Capitol View

By Richard Borreca

Wednesday, March 12, 1997


Making state government
perform better

FOR the college giants, the madness in March comes on the basketball court. For the creatures of the Legislature, March is a time of maddening budget decisions.

At its simplest, the decision is confined to how closely the state budget should mirror the taxes the Council on Revenues figures the state will collect.

The decision to follow the few lines of data describing how much money will be left in the state treasury next year means that some programs will grow, others will wither and some will just be forgotten.

Because it is a decision demanded this month on something that has not yet happened, the result is not without its own art.

The council was set up by the 1978 Constitutional Convention to do away with the Legislature's practice of producing the annual March miracle.

In the old days the heads of the Ways and Means and Finance committees would trundle over to the office of the state budget director to receive the news of how the state: suddenly found money in old bank accounts, jiggled some bonds until the interest rates shrank or lowered some other fiscal deus ex machina onto the legislative stage.

Obvious, you couldn't keep fiddling with the books forever, so the Council on Revenues was set up to figure out how much we got and how much we are going to get.

The state and the Legislature don't have to follow the council's estimates, but there has to be a reason given for not doing so.

It was in the last years of the Waihee administration that spending started to exceed income.

That was when the Legislature and the state administration made a mistake. The decision was made to simply cut the budget until it matched the revenue estimate.

But as Paul Brewbaker, chairman of the Council on Revenues, said, the state has two facts to deal with: the revenue projections and the budget.

If the state can't fit itself in between the two it has failed.

So as Brewbaker pointed out in 1995, right after that year's March madness, the "long-term focus should be on how to generate productivity growth in the public sector."

Notice he didn't suggest raising taxes. He didn't suggest cutting services. He said make government produce more.

That is the challenge unmet by Gov. Ben Cayetano and the Democratic leaders in the House and Senate.

FOR many, government is tolerated only because of the services it renders. To have state leaders campaign on cutting the budget without increasing services or sparing the state a tax increase isn't reason enough to remain in office.

Microsoft and other software companies sell cheap and powerful programs to manage budgets. If you direct a spreadsheet program to cut the budget by 10 percent, it will honestly, effectively and impartially reduce all the numbers by 10 percent. All the beans will have been counted.

Government by revenue projections, however, means the state's real slogan is "Spend All the Money We've Got."

When there is no more money the Legislature and the administration stop spending. It isn't much of an economic brake, but it works.

What isn't working is a rational policy to make government do more, do it better and do it for less.



Richard Borreca reports on Hawaii's politics every Wednesday.
He can be reached by e-mail at rborreca@pixi.com



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