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Bottom line

We are still waiting for the veto proof Democratic Nevada lawmakers lead by Speaker Barbara Buckley and Senate Majority Leader Steven Horsford to present their budget
By ksand99

1/14/09 at 11:19 a.m.

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Yes, that is a single part of PLAN's proposal. It is not the entirety, nor is it integral.

PLAN's other recommendations, such as repealing the outrageous deductions that allow mining companies to extract millions from Nevada without paying any taxes, a tiny business profits tax (to bring us in line with 46 other states in the union), removing the sales tax exemption on compted meals, etc, are valid and deserve consideration.

Only a true partisan would decline reviewing the proposals.

The income tax proposal which was mentioned in brief and without any financial analysis cannot be implemented by a single session of the legislature. That has zero chance of being implemented this biennium.

Again, you state without exception that Gibbons' plan will have fewer layoffs without knowing the alternative. I guess your famed crystal ball must be glowing brightly.

Since you are so sure, how many more government jobs will be saved by our great Governor's slash and burn plan?
By ksand99

1/14/09 at 11:22 a.m.

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Bottom line:

We are still waiting for the Governor of the State of Nevada to present his budget... since it is a constitutionally-mandated responsibility of Mr. Gibbons, and not of the Legislature.
By jfnance32

1/14/09 at 12:31 p.m.

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Bottom line:

The Democratic controlled Assembly has been passing budgets that contain cuts. The Governor can only recommend a budget. It is the responsibility of the Legislature to pass budgets.
By in_sider

1/14/09 at 1:43 p.m.

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Boys and girls I don't see any way out of this without both cuts and tax increases. I just hope the folks we have up in Carson (most notably Buckley, Horsford and Raggio) are ready to do their job for once and make tough, unpopular decisions. I'll vote in 2010 and 2012 for those who display leadership rather than political "cover my butt" cowardice even if it does mean, as a Nevada resident, I have to step up and take more financial responsiblity for services Nevadan's need and use like education, transportation, and health. I'd rather have a comprehensive tax/budget plan developed by professional state budget architects than have another round of shootfromthehip populist ballot tax initiatives. Increased taxes won't make us look like California if done correctly, remember Cali did a lot of their tax policy via ballot initiative. And please can we stay away from the gaming, sales and room tax as sole sources of increased income!? We already depend way too much on the resort industry for tax revenue in this state, that's part of the reason why we are in this mess.
By jfnance32

1/14/09 at 2:12 p.m.

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California is ranked 10th in the nation on state taxes per capita. Nevada is ranked 25th.

Budget wise California are in a bigger mess then we are even though they have a "diversified economy" and "broad-base" taxes like state and corporate income taxes. They have been borrowing money in the last few years to cover operating expenses and they are laying off teachers.

Gibbons is making the correct recommendations.

Raising taxes to high or the wrong ones can make the financial downturn be longer and/or deeper and have the opposite effect on the long term outlook on state tax revenue.
By geezelouise

1/14/09 at 2:28 p.m.

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I am waiting to see some leadership, instead of the mindless mantras and excuse after excuse.
By in_sider

1/14/09 at 3:17 p.m.

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Jfnance32: Stick to those Gibbons guns - I regret voting for the idiot and admit it. Taxes are rarely good in a bad economy, I give you that, but purely cutting blindly without addressing our terrible tax system and increasing revenue in some way is reckless.

First, Cali is in the mess they are in because they provide too many services to everyone (including illegals) and they allowed thier hands to be tied by Prop 98 and Prop 13. Do you think taxation through initiative is a good idea? We don't have to be like Cali.

I ask. In all your wisdom what government services are worthy of saving in a state with very few government services? Or are you like Bob Beers and the RJ editorial staff which are borderline anarchists which think any government is too much to begin with?

