Let’s play cut that budget.

Our leaders in state government are grappling for ways to keep government afloat.  I think the revenue shortfall will not be as bad as now projected any more than it was as good as projected 3 months ago.  Nonetheless, they are the best numbers we have and we have to make tough decisions.  Our leaders could use fresh ideas.  Let’s play cut that budget. Here are my top ten in no order of priority. Repeal the  new prevailing wage law because it is not the real prevailing wage.  I am all for a decent living wage in government contracts, but it makes no sense to cancel projects and have no wages.  Balance is a good thing. Allow more competition in the state supplier list by opening it up to new suppliers every quarter for mundane items and simplify the process.  Many times it is cheaper to go to Sam’s or Staples than buy from the state’s approved list.  If a company can come up with a great deal, why make them wait a year or more to offer it. Let’s get a performance audit of the Medicaid plan and the SChip program.  I don’t want to balance the budget on the backs of the poor.  I just want to find where the system is working and where it is not. Sentencing reform would help us keep the dangerous people incarcerated and eliminate silly mandatory minimums for nonviolent offenders.  Drug rehabilitation would be money better spent than mandatory minimum sentences.  Our prison system is one of the fastest growing portions of our budget yet we aren’t much safer. Sorry, but a salary freeze has to be a given.  Slight increases in employee premium shares for  dependent health care seem unavoidable for now.  That is painful for me to even write, but it is better than job or hour cuts. Stop spending tax money for open spaces and help the counties establish Transfer of Development Rights banks.  The key to making it work is for the cities to cooperate.  We need to rebuild our cities not artificially build town centers in our counties.  Livable Delaware is a failed experiment which we can no longer afford. Deregulate school construction.  Let’s allow schools to save money in construction by making sure schools are safe not dictating every detail. Why force prevailing wage on the schools?  Why not allow steel buildings and cut the cost by as much as 2/3’s.  Why stop a district from planning for obvious growth? Now let me borrow a couple from Dave.  I agree that we need a performance audit of state government.  Many of State Auditor Tom Wagner’s old recommendations are still on the shelf.  Let’s find which ones are still relevant. I also agree that we need to invite the citizens in the process with a lot more transparency.  A good start would be putting the proposed budget out and on line 5 days before the vote and the bond bill 3 days before the deadline.  Finally, Let’s re-energize the  process.   First, we need an active sunset committee which asks of each program over the next two years, does this program fit into the purpose of state government, is it fulfilling its goals, is it effective.  Second, take the budget into a committee of the whole with a rule which allows members to offer budget efficiencies or new proposals only by offsetting costs.  Third, let’s set up a temporary DEFAC style committee for economic growth.  Let’s get some economic, business, and community experts to recommend some approaches for the future. Your turn!

30 thoughts on “Let’s play cut that budget.”

  1. I have another. Stop republican legislators from making up $65,000 jobs for family members.

  2. Pass both open government bills. Then all can see the hardships everyone else is taking, and that will keep their whining to a minimum.

  3. kavips is right. Until we have transparency, we are all just arguing on emotional or ideological reasons rather than facts. I am not ready to say where spending should be cut until I see the numbers.

    This spring, Delaware Republicans have yet another chance to put some teeth into their open-government pledge, by refusing to vote for a budget unless transparency and open-government bills are brought to a vote.

    Or they can just keep on hiding behind Thurman Adams.

  4. Casinos in other states pay far more into the government coffers than ours do.

    That may or may not be a good idea. Are you comparing Delaware with full-service casinos? I think the reason for the disparity is we impose stricter limits on the size of the facility and the games offered. If we demanded more taxes, they would (rightfully) demand bigger facilities with fewer restrictions, and nobody wants that. Anyway, we’d be foolish to let gambling become too big a slice of the revenue pie.

