Washington’s financial crisis is alarming to us all.  High taxes, runaway spending, and a lack of tough leadership have finally caused citizens across our country to become concerned about our economic future. Arkansans are painfully aware of the problems in our federal government, but what about our state government? Is it any different? The answer may surprise you:  The trend we see in Washington is mirrored in Little Rock. Our current budget crisis is the best example.

 

In June 2007, Governor Beebe inherited a state budget surplus of $935 million. By 2010 the surplus was gone, and we had an over $200 million budget shortfall. In addition, Arkansas owes a $300 million debt to the federal government for its unemployment trust-fund deficit. This debt does not include the $200 million unfunded mandate anticipated for Medicaid next year because of the new federal health care law.

 

To address this dilemma, we must first understand how we got here. Outdated and economically harmful tax policies, wasteful government spending, and a lack of fiscally conservative management in our state government led to a complete depletion of the surplus.

 

Every aspect of the government budget must be thoroughly examined to determine the root cause of financial shortfalls. Let’s first look at the executive branch. Rather than demonstrating fiscal restraint and leadership, the governor has set a poor example for the rest of state government. For example:

Arkansans should be outraged at the rampant spending of their tax money. Our state government masks many of the spending increases, and growth in government employment continues to rise, even as the private sector continues to struggle.

The rise in government employment and spending occurred during a time when most Arkansas families and businesses were trimming their budgets because of the tough economic environment. In fact, the private sector economy of Arkansas has declined by an estimated 3.3% in the past year, resulting in a total job loss of 31,600 and an unemployment rate of 7.8%. To summarize the problem, while the private sector was shrinking during an economic downturn, the size of state government continued to grow, as did state spending.  

 

It is hard to believe that Arkansas had almost a $1 billion surplus in 2006 but now finds itself in this situation. Arkansans are hungry for fiscally responsible leadership, both on the state and federal level. We must demand more than the status quo. We must implement new policies and exert strong leadership to make this happen.

 

The logical question is “How do we stop the bleeding?” I believe we need to start at the top. I commit that, if elected as governor, I will always lead by example on budget restraint. On day one, I will cut the governor’s office budget by at least 20%. In addition, to set the appropriate tone, I will reduce my salary by 20% until Arkansas’ unemployment rate is 5.5% or less.

 

I will also take the lead in addressing the explosive growth of government. My office will take a hands-on approach in finding and eliminating inefficiency and unnecessary spending in state government. I propose to examine every agency, board, and commission to identify and eliminate waste. I will require every department head to justify their budgets under tough scrutiny. I have done this successfully many times in the private sector as the owner or manager of on-going businesses. Hard choices must be made, and I am prepared to make them.

 

Finally, Arkansas needs a new approach and new leadership to address the fiscal challenges of the future. I make this pledge: when I am elected governor in 2010, I will stop the escalation of state government and work hard to reduce total expenditures. At the end of my first term, the number of state employees will have not increased. Period.