Wyoming Liberty Group
The two most recent reports from CREG, the Consensus Revenue Estimating Group, tell of a mounting revenue problem for the state government. This has now led to the introduction of a bill - S122 - to the ongoing legislative session that calls for the formation of a group to find a solution to the problem.
Today Tuesday the House will hold its second reading of HB75, the Compact for a Balanced Budget bill that proposes a debt-limitation balanced budget amendment to the U.S. Constitution.
Yesterday's first reading included a vigorous debate, demonstrating that this is an issue the members of the House take very seriously. The vote, 35-23, also shows that while the idea of a balanced budget amendment is accepted in principle, there is still some hesitation as to whether or not the Compact is the right way to go.
This morning the House Revenue Committee passed HB0075 and HJ004, both proposing a so called Article V venue to put a balanced-budget amendment on the U.S. constitution. The two bills share the same goal, and the organizations that provide the background material - Compact for America (HB75) and the Balanced Budget Amendment Task Force (HJ4) - are for all intents and purposes fellow travellers. There is one major difference, though, between the two alternatives: the Compact model comes with a ready-to-go amendment; the Task Force, on the other hand, would leave it to the Article V Convention to draft the amendment.
The state budget problems that I have been warning about since last summer have finally caught up with our state lawmakers. Those who did not hear the wake-up call in the October CREG report certainly woke up to the alarm bells in the January report, which I analyzed on Monday:
Take a careful look at this chart. It shows GDP growth rates in the United States and in the part of Europe that is also known as the euro zone. When the Great Recession hit in late 2008 both these economies plunged into a deep chasm of negative growth, sharply rising unemployment and serious government budget problems.
The figure attached to this article reports the increase in total state spending between 2012 and 2014 in 14 states. These are not the only states where spending has increased - it is the group of states where spending went up by ten percent or more.
For all the 50 states, total spending went up by 8.4 percent in the two-year period. This may not seem like much - just over four percent per year - but there are two reasons to be concerned about this spending increase.