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Obenshain Bullseyes The Budget Mess

By Greg L | 18 August 2008 | Virginia Politics | 34 Comments

Senator Mark Obenshain sent out a great run-down on what’s happening with this sudden realization by the Kaine administration that seven weeks into the biennial budget, there suddenly isn’t enough money available to pay for all the spending increases Governor Kaine wanted.  This kind of fiscal irresponsibility we’re seeing from the Governor is utterly appalling.  It’s one thing to make mistake after mistake with budgeting and revenue forecasting, but quite another to continue to justify increased spending while at the same time ignoring clear and consistent evidence that there just isn’t the money to support this such public spending growth.  The taxpayers are not a bottomless source of public financing, no matter how important Kaine might think it is to provide day care for four year olds at publlic expense throughout the Commonwealth.

Over the past several weeks it has become apparent that the budget just adopted in March will need to be cut by upwards of $1.4 billion. That will result in less state money for schools, higher college tuition and reduced funding for virtually every government service.

Today Governor Kaine appeared before the money committees of the General Assembly to explain his administration’s breathtaking forecasting errors. The Governor’s explanation demonstrated that he has a firm grasp of the obvious. He told the Committees that “Virginia’s economy is slowing.” The problem is not the Governor’s message. It is his timing.

When Gov. Kaine unveiled the 2008 “caboose budget” and 2009-2010 biennial budget on December 17, 2007, the economic slowdown was already well underway. The so-called “caboose budget” the governor proposed was designed to cover a $641 million shortfall for 2008 - an indication, one would think, of trouble on the horizon.

It wouldn’t have taken an expert to determine which way the fiscal winds were blowing in the waning days of 2007. Profligate spending, unfortunately, was the order of the day, and the attempts my Republican colleagues and I made to inject a dose of fiscal sanity into the budget process were dismissed out of hand. Reality and new spending programs were at odds, and the Governor decided that reality would simply have to give way.

Consider the Governor’s comments today:

“Sales tax collections, which would now have to grow at 4.9 percent to make the fiscal year 2009 forecast, grew at an average rate of only 0.8 percent in the last four months of the fiscal year. Likewise, income tax withholding, which would now have to grow at 6.4 percent to make the 2009 forecast grew at an average rate of only 1.6 percent in the same four month period.”

Let that sink in. A mere eight months ago, Gov. Kaine stood before the very same committees he addressed today and predicted 6.4% growth in income tax withholding receipts.

To quote the governor again: “As anyone reading newspaper headlines knows, the effects of the ongoing housing downturn and turmoil in financial markets continue to be a drag on economic growth.” The Governor, of course, is right; however, he would have been well advised to have started reading the newspaper headlines a little earlier. The Housing Market Index was down almost 50% on the year when Governor Kaine unveiled his budget in December of 2007. Reasonable people might ask how he could have possibly missed that. Did he dismiss it as a blip? Did the Governor stake Virginia’s economy on some wildly optimistic expectation of a massive rebound?

Back in mid-January, while the General Assembly was considering the Governor’s budget Sen. William Wampler warned that the economy was slowing and observed that “it’s a lot easier to avoid making new spending commitments than it is to cut spending after the fact,” a lesson Gov. Kaine is just now learning. Even before that, Sen. Walter Stosch wrote an open letter to the Governor noting that since the budget is built on assumed revenues for the forthcoming biennium, “we can easily over-commit in the budget and build expectations we cannot meet if we fail to estimate revenues conservatively.” The Governor and his Secretary of Finance, Jody Wagner, refused to listen.

More to the point, when the Governor presents revenue forecasts put together by his Secretary of Finance, we need to be able to rely on those projections as an unbiased and factually-based estimate. Instead, however, the numbers were merely a ploy to push new expenditures our Commonwealth can ill afford.

The Governor’s confidants have made no secret of their boss’s vice presidential ambitions, and perhaps Kaine is, indeed, precisely the man Sen. Obama has been seeking. After all, it takes a lot of audacity to submit a budget predicated on the economic numbers you only wish you had. If that’s “the audacity of hope,” Virginians should want nothing to do with it.

