ACTION ALERT: YES on SB 101 and SJR 10

Following the biggest conservative victory of the 83rd #TXLEGE in the Texas House on Wednesday, Conservatives now need the Texas Senate to act on the following two pieces of legislation:

• SB 101 -- This is the corresponding legislation to the bill the Texas House passed on Wednesday; "Relating to the constitutional limit on the rate of growth of appropriations of revenue."

• SJR 10 -- This will place a strict spending cap in the state Constitution; "Proposing a constitutional amendment concerning the limitation on the rate of growth of appropriations of revenue."

These two pieces of legislation are major components of the Texas Budget Compact, which Lt. Governor David Dewhurst endorsed last year.

Concerned citizens should contact BOTH Lt. Governor David Dewhurst AND their own Senator and respectfully request a vote on SB 101 and SJR 10 on the floor of the Texas Senate.

Lt. Governor David Dewhurst:

(512) 463-0001

Facebook: David Dewhurst

Twitter: @DavidHDewhurst

Texans can contact their individual Senator here.

Read More

"The Biggest Conservative Victory of the 83rd #TXLEGE; So Far...."

Last night, a source on Congress Ave sent us this clip from the Houston Chronicle; money quote:

There would be a tighter state limit on spending under a bill given preliminary approval Wednesday by the Texas House.

Rep. Phil King, R-Weatherford, added the spending limit as an amendment to House Bill 7, which, along with HB 6, seeks to tamp down on the practice of collecting fees or taxes for certain purposes and instead leaving them unspent to help balance the budget.

....

King’s amendment would require the board to base the cap on the lower of three things: revenue, growth in personal income or growth in population and inflation.

....

King afterward acknowledged the potential for confusion but said his amendment would put a new cap on the overall budget.

Gov. Rick Perry has called for a new spending cap to be placed in the state constitution that would limit spending to growth in population and inflation. A constitutional amendment would require approval by two-thirds of the Legislature to be placed on a statewide ballot for voter approval. HB7, as amended, would simply put the new cap into state law.

 This is huge.  This type of spending cap is a major component of the Texas Budget Compact.  Perhaps we're seeing movement after all.

Our source explains:

if this survives on [sic] makes it through, it will be transformational....Not only will it freeze the footprint of government as far as the state funded side of the budget, but it will apply downward pressure on the unexpended balances maintained for budget certification, which will force agencies to reduce their taxes and licensure fees.

 In other words, this policy will alter the trajectory of state spending.

Cahnman's Musings would like to thank Rep. Phil King for introducing this amendment.  We would also like to thank reps Drew Darby and John Otto for assisting Rep. King on the floor.  This was the best move the Texas House has made all session and Cahnman's Musings prays it continues.

Update: Williamson County Conservative has more here.

Read More

After HB 11: How to Move Forward

This morning, Cahnman's Musings was blessed to attend a breakfast/Q&A session with Governor Perry.  The discussion was candid, much of it surrounded water, and last night's failure of HB 11 weighed heavily on the visibly tired Governor's mind.  The Governor made several salient points regarding the long term water needs of our state and, in the spirit of solving this impasse, Cahnman's Musings has a proposal:

Pass the Texas Budget Compact first.

The discomfort around HB 11 in grassroots circles concerns creating new quasi-governmental agencies before we've addressed the state's long-term finances.  Grassroots Texans are justifiably queasy about tapping the state's savings account before the legislature enacts structural reforms to state spending.  The Texas Budget Compact has always been the best way to assuage those concerns.

By amending the state constitution to limit spending to inflation and population growth, the Texas Budget Compact will prevent a new water authority from growing out of control.  The Texas Budget Compact will enforce the discipline necessary to limit any new water authority to its original functions.  Speaking candidly, the Texas Budget Compact will keep a new water authority honest.

In the event that the legislature passes the Texas Budget Compact, Governor Perry's points regarding water make a lot of sense; the Governor wanted to stress that:

• Right now, with $12 billion, there's too much money in the rainy day fund.  The state only needs to keep $7 billion in the rainy day fund to maintain its bond rating and be prepared for a major disaster.  Keeping this extra $5 billion around ad infinitum is an invitation for mischief.

• Water infrastructure is a one time expense.  Governor Perry repeated his opposition to using the rainy day fund to pay for ongoing expenses (ie. education and Medicaid).  If you have extra cash, and you face a one time expense, proactively addressing the problem  makes a lot of sense.

• Given the rate at which Ben Bernake is printing digitizing money, the bucks sitting in the rainy day fund will shortly have a lot less bang.

Using extra cash to pay for one time expenses makes sense, but only if the necessary long-term controls are put into place first.

If the Texas Budget Compact becomes law during the General session, then grassroots opposition to a narrowly tailored water infrastructure package will be defused during a special session; the ball is in your court, Mr. Governor.

