Budget: Wait till next year

Two issues from last spring describe the challenges that will await the governor Virginia will elect next week:
One concerns the federal stimulus package, which according to a study at the time, would take care of 37 percent of the state’s budget gap.
The other was similar: Federal education money also was being used to make up for budget gaps and to save existing jobs.
The process for balancing Virginia’s budget so far has caused real pain. As the news from last spring indicated, an absence of federal stimulus money would have made the situation far more difficult. This is a statement of fact, not an endorsement of the stimulus package.
The stimulus funds will not last forever. Indeed, the program likely will expire before the economy returns to the status quo ante. Although there are signs of recovery, as Jeffrey Lacker of the Richmond Fed concludes, jobs typically trail other indicators.
Many experts expect the unemployment rate to rise another point or more, even as various markets register improvement. Stagnant payrolls mean stagnant state revenue from income taxes in particular.
It needs to be stressed again that stimulus dollars have buttressed existing programs — items the commonwealth otherwise would have had to cut. Maybe it should have pruned or eliminated many of those items — and maybe it still should — but few politicians make that argument. It is fatuous to imply that the needed savings can come solely from controlling waste, fraud and abuse.
Both gubernatorial candidates — Republican Bob McDonnell and Democrat R. Creigh Deeds — outline ambitious plans regarding education, transportation and other lovely things.
But if there is not enough state money to pay for existing services, then how can Virginia pay for the new? Wise political leaders are already concerned about how Virginia will cope with the next budget, as tax revenues continue to plunge. If Virginia had to rely so heavily this year on stimulus money, what will happen when that money is devoured even as the budget gap worsens? Will future budgets, not only in Virginia but in other states, depend on permanent federal stimulus? When will the reckoning arrive?
Whoever next steps into the Exec-utive Mansion had better have some good plans for this eventuality.
As the long-suffering fans of the Pittsburgh Pirates say every opening day, “Wait until next year!”

adapted from the Richmond Times-Dispatch