I believe in doing things a different way. I believe in being upfront with the hard-working taxpayers of Virginia, and a budget that reflects fiscal realities - even one that requires tough choices. With all due respect to the Governor and his ambitions for higher office, that would be change we can believe in.



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34 Comments

  1. Herndon Bob said on 19 Aug 2008 at 5:37 am:
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    I will believe Kaine is serious about the deficit, when he proposes elimination of benefits to illegal aliens.

  2. Truth Seeker said on 19 Aug 2008 at 7:29 am:
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    Herndon Bob,
    Please elaborate on what benefits illegals receive in the Commonwealth. I would be interested in knowing.

    On another note: It is my understanding that the Governor’s office has already sent out directives to all State Agencies to make budget cuts.

  3. Herndon Bob said on 19 Aug 2008 at 9:04 am:
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    Truth Seeker

    It is not worth my time to go through all the State programs offered and determine which are and which are not available to illegal aliens. The list can be found at http://www.dss.virginia.gov/form/ if you want to go through it. Some of the programs are required to support all applicants by the Federal Government and some are not. Since there is no way to verify most of the information in applications, fraud is a distinct possibility.

    Based on state expenditures (cash bases for 2007) from page 6 of http://www.doa.virginia.gov/Financial_Reporting/PAFR/2007_PAFR.pdf the state spends 33% of the budget on individual and family services. Qualifying applicants for social services the same way applicants for drivers licenses would likely save millions.

    Health services are not even considered part of social services. Stop funding non-emergency care provided at hospital emergency rooms.

    Let’s save even more by charging illegal aliens for court interpreters for illegal aliens.

    Stop funneling money through the use of NGOs which provide a variety of services without regard to legal status.

  4. Beck said on 19 Aug 2008 at 9:18 am:
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    In addition to the State and localities paying benefits (health care, education, law enforcement…) for illegal immigrants, the State loses revenue for every illegal immigrant working in Virginia. These ‘employees’ and their employers bypass the many taxes paid by those of us who are not breaking the law.

  5. Che' said on 19 Aug 2008 at 9:42 am:
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    I think that we need to push hard for Kaine to be Osama Hussein Obama’s VP candidate. Even if they win, it will be a boon for our commonwealth to be rid of this imbecile.

  6. Truth Seeker said on 19 Aug 2008 at 9:56 am:
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    Well Bob and Beck your responses are interesting. I believe the state programs to which you are referring, Bob, are TANF, Food Stamps and Medicaid. Maybe you should call a Dept of Social Services to find out the facts. To my knowledge illegals are not entitled to those benefits. In addition, they are not entitled to housing subsidies either. There are many tests for eligibility and some include original birth certificate, original social security card, etc. I do believe all Social Service agencies can check the validity of those documents. I also believe the Federal Government sets the policies for who is eligible for the public assistance benefits I mentioned above.

  7. LOVE THE USA said on 19 Aug 2008 at 10:51 am:
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    Truth Seeker, you are right in what you are saying but the loophole is, illegals get FREE medical care when they are having their anchor babies. They then get foodstamps, WIC and other benifits for these anchor babies. If these illegals wern’t here, this cost would not be passed on to us, the American taxpayer!

  8. LOVE THE USA said on 19 Aug 2008 at 10:56 am:
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    Also Herndon Bob is right. The money we spend on those illegals incarcerated add up pretty quick. The interpreters, the cost of the trial, the defense, the police used in the investigation are all costs that we the taxpaying citizen incur. I for one am sick of it. How much does the state and local governments spend each year on this?

  9. Riley said on 19 Aug 2008 at 11:22 am:
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    Timmy! is a moron and we can only hope that Barry picks him as his running mate.

  10. freedom said on 19 Aug 2008 at 12:27 pm:
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    ….and of course, could stop publishing public documents in spanish and discard the public child-care program of Pre-K….:(

    It’s a matter of common sense, check this out…

    http://www.youtube.com/watch?v=pKFKGrmsBDk

  11. Anonymous said on 19 Aug 2008 at 12:29 pm:
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    I believe the Guv has been pre-occupied with his idol Obamorama and his (Kaine’s) run for the vice-presidency. The Commonwealth’s fiscal condition has taken a back seat and the Guv is hoping to have all of this behind him in a couple of months as “it will be someone elses problem then.”

