By ROD HAXTON
Scott County Record
If you thought the budget fiasco in Kansas was bad before, then brace yourself. Here’s the rest of the story.
By now, you may be familiar with how the Brownback Administration has been tapping into the Kansas Department of Transportation – half-jokingly referred to as the Bank of KDOT – to fill the growing pothole known as the budget deficit. What you may not know is how Gov. Sam Brownback and Republican leadership in the Kansas Legislature have been pulling off a budget scheme that would make Bernie Madoff proud.
When the state budget was approved last spring, it included a provision – at the request of Brownback – to suspend the KDOT debt cap for 2016 and 2017. The goal wasn’t to embark on a spending binge to improve highways and bridges across the state.
Instead, lawmakers had discovered a means by which they could circumvent the balanced budget requirement of the state’s constitution.
And they were attempting to do so with as little fanfare as possible.
State Rep. Don Hineman (R-Dighton) said there was not widespread understanding last spring that the debt limit had been suspended.
“The chairs of the Ways and Means and Appropriations committees claim this was public knowledge, but I don’t remember it ever being brought up and neither do my colleagues. We would have remembered if something this important had been brought to our attention,” says Hineman.
Attempts by the governor and legislative leaders to conceal their activity was further highlighted by the issuance of another $400 million in bonds on Dec. 2 which was supposedly for the T-Works highway improvement program. This raised KDOT’s bonded indebtedness to a record-setting $1.2 billion.
However, knowledge of this latest $400 million bond issue didn’t surface until two weeks after the fact and only after it was discovered by the media.
What lawmakers did was apparently legal – though arguably unethical.
“It’s pretty obvious the plan is to use this money to fill part of the hole in the general fund,” notes Hineman. “This is reckless fiscal policy. You do not take out long-term debt to pay your current bills. That’s not conservative and it’s not responsible.”
How long term is the representative talking about?
He saw the prospectus for the recent $400 million bond issue and the first principal payment is not due until 2025.
“We’re borrowing the money now to pay this year’s bills and we won’t start paying the principal for another 10 years,” emphasized Hineman. “How can you endorse this policy and call yourself a fiscal conservative?”
Just in case you were wondering, that’s seven years after Brownback leaves office. In all likelihood, a number of the ultraconservative lawmakers who are also responsible for this disastrous fiscal policy will also be out of the legislature by that time and enjoying their annual Christmas cards from the Koch brothers.
These so-called conservatives are decimating the sound budget principles that have long been the foundation of Kansas government. Bearing the brunt of this morally bankrupt policy will be those in Kansas who can least afford it as well as our children and their children who will have no choice but to pick up the tab.
We’ve seen it before.
It’s strikingly similar to the pyramid scheme used by Wall Street scam artists who promise huge returns on investments, but deliver on those promises by continually attracting “new” money from unsuspecting clients that is then redistributed to their earlier investors. In this case, the “new” money is hundreds of millions of dollars in long-term debt that’s being used to help pay off those who have received hundreds of millions of dollars in tax breaks.
What lawmakers are doing may not be in direct violation of the state’s Constitution, but it’s “a violation of the spirit of the Constitution,” argues Hineman.
We would take that a step further and argue that if it’s not criminal then it ought to be.
Not that any of that matters to the ideologues in the Brownback Administration or those who hold down leadership positions in the legislature. They aren’t concerned with whether massive income tax cuts represent good policy or whether using long-term debt from KDOT to pay current salaries and utility bills is morally responsible.
They are much more concerned with fulfilling the ultraconservative goal of giving tax breaks to the wealthiest individuals and corporations while further limiting the ability of government to perform its duties.
Further cuts to our social services safety net, toward the public education of Kansas children and in the state’s infrastructure that we all rely upon are of small consequence. How different is this from the disdain that Madoff had for the victims of his financial fraud that resulted in guilty pleas to 11 federal felonies and earned him 150 years in prison?
Only there will be no jail time for the fiscal shenanigans committed by Brownback and his co-conspirators. Instead, it will be up to future lawmakers – if they choose to act responsibly – and our children to clean up one helluva mess.
Rod Haxton is editor of the Scott County Record. [email protected]