I'm a moderate, not a tax and spend liberal - I HATE TAXES. And the strength of Nevada has always been its low tax environment. But to cut essential services that will cost us 4 times as much to restart when things rebound is even more fiscally irresponsible than modest tax increases on a population that enjoys one of the best tax climates (tell me where you get your numbers for Cali and Nevada - oh wait, Bob Beers) in the country and historically one of the least taxed (Anywhere from 47th to 49th)populations in the country (thanks to gaming) Cali on the other hand always ranks among the top 10 most taxed per capita (usually around 5th most).

Here is where I get my numbers which is pretty much used by everyone. http://www.taxfoundation.org/taxdata/sho...
By jfnance32

1/14/09 at 3:40 p.m.

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"allowed thier hands to be tied by Prop 98 and Prop 13"

Califorina does not have a lack of tax problem. It is ranked 10th highest in state taxes per capita in the nation.

Nevada is ranked 25th highest in state taxes per capita in the nation.
By thebs

1/14/09 at 4:10 p.m.

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Looks like Nance has a new talking point everyone. Let's give some context to it, shall we?

2008 United States
State-Local Tax Burden as Percentage of Income: 9.7%
Per-Capita Average Income: $44254
State and Local Per-Capita Taxes, Average: $4283

California:
State-Local Tax Burden as Percentage of Income: 10.5%
Rank: 6th in Nation
Per-Capita Average Income: $47706
Total State and Local Per-Capita Taxes: $5028

Nevada:
State-Local Tax Burden as Percentage of Income: 6.6%
Rank: 49th in Nation
Per-Capita Average Income: $49371
Total State and Local Per-Capita Taxes: $3245

Who cares what people are paying, per capita, if the effective tax rate in Nevada is only 6.6%, three points lower than the national average?

Per capita is a lovely, yet failed, attempt at spinning Nevada's tiny tax burden as if it were much larger than it is.
By ksand99

1/14/09 at 4:26 p.m.

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Yes, per-capita as a measure of tax dollars is cherry-picking the only way to skew Nevada's tax burden as somehow bad.

If I go next door to California, my average wage drops and my average tax burden jumps. Nevadans are far better off here, under this tax climate, and these numbers only show how increasing some taxes on mining or gross profits won't destroy the Nevada economy, it will make our state government stronger and more stable.

You would think the crazy right wingers would be happy the tax burden here is so low. You would think they would want to shout it from the rooftops. Nope, they would rather try to mislead us with meaningless measures of taxation.

What a surprise.
By jfnance32

1/14/09 at 4:28 p.m.

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No matter how you spin it. Nevada is ranked 25th in the nation for state taxes per capita.
By jfnance32

1/14/09 at 4:32 p.m.

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"If I go next door to California, my average wage drops and my average tax burden jumps."

Thanks for pointing that the heavy taxes in California has not resulted in economic gains for its citizens.

"it will make our state government stronger and more stable."

Yes, the high tax state California is so stable and strong that it has been borrowing money for daily operations and is laying off its teachers.
By ksand99

1/14/09 at 4:37 p.m.

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"Thanks for pointing that the heavy taxes in California has not resulted in economic gains for its citizens."

First, you make a connection between taxation and "economic gains" with no supporting evidence.

Second, California has an above-average per capita taxation rate, and an above-average per capita income. So if you choose to draw a conclusion between a high tax rate and economic gains, the case is right there. I don't believe it to be the case, but if you want to misrepresent numbers, as you continue to do, I will as well.

"Yes, the high tax state California is so stable and strong that it has been borrowing money for daily operations and is laying off its teachers."

That would be a valid argument if Nevada's tax burden would be anywhere near 10.5 percent. Even with the modest proposals I've seen, we would still be far, far below 8%... which is also beneath the national average.
By ksand99

1/14/09 at 4:40 p.m.

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"No matter how you spin it. Nevada is ranked 25th in the nation for state taxes per capita."

So you have claimed. The argument that that particular statistic is essentially meaningless in context, however, you have not contested. I don't think you understand, but that's ok. Everyone else does.
By jfnance32

1/14/09 at 4:55 p.m.