  5. I don’t have access to the experts. I can’t give you exact numbers, but my back of envelope calculations are around 150 to 200 million dollars depending on the degree one wishes to follow some of these suggestions. This is without cutting “core services”. More importantly, some of these changes would pay off in the out years. Take sentencing reform and medicaid reform. Getting ahold of those expenses is vital for the long run. Prisions and health care are controling our budget instead of us having control over them.

    I have a big change to suggest. It may be controversial but it deserves its own post or series of posts. We need a new public mental health strategy.

  6. Stop spending tax money for open spaces and help the counties establish Transfer of Development Rights banks. The key to making it work is for the cities to cooperate. We need to rebuild our cities not artificially build town centers in our counties. Livable Delaware is a failed experiment which we can no longer afford
    *
    bravo to this idea. courage in legislation is necessary here, however.
    na gonna happen.

  7. Jason, I am opposed to anyone stealing so I will sort of agree. Since you want to make this some partisan game, I will play along.

    I am so glad that the governor has pardoned Lofink because of the Republican exemption from theft. (Oh, you missed that one, it must not have happened, I guess he is still going to jail and is still fired.) Only Democrats should be held to standards. I am tired of Democrats violating the separation of powers by being legislators then getting political appointments to the administration. There is no possibility of administration influence there. Let’s clean up the Democrat administration then worry about those who don’t have the power. 🙂 Yeah, I am kidding just to illustrate how silly it was to take that tack.

  8. “Let’s get a performance audit of the Medicaid plan and the SChip program.”

    Why stop and start with those two. How about a performance audit of everyone and everything in government. Eliminate waste, fraud and abuse.

  9. David, as a fellow Republican I would respectfully suggest you and Dave take the prevailing wage issue of the burner for the sake of reestablishing our brand in Delaware. The savings from repeal of PW are not that easy to figure, the unintended consequences are potentially negative, the savings to be had are speculative. But one thing is for sure, just like being against minimum wage, being against paying high wages on state construction jobs is, politically, an attack on working people.

    You can argue a million different ways, but for our Party to be the Party that wants to cut construction workers pay, is just not a good thing.

    We would do better with the people of Delaware proving we can save money somewhere else, anywhere else, and actually do it – not just blab about it. Save some big money on something somewhere anywhere. Gain some credibility, then maybe on some other day, go after construction workers wages.

  10. Dave, you never made your case for how you came up with “hundred million dollar”. How do you get that number? You may see it as a simple Union conspiracy, but it’s much bigger more important than that.

    Prevailing wage is Republican legislation. Named after two Republicans (Davis-Bacon), passed by a Republican Congress, signed by a Republican President. It was made law during the Depression to help bring the country back to life. You want to kill it now because you think you can save money? Republicans have always been proud of this accomplishment. It has only been since the Depression has faded from memory, that younger Republicans deem it wise to forget the past. One lesson of economic collapse of 1929 was that “cost effective” is not always what is best for the American family.

    Depression era legislation has saved our ass many many times since, including this month during the financial almost meltdown. It was the Fed with all the 1930’s era mechanisms and insurances that averted a panic.

    Be careful not to forget your history. Prevailing wage, FDIC bank insurance, Social Security, minimum wage, unemployment compensation. It’s all part of the engine that makes this country hum along. I would hate to see a guy who is not a mechanic, under the hood, pulling parts out tossing them away because he doesn’t understand what they do.

  11. If you cut the workers pay, how do you know the Construction Company owners won’t just pocket the savings?

  12. You are going to have to figure a way to proportion and control labor costs and profit margins on these jobs, otherwise you have no way of knowing if you saved the State money. The only thing you will know for sure is you cut the carpenter and electrician and plumber pay, but not the CEO, management or shareholders pay. It could work out that on a $30 million dollar job the $2 million or so you cut out of workers pay goes right into the bosses pocket and the State saves hardly anything. Is there any legislation that would prevent an owner from pocketing a $2 million dollar bonus on these jobs?

    The ultimate savings on public works would be importing Chinese peasants like when we built the transcontinental railway, why let a local Delaware family earn $65k now and then when there are a lot of cheaper ways eh?

