The Corner

The Revenge Against Fiscally Prudent States Act of 2010

Last week Dan flagged an editorial in the Washington Post that was surprisingly critical of the state bailout bill that shall not be named (though I really like The Most Recent Desperate and Obviously Political Act of The Out-of-Touch 111th Congress — can we send that reader a t-shirt?). The editorial noted that “As of last school year, the money for 5.5 percent of the 6 million K-12 jobs nationwide came from Washington through the 2009 stimulus; the new money reinforces this dangerous dependency.” It absolutely does, which one reason why Texas, which did not face a state-level budget shortfall for education at the time, decided not to use its share of the 2009 stimulus money to increase spending on education. Instead, state lawmakers used the money to shore up a rainy-day fund in case the recession caused a budget shortfall down the road. 


That turned out to be a pretty wise move, so naturally Democrats in Washington are trying to punish them for it:

When the House convenes today in a special session to vote on a $26 billion package of aid funds for state and local governments, it will have to decide whether to single out one state — Texas — for special treatment. This is not the kind of special treatment that we’re used to seeing in Washington, where senators often secure extra benefits for their states in return for their votes. Instead, Democrats are trying to punish Texas for its fiscal responsibility, above and beyond the punishment inherent in a “state bailout” that is intended mostly to help spendthrift states such as California, but that Texas taxpayers must help pay for nevertheless.

The provision in question, an amendment authored by Rep. Lloyd Doggett, an Austin Democrat, would deny Texas its share of the bill’s education funds unless its governor “provides an assurance” that it will not reduce the percentage of total revenues it spends on education at any time in the next three years. Gov. Rick Perry argues that this is impossible: The state legislature controls education funding in Texas, not the governor, and the governor cannot bind future legislatures to any level of spending. Because Perry cannot provide the kind of assurance the Doggett amendment appears to require, he argues that it would deny Texas, and only Texas, over $800 million in education funds.




Doggett’s amendment is a clear act of political retribution and an attempt to handcuff a governor who disagrees with him about the proper level of education spending in Texas. But here’s a question for Doggett: What’s going to happen to that 5.5 percent of teachers nationwide whose salaries are currently coming from federal emergency funds when it comes time to shut down the stimulus machine? In Texas, it won’t be that big of an issue, precisely because Texas did not use previously appropriated stimulus funds to increase the education-spending baseline. Elsewhere, however, Congress has made the state-deficit problem worse by structuring stimulus funds so that they lock in higher state spending in the future. 

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