Texas Used Stimulus to Cover 97% of Its Deficit

[hedgehog]

Even as he railed against the Recovery Act, Texas Gov. Rick Perry used the government's stimulus plan to cover 97 percent of the state's budget deficit in 2009:

Turns out Texas was the state that depended the most on those very stimulus funds to plug nearly 97% of its shortfall for fiscal 2010, according to the National Conference of State Legislatures.

Texas, which crafts a budget every two years, was facing a $6.6 billion shortfall for its 2010-2011 fiscal years. It plugged nearly all of that deficit with $6.4 billion in Recovery Act money, allowing it to leave its $9.1 billion rainy day fund untouched.
"Stimulus was very helpful in getting them through the last few years," said Brian Sigritz, director of state fiscal studies for the National Association of State Budget Officers, said of Texas.





http://www.theatlantic.com/business/archive/2011/01/texas-used-stimulus-to-cover-97-of-its-deficit/70077/

[jpak]

1. K&R

and bookmarked

[stopbush]

2. Saw this yesterday. Somehow, the MSM missed it...and will continue to miss it.

This story SHOULD be part of any and every narrative being spun by D operatives. Otherwise, it will never gain traction in the MSM.

[elehhhhna]

3. the unreccers are out in droves now, too. REC THIS THREAD EVERYBODY.

Texas Debacle.

[ret5hd]

6. really? the threads been up for about 20 minutes and is on the greatest page w/ 14 recs.

[LiberalFighter]

10. Thankfully, I didn't miss it. The only reason I found it was because Rachel

brought something about Texas being about having a $7 billion deficit. So I went looking and found that article and added it to my twitter account.

[stlsaxman]

38. Yeah, CNN sure missed it- in fact, CNN is where the original, extensive article came from.

http://money.cnn.com/2011/01/23/news/economy/texas_perry_budget_stimulus/?cnn=yes

[valerief]

41. The M$M wouldn't THINK to dampen Perry's parade with FACTS. nt

[Enthusiast]

44. It should be a part of every narrative

but TV political talk show hosts will skillfully make sure it isn't.

[Scurrilous]

4. K & R

:thumbsup:

[nc4bo]

5. Wait a minute, I thought stimulus funds HAD to be used specifically for

infrastructure, funding schools, alternative energy development, etc.

[nc4bo]

7. K, according to Wikipedia

Under Provisions of the Act, #5:

To stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.

But it's 5th UNDER 1-4.

#1 To preserve and create jobs and promote economic recovery.
#2 To assist those most impacted by the recession.
#3 To provide investments needed to increase economic efficiency by spurring technological advances in science and health.
#4 To invest in transportation, environmental protection, and other infrastructure that will provide long-term economic benefits.

And he used 97% to cover his budget? What did #1-4 get?

Damn, that program wasn't supposed to work like this, was it? Or Texas was in such deep shit under Gov. Perry's helm that there should be NO question that he's not competent to be any where near the presidency.

[paparush]

49. Damn. There should be a limit in the budget clause, "..up to 10%.. " or something similar.

[JVS]

8. It's shit like this that prevented the stimulus from being more effective.

In fact, I'm not completely sure that the stimulus actually was a stimulus rather than an emergency bailout of state governments which nearly all became insolvent due to the economic downturn.

[hedgehog]

9. Take a look around at all the teachers getting laid off now that

stimulus funds have run out. That's part of what's causing the double dip. If those people had been laid off a year ago, things would have been much worse.

[JVS]

11. True, but filling holes in state budgets isn't stimulus. It's just maintaining the economy.

Maybe it helps if I simplify this. Imagine you're my dad and I'm a kid. Mr. Jones runs a candy shop but there was a tainted candy scare and now consumption is way down. You like Mr. Jones and in addition to my normal allowance of $8 each week one day you hand me $2 and say "why don't you go buy some candy". Now normally my $8.00 budget goes half to candy and half to comic books but for some reason I've lost $2 (tax revenue shortfall due to economic crisis), so when you give me the $2 to spend at the candy shop, I end up spending my normal $4 there. Mr. Jones (our metaphor for aggregate demand) doesn't see any increase, which is what the $2 was intended to do, because what should have been a boost to him is merely able to maintain normal consumption.

[hedgehog]

12. Part of the stimulus money was meant to stop the ongoing collapse

by keeping government employees working (and spending). Maintaining normal consumption was indeed the objective.

[JVS]

13. Intention or not. Stimulus in the Keynesian sense requires increased spending.

Hence my comment that actions like Perry's keep stimulus from working because he used 97% of the money to fund the state's shortfall.

[hedgehog]

16. OK, i see what you mean now.

[Telly Savalas]

18. How could he use the money for anything else until the shortfall was addressed?

If what you're getting at is that the stimulus was too small, I wholeheartedly agree. But the pre-existing state budget obligations needed to be addressed before any additional spending can happen.

[kenfrequed]

48. exactly!

Rather than run his government rationally and raising taxes a bit to cover the deficit he instead turned money that should have been used for new programs and pumped it all into his debt.

The problem with the stimulus is that it is the evil bizarro universe equivalent of unfunded mandates. It ended up being funded not-mandates. Some states were able to twist and finangle all of the money into covering debt for services they already provided.

Texas though, despite their independent cowboy image, has long been on the federal teat and all their bootstrap bullshit bravado is just so much 'all hat' crap.

[Beartracks]

26. Another (similar) analogy...

If you give me an economic stimulus, and I just use it to pay my debts -- that is, to pay off things I've ALREADY BOUGHT -- then the effect of the stimulus is nil because it created no new spending.

