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Reason Foundation

Using Scare Tactics to Drum Up Spending

The sky isn't falling in Colorado

Geoffrey Segal and Adam Summers
October 27, 2005

Proponents of Referenda C and D are painting some truly frightening pictures of what "would" happen should Colorado taxpayers say no to new spending on November 1st. While they stopped short of saying that people will die, bridges will collapse and schools will close the governor and his administration have suggested that popular programs are the first to go. A budget prepared by the governor's office in the event the referenda fail calls for significant cuts to health care and college financial aid, not to mention the permanent closing of 11 state parks (and 15 more on a seasonal basis). Senator Bob Hagedorn warned that the cuts would result in "people literally in the street."

In Washington, this publicity stunt is commonly known as the Washington Monument Syndrome where when faced with cuts the National Parks Service talks about closing the Washington Monument. In addition, the so called "contingency" proposal is a classic "straw man" tactic: Vote to give up more of your hard-earned money to the government or vital services will be slashed and burned! But it is a false choice, and voters should not be fooled.

While fear mongering may be a brilliant communications and public relations strategy, it is not an accurate depiction of the situation. It presupposes that every dollar spent by the state of Colorado is both spent well and importantly. While the services in Colorado may be performed efficiently, there is always room for improvement. In addition, over the years the state has taken on new responsibilities and started new programs. Rarely do old programs get phased out or eliminated. There certainly must be some functions government can stop providing.

What's most frightening about the administrations' proposal is that it suggested that state parks, indigent health care, and college financial aid are not priorities. Indeed, with their feet held to the fire, they're the first to go. Apparently everything else the state invests in is more important than these programs.

Certainly there are other programs that could be scrapped or reduced. For example, simply cutting funding in half for low-priority economic development programs such as the International Trade Office and the Colorado Tourism Office would save over $6 million per year.

A cursory look at the state budget reveals numerous opportunities for savings. Some other opportunities include: Suspending state funding for the Colorado Council on the Arts ($500,000), increasing Medicaid copayments to federal allowable levels (approximately $10,000,000) and ending agricultural marketing subsidies ($400,000).

Making these simple changes make a serious dent in offset needed. Not every program can be a priority; tough decisions will have to be made. Coloradoans should rest assured that the sky won't fall nor will their quality of life suffer should Referenda C and D fail.

If lawmakers and the administration want to truly fix the budget, they should learn from successful budget-balancing efforts in other states. Texas utilizes performance-based budgeting to identify the most effective and efficient programs and budget its appropriations accordingly. In addition, they regularly evaluate state agencies for purpose and effectiveness often eliminating or merging programs´┐Żresulting in billions in savings over time.

Washington state and South Carolina use a "priorities of government" budgeting model to rank all government services by activity—rather than rigid agency structure—and "purchases" all activities from the top of the list down until available revenues are depleted. The least important or effective programs are eliminated or suspended until state coffers are more flush—much the same as the way families spend their scarce dollars on the most important things and put off buying luxuries they can't afford until a later date.

Both of these approaches place an emphasis on performance and results, rewarding governmental services that best meet citizens' needs and weeding out ineffective and low-priority programs. Note that this improves the quality of public services while eliminating government waste.

Despite what public officials in Denver are claiming, the sky is not falling and Colorado will not fall to pieces if Referenda C and D fail. Colorado does not need more taxes or government bonds; it needs a fundamental change in its budgeting process and a serious evaluation of its priorities. A process that emphasizes program performance and providing higher-priority services would improve Coloradoans' quality of life while continuing to protect their pocketbooks.

Geoffrey F. Segal is the director of government reform and Adam B. Summers is a policy analyst at Reason Foundation. They are the authors of "The Sky Isn't Falling: Proven Strategies for Budget Reconciliation," published by the Reason Foundation and Americans for Prosperity Foundation.


Adam Summers is Senior Policy Analyst


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