Posts Tagged capitol

Best of Times, Worst of Times


“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness . . . ”  So begins Charles Dickens’s novel A Tale of Two Cities.  It is set in in the years prior to the French revolution, but actually applies to the recent performance of Republicans in the Pennsylvania legislature.

As official Harrisburg prepares for what is shaping up to be another epic budget battle, the big question is: which GOP will show up in 2017?  Will it be the Republican-controlled legislature that last year stood its ground and fought Governor Tom Wolf’s historic tax and spending proposals, or will it be the GOP that this year folded like a cheap suit and approved $1.4 billion in new spending?

The $1.4 billion spending hike might not qualify as the worst of times, but coming on the heels of a successful struggle against the Wolf Administration’s spending demands it did leave a lot of folks puzzled.  After winning the longest budget fight in state history, why turn around and cave in months later? This leaves most observers – and quite a few participants – at a loss when it comes to predicting how the 2017 budget war will unfold.

We are certain of a few things.

The toxic stew of tax increases and new taxes cooked up to pay for this year’s massive spending increase has failed to live up to expectations.  To date, revenue collections for the 2017-2018 fiscal year are running $261.8 million below estimates.  This, coupled with a “structural budget deficit” pegged at over a billion dollars means the new budget will begin with a significant gap between spending and revenue.

We also can be sure that Governor Wolf will again demand massive spending increases and the taxes to pay for that spending.  He used his budget address this year to lecture the General Assembly for its refusal to accede to his spending demands.  Since most of his priorities have not been funded chances are they will be dusted off and included in his new budget proposal.

But should Republicans sit back and wait for the governor to set the agenda?  Leo Knepper of the Citizens Alliance of Pennsylvania, a pro-growth PAC, suggests a different course of action.  “If Republicans in the General Assembly were smart, they would upend a long-standing budget tradition and go on offense,” Knepper wrote in a recent policy brief.  “(They) should ignore tradition and pre-empt the Governor’s budget address with a plan of their own.”  Knepper observed this would “force the governor to play defense rather than the usual offensive position granted to governors.”

The question remains, however, whether or not legislative Republicans – or at least the leaders who actually sit at the negotiating table – want to go on offense.  Will the resolute leaders who fought and won the first budget battle show up to play, or the ones who forfeited this year’s game?

The final certainty is that all this will play out against the backdrop of the rapidly approaching 2018 election for Governor.  For his part, Governor Wolf will want to deliver the goods of higher spending to his largely urban constituency.

It won’t be so simple for Republicans.

With a number of legislators, including leaders who will negotiate the new budget, eyeing a race for the Republican gubernatorial nomination, the upcoming budget battle is fraught with peril.  There are pressures for leaders to “be responsible” and give into spending demands.  But with a veto proof Senate majority and a historically large majority in the House, voters are not likely to be either understanding or forgiving if the GOP doesn’t stand firm.

Will it be the “best of times” with legislative Republicans going on offense and standing up to a tax and spend governor, or will it be the “worst of times” with the taxpayers of Penn’s Woods getting stuck with yet another round of tax hikes?  As the budget process begins a new cycle it is impossible to tell which of the GOP’s split personalities will emerge dominant in 2017, but both the pocketbooks of taxpayers and the political fortunes of many politicians will be affected by the outcome.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

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When in the Course of Human Events


This is the time of year when Americans celebrate the anniversary of our declaration of independence from Great Britain.  It is ironic that the United Kingdom itself a few days ago found it necessary “for one people to dissolve the political bands which have connected them with another.”  By leaving the European Union the British people have reconfirmed that the longing for liberty is an eternal emotion.

Meanwhile, here in the colonies, the very document that ensured our rights as a free people has been under relentless attack.  The Constitution of the United States has withstood the test of time. After the Articles of Confederation failed to provide the framework for an effective federal government delegates from the 13 colonies met in Philadelphia and in September of 1787 put their signatures to the document which, at least theoretically, remains our nation’s ultimate authority.

