Projected Budget Shortfall Shows Need for Spending Cap Measure
AFP-MO Renews call for Cap Spending Measure
JEFFERSON CITY – Late last week Missouri lawmakers were greeted with news of Missouri’s poor economic health, as it was reported that Missouri is expecting slower economic growth, resulting in lower than projected revenues which will require spending cuts. Figures released Wednesday show that net general revenues declined 1 percent for the 2014 fiscal year when compared with the previous year. That translates to $308 million short of what Democratic Gov. Jay Nixon projected and $241 million short of the forecast by Republican legislative leaders.
Joe Haslag, an economist at the University of Missouri-Columbia, said Missouri’s declining revenues reflect a longer economic trend:
“The undisputed fact is we just haven’t been growing fast as a state for a couple of decades.”
In June, the federal Bureau of Economic Analysis released state-by-state figures for the 2013 growth in the real gross domestic product, a commonly used method for measuring the strength of the economy.
Missouri had 0.8 percent growth, which was a full percentage point behind the national rate. Missouri’s economic growth ranked 45th nationally, ahead of only Alaska, Maryland, New York, Pennsylvania and Virginia.
Patrick Werner, AFP-MO State Director stated,” If Missouri had a cap on state spending based on previous years’ income plus inflation and growth there would be no need to for the charade of overspending based on inflated economic growth projections followed by cuts when the economy slows.
Furthermore, it’s worth noting that lawmakers do not actually need to make a “cut” in spending, but merely slower increase in spending.”
Reining in government spending at all levels is one of AFP-MO’s nine policy initiatives listed in its 2014 Path to Prosperity launched earlier this year to give policy makers a blueprint to long term growth and prosperity. One of our policy initiatives, A Cap Spending measure, would allow Missouri residents to vote on a constitutional amendment that would cap future legislative spending bills. This year, The Missouri House passed HJR 75 and Senate Committees passed two similar measures but both were held up in the Missouri Senate by big spending Senators.
Patrick continued: “It’s time we protect tax payers by implementing common sense spending limits and protect Missourians from an ever increasing government.”
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