I think that's what happened to the tax refunds people got a couple years ago. By the time money made it to their pockets, they used it to pay bills and credit card debt, so there really wasn't much in the way of stimulation.

================================

[Telly Savalas]

17. This is the one capacity in which the stimulus was effective

If states weren't able to meet their shortfalls it would have been disastrous.

Nevertheless, Perry is a douchebag for financing his state like this then turning around and pounding his chest as a fiscal reactionary.

[Rex]

14. So IOW, Perry is a fucking hypocritical, shark gargler!

[TwilightGardener]

15. Now isn't that interesting. Obama and the Evil DC Empire will be waiting

for the public thank you from Mr. Perry. I am sure it's forthcoming. On Edit: if he can have what he calls a "Texas Miracle", then he must also acknowledge the "Texas Bailout".

[blkmusclmachine]

19. The MSM will NEVER mention it. And it's 50/50 the WH won't, either:

So it might as well have never happened. (If a tree fell in the woods, and nobody was there to hear it, did it actually make a crashing sound as it fell to the ground?)

[tanyev]

20. So does that mean Rick Perry does or doesn't love America?

I can't keep up.

[McCamy Taylor]

32. He hates American workers. He loves their tax money.

[Plucketeer]

53. Perry LOVES America

- so long as Americans are too lazy to fact check his barfed bullshit. :puke:

[Horse with no Name]

21. Not only that...but he plugged in stimulus funds and then used them for

school. INSTEAD of state funds. Then, when the stimulus money ran out, he REFUSED to replace them with state funds--leaving the schools in dire straits. Then, the message was out that the schools were underfunded because of OBAMA.

And trying to talk reason to folks...not going to happen.:(

[Firebrand Gary]

22. C'mon ya'll, let's leave Rick Perry alone.

It would be a shame if he was to lose the GOP Primary. lol

[ejbr]

23. I guess he had to wait to secede until after he got the funds, huh? n/t

[upi402]

24. Texans mess with Texas.

Randi Rhodes layed out the mess in Texas out pretty well.
18% elected their Governator. No wonder.
unreal

[Beartracks]

25. What? Another Repub who's either ignorant or a hypocrite???

What are the odds?

=============================

[pam4water]

27. D:

[Major Hogwash]

28. Why didn't David Gregory tell us this?

On Press the Meat, where he is the manipulator???

[Major Hogwash]

29. Or John King, why did he fail to mention this fact?

On CNN, where he controls what they say on that channel?

[Major Hogwash]

30. Or Ed Schultz, why doesn't he talk about Perry doing this on his teevee show?

Instead of taking lines from Obama's speeches out of context?

[Historic NY]

31. Interesting where's the Federal audit of our money?

[Skittles]

33. OMG A REPUKE HYPOCRITE

*YAWN*

[0n1n3]

43. LoL +1

*Yawn* x2

[peace frog]

34. Tattoo it to Goodhair's forehead

Never allow the sniveling little creep to hide the fact that the federal stimulus saved his sorry ass.

[rasputin1952]

35. I thought this was common knowledge...

it was discussed briefly when it happened.

Revisiting this would be in the interest of the voters...but I don't think Perry has a chance in hell of getting the nomination. The inherent ties to bush will crush any "drive" for Perry to get the nomination.

[Major Hogwash]

39. Perry said yesterday that another stimulus would be like treason, yet he took the money and run

The first time to make him look better.
He'd better stay out of the sun for awhile because I do believe that boy is tetched in the haid.

[rasputin1952]

40. I'm surprised he doesn't burst into flames...

I'm glad he's opening his yap though, the more he does, the more he proves how dumb he is...:D

[Firebrand Gary]

36. K&R

[jwhitesj]

37. It makes me more angry

That the money wasn't used for stimulus spending, then it does that he denounced the stimulus and used it. These are the reasons the stimulus didn't work as well as hoped. So much of the stimulus fund was wasted.

[a2liberal]

42. K&R (n/t)

[annabanana]

45. k&r. . . . n/t

[avebury]

46. K&R

[russspeakeasy]

47. Tactic: kill the parents then cry because you are an orphan...

:argh:

[ldconfig]

50. 3am cold sweat

Is what happened to me last night.
Before I woke I was having the most vivid nightmare of my life. A tall man on his knees before 3 robed men in a room filled with elected leaders from both parties. One robed man said "You have been picked by Jesus himself to rule" Then an image of the front of the C-Street house.

I woke up in a panic knowing the warnings were true. A great man in 1953 wrote 'Revolt in 2100' that warned of a leader coming to power so popular that no one would question him and he would lead us into 100 years of Christian America.

That man on his knees was Rick Perry.

I am very scared if Perry isn't stopped in 5 years or less liberals could become an endangered species. I really believe with this man in power Christians could commit genocide in the name of their God. Its happened MANY TIMES through out history.

[Permanut]

51. Odd that Rich Lowry didn't mention it in his column today...

Must have been just an oversight.

Oh, and K&R

[orbitalman]

52. Clearly subversion of purpose. GIVE IT BACK. n/t

[fishwax]

54. k/r

[krispos42]

55. k&r n/t

[nxylas]

56. I thought he refused stimulus funding?

And for once, I'm not being sarcastic. I've heard the "Perry refused stimulus funding" meme repeated so often, without ever being challenged, that I never really questioned its veracity, though in retrospect, I should have known better.

[Blue_Tires]

57. A few red state governors made a very vocal refusal with the cameras running

scored their political points, then weeks later quietly took the money on the sly...It was done in SC and LA, iirc