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Wednesday, May 6, 2020

RI’s budget plans trashed by pandemic – who will end up paying?

Progressives must prepare for the coming state budget battle

Income Inequality in Rhode Island: A Snapshot | Economic Progress ...Budget time is almost here, in whatever form it might take, and it’s time for us — including progressive lawmakers in the General Assembly — to get organized to secure progressive revenues and prevent cuts to critical services, funding to cities and towns and schools, and so on. 

This requires getting up to speed ASAP about allowable uses of the various federal tranches of funds and the extent to which they can be used to support ongoing expenditures — and also ensuring that we push back against efforts that are surely underway to ensure that funds are steered to large corporations and others who need them least. 

We must make certain that we don’t end up with a mini Rhode Island version of the Mnuchin bailout fund or other uses that don’t best serve the general public welfare. 

The Chambers of Commerce and other powerful forces are surely frothing at the mouth, waiting to pounce on whatever of the $1.25 billion-plus that the federal government is granting the state — and they’ve likely already been much more in touch than has been the left with the Powers that Be over recent months. 

We must also organize to ensure that new sources of revenue are made available (or that certain revenue phase-outs are paused) in as progressive a manner as possible.

To my friends in the General Assembly: Progressives lawmakers must recognize that they wield great power as next year’s budget is shaped and any shortfall in the current year’s is addressed. 

The budget is going to be a total mess. Nobody is going to be happy about voting for it if it entails substantial cuts that hurt ordinary Rhode Islanders. 

Importantly, even House and Senate leadership will be sympathetic to many of these considerations: They don’t like cutting city and town budgets in ways that hurt their communities and leave them open to accusations of spurring property tax increases. 

They probably would have helped kill the steep municipal funding cuts in Raimondo’s original budget proposal from this winter — amazingly already presented before the COVID and attendant economic and fiscal crises hit. 

Moreover, if things go as expected and whatever session there is is focused solely on the budget then there will be fewer sweeteners in play to secure votes — like individual pieces of legislation that pass only after the budget, perhaps with consideration given to how their sponsors voted. 

Even if some non-budgetary measures are viable, it’s almost certainly the case that whatever is on offer will fall far short in scope of the rare legislative effort (paid sick days, gay marriage, codification of Roe, equal pay) that could be said to compete with prevention of broad-based austerity in terms of magnitude of impact in our communities.

We can and must build a bloc of lawmakers that is capable of credibly threatening to block the budget (a supermajority vote is required) unless austerity is prevented. 

During the last crisis, in early 2009, progressives in the Assembly (folks like myself, Edie Ajello, Art Handy, Donna Walsh, Ray Sullivan, Chris Fierro) stood together — along with several more conservative Democrats and the chamber’s few Republicans — to block a supplemental budget until a reduction in funding to cities and towns was made less severe and we secured a commitment to end the phase out of the capital gains tax. 

I have a fond memory of slamming the door in the face of the ever-intrepid Scott Mackay as he tried to sneak into one of our group’s hurried strategy sessions.

 We need progressives in the Assembly to bind together now to offer a similar — and ideally superior! — defense against austerity.

Hopefully the federal government will get it together and obviate these concerns through issuing further stimulus: None of us should want the crisis to be contained through state and local budgetary actions, as even the upward bounds of what might reasonably be levied by raising taxes on wealthy Rhode Islanders could fall well far short of what is needed to meet the demands of this moment and property taxes are generally regressive. 

The feds can of course spend into the economy literally as many dollars as they care to. But I remember waiting around for a mythical “second stimulus” to bail out the states in 2009 that never showed up — even as Dems controlled the House, Senate, and Presidency. 

So we need to prepare for the worst. We have power — and it’s time to get organized.

David Segal is a former Rhode Island State Representative and Providence City Councilperson.

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