On June 21, 1788, New Hampshire became the ninth state to ratify theConstitution which then took effect on March 4, 1789.  The document was, however, viewed as incomplete and several states insisted on the inclusion of ten amendments, which became known as the Bill of Rights.  Those amendments were ratified and became effective on December 15, 1791.

That the Bill of Rights was necessary is evidenced by periodic efforts throughout our nation’s history to disregard, water down, or remove them entirely.  Perhaps no amendment has been so violated as the tenth which limits the power of the federal government.  Congress and the president, frequently with complicity by the Supreme Court, have consistently throughout the ages infringed on this right.  Today the assault continues, especially upon the second amendment governing our right to keep and bear arms.  The non-existent “right” of freedom from religion has replaced the “free exercise of religion” guaranteed in the first amendment.

It is safe to assume that the founding fathers would place in the first amendment those rights that they viewed as most vital to a free people.  It is here that the Constitution guarantees our right to freedom of speech and of the press.  Now obviously there was no electronic media or internet back in 1787, but freedom of speech and of the press clearly applies to all means of communication.

A free press was instrumental in our nation’s founding.  The only method of mass communication was through the printing press producing formal newspapers, pamphlets, and broadsides.  From Thomas Paine during the revolution to the Federalist Papers, the expression of opinion via the printed word was a vital means of exercising free speech.  Throughout our history we have depended on a free press to keep government in check, such as it did during the Watergate scandal of the 1970s.  So vital is a free press that it is often referred to as the “fourth estate,” or fourth branch of government.

It is therefore disturbing to see candidates and elected officials from the national to the local level trampling this vital right.  In just the last few weeks, Republican presidential candidate Donald Trump has banned the Washington Post from covering his campaign events.  Here in Penn’s Woods, the Democratic mayor of Harrisburg, Eric Papenfuse, has revoked the credentials of the capitol city’s newspaper the Patriot News/Penn Live. Papenfuse’s actions are especially curious in that he is the owner of a prominent bookstore, so you would think he might have some loyalty to the unfettered circulation of the printed word.

My goal here is not to defend the content of these publications – whose left-wing ideology frequently taints their reporting of the news – but to stand up for their right to do so.  If elected officials, from mayors to presidents can decide who can cover the news they can also then control the news.  This is not only a violation of the media’s constitutional rights, but an existential threat to our democracy and ultimately our individual liberty.

As we celebrate our freedom with fireworks and back yard barbecues let us always remember that the trampling of one right is the trampling of all rights.  The loss of any one right puts us on a very slippery slope which will ultimately lead to the loss of all rights.  From freedom of the press, to freedom of religion, to our right to keep and bear arms, we must fight to protect our God-given rights against those who would take them away.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

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Déjà vu All Over Again


‘Tis budget season again in Harrisburg.  Governor Tom Wolf and the state legislature face a June 30th deadline for enacting the 2016-17 spending plan. If it seems like we just finished the budget; that is because it took until April for the longest fiscal stand-off in state history to be resolved.  And now, it is time to begin anew.

Hopefully, not the lengthy stand-off part.

June is typically when the heavy lifting on crafting the new budget is done, particularly the last week of the month when legislators act like college students pulling an overnighter to get their assignments finished.  In this case though, there is no penalty for tardiness.

The big question under the capitol dome is will there be a summer re-run of the 2015-16 budget drama, or will the state budget actually get done relatively close to the constitutional deadline?  So far, the signals are mixed – but ominous.

Will it be, as Yogi Berra once said, “déjà vu all over again?”  Two factors point to another epic battle.  First, Governor Wolf’s “budget address” last winter lacked any content actually pertaining to the budget. Instead, he unleashed a tongue lashing at the legislature for failing to approve his historic tax and spending increases.  This was as well received as an illegal alien at a Trump rally.  Second, not a single legislator lost in April’s primary as a result of the budget battle.

