What Obama can learn from New Hampshire’s budget reform

President Barack Obama visits the Granite State Thursday (provided the snow storm doesn’t scuttle his trip). He’s expected to tout recent positive economic news to bolster his presidential re-election campaign.

But the President should close his mouth and open his ears. If he did, he would learn a thing or two about fiscal prudence and responsible budgeting.

When Republicans William O’Brien and Peter Bragdon took over the State House and State Senate respectively, they inherited a massive deficit hole of $47 million from the previous budget. One reason Republicans swept the 2010 elections is because the Democratic leaders of the previous General Court had so badly mismanaged state funds.

Republicans almost immediately took to fixing the budget. They reduced spending by $1.2 billion, an 11% reduction in the size of the previous Democrat budget. They reduces general fund spending by $536 million, an 18% reduction.

Republican leaders also trimmed taxes and fees for businesses large and small and for individuals.

These moves provoked the usual expected howls from the Democrats. But the results are indisputable. The state now has a $17.7 million budget surplus, which is almost exclusively attributable to spending reductions (revenues are believed to be on the rise, as well, but the effects are unlikely to be felt for a couple of months.)

State Democrats called the spending cuts a “war on the middle class” and predicted they would result in catastrophe. But the state’s unemployment rate continues to fall and currently stands well below the national average at 5.2%.

Consider, by way of contrast, President Obama’s recent budget proposal. To be sure, the President knows his budget has no hope of passing; the House is controlled by Republicans and the Democrat-controlled Senate is openly flouting its responsibility by failing even to pretend to want to pass a budget. So Obama’s budget is strictly designed for political and aesthetic purposes. And it still doesn’t come anywhere near balance. In fact, it forecasts a $1.3 trillion deficit.

“The President should note that New Hampshire is shrinking our unemployment rate and growing our workforce the right way – without government bailouts or taxpayer funded stimulus programs,” House Majority Leader D.J. Bettencourt told NH Journal. “Instead, we brought spending under control and reduced a historic deficit without raising a single tax or fee. In fact, we cut or eliminated 12 taxes or fees and passed 43 new laws that reduced regulations. Now, our economy is thriving as our employers are gaining the confidence to add new jobs. The President should leave his big government solutions in Washington and learn how we can get the economy moving again when we lift the burden of the state from the back of those who actually create jobs.”

When we compare the fiscal condition of President Obama’s federal government and that of the Granite State under a Republican budget, there is no contest. Obama’s time in New Hampshire would be best spent listening to Republican leaders at the State House rather then spinning tales about his own discredited fiscal policies.

Author: Patrick Hynes

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  • Anonymous

    Seems a reasonable course of action. 

  • AnnaCamellia

    I’m not sure this column really makes the point it is trying to make.  How does it demonstrate that reducing the budget is also reducing unemployment?  I agree that cutting the state budget is absolutely necessary, but I think the reason unemployment is falling, at least based on my experience in the Upper Valley, is that people are leaving– either leaving the legitimate job market or leaving the area altogether.  I have been laid off four times in the last seven years, and am now in a job where the managers have decided they can’t afford to pay me what they agreed to pay when they hired me.  I have a short time within which to find another job, but if that doesn’t happen, I will lose my house.  When my house is foreclosed, I will move away.  Every realtor I have spoken to has told me the same story:  People come here to take a job; they buy a house; they lose the job and can’t replace it; they move away.  And they disappear off of New Hampshire’s employment numbers.

    • Diggs

      Governments that run a fiscally responsible budget give businesses the level of confidence that is needed to expand production, and hire more workers.  It’s pretty simple economics.  Businesses understand that so well, the entire southern tier of NH is filled to the brim with businesses that have fled Massachusetts.
      Your story of unemployed moving away is ridiculous when the bottom line of the story is that people move away from a low-unemployment state and move to high-unemployment states TO GET A JOB!  If they are that stupid, then NH should be happy to pay their bus fair to leave. 

  • http://www.facebook.com/profile.php?id=1092612597 Neil Rowland

    Here in New Hampshire, we live in the real world and do what works.

  • GIJoe

    Save your breath and ink. Oblahblah doesn’t give a damn about balancing the budget. He had the gall to submit a budget with another trillion dollar deficit. There was no attempt to cut spending or cut the deficit. Get it? He is a rigid, idealogical politician interested in the liberal idea of fairness (as he defines it). His policies have slowed the recovery and job creation.

  • John

    Unemployment falls because after being unemployed for too long, you are no longer considered unemployed