Republicans might want to put the party hats away for
right now …
Arizona’s Republican leaders spent a good amount of time
patting themselves on their backs after Moody’s Investors Service, a credit
rating provider, increased the state’s credit outlook last week to “stable.” The
governor celebrated this news, calling it a “testament
to the good work we’ve done.”
He has said repeatedly that they had to make tough
choices to balance the budget. He and legislative Republicans did have to
make choices. They chose to rush
the budget process, and they chose to try to balance the budget on the backs
of Arizona’s school kids.
Instead of slashing education and social safety net
programs, Republicans could have stopped special interest tax credits and closed
tax loopholes that cost the state hundreds of millions of dollars. If they had
done that, they could have invested more in education, which is the real
solution for economic recovery. Research
shows a positive relationship between education and economic opportunities .
Education is the best way to build a foundation for economic success.
So we think the Republican celebration may be a little
premature. In their descriptions, they seemed to have left out the part of the
Moody’s report indicating that the
credit rating could go back down if:
- The budget is not structurally balanced and/or the reserves are further depleted
- The state faces a significant increase in funding requirements for Medicaid, education or other mandated services
- The state’s economic recovery stalls
Arguably, the state’s budget is not actually structurally
balanced. The Joint Legislative Budget Committee (JLBC) reported that a law the
governor signed after the budget will leave the state’s budget structurally
imbalanced for years. The Legislature also passed several other bills after the
budget was signed that will affect
the General Fund.
Moody’s report also listed the state’s ongoing K-12
inflation funding litigation as a potential challenge. The Republicans included
$74 million for this obligation in the budget but a judge ruled the state owes
the schools more than $300
million. This would impact the state’s reserves.
And Arizona’s economic recovery is in a precarious position
– because Republican leadership refuses to invest in education. A recent report
indicates that Arizona
dropped 41st in the nation for per capita personal income – with no
indication that will change soon. Any real economic recovery plan must
include a substantial investment in education. The
Republicans’ most recent budget cuts $115 million from higher education and $117
million from K-12 education.
Arizona’s economic future will remain in jeopardy until
funding education becomes a priority for the Republicans. So while the news from
Moody’s is positive, it comes with a number of caveats. When the Republicans
attempted to balance the budget by sacrificing support for education, they set
the state up for future failure.
Those who are touting this as proof of “The Great Recovery”
may want to put the party hats away… at least for right now. There is still a
lot of work to do. To learn how to get involved to make education a priority at
the Legislature, click here.
Source:Arizona House Democrats
