I saw a short blog entry (h/t Josh Gillespie) referring to a Congressional Budget Office Report indicating that the 2001 budget projection was off by $11.8 trillion (pdf). The $5.6 trillion surplus we were headed for in 2001 turned into a $6.2 trillion deficit, largely on the strength of ill-advised tax cuts, a new Medicare prescription benefit, and a couple of unfunded wars.
In fairness, I don’t think Gov. Daniels had anything to do with the Medicare prescription benefit. And, really, I wouldn’t be picking on Gov. Daniels for this except that the mythology creeping up around him is that he “balanced the budget without raising taxes.” That mythology would require you to ignore the $2 billion+ we owe the feds because of our grossly underfunded unemployment insurance benefit program. It would also require you to ignore the 16% sales tax increase in Indiana.
But since you pay the sales tax in tiny increments, and don’t ever see a total for how much you’ve paid for the year, that doesn’t count.
That’s government transparency and accountability at its finest.
A fair analysis,tho we got quite a bit for the 1% raise in sales tax. I learned a long time ago that while you might prefer one party or the other, it really behooves you to try to get the best possible candidate running against your side, just in case it goes the wrong way. It might be nice to run against Trump, but what if he actually won?
It was a 16% raise in the sales tax; an extra 1% per dollar spent.
But, yeah, I don’t see the Republican candidate yet I prefer to Gov. Daniels.
My prediction is that if Gov. Daniels wins the Republican nomination, he will suddenly turn into a social liberal / fiscal conservative at least until the election is over. He’ll pretend to regret signing all the bull we’ve seen this year. Maybe it will get him a 3rd party challenger on the right, but so much the better. If all that pushes Obama to the left, I won’t complain a bit.
On a smaller scale, the same is true of the revenue shortfall last month here in Indiana, when considered in light of the projection that came out in the middle of the month. As Doug pointed out in terms of the 2001 budget projection, I’m not saying that this can or should be attributed solely to Mitch. It just seems like there is a trend of government offices/bodies over which Mitch has control being wildly inaccurate in their projections and running considerable shortfalls.
“It just seems like there is a trend of government offices/bodies over which Mitch has control being wildly inaccurate in their projections and running considerable shortfalls.”
This statement would also be true if you took out: “over which Mitch has control”.
I hope Mitch runs for president because the national media will finally expose him as a fiscal fraud since the state’s media has bought his PR machine’s bull-logna hook, line and sinker. Daniels is lucky the unemployment fund’s $2.17 Billion debt (6th highest owed in the US) to the federal government does not count towards his budget figures, because if it did, he really would have some explaining to do.
The state’s media outlets have failed to expose the Daniels administration’s horrendous record in ruining Indiana’s unemployment system (as I have discussed before on here. Sorry if it’s overkill, but damnit, why do people keep allowing it to happen?) When Daniels entered office, the state’s Unemployment Trust Fund essentially had $500 Million in reserves; before the recession hit in full force and before any state in the country (except Michigan), our trust fund was bankrupt in November 2008 (3 3/4 years into his term). In 2 1/2 years since, we essentially have lost $2.17 Billion; in Daniels’ 6 1/4 years, our unemployment system has lost about $2.67 Billion.
Daniels and especially his moronic “Leadership Team” of DWD have purposefully neglected following state and federal laws which are intended to ensure claimants who are entitled to benefits are paid and in a timely fashion, to ensure businesses and their unemployment taxes are used correctly, and to ensure the taxpayers who pay for unemployment of employees of government employers (who many times do not pay into the trust fund) do not lose tax dollars improperly. Daniels and his DWD have failed in almost every imaginable way. He is the chief executive of this state, and his unemployment program’s collapse is the biggest failure of his administration that he, his Inspector General’s office, and his public relations people have mostly kept hidden from Hoosiers.
Before someone says “Well yeah, but we’re in a recession and claimants are paid good benefits” (absolute bullshit), I have to produce these quick figures: According to figures found on the US Department of Labor’s website, Indiana OVERPAID claimants an estimated $1.157 Billion from 2006-2009 (the most recent figures), and half of what the state now owes the federal government. This was the 3rd most money overpaid in the US (only California and Illinois overpaid more). Of that amount, Mitch Daniels’ DWD was in some way responsible for $859 Million (or over 74% of the total amount). That was THE WORST amount in the country – about $400 million more than the next-closest state, Louisiana, in those 4 years.
If Mitch can’t control spending in his own state (where he has direct control of the unemployment system’s administration) for a program that affects nearly every citizen in some way, how can we expect him to control the federal deficit that he’s called “The Red Menace”? The only Red Menace I see is Mitch Daniels himself.
Unfortunately the national media that is in early, like the National Review, are either oblivious to the problem or simply dishonest.
They have had multiple articles about Daniels and his fiscal brilliance and have never once acknowledged the dwd issue, even after prompting via article comments or email.
Thanks for mentioning the 1 cent sales tax which equals 16%! I cringe every time I hear that Daniels never raised taxes.
And that one penny sales tax hike went into effect immediately, while it took 3 years for our property taxes to adjust down.
Most people who live near me have higher property taxes now than we did before Daniels took office. I’m not saying the higher property tax is his fault, its just that it is not factual to say that he did not raise taxes. Because under his watch, all kinds of fees and taxes increased.
Talking about the Governor, I find myself in a weird dynamic. I disagree with him about plenty, but I find myself pushing against his record in areas where I’d be willing to give him more of a pass if it weren’t for the mythology he or his supporters seem to be trying to create.
On the “balanced budget,” I find myself taking shots because of the $2 billion Indiana owes the feds. He could have done more to pay that down, but I don’t believe the original structural imbalance was primarily his fault. The unemployment insurance fund was underfunded when he got into office. But, since he ignored it, I don’t think we can credit him with balancing the budget.
On the increased taxes, I thought property taxes were a more stable tax base and oppose increasing reliance on the sales tax. But, again, the property tax problem had been brewing since 1998. He just ignored it long enough for it to wipe out Bart Peterson and have it be useful to reshape tax policy to favor his supporters a bit more.
Paul C.:
I agree with the general sentiment of your post, but since Mitch is hailed as a budget guru and deficit hawk, it’s especially relevant for him given his supposed expertise.