Don't raise taxes, reduce spending
Friday, January 06, 2017 8:01 AM
As the Indiana General Assembly begins its 2017 session this week, one would assume the Republican-dominated state government would be pushing legislation for a more limited and fiscally responsible government — and one that protects individual liberty, freedom of religion, the right to keep and bear arms, and the sanctity of life. After all, that’s what their 2016 state convention said they stood for.
That would be a bad assumption; the GOP leadership actually intends to increase taxes.
The heart of their legislative agenda is a gasoline tax hike on Hoosiers from 18 cents per gallon to 26 cents per gallon. Why? So they can spend an additional $900 million to $1.2 billion a year to maintain state and local roads and fund new highway projects. They’re also talking about new tolls on state and federal highways and imposing new fees at the Bureau of Motor Vehicles.
So much for the Republican Party’s promise, “We believe that budgets should be balanced and should reduce spending, rather than increasing taxation.” To add insult to injury, House Speaker Brian Bosma’s agenda is to triple the spending on the new government-funded preschool pilot program at the same time he says we don’t have enough money to maintain our existing roads and bridges. His counterpart, Senate President Pro Tem David Long, wants to double this pre-K spending. If these Indiana Republican leaders were really the fiscal conservatives they claimed to be on the campaign trail, they would fix the road problem by reducing spending elsewhere to pay for their road funding plan instead of raising taxes.
If Republicans merely held true to the principles they say they stand for, this $900 million in cuts would be easy. The talking points:
First, all of the sales tax on gasoline should go to road maintenance – not just one-seventh of it but all of it. That’s $400 million that should be dedicated to road funding but instead gets squandered elsewhere in the general fund.
Second, if they really believed in economic freedom, Bosma and Long would eliminate the $95 million the state spends on so-called “economic development,” which turns into politicians handing out government favors to those who contribute to certain political campaign committees.
Third, they can reduce regulations, and an easy place to start is eliminating the $50 million on the Gaming Commission and Horse Racing Commission, which makes it more difficult every year for not only casinos and race tracks but for philanthropic clubs like the American Legion, VFW, Eagles, Moose Lodge, etc., to operate.
Fourth, show the kind of fiscal discipline in the state-funded university system as what the private sector has to deal with in tough times. Get rid of top-heavy bureaucracies, and start by eliminating the $368-million Commission for Higher Learning and transfer its functions to the universities themselves.
Next put new construction at universities on hold ($46 million) while we focus on roads. During this same period, have state universities run leaner by reducing their budgets by 15 percent, freeing up $285 million for roads.
Lastly, since government-funded student loans are feeding the college student debt bubble it would be prudent to reduce this as well. A 25 percent reduction in these subsidies would free up $90 million. All totaled, these cuts would give Bosma and Long their additional $900 million for roads without raising taxes.
Budgets should be balanced by reducing spending, not by raising taxes. The 2017 legislative session will reveal whether Bosma and Long are the fiscal conservatives they claim to be, or are mere lackeys of the Indiana Chamber of Commerce and their other special-interest campaign contributors.
John Pickerill, former chairman of the Montgomery County Republican Party, wrote this for the Indiana Policy Review Foundation. A graduate of Purdue University and the Navy Nuclear Propulsion Program, Pickerill retired from the U.S. Navy with the rank of Commander.