That second factor is significant.  With all House members and half of the Senate up for re-election this year pressure is normally on to avoid anything even remotely controversial so as not to upset the electorate.  However, Republicans in particular are emboldened because they stood their ground, bested Governor Wolf in round one, and were rewarded by voters.  This gives them no incentive to cave to the governor’s tax hike demands.  Quite the opposite, voters in their districts clearly don’t want expanded state spending and the taxes needed to pay for it.

Conversely, Democrats – who have become essentially an urban party in Pennsylvania – represent districts that benefit from state taxpayer largesse.  Their constituents want more spending because they are on the receiving end, thus those voters returned their representatives to office as well.

Stuck in the middle are the endangered species of suburban Democrats who represent so-called “swing districts.”  Largely located in western Pennsylvania, these districts have been flipping from Democrat to Republican in recent cycles.  This is where the biggest electoral battles of 2016 will be fought, and those Democrats are on the hot seat.

This brings us to the one factor that could bring about a prompt budget resolution: Democratic desires not to lose even more of their seats.  Already Republicans hold legislative majorities not seen in over a half century.  The electoral map does not offer Democrats much hope.  At least three Senate Democrats are imperiled while the GOP faces no significant opposition to holding their seats.  In the House, most battles will again be fought on the little remaining Democrat turf in the western part of the state.

In each of those districts the trend line has been favorable for Republicans, and the Democrat constituencies are far more conservative than those found in urban areas.  Thus, Democratic candidates in each of those districts can ill afford to be tagged with supporting Governor Wolf’s tax and spend agenda.  This is incentive for Democratic leadership to postpone until next year any epic battle over the budget.

Should that occur Pennsylvania taxpayers will have only a brief respite.  Governor Wolf must stand for re-election in 2018 meaning his last shot at enacting his bold plans to expand the size and scope of state government will come next year.  Lose, and his image as an isolated and ineffective chief executive will be cemented into place.  But for Tom Wolf, even winning comes with some risk: will statewide voters actually reward a governor who just imposed upon them a historically large tax hike?

The only thing we can say for sure is it will be interesting to watch.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

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Uncharted Waters


On one point there is unanimous agreement under the capitol dome in Harrisburg: Pennsylvania is in uncharted fiscal waters.  Never before in the history of the commonwealth has a state budget impasse lasted this far into the fiscal year.  There are no signs of agreement on a pathway forward.  And the deadline for next year’s budget is now on the horizon.

Despite all of this there has been little public outcry.  Recent polling suggests Governor Tom Wolf’s approval ratings have taken a hit, but the filing deadline for candidates to run for state House and Senate seats came and went in mid-February leaving most lawmakers with no or token challengers.  And, for the most part, the machinery of state government chugs onward.

Unlike past periods of budgetary disagreement state workers have continued to be paid throughout this impasse.  This as a result of past court rulings that held employees who in fact show up for work and perform their jobs must be paid.  As a result, essential – and many non-essential – state services have continued unabated.

Since the state constitution requires passage of a budget before spending can take place you might think state coffers would be overflowing with unspent tax money.  You likely have noticed that despite the lack of a budget, state income taxes are being deducted from your paycheck and you continue to pay sales tax on purchases.  The state, however, is broke.

The state treasury a couple of months back took out a $2 billion loan supposedly to keep the cash flowing.  But, without a budget how can the state spend so much money it actually had to take out a loan to stay in business?  The answer is over $37.5 billion has been expended, much of it prior to the partial budget resolution that occurred in January.

This has caught the attention of Republican legislators who point out Governor Wolf does not have the authority for such spending.  Worse, what gets paid and what does not get paid is basically happening at the discretion of the Governor.  Senate Republican spokeswoman Jennifer Kocher told the Pittsburgh Tribune-Review that Wolf is spending as if he has “an open checkbook.” She pointed out, for example, the governor continues to fund the state corrections system even though he line-item vetoed that portion of the state budget.

