Jun 222010
Authors: Ian Bezek

If you’ve picked up a Collegian over the past year, you’re aware of Colorado’s higher ed funding crisis. Well, I have good news and bad news. The good news is that the higher ed crisis is over.

The bad news is that the funding crisis has grown so large that the deficit can’t be fixed by slashing higher ed funding anymore; none of Colorado’s services are safe from the chopping block.

A new economic forecast from the governor’s office and advisers to the General Assembly, according to the Colorado Springs Gazette, forecast a $1 billion shortfall over the next fiscal year.

It appears that health care, grade schools and help for the needy are probably the next items on the cutting block. Gov. Bill Ritter is required to come up with a plan by August to address the shortfall. He has covered past shortfalls by releasing prisoners early, eliminating state programs and furloughing state employees, in addition to slashing our campus’s funding.

These types of measures will not be able to provide the sorts of savings needed to fill this big gap. And things could get even worse. Ritter cautioned that the budget gap could expand further as Colorado is relying on federal aid to plug numerous holes. Colorado hopes to receive $211 million in federal funding that may not arrive, and $530 million of anticipated funding from Congress to pay for Medicare and colleges hasn’t yet been delivered.

Why is Colorado’s financial situation worsening again? State tax receipts from March onward have begun a new decline after a modest recovery in 2009, suggesting that the feeble economic recovery has entirely stalled out.

The state of the national economy isn’t helping. Unemployment (discounting the temporary effect of the census) is refusing to drop and may in fact be turning upward again.

Federal legislators have been more cautious in spending money; they recently voted down an extension of unemployment benefits with the stated reason of fighting the deficit. The national economic recovery since March 2009 was almost entirely based off of federal stimulus spending. As that spending slowed, it caused the recovery to stop and, it appears, another recession to begin.

What does all this mean for Colorado? If nothing else, we can see that short-term plugs and stopgap measures can’t be the answer. We’ve been operating for several years in a crisis-to-crisis mindset. If we only get through this one, the thinking goes, we’ll be rescued as tax revenues recover along with the economy.

Well, that just isn’t happening. The bump in tax revenues in 2009 was not enough to fix Colorado’s budget woes, and with sales tax revenues in decline again, we clearly can’t plan our budgetary strategy while waiting for things to improve.

That means we have take substantive action to address our budget mess. Little measures won’t work anymore. There are only two solutions to a budget mess: You can either increase revenues or cut spending.

Since the federal government is showing restraint in economic spending, we can’t go begging to them anymore. Thus, if we want to raise revenues, taxes have to go up on a state level. As a libertarian, I don’t like taxes very much, but this is a cold mathematical fact. If we want to maintain Colorado’s current level of services, taxes have to rise.

The other option, of course, is cutting spending further. The question, of course, is what to cut? Legislators first turned to easier places to cut, like our state’s campuses.

But cutting our universities’ funding won’t be enough. The shortfall is now $1 billion –– more than our higher education system receives from the state. If we keep cutting, do we target K-12, health care, roads or prisons? That’s the real question.

We, as CSU students, can’t simply say that we want to protect our funding for higher education anymore. It’s time for a fundamental reconsideration of the role of government in Colorado. Do we want a much smaller Colorado government or do we want to raise taxes? Regardless of your answer to that controversial question, it is clear that this crisis isn’t just about higher ed anymore.

Ian Bezek is a senior economics major. Letters and feedback can be sent to letters@collegian.com.

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