Marc Stier at Large

Remember when, in the movie Moonstruck, the character played by Nicholas Cage tells the character played by Cher that he loves her. And she slaps him in the face and says, “Snap out of it?” Well that’s what the financial firm Standard and Poor’s just told the state of Pennsylvaniayesterday. They, once again, threatened to downgrade our bonds – forcing up the interest rates we pay – if we don’t get our fiscal house in order. They are telling our General Assembly to: Snap out of our reliance on one-year revenues, like licenses for gaming or liquor sales to “balance” our budget. Snap out of our willingness to move money from one fund to another to “balance” our budget. Snap out of our penchant for over-estimating revenues to “balance” our budget. Snap out of our tendency to shift spending from one year to another to “balance” our budget. And most… Continue reading

While we will need some time to analyze the details of the budget that the House and Senate will pass today, our preliminary view is that it is, as we had expected from the beginning of the year, an austere budget that does not really address the deep public investment deficit of the state, but it certainly could have been far worse. Given that the General Assembly seems utterly unwilling to raise revenues to meet public needs, negotiations by the leaders of the legislature and Governor Wolf have led to a budget that still takes some small steps forward. We caution, however, that we have only half of a budget so far. No plan has been passed to secure the revenues necessary to balance the budget. And, as we will point out later today in more detail, we are deeply troubled by reports that the deficit for the year that… Continue reading