Read More

Revised Priorities for the 83rd Texas Legislature

Back in February, Cahnman's Musings published this list of big ticket items for the 83rd Texas Legislature; heading into the final six weeks of the session, these are our revised priorities:

1. Gold, gold, gold - Rep. Giovanni Capriglione has proposed building a depository to store Gold bullion.  Governor Perry supports this effort.  Repatriating our own gold, and creating a safe haven for others' gold, will enable Texas to withstand the coming global economic [REDACTED]storm.  In a world where bank deposits are being confiscated, safety has value.  Accomplishing this task will allow us to live to fight another day.
   
2. School Choice - K-12 education is 40% of state spending.  Keeping long-term education spending under control is essential to keep the budget under control.  Putting the money in the hands of parents instead of educrats will also help pre-empt future CSCOPE's.
   
3. Medicaid - Medicaid expansion is economic suicide; just say no.
   
4. Transparency/Pensions - As we said in February: "Local government debt in Texas is $324 billion.  Pension obligations are a big chunk of that debt.  The interrelated issues of local debt and pension obligations are a time bomb the legislature should defuse before it becomes a crisis."
   
5. Texas Budget Compact - This is Rick Perry's baby.  To our knowledge, he isn't doing bupkus to get it passed.  Cahnman's Musings was an early supporter of the Texas Budget Compact, but if Rick Perry isn't going to do squat to pass his signature initiative, why should we?!?

There's still time to pass every item on this list.  These are structural reforms that will strengthen Texas' economy for the next generation.  If the 83rd Texas legislature delivers on these five items, Cahnman's Musings can live with a lot of other crap.

Read More

Governor Rick Perry on Limiting Spending, School Choice, and Medicaid

Governor Rick Perry spoke to Texas Bloggers tonight thanks to Americans for Prosperity -- Texas.  The Governor had about ten minutes of opening remarks then took questions for 25 minutes.  The following are from my notes:

• Conservative fiscal policies have "consistently paid dividends" through good times and bad.

• While the Legislature is in town: "everyone wants a piece of the money."

• The basics: Keep spending and taxes low, predictable regulatory climate, fair court system.

• Not only should Texas hold the line on taxes, we should lower the tax burden.

• Texas has the third highest High School graduation rates in the U.S. today.

• Different children learn with different goals in mind.

• Allow education dollars to follow the Child.

• I "really support" Dan Patrick on School Choice.

• Medicaid:
• We could have a healthier population for less money but Washington refuses to allow us to spend our own money how we see fit.
• Washington is going to run out of money in 3-4 years, at which point the states will be on the hook for the full cost; that's when they're going to start pushing single-payer.

• Texas Budget Compact:
• We began the process early so the idea could be distilled properly.
• The Legislature "will vote on this."
• Straus will "allow the will of the House to prevail."

• Other than that, the Governor also discussed various ideas for tax relief; while the Governor hasn't committed to any particular idea, he did promote this website for any Texans who want to make suggestions as to what form tax relief should take.

Update: Pondering Penguin has more here.

Read More

Big Ticket Items for the 83rd Texas Legislature

With the 83rd Texas Legislature one-third over, and conservatives off to a bad start, it's time to re-group and prioritize.  To protect and strengthen Texas' economy, we need to alter the trajectory of state spending.  The following five items will maintain Texas as place where entrepreneurs can risk their capital and achieve a decent rate of return.

1. Texas Budget Compact -- Cahnman's Musings was an early supporter of the Texas Budget Compact.  It remains our top priority, though we remain frustrated with Governor Perry's timidity.  Limiting government spending is the foundation of prosperity.
   
   
2. School Choice -- In order to limit state spending, you have to get education under control.  K-12 Education remains 40% of state spending.  For that money, K-12 education remains an array of boondoggles and bureaucracy.  The CSCOPE scandal re-enforces what we already knew about public education.  In order to keep state spending under control (and pre-empt the next CSCOPE), you need to take education dollars out of the hands of bureaucrats and put it into the hands of parents.
   
3. Medicaid -- Medicaid has been the fastest growing component of state spending for two decades.  In 2001, Medicaid was 14% of the budget; today it's 25%.  If the Obamacare Medicaid expansion goes through, that will rise to 33%.  Medicaid is a broken program that hurts the poor.  We can't keep pouring money we don't have into a program that doesn't work.
   
4. Pensions/Transparency -- Local government debt in Texas is $324 billion.  Pension obligations are a big chunk of that debt.  The interrelated issues of local debt and pension obligations are a time bomb the legislature should defuse before it becomes a crisis.
   
5. Repeal the Margins Tax -- This atrociously designed tax is unworthy of a state like Texas; end it, don't mend it.

In business, the Pareto principle states that you get 80% of your results from 20% of your activity; this list is that 20%.

Read More

Empower Texans: Supporting the Texas Budget Compact

Empower Texans has a great tool on their website to assist citizens who want to support the Texas Budget Compact:

We will print your letter on plain paper and hand-deliver it to the offices of your specific Texas House and Senate members, as well as the governor and lieutenant governor.

Read and sign your letter here.

Read More