Tuesday, February 3, 2009

Just Show Me the Money


By Patrick D. Reagan, Ph.D.

The newly-minted Republican majority in the Tennessee General Assembly is faced with an unaccustomed reality: responsibility for governing, rather than criticizing those who hold that responsibility. Tennesseans, not unexpectedly, are curious about how this newfound responsibility will be implemented.

The overwhelming challenge confronting the Republican majority is certain to be the enormous budget deficit, likely to exceed $1 billion for this and next year. Gov. Bredesen will present his budget recommendations in February but he is already talking about 20 percent cuts in most departments and related functions, like higher education and health care. Reductions of this magnitude will bring real suffering and loss to millions of Tennesseans.

The nation’s economic misery is partly to blame, but so is Tennessee’s antiquated, dysfunctional, unfair, and ineffective tax system. By relying so heavily on the nation’s highest sales tax for the state’s principal revenue source, the revenue shortfall is hardly surprising. There is no doubt about the situation: Tennessee is in a horrendous budget mess.