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Massachusetts Liberal

Observations on politics, the media and life in Massachusetts and beyond from the left side of the road.

Friday, January 02, 2009

The dance begins

I wanted to wait at least one day into the New Year before I got too gloomy about the prospects for 2009, but the speed of the economic breakdown isn't that forgiving.

Dan Kennedy examines the dust-up between the Globe and the Herald over whether Boston is actually considering the layoff of police officers, while Globe reporter Kay Lazar takes a look at yet another sector that faces serious hard times as a result of the state's need to cut another $1 billion from the fiscal 2009 budget.

And to round out the picture, Casey Ross reminds us of a new provision of the state tax code that will bring in $400 million -- and a measure of equity -- that legislative Republicans want to repeal even when facing revenue shortfalls that begin with "b" and not "m."

The annual dance of the budget is upon us -- and this time it is a double feature that looks at both the current and upcoming spending plans.

Policy wonks love to talk about zero-sum games and this one certainly is. Below zero in fact. Spending needs to shrink to match the loss of dollars and for every "winner" there are often multiple "losers."

Early line here -- public safety will win and human services will take a hit. Same as it ever was.

My own guess is that the Menino administration authorized the leak offering the worst-case scenario of 200 out-of-work patrolman to put the pressure on the Patrick administration as it evaluates where to chop.

That's no different than the efforts being mounted by the various human services groups in an effort to save a piece of their pie. Or the effort by legislative Republicans to stand up against taxes, in any form.

And that doesn't even begin to take into account the efforts at the federal level by every industry to get its hands on taxpayer dough too.

In the end, everyone will take a hit -- painful but not as bad as it could have been if they did not play their roles in the intricate Kabuki dance known as a budget.

I'll be here to critique the performances.

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Anonymous Anonymous said...

Combined reporting. The Republicans are seeking repeal, yet no one is addressing a possible reality: Corporate tax revenues may actually shrink BECAUSE of combined reporting. It happened to California in the early 80s.

The problem is that Massachusetts, although experiencing recession, is outperforming companies in other states. When the multi-state operators are combined, the Mass profit is combined with the other-state losses to create a combined loss, or else a combined lower profit, and presto. Lower Corporate receipts.

Mass DOR acknowledges this phenomina, but defers to the Politicians' wisdom to consider i) deferral ii) amendment iii) repeal iv) nothing.

January 02, 2009 9:30 AM  
Anonymous Anonymous said...

You might be right that big cuts are coming, but my reading of the tea leaves says a fairly big percentage of what is likely to be a trillion dollar or so stimulus package will be block-grant style aid to state governments.

January 02, 2009 9:36 PM  
Blogger Outraged Liberal said...

Anon 9:30 -- interesting observation I hadn't thought about. It will be interesting to see how it plays out.

Anon 9:36 -- I hope you are right but I don't think any federal stimulus will cover a "fairly big percentage" of the pain. There will still need to be sizeable cuts.

January 03, 2009 9:36 AM  

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