Broad + Liberty: Shapiro’s unsustainable budget
Democrats love to use the word “sustainable” lately, so they really ought to take their own advice and look at the commonwealth’s budget through that lens.
The 2019-2020 total budget was $33.9 billion. The current proposed budget for 2025-2026 from Governor Shapiro is $51.5 billion. That’s a 51% increase in a short six-year period, which we will not hesitate in calling it what it is: unsustainable.
Nearly as concerning is the fact that the current budget proposal calls for about $4.5 billion of spending from two sources of non-recurring revenue. That means almost 9% of the proposed budget is being paid for by one-time revenue sources. Again — unsustainable, without a 32% increase in the income tax.
Obviously, with a budget in the tens of billions of dollars, there are infinite points of context that can be added or subtracted from the discussion. We realize we’re not addressing those in the present editorial. But sometimes it’s helpful to do nothing but set the trees to the side momentarily and measure the size of the forest.
These facts, even on a standalone basis, should give every Pennsylvanian pause.
In contrast, the gross domestic product for the commonwealth is up about 32% over the same time. From our standpoint, it’s not suitable to think the state budget should grow at an equal pace with the state’s economy. Ideally, the budget should always grow slower. But Shapiro and his administration have taken the opposite view, imagining a state government that has an ever-expanding role in the economy and consumes an ever-growing slice of your paycheck.
The truth is Pennsylvania’s population and economy are growing at a slower rate than that of the country overall — we aren’t shrinking, but we’re failing to keep pace with more dynamic states that are friendlier to taxpayers and to businesses. People have a choice about where they can live, more than ever since the rise of work-from-home jobs. States can no longer rest on past achievements or count on their people to stay put.
All this spending might be easier to accept if it were paired with major reforms — like school choice, regulatory overhaul, or long-term pension fixes. But those ideas are nowhere in this proposal. Instead, taxpayers are footing the bill for a status quo that only grows more expensive without delivering any improvement in services — more money for the same product.
The two sources of non-recurring revenue, $1.6 billion from the rainy day fund and $2.9 billion from other reserves, make up 8.7% of the funding in Shapiro’s budget, and are set to run out, conveniently, after the governor’s reelection campaign.
What will happen then? Pennsylvania’s constitution requires a balanced budget, so the legislature’s only options at that point will be to cut their spending or to raise your taxes.
The governor is effectively requiring Pennsylvanians to subsidize his reelection campaign. But, not to worry, the bill won’t come due until after he secures a second term in office.
Shapiro always has his eye on the next job, and demonstrates a unique capacity to create the illusion of effectiveness just long enough to launch his next bid for office. Maybe if he makes it to the White House, he can send more temporary federal funds to Harrisburg to bail out the folks he will have left behind.
A better answer: fix Pennsylvania’s spending problem now and run on a record of real fiscal success and sanity.
Independence parent site Broad + Liberty is a Philadelphia-based news and editorial outlet dedicated to freedom of thought and giving voice to issues and ideas that have been shut out of our discourse for too long.