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ksand99:

Then: "If I go next door to California, my average wage drops and my average tax burden jumps "

Now: "Second, California has an above-average per capita taxation rate, and an above-average per capita income. So if you choose to draw a conclusion between a high tax rate and economic gains, the case is right there"

According to you and your boss, theBS, Californians has lower per capita income than Nevadans and has higher taxes per capita income than Nevadans.

According to your and theBS's data, Nevada's tax policy must be doing something better than California. Nevadans make more money than Californians.

The state of California is not stable nor strong even with all its high taxes. It has been borrowing money for daily operations and is laying off its teachers. Even though that state has a "diversified" economy and "broad-based" taxes like personal and corporate income taxes, it is falling flat on its face.
By thebs

1/14/09 at 5:39 p.m.

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"According to your and theBS's data, Nevada's tax policy must be doing something better than California. Nevadans make more money than Californians."

As always the point sails over Nance's head.

The point was that there is no definitive relationship between taxation levels and income.

There are low-tax states where per capita income is low. There are low-tax states where per capita income is high.

Actually, let me point to another state, Connecticut, where the state tax burden is 11.1%, and the per capita income is $63160.

If there was a relationship, it would seem that we should double are taxes.

The point: there is no direct relationship between the tax burden and per capita income.

Don't let that one sail over your head, Nance.
By jfnance32

1/14/09 at 5:54 p.m.

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Thanks again, theBS.

theBS says there is no definitive relationship between taxation levels and income.

Hmmmmmm.......I guess we should throw out that BS about higher taxes equals community investment that results in higher income for its citizens in the long run.

Thanks BS
By thebs

1/14/09 at 7:20 p.m.

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Is there a counterargument in there? Cause I can't find one, Nance.

A higher tax burden does not directly influence per capita income, in either direction, according to the data. There are many high-tax burden states where per capita income remains high. There are also low-tax burden states where per capita income is ALSO high. There are obviously many factors that influence per capita income.

There's no direct causal relationship, even though you seemed to infer the opposite earlier by comparing California's tax burden with Nevada's tax burden.

I welcome data that refutes this.
By ebee

1/14/09 at 8:41 p.m.

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you know some people on this site have wayyyyy too much time on their hands. especially people who work for B3G Systems LLC. I mean if I was the sys admin at your company and I saw how much time was spent posting your dem vs rep. spew neccesantly, I would pull the plug on your internet access, send the proxy records to your boss and actually make you write the code that you claim to know how to write on your elance site. but hey, I guess you can be too busy since your focus all day is how its the democrats fault. regardless, they, i.e. politicians, have all of you right where they need you. divided. and until you all wake up as a collective whole and stop the fighting, nothing will change, no matter who's in charge. it's seriously so freeking old already dude, instead of being negative why not try and see how you can change things for the positive side. and who actually claims to write fox pro code anyway, thats like touting VB6 as a strength.
By ksand99

1/14/09 at 10:19 p.m.

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"theBS says there is no definitive relationship between taxation levels and income."

Actually, the word that was used was "direct" relationship, not "definitive."

There could very well be a convoluted relationship between the tax burden of a state and its' residents' per capita income, but it definitely isn't a direct relationship.

Nevada taxes less than California, but per capita in Nevada is higher.

Connecticut taxes more than California, but per capita in Connecticut is higher.

That pretty much proves there is no direct relationship.

If I were a legislator, I would look long and hard at the proposal from PLAN. It has many good and fair ideas on increasing state revenue.

It is time to get Nevada on a stable footing.
By jfnance32

1/14/09 at 11:49 p.m.

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ksand99:

"Actually, the word that was used was "direct" relationship, not "definitive.""

theBS used the word "definitive".

It does not matter to me which word is used.

I am agreeing with both of you.

It is BS when people say that higher taxes equals community investment that results in improvement in the long term income earnings for its citizens.