  12. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 19 Aug 2008 at 1:10 pm:
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    Truth Seeker,

    You are correct the ILLEGAL aliens are not eligible for those benefits, but their anchor babies are. So, indirectly they are receiving benefits they would not normally get.

  13. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 19 Aug 2008 at 1:11 pm:
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    Sorry I didn’t refresh before posting. I didn’t mean to reiterate a point already made.

  14. Just the Facts said on 19 Aug 2008 at 4:49 pm:
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    Let me add my voice to those advocating that we praise Timmy in hopes Barry picks him as his VP. Two inexperienced morons running together would be easier to beat than just one. If we trash Timmy, Barry realizes what a bad choice he would be, and he picks a strong running mate, he might get elected.

    I have my concerns about McCain and have considered casting a protest vote but have decided against that course of action. At this point I don’t even buy the argument that four years of President Barry would get us another Reagan in 2012.

    McCain is weak in some areas (i.e., immigration). Nonetheless, a genuine war hero who is conservative on most issues is vastly preferable to a catastrophic four years of Che Guevara (Barry) as president with a Democratic majority rubber stamping his nominations of Fidel Castro and other like-minded leftists to the Supreme Court.

    Until after the dems have their convention, we must chant “all hail Timmy – the most wondrous leader - except for his holiness Barry himself.”

  15. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 19 Aug 2008 at 5:26 pm:
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    LOL Facts!!! That may very well be true!!

  16. Groveton said on 19 Aug 2008 at 9:54 pm:
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    If Northern Virginia kept only half of the money taken from us in taxes and squandered outside of NoVA we could pay for the state revenue deficit and provide benefits to every illegal alien in Virginia.

    I hear you guys on the illegal immigrant issue. You have a point. But you are missing the big picture. The big picture is the billions taxed in NoVA but spent elsewhere in VA each and every year. Why don’t we hear about that from the Republican stalwarts in the General Assembly? Because they are siphoning money from NoVA to buy votes elsewhere in the state just like the Democrats.

    Shouldn’t one of NoVA’s state politicians at least provide an accurate accounting to the constituents as to what the real flows of money are in this state and how those flows have changed over the past 10 years? Isn’t that part of the transparency the Republicans claim to want?

    My estimate is that NoVA pays $5B per year more in taxes than it receives in state spending. How much illegal alien enforcement could be accomplished with $5B per year? How many roads could be built? How much mass transit could be constructed? How many schools could be built?

    And the worst part is that (as far as I can tell) the siphoning is increasing at an increasing rate - year after year. Certainly that charletan Mark Warner increased the sucking sound with his idiotic 2004 tax increase for “education”. But you never hear the Republicans talking about that. They never talk about how Warner’s tax hike did not include a maintenance of effort clause like the one in Jim Gilmore’s prior tax bill. Why don’t the Republicans talk about these things? Because they are as much in on the scam as the Democrats. They rant about illegal immigration and still siphon billions from NoVA. They rant about Kaine’s tax revenue forecasting and still siphon billions from NoVA. Then they go downstate and tell people that a raise in the gas tax (after 22 years at the same cents/gallon) would be “unfair”. They say, “I won’t let you pay for NoVA’s roads” while $5B per year slides from NoVA downstate. They talk about “the real Virginia” outside of NoVA. The Republicans in the General Assembly are every bit as big a bunch of con artists as the Democrats.

  17. NoVA Scout said on 20 Aug 2008 at 12:55 am:
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    I was not aware that there were significant state programs that gave benefits to illegal aliens. I must say that surprises me. What’s the price tag on that Herndon Bob? Do you think it’s a significant part of the looming state budget crisis? And “Love the USA” - what’s the state program under which illegals get free medical care while having “anchor babies”? That one has escaped my notice for lo these many years that the GOP has controlled the General Assembly. When did that get put through the legislature? Why did they ever enact that? Can we Yankee Doodles get some of that? If not, why not? Or are you perhaps mistaken? And when we assess these costs, have we netted out all the taxes paid by illegals? A lot of studies have indicated that the net tax contribution of illegals (sales, property, social security, withholding under bogus tax and ss ids) markedly exceeds the public costs of illegal immigrants. Are there data you’re using that disprove that?