  13. Thanks Dave for your intelligent and spirited defence of prevailing wage reform. Notice how tough of an issue this is. I did not talk about repealing it for most state projects, just market reforms. The latest change made no sense and actually hurts workers. They are making less money because we are not doing the projects. I remember someone saying, I make $40 an hour–when I work. I would rather make 28 or 30 and work regularly than 40 and hardly work.

    I am talking about a real prevailing wage. I don’t want government undermining wage levels. I also don’t want taxpayers soaked and projects undone.

  14. I am surprised that the committee of the whole budget cutting day got no play from you all. I know it sounds wonkish (It is.), but this has true potential to generate savings.

    Here is how. The appropriators are fine people but they see their job as spending money. They will put together a fine budget, but not likely one which has real change or as Dave puts it revolutionary change. They just move numbers around. That is valuable work, but if you want real change this year, you have to open the process to those back benchers who are willing to push the envelope. The folks who want change have to wait for years to get on these committees if the special interests ever let them on.

    The people can have more input on changes if the process is open to various amendments from everyone especially if it is done with a cost savings mindset. This could be the best idea of the group or at least one of the top three. Hey, we elect all of them to make these tough calls, let’s give them all a chance this year.

  15. Dave, “Once the labor costs were set by the market, the extra profit would go. I’ve been told by contractors that . . . ”

    Ah yes the “market”. Is that how the banks, appraisers, and mortgage lenders got to where they are, or was it a unregulated market abused by those who were free to do so?

    “restaurant managers, car salesmen, receptionists, retail clerks”. Many of these unfortunately don’t have health insurance. The high union prevailing wage includes health insurance. Are you saying you would like to see construction workers dangling from the new bridge without health insurance? Or maybe you have a plan to require $13,000 a year for each construction worker on state projects.

    You say ” I’ve been told by contractors they make a fixed percentage on State jobs”. Sounds like due diligence to me? I’ve been told by blue collar workers they would lose their houses and health insurance if we abandon the Davis-Bacon principles that have served us so well for the last eighty years.

  16. Dave, if you want to be the crusader against high paying blue collar jobs go ahead. I think it would be better for the Republican Party in Delaware if you distanced yourself from the GOP and aligned yourself more with the Chamber of Commerce. I say that not as a ball breaker, but as a sincere wish to see our Party shed the image of the against minimum wage against prevailing wage against unions against public schools, against universal health insurance against Party.

    Your logic, that many other workers are hurting, so why not get rid of Davis-Bacon subsidized jobs so that construction workers can join the ranks of the working poor is an interesting take on life.

    We need higher wages more than “more work”. If more work means more work for half the pay and no benefits, you are dreaming of an America most families don’t won’t. Your highly subsidized real estate business just got propped up by hundreds of billions in taxpayer dollars and you have the coldheartedness to begrudge a plumber or carpenter getting a guarantee of high wages? Nice.

    You are championing ideas identical to the Chamber of Commerce. That’s great. Our Party should stand for something different.

  17. The prevailing wage is suppose to based upon the market union wage in the area. That is what I am talking about using, not minimum wage but a good living wage which will keep up a good standard of living. What I am opposed to is the recent change which artificially soaks one group of people and leaves vital projects underfunded.

    I am opposed to ridiculous legal fees being paid by the state, but i better stop before I get another special interest group mad.

    No one complained when we pressured down the amount business men made early this decade. You don’t complain when we use power of bulk purchasing for drugs in the VA or elsewhere. What is wrong with saying that we can’t just raise salaries independent of market wages. Should someone hit the lottery just because their company has him assigned to a state contract while everyone else in the same company receives no such benefit?

    We are not arguing against prevailing wage in this proposal. We wouldn’t see the point because it will not go away. What we are arguing is that the recent changes are irresponsible and we need the system reformed.

  18. Dave, you offer no proof, no guarantees we would have more schools or roads. Only a half baked theory. The only thing for sure is that you would break the back of trade unions and reduce the pay and benefits for the men and women doing construction work for the State.

