The Rendell Legacy: PA’s Fiscal Catastrophe

Member Group : Freindly Fire

Let’s give credit where it’s due. Fast Eddie never gives up, no matter how short-sighted his ideas may be.

When we last left our lameduck leader during the 2009 fiscal debacle, which took 101 days to pass a budget, the Governor was doing what Democrats do best — transferring money from the people to government coffers. How? By initiating yet more tax increases on an already overtaxed public.
No surprise there.

At a time when Pennsylvania families are doing the responsible thing — tightening the belt and exercising fiscal restraint — the Governor does the polar opposite. Rendell has proposed a budget increase of 4%, in large part to pay for his pet projects, while incomprehensibly ignoring the fact that revenues are declining.

But given the fact that Rendell hasn’t signed an on-time budget since taking office, why not go 8 for 8?

He pays no attention to the coming pension bomb, in which obligations to state pensions will increase eightfold over the next three years, from $550 million to over $4 billion.

The Governor has apparently ignored the recent court ruling that the $800 million raided from the MCARE fund —money specifically allocated to alleviating high medical malpractice premiums — must now be paid back.
And he conveniently forgets that there won’t be the $2.7 billion in federal stimulus money that we had last year, and that accounting gimmicks won’t work anymore — such as counting the anticipated tolling of Interstate 80 as "revenue."

(Despite Ed’s vehement objections, the federal government shot down the I-80 tolling plan, so it’s back to the drawing board).

All of which means higher taxes and an expansion of gambling — government at its finest!

But because Rendell believes that government, rather than the people and their employers, knows best, his approach makes perfect sense — at least to him.
And he’s dead right if you believe in: a) spending beyond your means, b) grabbing money and property that isn’t yours, c) over-regulating almost everything to justify the existence of bureaucrats, d) failing our children, and e) doling out untold millions in secretive no-bid contracts to your buddies — the same buddies who kicked in millions to your campaigns.
Now Rendell is back at it, fighting for —you guessed it— more tax increases on Pennsylvania’s citizens and companies. To someone like Rendell, it makes no difference that:

1) There is no such thing as a "business tax," — the cost is ALWAYS passed along to the consumers.

2) Pennsylvania companies already face some of the highest tax rates in the world. We have the second-highest corporate net income tax in America, an onerous Capital Stock and Franchise Tax (which was supposed to be phased out but was resurrected —retroactively! — thanks to the horrible 2009 budget deal), and the most hostile legal climate in the nation, resulting in a massive "hidden tax."

3) Philadelphia, in part because of the Rendell "legacy," is the single highest taxed city in the nation. As its tax base flees — both businesses and individuals — the remaining citizens are stuck with an impossible burden. Many seniors, who have paid off their houses decades ago, are forced to sell because they cannot afford the skyrocketing property taxes.

4) Rendell signed the 2009 budget that permitted Mayor Nutter to increase the city portion of the state sales tax by 100%, and, incomprehensibly, allowed the city to not fund ANY of its pensions for two years, ostensibly so that Philadelphia could get its fiscal year in order.

Does anyone really believe that in Year Three, conveniently after Nutter stands for reelection, the city will be able to make a lump sum payment of some $800 million to its insolvent pensions? Not a chance in the world.

So the city will either A) send a nice note to its retired workers telling them that their pension is worthless, and to have a nice life, or B) once again, implore —actually, indignantly demand — that the Pennsylvania legislature bail out the city with state money.

Which is a meaningless term, since there is no such thing as "state" or "government" money. It’s OUR money, sent to Harrisburg with the expectation that it be spent wisely.

And now, in an act that redefines "chutzpah," Rendell told attendees of an energy conference in Texas last week that:

A) He was the "best ally" of the natural-gas industry.

B) A tax on gas production (in addition to all the other taxes Pennsylvania levies) should be embraced by the industry.

C) The industry should be giving more money to the Democratic Party in Pennsylvania.

D) The tide of public opinion was turning against the industry, and
E) He was available for hire after his term expired.

There’s a term for telling someone with deep pockets that, if they expect to get things done, big cash contributions need to be forked over and that you’re available for hire (at a presumably high rate).

I’m not sure what that term is, but a certain ex-politician might have the answer.

Vince Fumo. Not coincidentally, a close ally of the Governor.
Welcome to the Ed Rendell Legacy.

Chris Freind is an independent columnist and investigative reporter who operates his own news bureau,
Readers of his column, "Freindly Fire," hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris’ recent bestseller "Catastrophe."
Freind also serves as a weekly guest commentator on the Philadelphia-area talk radio show, Political Talk (WCHE 1520), and makes numerous other television and radio appearances. He can be reached at [email protected]