Tennessee State of the State

I didn’t watch Bill Haslam’s first State of the State Address Monday, but I read it, using an internal Dana Carvey voice. I invite you to do the same, though you likely won’t learn much.

Haslam talked about the budget, and his legislative agenda, and how things are tough and all that. From a budget standpoint, there’s not much difference between he and Bredesen. Of course, considering how long he’s been in office, there’s not much else he can do. State employees are finally getting a raise, though it’s less than the cost of living, and over 1100 unfilled state jobs are being eliminated. Nothing radical or particularly partisan about that.

TennCare, and Higher Education are getting cuts, but not scholarships, which means those scholarships won’t go as far as they once did after tuition increases, and more people will be left out of access to healthcare. Teachers will have a higher threshold for attaining tenure, even though Haslam says he loves teachers. Collective bargaining will be curtailed, creating greater instability in the teaching profession, and Charter Schools will be pushed, perhaps even from the state level, even though there are plenty of questions about whether or not Charter Schools are even effective.

Still, despite all this, there’s not much different in the rhetoric of the new Governor than his predecessor. But, as we all know, rhetoric is just that. Actions and words are often in conflict, and while Haslam continues to moderate his speech, his silence on the more radical legislation his party is pushing says more than any words that could pass his chocolate pie covered lips.

All told, the budget cuts amount to nearly $1b. But as with so many things, there’s a story within the story. Even though the state is struggling with revenue, there are some 11 bills in the state House that seek to either cut or eliminate taxes on investment income, which primarily impact the most wealthy Tennesseans. The Governor’s silence on these bills is telling.

While the $200m that the Hall Tax collects may seem like a drop in the bucket, at a time when revenue is scarce, is cutting taxes on the people who need a tax cut the least the right thing to do? Well, he did say he “ran and was elected as a Republican. The majority in this Chamber did the same. As Republicans, we understand and support the principals of less government, lower taxes, and free enterprise.”

Of course, the majority of Tennesseans have no prospects for a tax cut, unless they curtail their spending, which they may have to do in an environment where government, apparently, can’t create jobs, and neither can the private sector. Still, with over 1100 miles of border, and an average width of around 120 miles, no one is that far away from an effective tax cut on their purchases in Arkansas, Mississippi, Alabama, Georgia, North Carolina, Virginia, or Kentucky. I don’t advocate that, but people will do what they have to to survive, especially when Government isn’t helping.

The largest single revenue source for the state government, aside from the Feds, is the sales tax, bringing in some $6.3b, or about 55% of revenue according to the FY2010-11 budget. There are a host of other taxes and fees that contribute the other 45%. Of those revenue sources nearly all have a bill that would cut them, except the ones that all us regular folk have to pay every year or four.

Here’s to looking out for the little guy.

So the long and short of the State of the State is, “it’s great, as long as you’re rich.” If you’re not, you’re just as screwed as you were last year, if not more so.

It’s gonna be a long four years.


Full Text via Humphrey on the Hill
State of the State address: Gov. Haslam urges more belt tightening for recovery
Liveblog of the State of the State address
Gov. Haslam sticks to spending plans
Commentary on the Gov’s Speech
Haslam’s SOTS
Finney and Fitzhugh call out Haslam for lackluster jobs proposal
The typically evasive Bill Haslam gets specific about the gloomy state of the state

Gov. Haslam unveils Tennessee budget; will expedite $97 million for Electrolux
Haslam Proposes 1.6 Percent Pay Raise in $30 Billion Budget
Haslam’s First Budget Picks Up Where Stimulus Dropped Off (feature)
Gov. Haslam offers spending cuts, pay raises
Haslam’s Budget Makes Cuts to Higher Education
Haslam presents $30.2B budget
Governor Proclaims a “New Normal” in State Spending
Haslam’s Budget Cuts Programs 2.5 Percent, Gives State Workers Raises
Devaney: The Governor’s Budget is ‘Sensible’
Hard budget decisions still to come, Haslam says
Haslam: We’re Not Out of the Woods Yet

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