Basic Good Financial Management

What makes you think (0.00 / 0)

that by the end of this year that revenues won't continue to drop below projections, and that we'll be facing either serious cuts and/or revenue increases?

I've always maintained that historically, Montana's economy lags the national trend by 18 months. Which would explain why it took longer for this state to start eating away at its surplus. And given our bleak job outlook (another $70m dropped out of the local economy in '10 in the form of wages from almost 500 lost Smurfit jobs, i.e. Missoula's unemployment rate just jumped over 1% with one press release, not including ripple) where's the recovery going to come here? Outside of Schweitzer's sidelong "some long passes" reference, what's he got cooking to bolster jobs, except to sell coal?

My take is that Schweitzer's outlook for a +40m balance sheet by mid '11 is far too rosy. And that he'll be cutting hard before year's end. And that when the leg comes in for '11, they'll be merciless.

This fall's election will be dominated by the budget picture and worsening employment numbers, with a call for major cuts, starting with the school systems, state hires, and state wages. Look for some union busting. Look for repubs to take health reform state-wide with calls to neuter whatever reform gets out of Congress, and cutback funding for things like CHIP and Medicaid. MSU and UM prez and football coach wages going quarter million and up will spur a populist backlash against overall budgets.

Repubs will call for tax cuts to spur economy, which will call for even more belt tightening for state agencies. It's going to get real ugly on the campaign trail. Tea baggerism will be out in full force looking for blood in the water.

And along with that 18 month trend lag, until we see the national outlook improve for jobs, we won't see anything in Montana for at least 18 months after that. Like maybe sometime in '13-'14.

Dig in folks, it's going to get a lot rougher before we see the light at the end of Bush's Great Recession tunnel. When the gov says he's taking his dog hunting, it ain't cuz he's not got anything better to do. It's because he wants to get out of the limelight when the sh*t starts hitting the fan, as he starts moving on to the national stage for his next act.

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by: JC @ Sat Jan 02, 2010 at 18:32:50 PM UTC

Revenues probably will drop below current projections (0.00 / 0)

But that's not the sort of self-inflicted wound most states are reeling from. Other places took short-term revenue boosts and projected them as long-term income bumps. Schweitzer balanced the budget, minimized the revenue cuts through his one-time rebates, and paid down some long-term liabilities.

That doesn't mean that the economy isn't going to have an impact. You can be caution with your finances and still get laid off.

My point is that Brian prepared us ably for this situation, more ably than just about any Governor in the country.  

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by: Matt Singer @ Sat Jan 02, 2010 at 19:42:27 PM UTC

[ Parent ]

support for local main street business is the key to employment (0.00 / 0)

big banks like bank of america, wells fargo, us bank and others are holding rather than lending the money we gave them to stay solvent.

if we want to do something locally that is constructive to create a better economic environment for job creation a bit quicker, we could make sure what little money we all have goes to smaller community oriented banks. there is an organization that can help you shop for good safe local banks that invest in our local economy rather than help the wealthy elite on wall street.....  http://moveyourmoney.info/

the movement is covered in this article.

http://www.huffingtonpost.com/...

local credit unions are also an excellent choice.
i may not have much but at least i feel better knowing that what little i have will be used locally to help those businesses struggling to keep people in my town employed.

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by: problembear @ Sat Jan 02, 2010 at 20:12:17 PM UTC

[ Parent ]

You can give Schweitzer (0.00 / 0)

all the credit you want, but it really took the leg preventing the repubs from enacting a tax cut or rebate that did the trick.

Yes, it was good forethought to put a large buffer in the budget. But when you have at least a 4 year problem with major economic disintegration occurring in the state, with only a two-year buffer, you still have a major problem.

Schweitzer should be talking about how he's going to get Montana through the election and the next leg session and deal with the inevitable structural problems we're going to have in '11-'12. Instead of just handing out "wear suspenders and a belt" shucksterisms.

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by: JC @ Sat Jan 02, 2010 at 21:01:48 PM UTC

[ Parent ]

Yeah, Brian has done a great job (0.00 / 0)

of increasing State government both in size and in spending. We now have what?? about 1200 more State employees. Seems I recall the State budget being increased by about 15% in 2005 and another 26% in 2007. He tried to get about a 9% budget increase though in 2009 but the Republicans held that down to under 3% after the Republicans on the Tax Committee finally got the Democrats on the Tax Committee to accept a more realistic budget forecast in HJ2 some $290 million lower than the initial forecast. The $40 mil ending balance being mentioned now started off being closer to $300 mil and is just Terry Johnson's current forecast - which has been dropping just about every month. Revenues thru November are down about 24%. Terry has also said that he does not expect State revenue to get back to the 2008 level until 2015. '11 will be an interesting Session.

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by: MTLiberty @ Sat Jan 02, 2010 at 23:33:32 PM UTC

Don't thank the Governor - (0.00 / 0)

Thank the legislature for our fiscal health.

The Good Guv likes to take credit , but if it wasn't for the GOP keeping him in line he would be another Obama.

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by: Eric Coobs @ Sun Jan 03, 2010 at 23:14:07 PM UTC

I think (0.00 / 0)

I basically said that above :-)

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by: MTLiberty @ Mon Jan 04, 2010 at 02:16:27 AM UTC

[ Parent ]

Governor vetoed Republican Spending (0.00 / 0)

The good guv vetoed some 30 spending bills past by the legislature.  That included a lot of Republican spending measures.  And let us not forget the Republican solution to balancing the budget in 2003, a much milder economic downturn, was to gut the workers comp fund that businesses are still paying for today.  Thanks Roy Brown.

Then it was Senate President Bob Story, John Esp and Dan McGee who poured tears to the people of Montana about how hard it is going to be handling the Governor's vetoes. The title speaks for itself "Schweitzer vetoes worthwhile stimulus spending"  or how about the second paragraph heading "Too much in savings account."

Just like President Story is loving the new Rubber-tiled Tennis Courts in Bozeman.  Republican Sen. Bob Story, R-Park City, said he thinks lawmakers did it right by not doling out the money to specific city projects.

Also, remember it was Dangerous Dan McGee's bill that rolled the entire public defenders office into the state and therefore increased the numbers of state employee's.  

So I guess if you were a scholar, which we all know you are not, that information would be included.

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by: Junior @ Mon Jan 04, 2010 at 23:09:42 PM UTC

[ Parent ]