Budget Cuts

Here's what's going to be the big issues (Note how many issues there are! these cuts are bad news):

Department of Agriculture: They want to cut licensing offices across the state. If you're not aware, pretty much all commerce in agriculture in this state requires licensing. Buying and selling plants and produce requires a license. So cutting these offices is something of a big deal to people in the industry - especially since there's a perception, even if its not true (I don't know yet) that these offices are paid for by the license fees.

FWC: 2 million to be cut from Red Tide research and prevention. Luckily for budget cutters, there's no red tide so far this year - if there is, at any point this year, expect it to blossom into a big issue. Also, cutting down number of patrol officers means less protection for manatees along with other duties - like rescuing people, issuing speeding tickets, etc.

Department of Corrections: If you haven't heard about Secretary McDonough's proposed budget cut/reforms, read up on them. This guy has a vision, and he's trying to use the budget cuts as a way of pushing it through. Of course, Republicans (and Democrats trying to appeal to Republicans) will never support a change from traditional punishment of criminals.

Justice: public defenders and state attorney's budgets are something like 95% salaries. So they'll have to cut salaries or positions. This means, of course, a slow down in the courts along with lower quality work, for both prosecution and defense. Cutting the DARE program is of course controversial even though the program doesn't work.

Juvenile Justice: Cuts will close facilities, resulting in overcrowding. Cutting The Guardian Ad Litem program, which is mostly tied to DCF, will cause over 3000 children in the foster care system to lose their guardians (people who make sure that the foster child is being taken care of in the foster family).

Other: candidate filing fees traditionally go in part to the the political parties. Now, the plan is to have all that income go straight to the state. Expect the parties to fight for the money.

Cutting the budget of the Division of Administrative Hearings will probably go straight to salaries or positions, and lack of workers will mean delays to worker's comp cases. The situation in Florida for workers comp is already pretty bad - another insurance problem.

Healthcare: 43 million from prescription drugs; 80 million from medicare payments to nursing homes - which counties will have to make up. The Rape Crisis Trust Fund could be totally cut.

The Agency for Persons with Disabilities has an interesting cut that would remove something like 75 million from the privatized Support Coordinator program. Support Coordinators apparently interface with government for disabled (mental and/or physically) people and provide other services. The agency wants to cut the program and have state employees do it at a reduced salary and greater caseload. Support Coordinators, of course, are fighting this tooth and nail, and getting the families of the people they help to fight with them.

Finally, education.

232 million from the university system, with no tuition increases.

102 million from community colleges, with increased enrollment and no tuition increases.

19 million from financial aid.

191 million from class size amendment funding - and now Republicans are claiming that the size requirement is only for average size, not max size for every class.

32 million from school readiness program, which will apparently result in 8200 children being "disenrolled."

And more! but too much to list here

BUT - no cut to controversial, and unwanted by teachers, merit pay programs

Now, these are from the 10% proposed cuts, when only 4% is necessary. So some of these programs will be saved, and other cuts won't be as deep. But everything mentioned here is on the cutting board, and needs to be defended. And I'm sure they will be - loudly in some cases, softly and behind the scenes in others.

How much of this looks like “government fat” that Republicans claim they need to cut? I think this round of cuts - or the next! apparently another 900 million needs to be cut from next year's budgets, and will happen in the regular session in March and April - will bring people around the the realization that Florida needs more revenue. Whether it's from an income tax, or cutting out the sales tax exemptions, or taxing corporations more, or reinstating capital gains taxes, or something else, Florida just needs more money to do what people want and expect it to do.

You got more? let me know what other controversial stuff is on the cutting wish lists.

Bright Futures: Florida's Most Popular Welfare Program

There's been a lot of news recently, but nothing really interesting. The insurance issue is where it was last week, since State Farm apparently needs a month to produce documents. Budget cuts are pretty quiet in terms of what what will actually be cut. I'll probably have more to say on that as we head into the committee weeks prior to the special session. So, I've debated whether to write this post on Hometown Democracy or Bright Futures. Bright Futures won, in part because of the recent push by Democrats on education (in regards to the FCAT).

