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Budget cuts could have been avoided

Photo
Illustration by Cody Angell
By Phil Leckman
Arizona Daily Wildcat
Monday February 3, 2003

Take a deep breath, Wildcats ÷ it's over for now. But will the administration's flurry of nips and tucks really bring "Focused Excellence" to our little corner of the Old Pueblo?

The answer to that conundrum probably depends on who you ask. For the university's budding landscape architects and librarians, the answer is likely to be a resounding "no." The rest of us will offer a quick breath of thanks for emerging unscathed, cast a guilty glance at our colleagues in doomed programs, and hope that President Likins and the rest of the administration truly have the university's best interests at heart.

At worst, we can credit Likins and his team with a brave attempt to put a positive spin on a brutal series of budget cuts. Because for all the talk of streamlining and entrepreneurial self-sufficiency, that's what Focused Excellence is really all about. The state's current budget crisis has dealt the UA ÷ and nearly every other state institution ÷ a crippling blow. And according to a provocative study recently released by ASU's Center for Business Research, it didn't have to be that way.
Photo
Phil Leckman

As anyone who hasn't been hiding under a rock for the last two years knows, Arizona is enduring one of its severest financial dilemmas ever. Next year's budget deficit is already projected at over $1 billion, and continues to balloon. According to the ASU study, the projected shortfall effectively represents close to 40 percent of the state's non-mandatory spending. What's truly interesting about the ASU study, however, is its contention that Arizona's budget woes were by no means simply the result of fiscal bad luck. Instead, blame for the crisis that has sent the UA reeling can be laid squarely at Arizona's statehouse doors.

During the 1990s, Arizona legislators engaged in a flurry of tax cuts, effectively paring the state's relative tax burden to its lowest level in 30 years. This was not exactly a surprising move. After all, conservative politicians ÷ indeed, politicians of all stripes ÷ love tax cuts. They're cheap, easy political capital ÷ any freshman legislator with an ounce of creativity can hop on his soapbox, decry the big government of "tax-and-spend liberals," and proclaim himself the champion of the people's pocketbooks. Tax cuts earn votes. And since they usually benefit fat cats and big businesses, they earn politicians powerful patrons.

Unfortunately for the people of Arizona, however, tax cuts do not exist in a vacuum. In their rush to funnel the state's coffers back to their constituents, Arizona's political leadership appears to have forgotten that all that money had to come from somewhere. According to Tom Rex, the ASU economist who authored the tax-cut study, the spending adjustments Arizona made during the Î90s came nowhere close to equaling the revenue lost to tax cuts.

If tax cuts are the political equivalent of the Midas touch, turning even the most lackluster economic agenda into pure gold, spending cuts are more like a bad case of poison ivy. The same

politicos who smile broadly for the photo-op when a new tax cut is announced are nowhere to be seen when it comes time to pull out the spending knife. Spending cuts turn the play money of tax cuts into cold, hard reality ÷ real reductions in real programs, hurting real people. So it's a classic strategy of conservative politicians to hack taxes back, then blame their opponents ÷ those pesky tax-and-spend liberals again ÷ when sufficient program cuts fail to materialize. In Arizona's case, according to Rex, it's doubtful that adequate spending cuts would even have been possible without cutting public services to a bare minimum.

Of course, that's precisely what's happening right now ÷ we are all paying the price for our politicians' tax-cutting exuberance. And instead of coping with program cuts during a boom economy flush with jobs and cash, Arizonans now face radically scaled-back services while many are already up to their necks in financial hardship. The outlook for the future is even worse ÷ Arizona is like a fiscal Titanic, with icebergs dead ahead.

If its push toward self-sufficiency enables the university to abandon this sinking ship of state by introducing the kind of financial self-discipline Arizona's political leaders clearly lack, Focused Excellence will certainly have proven its worth.

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