    And don’t go kicking me out of your Party again. I am not bashing the Republican Party. You keep confusing yourself with the Republican Party. As I mentioned before, The Republican Party invented the prevailing wage laws. We fostered and protected them for 80 years, now guys like you come along and say these ideas are not Republican? That supporters of PW belong in the Democratic Party? Do your homework pal. You are the one betraying traditional Republican values. I would have loved to hear you rant and rave when Eisenhower
    commissioned the building of the federal highway system. All them concrete workers in the 1950’s laying down them highways coast to coast north to south all making great money protected from cheap foreign workers by the Republican Davis Bacon Act of 1931. I have a feeling you would have been pissed.

    You want to save the State money? Pick on something else or form a new AntiUnion Party

  19. Dave, why do you keep insisting you represent the Republican Party more than I do? What’s with that? I am criticizing you. Is repealing Davis-Bacon part of our GOP platform? Is Mike Castle backing you on this? How about Terry Spence? You call it whining, traditional Republicans call it fighting to get our Party back from the wingnuts.

    All the whining you do about rotten lousy spiraling downhill mismanaged Delaware, it’s a wonder you haven’t moved to another State.

  20. Good luck in Dover. Maybe you can get that minimum wage increase rescinded. Your other sound argument backed by data was that raising minimum wage is bad for workers. Your current argument is that lowering wages for construction workers is good. In each case you say lower wages means more jobs. I am saying you are out of tune with the times. The problem is not jobs. The unemployment rate is low. There are plenty of jobs. This problem is low wages. Your ideas exacerbate that problem. There must be a way you can redirect your energy towards ideas that increase workers wages. And yes, governing is a lot about emotion. If it was just about “data” it would be easy.

    RE: Anonymous whining. Benjamin Franklin wrote prolifically in the pen name guise of a slightly prudish widow named Silence Dogood.

  21. Dave, don’t try to steal the monster title from our gal Hillary. I know you are not uncaring. I know you are full energy to make things better. I just wish you would harness that energy into solutions more in tune with this new age of declining purchasing power. You are fighting yesterdays war. Today it’s all about how do you make enough money to buy gas, heat, food, and keep a roof over your head. Handouts are not the worst thing that can happen. We all get them. Real estate in particular. All the tax preferences and subsidies to encourage home buying cost us a fortune. But it’s all good. It is one of the mechanisms we use to dissolve concentrations of wealth. As you have pointed out on numerous occassions, a small percentage of our wealthiest citizens pay the lions share of taxes. That is the money we hand out to many different people for many different reasons. It is the mechanism by which we constructed our middle class. From Davis Bacon to the GI Bill and on and on it has never been about money, America has always been about promoting the general welfare.

    I wonder how much revenue Delaware would raise if we amended our State income tax so the deductions for home buyers and mortgagees were eliminated. All those people in houses much bigger than their needs eating up all that energy, why should we subsidize them with tax breaks. Even the idiot first time home buyer gets deductions. How about the big tax break people get just for keeping a house a couple of years? We don’t get that for automobiles. Why favor real estate buyers over renters. Is this a politically powerful industry getting all kinds of breaks? Sounds different when the envy is placed elsewhere eh?

  22. “The only thing for sure is that you would break the back of trade unions and reduce the pay and benefits for the men and women doing construction work for the State. ”

    Ironically, Don, considering your complaint about Dave not offering proof of savings, you offer no proof of this scenario — a far more ludicrous charge — is anything but union-backed twaddle. “Break the back of trade unions”? Right. This sort of overwrought statement illustrates the weakness of the union position.

  23. Could somebody please put the DE prevailing wage rates AND the R.S. Means study online so your dear readers have the opportunity to figure out who is the BS’er here. That would pretty much put an end to this pissing contest.

