In a striking contrast to the $16 trillion federal debt so frequently mentioned in political advertising, the state of Iowa “officially closed the fiscal 2012 ledger with a $688.1 million budget surplus after its cash reserve and economic emergency funds were filled to the statutory maximum of nearly $596 million.” That’s the largest surplus in state history, according to David Reynolds, a fiscal analyst with the Legislative Services Agency.
Governor Terry Branstad (who wrongly claimed Iowa could not afford to give public employees a 3 percent raise) is already using the surplus to justify deep income tax cuts for corporations and wealthy individuals, in addition to a major commercial property tax cut. An earned income tax credit that would benefit hundreds of thousands of low-income workers will be a bargaining chip again.
Meanwhile, children in thousands of Iowa public schools have been dealing with larger classroom sizes and program cuts, because the governor and Republican state legislators insisted the state couldn’t afford any allowable growth for K-12 budgets in the 2012 fiscal year, and just 2 percent allowable growth in the current year. (In past decades, Iowa legislators routinely agreed on 4 percent allowable growth for school district budgets.) For statehouse Democrats, the record surplus shows that Iowa doesn’t need to “starve” state programs, especially education and human services.
This is an open thread. All topics are welcome, particularly any comments on state budget priorities.
UPDATE: Rest in peace, George McGovern. After the jump I’ve enclosed a famous passage from his book, What It Means to Be A Democrat. John Deeth recalls meeting and interviewing McGovern in Iowa. SECOND UPDATE: Added statements from Senator Tom Harkin and Iowa Democratic Party Chair Sue Dvorsky below.
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