The state’s contentious two-year budget, passed just seven months ago for the 2002-03 biennium, is already being declared defunct. The budget, which many people believed short-changed K-12 and higher education, will be replaced with a decidedly thinner set of numbers. Due to the recession, government projections predict a $1.95 billion shortfall for this biennium and a $2.5 billion shortfall for the next, leaving state government with the tough decision on whether to run a deficit.
Gov. Jesse Ventura strongly opposes an unbalanced budget. He recommends a combination of tax increases and spending cuts to keep the budget balanced. Although the governor and his administration have come up with some resourceful ways to re-collect the money they’ve been giving away for the last couple of years, their willingness to further slash K-12 education’s funding is, frankly, uneducated. In 2002-03 the governor wants to cut $92 million from the K-12 funding and slash an additional $318 million next biennium. Also, he wants to eliminate schools’ sales tax exemption, costing the institutions millions more. These reductions are on top of cuts that have already forced some schools to consider four-day school weeks.
Ventura obviously under-appreciates the role education plays in our communities. Even worse, he thinks education funding should be used as a resource for balancing the budget. Unfortunately the effect of this is detrimental and permanent to children currently going through the system. Skimping on education now means a generation of less educated people in the future. And once the damage is done, it’s irrevocable. We only get one chance to educate the today’s children.
Instead, the state should run a temporary budget deficit. Interest rates are low right now and Minnesota’s rare AAA rating means it can offer even lower interest rates on its bonds than other states.
Still, many people negatively stigmatize a budget deficit. True, it can lead to inflation and a general weakening of the economy when mishandled, but handled responsibly, most economists agree running a deficit now that will be a debt tomorrow is beneficial as long as GDP is expected to grow. Currently the GDP is expected to start growing as soon as March.
Instead of permanently lowering the education of today’s children, the state would be better advised to run an ephemeral debt that can be paid off in the future with money that likely would have otherwise been squandered in some aspiring politician’s tax rebate.