Bright Futures got a good write up in the Orlando Sentinel (a paper I otherwise despise except for the insightful commentary by Mike Thomas). Thomas's argument is right on the money - standards are too low, and it holds down tuition at universities. He gets close to saying, but doesn't quite utter those controversial words, what Sandy D'Alemberte (former USF president) has said: Bright Futures is an entitlement program for the wealthy. That quote is from a piece in the Sarasota Herald Tribune that's a bit more inflamitory than Thomas's article.

Let me restate that to make it a bit more clear: Bright Futures is welfare for the adult children of rich and middle class Floridians. It literally is welfare - even if they have no other scholarships or loans, and have to pay tuition and other school cost out of pocket, Bright Futures is twice yearly welfare check for young adults disbursed by universities. It's means tested, too - they had to have gotten a 3.0 GPA and 970 SAT. Many students (I was one of them) got Bright Futures in addition to other scholarships and/or loans, which effectively means that Bright Futures prevents middle class students from having to work to have spending money while in college. In other words, just as conservatives have always criticized welfare programs, Bright Futures was an incentive for me and tens of thousands of other reciepients to not work. So again, just so its clear, Bright Futures is a means-tested welfare program.

That it's targetted to middle and upper class families is also obvious. While 3.0 and 970 aren't demanding, they're difficult enough that lower class families, who have more on their mind than their child's academic achievement (like paying rent, being able to afford enough food, the higher crime rates in their communities, dealing with second or third jobs, etc.) may find those standards out of reach. That's particularly true of the GPA requirement, which a student can fail to achieve because of just one bad year (which, again, can be caused by things other than the student's academic capabilities). The children of middle and upper class families- which is to say, socioeconomically blessed students - do better in school environments and are much more likely to meet those standards even if they aren't, from a different point of view, more deserving of a merit based award. So clearly, Bright Futures is not intended for getting impovershed or working class students into college.

Fine. It's okay to have an extremely regressive entitlement program, so long as there is a good purpose for it, and it is achieving that purpose. Proponents of Bright Futures, like Ken Pruitt, argue that Bright Futures is necessary to keep college students in Florida, where they'll provide a highly educated workforce and keep Florida's economy strong. Okay, that makes sense - a broad program to provide higher education and keep those educated to stay in Florida sounds like good public policy. It's also SOCIALIZED higher education, but okay, whatever. But does the program achive that goal? and is that goal worth the cost?

Whether Bright Futures keeps college educated students in Florida is a question for statisticians, but on the other hand, it's worked for me so far, and I'm willing to say its probably successful in that goal overall. Now, as to the cost. The obvious price tag is the $350 million it takes out of the budget. That's a lot. It's more than the state spends from its lottery fund on public schools. But still, if you're comfortable with socialized higher ed, maybe thats okay. The real price is what it's done to funding for higher education. That $350 million is, obviously, going straight to universities as tuition. It's money that students would have paid anyway, however, so it's potentially $350 million that universities (or any other education or public program) would have got anyway. This goes back to the argument of whether a regressive entitlement program is a good way to spend public money.

The other price paid is that increasing tuition - which universities need to do every now and then to be able to remain competitive with other universities in other states - means increasing Bright Futures expenditures. Since the legislature controls tuition (or at least, has controlled tuition - hopefully the BoG will get control of that in the future) and has to deal with balancing Bright Futures in the budget, it simply hasn't increased tuition for years. Which means that Florida's universities are underfunded - higher student-faculty ratios, larger classes, less research initiatives, etc. The important thing to remember here is that tuition needs to be adequate but fair - too high and it's regressive, so there should be resistance to raising tuition frequently, but too low and the universities wither. Bright Futures is putting downward pressure on tuition, and long term, that has been the greatest cost of the program.

