By FRANK KEEGAN – When 23 new governors met with President Obama Thursday, they essentially bowed, kowtowed and kissed his invisible imperial ring. They and their legislators should scurry over to Congress and do it all over again. Their fiscal lives depend on federal largess. State power – the check and balance against central government authority envisioned by our Founders – is pawned. Our state leaders are vassals.
In a letter two weeks ago to soon-to-be-ex and soon-to-be House Speakers Nancy Pelosi and John Boehner, and Senate leaders Harry Reid and Mitch McConnell ,NCSL begged for more time to pay.
“If the current waiver is not extended, already cash strapped states will be pressed further to come up with funds to pay the interest on the loans, slowing an economic recovery. More than half of the states have already borrowed some $40 billion from the federal account to cover benefits during the current economic cycle, and projections from the U.S. Department of Labor demonstrate that up to 40 states are expected to be borrowing before the economy recovers.”
Since that letter the toll of floundering states already has gone way above half. As of Thursday they’re up to 32, according to Hawaiireporter.com, which reported paradise is applying for an unemployment fund loan.
Is it because they are all “cash strapped”? No. States and municipalities — thanks to tax increases and a semblance of economic recovery — forced almost $25 billion more from us in the first half of this year than they did in the same period just three years ago, according to the latest U.S. Census data.
And a report released Thursday by the Rockefeller Institute of Government based on preliminary data from 48 states says “tax collections increased 3.9 percent in the third quarter … compared to the same period a year earlier. … Of states reporting, 42 showed gains in overall tax revenues. Collections improved for the two largest revenue sources – personal income and sales taxes – while corporate income tax revenues declined slightly.”
That’s not a good sign of long-term growth. For one thing, the report admits revenue increases are “partly driven” by “several states” just squeezing more from citizens who have less. And as we recently learned, personal income and sales tax revenues rise and fall abruptly on every whim of the economy.
Besides, state and local taxes fund only about 41 percent of total state and local government spending anyway. Federal taxpayers present and future make up most of the rest.
So, governors and state legislators have no choice but to grovel and beg. They need the money.
Witness South Carolina philanderer, liar and Gov. Mark Sanford’s initial opposition to accepting American Recovery and Reinvestment Act money unless he could use it to reduce state debt, and his eventual submission to a state Supreme Court writ compelling him to not only take it but squander it.
So much for sovereignty. For decades the creeping force of federal funding and mandates has stolen state sovereignty like a thief in the night, but this self-inflicted recession puts it right out in the open where none can deny.
And the official tally does not even include a 50-year “fiscal gap” of at least $9.9 trillion in secret debt states and municipalities have run up in recent years. According to a Government Accountability Office report, that is equivalent to immediately cutting expenses or increasing taxes 12.3 percent every year for the next 50 years.
The purpose of the study was to determine how “fiscal pressures could affect delivery of intergovernmental programs.” That means a lot of the federal money states and municipalities get requires them to spend matching state and local tax dollars.
If they don’t spend, they don’t get. So the federal government has their hands tied when it comes to cutting costs.
Citizens can vote out all the governors and legislators they want, but the federal government will force taxes up.
GAO concludes, “… challenges cannot be met by shifting burdens from one level of government to another.”
States have lost the power to control their fiscal destinies.
Balancing state and federal powers under the Constitution is a question that went to the U.S. Supreme Court in 1819 (McCulloch v. Maryland) when states first found out they generally lose.
Chief Justice John Marshall wrote: “The Government of the Union, though limited in its powers, is supreme within its sphere of action, and its laws, when made in pursuance of the Constitution, form the supreme law of the land.”
Advocates of so-called “states rights” abuse our nation’s fundamental principles because our Founders made it clear no government ever has any rights.
Only people have rights. Governments have only power. And those who govern universally abuse those powers to the degree they are absolute.
The words “right” or “rights” appear in the Constitution and Amendments 15 times, never in association with “state,” and 13 of those times guarantee rights of the people while restricting power of government to infringe them.
The 10th Amendment contains one of 36 mentions of “power” or “powers,” reserving to the states or to the people those not explicitly enumerated.
One important power reserved to the states was that of taxing and spending within its borders. This was intended as a check and balance against any voracious federal fiscal power.
Now that particular power is forfeit, pawned in a truly bipartisan squandering by reckless leaders through at least a decade.
Let governors and legislators dance to the federal fiscal tune and grovel for alms.
But let them remember, ultimate power in America is reserved to the people.
Tags: 10th, amendment, funds, governors, NCSL, Obama, sovereignty, unemployment, waiver