    The first thing to evaluate is Dave’s claim that:

    workers will go from making $80,000-$100,000+ over the course of a year to making $65,000-$80,000 a year

    This may or may not be true, I don’t know. Is that actual annual compensation? Or is that extrapolated from the hourly rate tables? Does it include benefits?

    Are those numbers taken from the peak of the boom? What is the projected annual salary for construction workers in 2008-2009?

  24. OK, here are the prevailing wage tables (follow the links for 3 separate PDFs):

    delawareworks.com/industrialaffairs/services/LaborLawEnforcementInfo.shtml#pw1

    Now we are getting somewhere.

    Now to locate the R.S. Means study, and related documents that analyze it.

  25. OK, it turns out the R.S. Means study is under FOIA… 90 days wait, and 50 cents per page from NCC for a fresh copy.

    Post it if you’ve got it.

  26. Looks to me like the average income of workers under Delaware’s Prevailing wage law, if you factor in the seasonal, uncertain duration, deduct health benefits, comes out to somewhere around $50K a year. I am sure many PW workers make a lot more, and many make a lot less.

    I know that a lot of this work, especially highway construction, has the added benefit of the highest injury and accidental death rates of any profession. It is also work that, like the short career of athletes, is not the kind of work you can do for thirty or forty years then retire. Unlike white collar work, these trades can be brutally physical. It wears the body out prematurely.

    The median income in Delaware is somewhere around $52K. The poverty level for a family of 4 is around $21k. In Massachusetts, a family of 4 bringing in $42K qualifies as poor enough for State health insurance.

    I don’t see the problem with PW. If we were to do away with Davis-Bacon prevailing wage laws, it seems the market would allow the cheapest labor to prevail. Seasonal guest workers for minimum wage? Not sure how it would all turn out. But I say, let’s guarantee our trade workers do not have to compete for poverty wages on Public projects. That is something we, as taxpayers, friends and neighbors or these workers can do to keep our middle class propped up.

    Here is an interesting link about Wisconsin and PW. I have not really studied it, I am sure Dave can tell us it is put out by Union propagandists and contains all sorts of omissions and errors but looks like it is worth considering: http://www.wisconsinsfuture.org/publications/otherpubs/PrevailingWageSummary.htm

  27. May I give a personal perspective? (Since I wrote the post, I guess the answer is yes. 🙂 ) When Dover proposed a 13 million dollar city park building and a ten million dollar bond to cover our portion, I was skeptical and eventually opposed it. I was one of the public voices of opposition. I claimed that it could be done for 1/4 of the cost and no debt if we approached it differently. My research showed that a similar steel building with brick facing could be done for 2.5 million to 3 million dollars.

    The establishment ridiculed Rob Ritter and I because if that were true than why didn’t that appear in any of the studies? Anderson and Ritter were on a tangent and stirring up trouble. The people voted the building’s bond down overwhelmingly and ousted 3 of the supporters from council. The park facility was declared dead.

    Councilman Pitts saw the vote differently. He saw it as a rejection of government excess and tax increases. He invited me on the Parks and Recreation Committee which he now chaired. He shepherded through a facility we could afford which was a 3 million dollar steel building. I was glad to support the effort and lent my name publicly to it.

    The state of Delaware was not happy to see us go a different route. They wanted to renege on state contributions. They would have rather us spend an extra 10 million dollars (our money not theirs) than have us respect the taxpayers and keep Dover out of debt. Right then, I knew something was desperately wrong with the state. Fortunately, the late councilman was enough of a leader to keep the basic value of respecting the people’s money at the top of the list.

    When I look at other state projects, they do it the most expensive way. We are not getting our monies’ worth. I think this crisis is an opportunity to focus the mind and gain a government which better serves all of us.

  28. My friend, that is the same with schools, libraries, and other projects. The state won’t consider lease backs and other interesting proposals. We know some of these schools will be filled before they even open but the state rejected Smyrna and CR’s inquiries into larger schools before their referendum. They won’t consider less expensive and more efficient structures. The state is broken. Your, right it is real money.

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