    Of course, as we lock up and detain more illegals the jail costs will indeed rise. As we make it harder for them to work, their tax contribution will diminish. As we collapse their underground economy without providing a legitimate one in its place, their generally law-abiding record may degrade, as scarcity and impossibility begin to assert themselves. Great policy formation there, what?

  18. Bridget said on 20 Aug 2008 at 3:03 am:
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    http://vdare.com/guzzardi/health_care.htm

    http://www.examiner.com/a-1510775~Illegal_immigrants_are_bankrupting_our_hospitals.html

    http://66.102.9.104/search?q=cache:E3BP7DmzhuMJ:https://www.noridianmedicare.com/shared/partb/bulletins/2006/229_jun/Undocumented_Aliens_-_Federal_Reimbursement_of_Emergency_Health_Services_.htm+federal+funds+for+aliens&hl=en&ct=clnk&cd=10&gl=us&ie=UTF-8

    http://www.heritage.org/research/Immigration/wm1490.cfm

    http://vdare.com/guzzardi/050315_cosman.htm

  19. LOVE THE USA said on 20 Aug 2008 at 8:29 am:
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    NOVA, It’s called Medicaid. It is done at every hospital. They actually have people soliciting these women in their rooms after they have given birth, they help fill out the forms for them.
    You are also assuming that illegals are paying taxes. I would venture to say that most of them are paid under the table. A lot of illegals live in overcrowded homes, so there again, they ARE NOT paying their share of taxes. Shopping at goodwill doesn’t ring up a whole lot of sales taxes either.

  20. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 20 Aug 2008 at 8:55 am:
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    NOVA, it is also called WIC. They get the benefits without question. All they have to do is prove the baby is a US citizen and the household gets the benefit.

  21. LOVE THE USA said on 20 Aug 2008 at 9:45 am:
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    I believe they also receive WIC when they are pregnant.

  22. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 20 Aug 2008 at 4:33 pm:
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    Yes, I believe they do as well. Benefits that need to be for US citizens. Cart your ass back to where you came from to pop out a baby. We have to fix the 14th ASAP. It is being interpreted much differently than it was originally intended because of the PC the US seems to be required to have.

  23. NoVA Scout said on 20 Aug 2008 at 9:39 pm:
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    So let me get this straight. Herndon Bob says that the Commonwealth’s budgetary problems are related to beneifts to illegal aliens and others chime in on that. I confess ignorance that there are significant state funds going to illegals and wonder why the Republican Majority in the GA would authorize this. I ask what state programs involve state monies paid to illegal aliens and ask whether you net out the taxes that the illegals pay in to calculate the overall financial impact. I can’t really discern that we’re getting very close to a number on this.

  24. IllegalisILLEGAL said on 20 Aug 2008 at 9:56 pm:
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    NoVA Scout does it really matter? Any money used toward an illegal alien in our country is money taken away from Americans.

  25. NoVA Scout said on 21 Aug 2008 at 12:35 am:
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    Depends on whether that illegal is contributing more economically than he costs in public expenditures. A lot of the way money moves around in a strong economy is not a zero-sum game, IiI

  26. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 21 Aug 2008 at 8:46 am:
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    The problem, which obviously you do not understand NOVA, is the ILLEGAL is using someone else’s SSN to “pay taxes”. They are not really paying taxes if they are using someone else’s number since the credit is going against the person’s identity. Yet another way to accept the ILLEGALS by making the argument that they are paying taxes, when in reality, they are not REALLY paying taxes, but contributing with someone else’s numbers.

    Anytime an ILLEGAL woman becomes pregnant, she can qualify for WIC. This is a WELFARE program provided by the state and federal gov’t. This is the problem, no one will break PC and ask for documentation that they are here LEGALLY. It is the don’t ask don’t tell of this decade.

  27. Citizen 12 said on 21 Aug 2008 at 9:59 am:
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    NoVA Scout said on 20 Aug 2008 at 9:39 pm:
    I ask what state programs involve state monies paid to illegal aliens and ask whether you net out the taxes that the illegals pay in to calculate the overall financial impact.

