Don't buy the corporate spin. 'Budget smoothing' means budget cuts.

Rep. John Kowalko | The News Journal

Rep. John Kowalko, D-Newark, represents the 25th District in the Delaware House of Representatives.

The usual suspects of corporate propagandists are at it again, disingenuously arguing for budget cuts under the guise of revenue stabilization. House Bill 460, supported by these corporate lobbyists in an article published in the Sunday News Journal, is an attempt to pass a Grover Norquist conservative dream version of a “balanced budget amendment.”

The proposed constitutional change would establish budgetary constraints to force the services and programs of the most vulnerable Delawareans onto the chopping block regardless of the intent of future legislatures. It will establish regressive taxation policies that will hurt working families and individuals, small businesses, and those on fixed incomes.

BACKGROUND: Panel seeks limits on annual spending growth in Delaware

The heads of the two largest pro-corporate organizations in the state, the Delaware Business Roundtable and the Delaware State Chamber of Commerce, support this constitutional amendment but offer no rationale for their support. Their claim that the State has “cash on hand” has no relevance to the constitutional amendment.

Further, the State is only supposedly “flush with cash” because of the major budget cuts imposed last year on our schoolchildren, elderly and working poor. Indeed, no argument is made in favor of HB 460 except for twice repeating a line about “smoothing out the high and lows of revenue projection.”

This is corporate doublespeak for imposing mandated spending cuts on the neediest Delawareans, which the article conveniently ignores.

HB 460 would impose “benchmarks” to limit spending increases in future budgets without any consideration of the harmful consequences that could befall the most vulnerable Delawareans.

When more students enter our public schools, the State has an obligation to fund an increase in teacher positions. When more people are underemployed or underpaid, they require government-funded Medicaid to protect the health of their families and children.

When large and highly profitable corporations insist on paying a full-time wage that does not even approach a livable wage, their hard-working employees need assistance subsidized by taxpayers to adequately feed their families.

While corporate apologists can choose to ignore the inevitability of such circumstances in their short-sighted attempt to limit the budget process with this proposed balanced budget amendment to the constitution, it will be the Joint Finance Committee and the General Assembly who will be prevented from any ability to uphold their obligation to responsibly consider the needs of all Delawareans.

Indeed, we should all view with suspicion how the usual suspects have attempted to push this constitutional amendment through the legislature. While most bills take months to go through committee and get to the floor for a vote, HB 460 was introduced last Tuesday, passed out of committee the next day, and was on the agenda for a vote by the House the day after. Even before the bill was introduced to the public last Tuesday, the corporate lobbyists had written their article and submitted it to the News Journal where it has been available online.

Why is a matter of such utmost significance being rushed through in the final days of this session? Why is no time being given for a fair assessment of the ramifications of this constitutional change?

In fact, the repeated use of the term “budget smoothing” is nothing more than corporate rebranding of a “balanced budget amendment.” The point is not to “balance the budget,” but to set strident benchmarks for spending and revenue considerations, and then use these benchmark plateaus to severely limit what services can be available by subjecting them to a constitutionally required cut if the benchmarks are exceeded. The necessary social services and support programs for the neediest in our state are the first to be cut back and suffer the most severe consequences for these mandated cuts across the board.

This balanced budget amendment proposal is a result of the failed proposals by the Advisory Panel to the Delaware Economic and Financial Advisory Council and its report, “Potential Fiscal Controls and Budget Smoothing Mechanisms.” The 2016 report of this unelected “Advisory Panel” was previously used to justify corporate tax cuts and the unforgettably damaging repeal of the “Estate Tax” at a tremendous cost ($9.2 million that year) to taxpayer revenue resources.

The most recent report that was released on June 1 once again urges conservative economic policies that will hurt the poor and middle class of Delaware without even considering the needed creation of two additional personal income tax brackets that was proposed in HB 108. It should come as no surprise considering the make-up of the “Advisory Panel” consisting of Chamber of Commerce and various conservative lawmakers and government agency heads. These same voices now urge us to pass HB 460.

HB 460 should not be passed at this time. A serious consideration of its intended and unintended consequences needs to be discussed with the entire General Assembly and the public over the course of the summer.

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