As a regressive entitlement program, Bright Futures isn't worth it. It needs reform. That doesn't seem very likely, however, because it's wildly popular. Turns out that upper and middle class voters love welfare programs - like Social Security, Medicare, mortgage deductions, and Bright Futures. Anyway, Bright Futures needs to be reformed, and soon. I'd share my ideas, but really, I'm not sure what would make sense here - how to fulfill the original goal of the program (I mean, other than just making Florida Universities more attractive than out of state ones... which only requires generous funding and superior management). Thomas suggests splitting the money into two pools, one based on merit and one on merit/need. It doesn't change the fact that A) any entitlement program based entirely on merit is (as I just discussed) regressive and B) restricting the entitlement means reducing political support for the program. Bright Futures would not be so popular if it was restricted to, say, GPAs of 3.6 and SATs of 1250 or higher, and so it'd be much more difficult fund it as much as Bright Futures is now. And of course, any means-tested entitlement program that spends money on poor people is going to be controversial and unpopular - even if the standards are the same as they are now, with the additional requirement that the family not earn more than (for example) $40,000 a year.

So thats the sad truth about entitlement programs in the United States: if they benefit the middle class, they're popular; if not, then they're criticized as bad public policy by conservatives.

The Property Tax Amendment

So there's still plenty to say about insurance, but I think we've hit a calm spot until next week when State Farm has to testify on its plan to drop 50,000 policies. There's other insurance news - like that PIP won't be on the agenda for the special session, and on KidCare and S-CHIP. But I want to instead take the time machine back to the last special session, on property taxes, and speculate a bit on what happened.

The last special session was scheduled to last up to ten days. That's ten days that could have been spent discussing ideas, building support for various ideas, forging compromises and settling the little issues. Instead, the leadership crammed a prefabricated plan through in just three days. And it wasn't like plan had been on the table and open for discussion before the special session began; no, instead, broad information about the plan was presented to legislators on the Friday before the session, and the actual language of the bill was finally provided on the Tuesday of the first week of the special session. The initial House Policy and Budget Council which was supposed to meet on that Tuesday was pushed back to Wednesday so that legislators could actually see the bill before they started debating it.

Starting that Tuesday, Rubio attacked Democrats for not immediately supporting his plan, and upped the rhetoric during a press conference on Wednesday. The plan passed on Thursday, but not untouched. There were a number of amendments, check out the list yourself. Notice anything strange? All of the successful amendments (including the one that allowed Floridians to choose between Save Our Homes and the super exemption) were proposed by Dean Cannon, who was one of the negotiators for the original plan. Check out who proposed failed amendments: Grant, Kravitz, Reagan, Robaina, Frishe, Allen... all Republicans. Toward the end of the list you see some Democrats also proposed failed amendments. Bottom line: only the leadership got to touch the bill.

Now, lets look at some of the rhetoric spewed out by Rubio and his lackeys:
From the St. Pete Times article mentioned previously: "[Rubio] said complaints that the plan is confusing amount to "code speak for 'let's do nothing.'" He later calls those against the bill "opponents of property tax relief."
From the Buzz: Adam Hasner (majority leader) said "despite the efforts of some politicians to obstruct property tax relief..." and "It is disappointing that so many Democrats chose to ignore the voices of the taxpayers..."
Dean Cannon said "Any vote against either of the bills presented today was a vote against property tax relief, plain and simple,"

The pattern here is that A) opponents of the tax plan were against all tax cuts and B) the tax plan was exactly what the people wanted. The point of part B is simple - it's just presenting their plan as the best possible plan It's what you'd expect from politicians. Part A, however, is more than just slamming Democrats - it's also intended to scare Republicans. Many Republicans were not happy with the plan when they got it, just as they weren't happy with it in the aftermath (take a look at my previous post on this). It appears that Rubio and co. did everything they could to prevent Republicans from challenging the plan - including shutting down questions from Republican Carl Domino. If you don't believe me that Republicans were ambivelent at best about the plan, check out this article in the Sarasota Herald Tribune written in the midst of the special session.

So if they had a bad plan on their hands, why did the leadership push it through? They had ten days to tinker with it. They didn't even have to listen to Democrats - that amendment list proves that plenty of Republicans had their own ideas.

I bet Rubio knows full well that the amendment is going to crash. It has to get 60 percent approval, and the first poll on the issue found only 57 percent supporting it. That number is going to go down - it always does on constitutional amendments. We all know what Rubio really wants: Sales Taxes. It'd be all to easy for him to, after the January 29th election, to blame its failure on Democrats, Teachers Unions, etc. and then turn around and offer an even more radical proposal - abolishing or severely cutting property taxes and upping the sales tax. In fact, he doesn't even have to. He can turn to his buddies on the Taxation and Budget Reform Commission. Since the commission has the power to place amendments directly on the ballot of the November 2008 election, Rubio can campaign for an amendment supporting his dream of increased sales taxes and abolished property taxes without ever having to get anything through the legislature.