The governor’s spending priorities have been controversial.  Last Fall the state treasury floated a “loan” to the House Democratic Caucus because they had run out of money to pay staff due to the budget impasse.  A couple of months later that same treasury denied the City of Erie School District a loan to keep schools open.

Worse, the Wolf Administration has been less than transparent in making public details of its unauthorized spending.  State Representatives Chris Dush (R-Jefferson) and Seth Grove (R-York) have had to file Right to Know requests to obtain information.

All of this has prompted calls for Auditor General Eugene DePasquale to conduct an audit of the state spending that is occurring during the budget impasse.  The GOP brought out the heavy artillery to make the request which came from House Appropriations Chairman Bill Adolph (R-Delaware) and Senate Appropriations Chairman Patrick Browne (R-Lehigh).  They head the legislative committees vested with budgetary power.

Governor Wolf triggered the ongoing budget battle by requesting, actually demanding, a massive increase in state taxes and spending.  Interestingly, the amount of money spent by his administration over the past seven months surpasses the total annual budget passed by the legislature and partially vetoed by the governor.  This has given rise to concerns that the governor plans to spend to his preferred level regardless as to whether or not he ever receives legislative approval.  That could turn the current fiscal and political crisis into a constitutional crisis.

Much like President Obama at the national level Governor Wolf has made it plain he plans to implement his agenda by whatever means necessary even if it means trampling the constitution.  His unchecked and unauthorized spending spree is proof positive he is doing just that.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

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Governor Wolf PERCs Up


After just one year in office it is clear Pennsylvania Governor Tom Wolf is the most spendthrift governor in the nation.  After all, his proposed and still unresolved 2015-16 state budget called for a tax hike greater than that of all other 49 states combined.  It was a bit startling to see this ultra-big government advocate actually announce he was going to shutter a state agency.

You might think fiscal conservatives would applaud his move to close the Public Employees Retirement Commission (PERC) an obscure state agency that most Pennsylvanians don’t know even exists.  But, any time a politician acts out of character it is a good idea to dig deeper into his or her motives.  Such is the case with Governor Wolf’s proposed elimination of PERC.

According to its website, the Public Employees Retirement Commission is responsible for “monitoring public retirement plans in Pennsylvania, studying the retirement needs of public employees … develop objectives and recommend legislation to the Pennsylvania legislature.”  PERC further administers various mandated reporting on the health of public employee pensions and funnels state funding to municipal pension systems throughout the state.

This trip takes us through the tall weeds of Pennsylvania’s arcane and convoluted public employee pension system, but the bottom line is PERC is responsible for monitoring the health of municipal pension systems and in the process of performing that duty raises a red flag when such plans are headed into financial trouble.  As such it performs an important watchdog function especially at a time when a significant number of municipal pension systems, especially in cities, are under fiscal stress.

In addition to providing independent oversight of municipal pension systems, PERC is required to administer the process of distributing some $250 million annually to municipalities.  According to a news release from State Representatives Stephen Bloom, Seth Grove and Keith Greiner, that amounts to 20% of the contributions that are made annually to municipal pension funds.  The representatives, Republicans all, voiced concern that without those funds many municipalities would be forced to raise property taxes.

Concern over the potential demise of PERC has produced something rare in Harrisburg, bi-partisan agreement.  State Auditor General Eugene DePasquale, a Democrat, said: “If people think there’s a (municipal) pension problem now, wait until municipalities don’t get their (Act 205) payments.”   That DePasquale, who has been one of the more rational voices on fiscal matters would sound such a warning speaks to the seriousness of the issue.

To complicate matters further Governor Wolf plans to shut down PERC without seeking legislative approval.  Using the “pen and phone” approach popularized by President Obama, the governor says the agency is simply going to cease to exist.  Republican lawmakers are crying foul pointing out the governor has no authority to close an agency authorized by an act of the General Assembly.  So not only does Governor Wolf’s plan to sunset PERC put public pension plans at risk and likely trigger municipal tax increases, but it creates a constitutional crisis as well.

