Monday, July 28, 2014

We can't borrow from our future to fund current special interests

Last week, Governor Bentley teased legislators, educators and citizens alike by threatening to call a special session to pull money from the education trust fund to support incentives to bring big business to Alabama.

If you just got deja vu, you aren't alone. It was in 2009 that we pulled $437 million out of the Education Trust Fund's rainy day account to help off-set proration in our public schools.

It was in 2012 that we raided the Alabama Trust Fund for another $437 million to help balance the state budget for three years.

Alabama's state finances are set up in two budgets: the education fund, which provides for education expenses, and the general fund budget, which provides for all other state services, including prisons and Medicaid.  

Each of these budgets have an account from which expenses are paid and revenues are collected.  They also each have a trust fund account, which collects interest to help fund the operating accounts and provides a safety net in case of an emergency.

We can think of these accounts like our household accounts: there's a checking account and a savings account.  And in our homes, what happens when we continually pull money from savings to avoid making tough budget cuts at the kitchen table?

Eventually, the savings account will run dry and you will be in a pinch if your car breaks down or the water heater busts.

Now, think of the education trust fund as the kids' college fund. We all know that education is the most important thing we can give our children, and we must protect those dollars at all costs.
So would your family raid the children's college fund to send some friends on vacation?

That sounds completely ridiculous, but it's exactly what Governor Bentley is proposing we do.  He wants to borrow--again--from the Education Trust Fund for incentives to lure businesses to Alabama.  

We spent $1 billion to bring Thyssenkrupp to Alabama in 2007. Taxpayers spent $400,000 per job that they created.  Today, there's a "For Sale" sign on the $5 billion factory and the state is left with 0 jobs created. 

Instead of spending billions of our children's education dollars to buy big business's favor, we should be doing everything we can to promote the industry that already exists in Alabama, especially our small businesses and entrepreneurs.  

And our education dollars, the foundation of our future, should be protected and preserved at all costs.  If we want business to thrive in Alabama, we must create a strong, educated workforce, which starts with our pre-kindergarten classrooms.  

If we want to reduce our prison populations and balance the general fund budget, we can do that short term by accepting the federal medicaid funding under the Affordable Care Act, and long term through solid education for the future generations.

Alabama won't be able to grow and thrive if we borrow from Peter to pay Paul. We have to look at the budgets and make some choices.  But one choice should always be clear--our children must come first in this state.

No comments:

Post a Comment