Still, I don't see how he could get 60% support for a sales tax amendment if he can't get it for a property tax one. So I expect him to be working on it during the regular session in March and April.

Insurance Rhetoric

So Democratic leaders are upping the rhetoric on insurance to a full scale "war." (this being echoed by our own FLA politics). House Minority Leader Gelber is calling for Crist to have the upcoming three-week special session on the budget also cover insurance. The Democrat's old plan for the January special session is being revived; part of which, by the way, was for a Rate Reduction Authority, which would allow the state to respond to an insurance crisis without the legislature needing to convene.

There was an interesting story in the St. Pete Times on Tuesday on the cabinet meeting that, among other things, discussed insurance. Its an interesting read because it reveals a lot about the position of each cabinet member on insurance.

Crist:
"Let's make sure, or find out, if these companies are adhering to the letter of the law. It's the law!" Crist roared, punctuating each word with a fist to the desk. "And there are consequences to not adhering to the law."

Agricultural Commissioner Bronson:
"Let's just be honest with everybody and not play games where nobody really knows what that coverage is going to be."

Alex Sink proposed undoing the policy changes from the January session:
"Let's go back to where we were before, if it's not going to make any difference,"

Attorney General McCollum:
"I'm disappointed that the rates aren't coming down for some of these companies, but I think each company has a good argument to make, and I think that's why we have a process and the Office of Insurance Regulation."

Notice a trend? Sink and Crist are ready for changes, reform, action; Bronson and McCollum are sticking to Republican ideology on big business and want to keep their noses out of it. Crist is emerging as a real moderate - he's a populist on insurance regulation, a moderate environmentalist, etc.

Don't believe me that Crist is a populist? Check out the Orlando Sentinel's political blog's coverage of his meeting with their editorial board. "...these are people who live in Florida, some of them....don't they care about their fellow Floridians? Don't they have any heart? Don't they have any compassion?" Of course, I like the title of the post, taken from this quote: "My word, how much do we have to bend over to the insurance industry in our state?" For videos, look here; they give you some context: Crist was riled up because of all the diet Red Bull he's been drinking.

There's more: Rep. Dennis Ross wrote a letter in response to Insurance Commissioner McCarty's op-ed pieces in various newspapers around the state. Choice excerpt: "It is axiomatic that competition and market forces will result in better insurance products at better prices for consumers," and "Consumers have a right to have businesses competing for their interests, and they are entitled to choices." Thats some hardcore free-market rhetoric!

Of course, what the insurance industry wants is hardly free market. The industry has been spamming newspapers with op-eds to combat McCarty's pieces. From the Palm Beach Post, an insurance spokesman called for the legislature to "rein in the state-run Citizens Property Insurance Corp.... [and] create voucher and grant programs that extend the surplus matching program and help with increased deductibles." In other words, end socialized insurance in favor of corporate welfare.

So, in summary, this "insurance war" has the Democrats and Crist on one side, and Republicans and insurers on the other. Democrats want to follow the tradition of FDR and keep plugging away at reforms until something sticks - Crist on the other hand wants to stick with the law as it stands, but enforce it vigorously. Republicans either don't want to do anything (as shown by McCollum and Bronson) or want to prop up the insurance companies (as per Ross's letter). When I heard that Democrats thought they had the upper hand on this issue, I was incredulous, as the whole thing seemed unwinnable, but how things have been playing out recently have convinced me that they appear to right. Floridians are going to want reform and change, even if it doesn't turn out well, rather than just sitting on our asses until the situation fixes itself, or worse, cave into the insurance companies and start feeding them vouchers and subsides (corporate welfare! And, decidedly not "free market," despite the Republicans' rhetoric). That's why Crist's "bend over' language is so appropriate: its what Republicans want to do.

PS - I know insurance isn't a sexy issue, but I'm focusing on it this week because it's what our politicians are are focusing on. Praxis means practical politics.