Pension reform has been a major component of the ongoing budget battle between Governor Wolf and the Republican-controlled legislature.  Senate Majority Leader Jake Corman, among others, has vowed not to consider any of the governor’s proposed broad-based tax hikes until the state’s pension crisis is resolved.  Why then would Wolf want to complicate matters by tossing PERC under the bus?

Perhaps because Governor Wolf simply refuses to admit there actually is a pension crisis. In his view, pension systems across Penn’s Woods are just fine – all they need is more money.  As a captive of big labor the governor is committed to blocking any and all attempts at pension reform instead favoring throwing billions more in taxpayer dollars into systems at all levels that are simply no longer viable.

While many municipal pension funds, especially those administered by townships, are financially secure, state employee funds and those in larger cities must either be reformed or taxpayers will see historic tax increases.  That Governor Wolf would open a new front in the pension battle by moving to shutter PERC shows not only is he not serious about pension reform, but he will do everything in his power to prevent it from happening.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address islhenry@lincolninstitute.org.)

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Harrisburg, We Have a Spending Problem


Pennsylvania state government has a structural budget deficit of $1.2 billion dollars.  This somewhat mystical figure is agreed upon by just about everyone.  Given this rare point of agreement, why then is the ongoing budget impasse focused on spending increases rather than spending cuts?

When the working families of Penn’s Woods sit down to pay their monthly bills and income is less than expenses then the family cuts back on spending.  That is because ordinary people can’t just walk into the boss’s office and say “I don’t have enough money to pay my bills so you will pay me more next month.”  And certainly, faced with a deficit, working families – and even most businesses – don’t go out and spend more.

But, that is exactly what Governor Wolf is proposing.  He wants a $4.7 billion increase in state taxes.  If you accept that there is a $1.2 billion structural deficit, then he also wants to increase spending by $3.5 billion.  It is an unrealistic proposal and the reason why the state budget impasse has dragged on for five months.

The governor, however, has won on this front: Republican counter-proposals have focused not on spending cuts, but on increasing spending by less.  Given everyone has bought into the structural deficit number the goal should be to reduce spending to bring actual income and expenditures into balance.  That is what happens in the real world.

Government, however, does not live in the real world.  At no point has a budget been put forward that would even slow the growth of state government let alone cut spending.  The battle has been all about how much bigger state government will become, not about living within our means.

Driving this irrational approach to budgeting is spending on K-12 public education.  The biggest lie since “if you like your health insurance you can keep your health insurance” is that Governor Tom Corbett took a meat axe to education spending.  A cabal of Democratic politicians, labor unions and their media apologists perpetrated that lie during last year’s gubernatorial campaign even though actual spend numbers prove state tax dollars spent on public education increased to record levels under the former governor.

Governor Wolf has never shifted out of campaign mode, and in an effort to repay the unions who financially backed his campaign has made historic increases in education spending a key demand.  Education is a motherhood and apple pie issue.  After all, who doesn’t want our children to have the best education possible?  We all do.  The rub is little of the increases in spending actually benefit children, going instead to pay for bloated administrative bureaucracies and skyrocketing pension expenses.

To their credit, legislative Republicans are insisting on structural reforms to the state’s pension system before agreeing to any spending increase.  But, they have accepted without as much as a whimper the governor’s premise that spending must go up.  Wolf is already crowing that he has gotten Republicans to agree to a “historic” (meaning massively large) increase in state spending on education.

Yet even today, as the budget that should have been done before Independence Day fireworks remains unresolved as we shop for Thanksgiving dinner, not one single party to the budget debate has put on the table any serious menu of potential spending cuts.  Even the GOP’s on-time, no tax hike budget which the governor vetoed included significant spending hikes.  No effort was made to cut spending to match projected income.