    NoVA Scout said on 21 Aug 2008 at 12:35 am
    Depends on whether that illegal is contributing more economically than he costs in public expenditures.

    **********************************************************

    Trying to rationalize criminal behavior down to dollars and cents cost / benefit ratio? That kind of thinking has poisoned the political mind set for the last 40 years. People who give the old excuse that it will cost more to enforce the law than the cost of the crime itself either condone criminal behavior or have a weak grasp on reality.

    Even if you could prove the invaders contribute to a positive cash flow, the people who would defend their presence based on that would be just as unwelcome as the invaders.

    I personally DO NOT set my principals and beliefs in this country based on the level of financial gain or loss provided by law breakers. It is a real shame many of our elected politicians find difficulty in holding a hard line as well.

  28. /\/\3|)iç 64 (Winner of the BVBL 40k and 50k post award) said on 21 Aug 2008 at 11:11 am:
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    Citizen 12, I agree 100%. They do not benefit the economy more than they take. The problem is the amount of money sent back to0 home countries which is not put back into our economy. That money, as a general rule, has not gone through the system of taxation. Yes they pay sales tax, but that is only when they purchase items in a store and not on the slide from a friend on the street. Too many are using the wrong SSN and ID’s of innocent people. When does it stop? Where does it stop? Who will stop it? Once we start punishing the smaller crimes, the larger ones will decrease. Once we start removing the incentives to come here and stay, they will self deport. They have no allegiance to this country, why should they benefit from the hard work of our ancestors?

  29. Brian Leeper said on 21 Aug 2008 at 1:23 pm:
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    “The problem, which obviously you do not understand NOVA, is the ILLEGAL is using someone else’s SSN to “pay taxes”.”

    If they claim a large number of exemptions on the W4 form they will effectively have little to no withholding.

    Years ago I made a mistake filling out the W4 form for a job I had just started. My first indication of a problem is that I kept owing taxes–over $1000 every April. After two years of this I determined that I had incorrectly claimed two exemptions on the W4 when I was only to have claimed one.

    To fix it, I submitted a new W4 form claiming no expemptions (since it wasn’t until November in the tax year that I figured out what the problem was) with additional withholding to make up the shortfall before the year’s end. Then, when the new year began, I submitted another W4 form claiming one exemption.

    You see, if you owe too much in taxes for too many years in a row(ie, you do not have enough withholding for too long), the IRS will charge you a penalty.

    However, they can only do this if you actually file taxes. If your intention is not to file taxes at all then you can claim a bunch of exemptions on the W4, effectively have no withholding at all, and if/when someone discovers there’s a problem you’ve probably moved on by then.

  30. Brian Leeper said on 21 Aug 2008 at 1:26 pm:
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    “If they claim a large number of exemptions on the W4 form”

    A correction: The W4 form calls them “personal allowances”, not exemptions.

  31. A Reader said on 21 Aug 2008 at 7:43 pm:
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    We also must not forget the $2,000 EXTRA spent on each kid in the ESOL program. Yes, I knowthe question, “How do you know they are illegal?” I don’t , but you know and I know that MANY of them are.

  32. NoVA Scout said on 22 Aug 2008 at 8:22 am:
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    AR: Should we have ESL for the legal immigrants and US citizen children of illegals?

  33. anonymous said on 22 Aug 2008 at 11:18 am:
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    The costs of providing “ESL” ought to be taken into account when considering the economic benefit of immigration.

    Wouldn’t you agree, Nova?

  34. NoVA Scout said on 22 Aug 2008 at 10:14 pm:
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    Yes, absolutely - to the extent it addresses illegal immigrant education. That’s a cost that wouldn’t occcur but for the prevalence of illegal immigrants in a community and we might as well put it in the debit column as we’re toting up these things. To the extent ESL is directed at legal immigrants, it’s probably a neutral cost. I haven’t really come to any conclusions about whether ESL is a good or bad thing generally. I see the logic of trying to move forward in basic studies in languages that the children are comfortable with, but it has to be done in a way that doesn’t slow down mastery of English.

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