With many anticipating a budgetary shortfall when lawmakers return to Austin, many liberal legislators have been advocating for tapping the state’s Economic Stabilization Fund – commonly referred to as the “rainy day fund.”
Just last month House Speaker Joe Straus (R-San Antonio) signaled his support for raiding the state’s savings account by appointing spendaholic lawmakers to a joint House and Senate committee to determine the balance of the ESF.
Still, in what has been a steady trickle over the past few months, Democrat lawmakers and their surrogates have ramped up arguments that tapping the ESF would be a “painless solution for the Texas budget.” They’ve also offered “fiscally conservative” solutions such as bringing Obamacare to Texas, defunding border security, and stopping tax relief dead in its tracks.
Now, they’re bringing out a bogus economic forecast to support their position.
From the outside, the Perryman Group has the auspices of a legitimate economic research and analysis firm. It boasts an impressive client list, and Dr. Perryman appears to be seriously credentialed. However, a view of its ‘Special Reports’ reveals that the group is little more than a number massager for liberal policy priorities.
Over the past few years the group has authored studies that advocate for amnesty, removing DPS agents from the border, and expanding Medicaid. Their most famous “analysis” was a hilarious allegation that if Texas A&M were to leave the Big 12 athletic conference for the SEC, it would cost the state “millions of dollars and thousands of jobs.”
Despite the absurd prognostications, since Texas A&M left the Big 12 for the SEC four years ago both the Aggies and the Bears have increased their revenue per year with no net negative impact on the state.
So what does the Perryman Group say about the upcoming budget and the ESF?
Raid it, the organization says in a blog post where it boldly declares that “these are the rainy days that the ESF was originally created for, and there is a clear argument for using some of the huge available balance to meet the pressing needs of a vibrant state with enormous growth potential.”
To do so, the author cleverly notes that while “the 2014 amendment stated that the ESF must have a ‘sufficient fund balance’ but it is not specified what that should be in any amendment or law. Instead, a committee determines what the sufficient balance should be prior to each legislative session and it is currently set at $7 billion for the 2016-17 biennium.”
One of the problems with the ESF is that a floor hasn’t been specified by law, despite conservative efforts, and that lawmakers can determine any balance they wish to be “sufficient.”
With hurricane season in full swing and the economic forecast for oil and gas still pretty dim for the short term, the last thing lawmakers should be considering is emptying the state’s savings account and going on a spending spree.
If lawmakers spend the money now they’ll be reaching for taxpayers’ wallets when the real rainstorm hits.