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Public Assets Institute criticizes state government budget cuts |
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Friday, 22 August 2008 |
By CHRISTOPHER ROY
Express Staff Writer
Vermonters will pay $650 million more for oil products in 2008 than they did in 2007. That was the word Paul Cillo, President and Executive Director of the Public Assets Institute (PAI) told the Newport Rotary Club Tuesday.
Cillo founded the PAI, a non-profit organization to provide lawmakers,
journalists, public advocates, and citizens with an understandable
analysis of state budget and revenue matters, according to printed
information provided by Cillo. Its mission is to keep the public
informed about how government spends money.
Cillo said Vermonters saw their aggregate health care cost increase by
$328 million in 2008 from 2007. Meanwhile Vermonters are spending $60
million less in the state’s General and Transportation funds during
that same time, he said.
“As we speak, the governor is negotiating with the Legislature about
how to cut $32 million out of the budget, which already had $25 million
in cuts before it was passed,” he said. “The bottom line is the state
is spending less.”
This is something that does not please Cillo. He said Vermonters can
change their economic decisions, but policy change is the way to help
fix things. He said Vermonters are paying the costs either directly or
indirectly.
“For 30 years we have heard government is the problem, not the
solution,” he said. “I would like to suggest that underfunded and
incapacitated government is the problem, because it can’t deliver the
services that citizens would hope it would.”
One of those services is Medicaid, which has a deficit of $38 million
that the state does not have. He said the tobacco tax is supposed to
encourage people not to smoke, but that creates a problem. The amount
of money to fund Medicaid decreases because people buy less tobacco.
“That creates a structural problem with revenues that are suppose to
support ongoing services that Medicaid supplies,” said Cillo. “The
result is the state doesn’t have the money it needs to adequately
support Medicaid, which underpays the doctors or others at the
hospital. The hospitals then cost-shift to private insurance because
they need the money to operate the facility.”
He said that’s why health care costs increased eight percent but health
care insurance premiums increased 15 to 20 percent. Cillo said the
government can solve the problem with higher taxes. He said Vermonters
are spending $1 million more, even though state political leaders are
saying the needed $38 million is not available. He said he’s not
suggesting the Vermonters need to pay more taxes but they should look
at spending for government in the same context as everything else they
spend money on.
Cillo wonders how much money would be spent on oil products now if more
money had been put into energy-efficiency, public transportation, and
aggressive home insulation several years ago.
He said other countries spend less on health care with a better outcome than Americans.
Cillo said the state is not taking enough money to pay for existing
programs and services. The thought in Montpelier, he says, is the
state should manage the money. At first it sounds reasonable, but that
attitude short-circuits any discussion about whether cutting services
will cost more than raising revenue.
“It also leaves every thing to fate,” he said. “It’s not fiscal policy,
it’s an abdication of leadership that says we have no control over our
future.”
Cillo said raising taxes is not the only option, but it should be an
option. He said Vermonters should manage a plan that will tell them
what they get and what it will cost.
The $8 million deficit that state transportation department is facing
could be solved by adding two cents to the gas tax, according to Cillo.
Over the last month the cost at the pump fluctuated 10 times that
amount.
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Last Updated ( Monday, 25 August 2008 )
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