Virginia Gov. Bob McDonnell has been touting the state's $403.2 million budget surplus since it was announced earlier this summer. On Fox Business Network yesterday, he took that advocacy a bit further and offered Washington lawmakers some advice on balancing the budget:
Watch the latest video at video.foxbusiness.com
"What we need to do is incentivize the free enterprise system which has been the strength of American democracy for hundreds of years to grow. I hope Richmond would be a model for Washington." Ahistorical nonsense aside -- for the first hundred years or so, chattel slavery was the economic core of American democracy -- Gov. McDonnell's "advice" obscures two things about the state's surplus; first, it's mostly the product of nifty accounting tricks. The state delayed payments to the Virginia Retirement System by $620 million and required retailers to pay its sales taxes earlier than expected (in fairness, this program was approved by his predecessor). The retirement payments are required by law and will resume in 2013 (with interest). Still, McDonnell hasn't balanced the budget as much as he has borrowed money from public employees and deferred responsibility for the shortfall to a future governor (Virginia's governors cannot serve two consecutive terms).
As for the rest of the surplus, the state benefited from federal stimulus payments -- to the tune of $700 million -- and avoided a tax increase by assiduous cuts to education and a number of state social programs. McDonnell's budget includes hundreds of millions in K-12 education cuts, cuts to higher education, and a 3 percent reduction in Medicaid reimbursements, as well as a 4 percent Medicaid cut for the 2011 fiscal year. In particular, the education cuts would fall hardest on the state's poorest districts, and force cities such as Richmond, Danville, and Petersburg to eliminate preschool programs for low-income children.
McDonnell's preening notwithstanding, Virginia's budget was balanced on the backs of children, the poor, and public employees. Indeed, the only Virginians who will benefit from this arrangement are the wealthy, who will sleep securely in the knowledge of their low tax rates.
-- Jamelle Bouie