There is an old saying in sports that you can’t win by simply playing defense.  That is what has happened as the budget game goes into triple overtime.  At no point has there been an offense designed to cut spending, just defense over spending increases.  So the taxpayers of Pennsylvania have already lost the game, the only hope now is that the final score is not too lopsided.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

 

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Cesspool of Corruption


These are days of shame in Pennsylvania.

In just the past couple of weeks a sitting state Supreme Court Justice has been indicted, a state Senator has resigned in the wake of her conviction on corruption charges, a former Senate President Pro Tempore has struck a plea deal, and a former Speaker of the House has entered and been released from prison.

Penn’s Woods is in the throes of the worst outbreak of corruption since Milton Shapp occupied the Governor’s office. Former high ranking officials of both political parties, as well as sitting elected officials in both houses of the legislature and the state’s highest court have brought shame upon themselves and upon the government they were entrusted to serve.

The case of former House Speaker William DeWeese is particularly egregious. Convicted and sentenced he reported to the Dauphin County Prison outside of Harrisburg on a Monday, but was released just days later pending appeal. As DeWeese walked out of the prison gates and later feasted at one of Harrisburg’s finest restaurants, those of less lofty status were left to languish in the prison while awaiting trial. Even in disgrace rank apparently still has its privileges. Making matters worse, DeWeese – currently resigned from the House – was nominated for a new term by voters in his Greene/Fayette County district in April’s primary.

Those charged and convicted (so far only one defendant has been found not guilty) have attempted to divert attention from their misdeeds by claiming the prosecution is politically motivated. This tactic spans the partisan divide. Former Attorney General, now Governor Tom Corbett was accused throughout the Bonusgate and Capitol Corruption investigations of prosecuting for political gain. In Allegheny County, District Attorney Stephen Zappala, a Democrat, is accused by the Republican Orie sisters of similarly pursuing a political agenda. But in both cases indictments were issued by sitting grand juries, and convictions came from a jury of their peers. Neither Corbett nor Zappala controlled those bodies, and none of the multiple juries involved were of political construct.

Adding further to the cesspool of corruption that has engulfed state government is the fact those charged and convicted were not low level staffers or even back benchers in their respective chambers. They were leaders: a Supreme Court Justice, a former Senate President Pro Tempore, two former Speakers of the House, and those who held other leadership positions. This again proves the old adage that power corrupts and absolute power corrupts absolutely.

Yet, despite the fact our prisons are filling up with former elected officials, and dozens of legislators have been tossed from office by voters, precious little reform has been enacted by those who remain. There have been a few changes; such as ending voting in the middle of the night, and not passing legislation in lame duck sessions.

But the reforms passed to date have been neither significant nor structural. The fact is the culture of corruption that pervades state government stems from the fact the General Assembly has become for all too many a career rather than public service. Once elected, all too many legislators place a higher premium on getting re-elected than in addressing the many significant needs of the commonwealth. That is why the state and school districts across Pennsylvania are standing on the beach ready to be swamped by a tsunami of pension costs, our roads and bridges are crumbling, and our public education system is in disarray.

There has been window dressing. A proposal to reduce the size of the General Assembly is nothing more than a ploy to concentrate more power in the hands of the few. Real reform, such as constitutional term limits, restricting session days to just three months per year, and limiting compensation to that proscribed by the state Constitution is nowhere on the radar screen. Even ministerial reforms, such as doing away with unvouchered per diems and requiring receipts for expense reimbursement, have not seen the light of day.

We are often told by those remaining in office that the few bad apples are not spoiling the whole barrel and that there are good and honest people serving in state government. This is certainly true. But, apparently there are not enough good and honest people – or at least not enough of them are willing to step forward – to make the changes necessary to put an end to the commonwealth’s culture of corruption.

The philosopher Edmund Burke once said: “All that is necessary for the triumph of evil is that good men do nothing.” So true, and by standing by and doing nothing the rest of the legislature adds to the shame that today shrouds Penn’s Woods like a summer fog.

  (Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal. His e-mail address is lhenry@lincolninstitute.org.)

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