Joint Fiscal meeting

[Carolyn Branagan]

The Joint Fiscal Committee met yesterday at the statehouse to examine recent revenue figures and listen to advice from economists. As many readers are aware, the recession we are experiencing is completely unprecedented. The steep decline in state revenue is worse than at anytime since the Great Depression.
 
All the key indicators still show a struggling economy at the state level and nationally. Conditions controlling how much revenue flows into the state worsened during the last quarter. The financial markets have not improved in spite of the band aids sent from the federal government. Labor markets continue to worsen. Vermont's unemployment rate now stands at 7.3% and is expected to reach 10% by year's end. Income taxes, sales taxes and rooms/meals taxes are all down. The only fund showing an increase is Transportation due to increase in taxes and fees. Overall, the revenue forecast shows a general fund shortfall of $28 million for fiscal year 2010 and a shortfall of $23 million for FY2011.
 
When asked if we could expect the economy to turn around in the next quarter, economist Tom Kavet answered, "Probably not."   None of the numbers are showing improvement, none are even showing stability. No bottom to the recession is in sight. He mentioned his belief that only a massive fiscal intervention by the federal government like the stimulus money would support any near-term growth.   
 
The good news is that even before this announcement Speaker Smith had convened a group of legislators to find a way to save $30 million in the way state government functions.    Opportunities for efficiencies exist everywhere, and I continue to believe that as time goes on we will be forced to make those changes.

Contact me for more information at cbranagan@leg.state.vt.us

Rep. Carolyn Branagan
Franklin-1, Fairfax/Georgia
Vermont House of Representatives

[edakrupp]

hopefully the tax amnesty will bring in some of those delinquent taxes. What about the rainy day fund? but still these are short term solutions- what about the long term? what is the plan to bring it all about face? Perhaps we are focusing on the negative and need to be thinking about what Can Be Done to Rebuild.

[special ED]

I hope that vt. yankee calls the states bluff,I would like too see weasle beak and his apprentice scramble for some answers

[dearon]

I watched a forum on the economy about 5-6 months ago, in it were several top economist along with Emerson Lynn from the Messenger etc.  Someone summed it up using an analogy stating  (I believe it was Emerson) in the past when were were in the ditch we could always figure how we could climb out; now for first time in history  we are in a ditch and can't figure how to get out of it. 
I don't think I will ever forget that as to me doing what I do it was quite frightening to think things are so bad no one can figure out how to get us out of this mess. 

[cedarman]

I don't think it's a matter of nobody can figure out how to get us out of this.   

It is a matter of us being a we want everything and we want it NOW!  Solutions to this current economic situation (and lack of revenue at the state level) are out there, but they will take time, and people will have to get by with less.

I think saying this current economic situation is "unprecedented" is a stretch.  The $$ figures may be larger now than they were in the early 80's,  but the total % of population unemployed is still lower.   Maybe it appears worse because as a country, and as individuals, we (in the general sense) have become less self-sufficient, more reliant on service/manufacturing/government jobs, and we carry more debt relative to our incomes. 

I'm not old enough to remember the hard economic times of the early 80's, but from what I've read about it (and other hard economic times that were not directly war based), they usually resulted from people overextending themselves financially.  They took out too much credit, and as soon as their incomes reduced a little, they couldn't sustain their payment.  It snowballed from there.

After a lot of reading about prior economic recessions/depressions, it seems the least effective programs involved government spending as handouts (Great depression era programs intended as temporary fixes have become legacy programs entrenched in our society), and the more effective programs involved the government working WITH large AND small companies to create new jobs!! 

"Lower taxes ultimately end up in greater revenue" and for the individual: "Spend less, save more for your own security".

[edakrupp]

After a lot of reading about prior economic recessions/depressions, it seems the least effective programs involved government spending as handouts (Great depression era programs intended as temporary fixes have become legacy programs entrenched in our society), and the more effective programs involved the government working WITH large AND small companies to create new jobs!! 

"Lower taxes ultimately end up in greater revenue" and for the individual: "Spend less, save more for your own security".
[/quote]

I hate to bring partisanship into this but the above statement would you think it is a democratic statement or a republican statement?

[Carolyn Branagan]

'Less taxation and smaller government'  is the core of all Republican platforms. The party says it has a 'big tent' meaning many  other beliefs are tolerated, but most would agree this desire for reducing taxation and the corresponding size of government is the heart of all Republican initiatives. It rests in the belief that the individual is responsible for his/her own actions and destiny, not  government.

Remember the Bill of Rights? The first 10 amendments to our  US constitution clearly document for us in law that all people have the right to pursue happiness, but there is no right to have the government pay for it.

Money is best left in the pockets of those who earn it. Of course for issues of public safety and general welfare, there are efforts that are best done for all of us by the government: building and maintaining the roads, national defense, care of the poor/handicapped etc. 

Carolyn B.

[edakrupp]

iI reducing the size of government means that the senators and representative and cabnit members will get paid less and government stops spending money so their personal pockets get full,  and giving tax breaks for the rich then... perhaps.

 But to me it seems there is a lot of greed and rich getting richer. special interest groups have the government by the balls and the mistakes that have been made in the past continue to be made and are almost expected.

Government has a lot of corruption and the rich have many ways of avoiding it. Is this a democratic view or republican. I bet everyone would like the reins brought in and moderation found.

[dearon]

iI reducing the size of government means that the senators and representative and cabnit members will get paid less and government stops spending money so their personal pockets get full,  and giving tax breaks for the rich then... perhaps.

 But to me it seems there is a lot of greed and rich getting richer. special interest groups have the government by the balls and the mistakes that have been made in the past continue to be made and are almost expected.

Government has a lot of corruption and the rich have many ways of avoiding it. Is this a democratic view or republican. I bet everyone would like the reins brought in and moderation found.

I don't think it fair to blame either the democrates or the republican the rich or the poor.  We are all to blame we all created this monster called recession.  To blame the rich for greed is as bad as blaming the poor for laziness or lack of will.  Allot of wealthy people have work hard and made good decisions; their hard work and good decisions. are the reason for their wealth.  As far as the people born into it, you can't blame them for being born wealthy can you???  Everyone has the power and the ability to create wealth.

[edakrupp]

You're right political parties don't really play into it. My Bad. Human nature is human nature.

 But..... Doesn't it just rile you when CEO get 200.000.00 bonuses! Or you find out our politicians are traveling to far off first class resorts on our bill?- I just wish that the money flow wouldn't get caught up in the corruption, and greed that seems to have grown with the screw everyone else mentality that seems so pervasive in the upper upper classes.

The recession, we'll get through. tighten the belt and wait out the storm. hell my father says my spending habits recently will single handily solve the recession!- being the good patriot that I am.

[dearon]

I agree there is definitely corruption in big business and too much spending by our politician at our expense.  They spend more on a trip to France or Martha's Vineyard than most people make in year.  That really really really bothers me and if I knew how to stop it or had the power to I certainly would!!!