When making spending decisions, governments must now set aside rosy projections

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Virginia is now facing a fourth round of cuts to the state general fund budget in a year. This time the cuts are being estimated at $1.5 billion. It shouldn’t have been that much.

    During the budget process, Gov. Tim Kaine was urged by many lawmakers to utilize a conservative approach in crafting a budget. That advice wasn’t followed and now the hard task of cutting the budget in mid-stream is underway. Just what effect those cuts will have on the city, county and school budgets have yet to be determined. Announcements are likely sometime after Labor Day. The sooner the better. Making those cuts now won’t be easy.

    The governor chose to ignore sound advice on the budget forecast and now tough decisions will have to be made.

    Similar problems are also on the horizon with the federal government. Just this week the Obama Administration announced that its 10-year budget projections were off by $2 trillion. The projected budget deficit a decade out has now been revised up to $9 trillion, well above the previous optimistic projections by the White House of $7 trillion. One can only wonder why the President and his staff chose to ignore the findings of the Congressional Budget Office, released months ago, on the projected budget shortfall. But the numbers no longer can be brushed aside.

    And those projections must be considered as Congress debates the issue of health care reform. Since his election, the President has brought the American people an $800 billion stimulus package, a $400 billion omnibus bill and Cash for Clunkers. The House has approved the President’s American Clean Energy and Security Act, the cap-and-trade legislation that, if approved by the Senate later this year, will likely have major economic ramifications to businesses and the taxpayers. As William McGurn stated in the Wall Street Journal this week: “These big-ticket spending bills have helped define what the President means by ‘hope’ and ‘change,’ and it is through this prism that the American public now views his health-care proposals.”

    For many that is “hope” and “change” they don’t want.

    In tough economic times, the individual American citizen has to tighten his belt and make tough choices on spending. Local governments must also do the same. When local governmental leaders choose to raise taxes they have to live next door to the ones their decisions affect. That at least makes them think twice about taking such action. But when the federal government has problems it passes those on to the state government which, in turn, passes those down to the local government.

    Today’s leaders in Washington have not shown any preference to curtail spending. And no one who honestly looks at the health care reform proposals can buy the claims that the legislation wouldn’t add to the deficit. The CBO has said as much and the question now remains as to whether the White House will be honest enough to admit that. The time for rosy projections are over. It’s time to curtail spending — not just for the individual American taxpayer, but for government as well.