Saturday Editorial, July 21, 2012

In the flurry of news and opinion gusting out of our computer screens and smart phones, it is easy to become 'news blind' - so focused on the flakes and flurries that we forget where we are headed. We stumble confusedly ahead with no map to our destination. It's easy to get lost in the storm.

I personally read almost every news source in Arizona - and keep up with national reaction to our politics, as well - in bringing to readers of BlogForArizona the Arizona Donkey Feed, which appears on our right-hand sidebar every day (you may also have the Feed emailed to you daily). So I, too, often find myself in that blizzard without a map.

I decided I might like to sit down once a week and take some time to look around, and identify what I think are the most significant landmarks around where we stand now. It might not be a map that will tell us where we are headed, but maybe I can get some idea of where we are. Over time, perhaps it will become a map of sorts.

I would also like to let you all know that Matt Heinz, candidate for Congressm in AZ's CD 2, will be guest-host at Drinking Liberally in Tucson. Come down to the Shanty of 4th Avenue this Wednesday at 6pm and enjoy a beer with Matt.

So, here are some thoughts on what I think are the most important, or just most interesting, developments in the past week in Arizona's politics...

Arizona's courts expose Arpaio's and Pearce's racist animus to the world.

The ACLU, the National Immigration Law Center, the Mexican American Legal Defense and Educational Fund, and the National Day Laborer Organizing Network filed an injunction against the remaining "papers please" provision of SB1070 in federal court seeking to demonstrate the law cannot be implemented constitutionally. One thread of their argument is that the law was adopted due to racial animus. To demonstrate that animus, the petitioners obtained through public records requests several thousand personal emails written by Senator Russell Pearce, which demonstrate the racist motives and attitudes that produced the law. They have publicly released many of these emails in a court filing. (PDF link)

Those emails are simply devastating and leave no doubt that racist attitudes and stereotypes, fabricated statistics, and simple hatred played a major role in crafting and passing SB1070. Former Senate candidate Randy Parraz reacted to the emails saying, "This just shows who Russell Pearce truly is.... You can call it hate speech. (SB 1070) was about using this type of fear and hate for political purposes.

Having read many of the emails myself it is painfully clear that they demonstrate a striking general hostility to Latinos, and specifically toward Chicanos who are Mexican nationals, or American nationals and residents. Clearly, Pearce felt far less constrained in his personal email communications than he did in using his official email address: big mistake.

Sheriff Arapio is also facing public reckoning in civil court this week. He is being sued for civil rights violations by a group of Latino citizens alleging his department conducted traffic stops and "crime suppression sweeps" in manner that was discriminatory toward Latino citizens and legal residents. Arpaio is expected to take the stand next week to defend his leadership of the MCSO and it's operations. I would be very surprised if Arpaio emerges looking like anything other than the racist he is. Keep in mind this is not the pemding DOJ lawsuit, but a private civil rights action. The DOJ trial is still to come and will continue the drumbeat of public disclosures of Arpaio's racist attitudes and purposeful violation of the civil rights of American citizens and residents for his own political gain.

These two trials demonstrate the genius of the American legal system's ability to hold political leaders to account for violations of the law and to expose their actions to the public for judgment in an authoritative and credible manner than journalism alone can never match. If you ever wondered why right-wingers so vociferously attack the judiciary, here is a fine demonstration of the reason.

Arizona's voters win the right to choose on permanent sales tax extension, and likely top-two primaries, as well.

Arizona voters will get the opportunity to decide whether to permanently extend the 1 cent sales tax for education, and whether they want a top-two primary system in their state elections on this November's ballot.

Arizona Secretary of State Bennett had his poor decision to keep the sales tax initiative off the ballot due to technical mistake overturned by the court. The court's ruling leaves Bennett even more compromised politically following a previous self-inflicted public embarrassment stemming from his attempt to pander to the right wing of his party in advance of a likely gubernatorial bid.

The top-two system allows Arizonans to vote in single primary (sometimes called a jungle primary) in which the top two vote getters advance to the general election regardless of party. Opponents of the top-two primary system are seeking an injunction to keep the initiative off the ballot, claiming it violates the single subject rule for Constitutional amendments. The suit is not likely to succeed, and comes barely under the wire, as printing of early ballots begins next Tuesday.

The top-two measure is widely unpopular among politicians on both sides of the aisle, which to many might constitute an endorsement.

Personally, I don't support either the permanent sales tax extension or the top-two primary system, but I think that Arizona's citizens who circulated, signed, and want the people of Arizona to decide for themselves on these initiatives, should have that opportunity. I will defend my opposition, as well as the case in favor, in an upcoming analysis of the ballot initiatives prior to start of early voting.

Arizona's budget crisis is far from over.

Given the number Republicans running for office based on their claims to have balanced the Arizona state budget, you might think the state is actually on a firm fiscal footing: think again. Arizona continues to have serious and on-going fiscal issues that are not going away until we implement major reforms.

The basic problems causing the on-going crisis are complex, but not inexplicable. We face another major deficit soon because we tend to budget for ongoing programs using one-time or limited-time revenue. We did it with reciepts from sales in the housing boom; we did it with fund sweeps, rollovers, and selling off assets over the past three years; and we are doing it with the temporary sales tax increase now. At root this is a problem in how we raise revenue, how we define a balanced budget, how we project spending and revenues over time, how we fail to account for the cost of new programs and tax cuts in the future, and how we fail to save for hard times.

How we raise revenue. In short, we can't. It requires a supermajority vote to raise a tax rate.

Not. Going. To. Happen. If someone wants to do the state a great favor, put an initiative on the ballot to eliminate the supermajority requirement, and spend lavishly to explain to voters how it screws us up.

Every time a tax rate is cut, which only requires a majority vote, it stays cut. Who can lobby best to get such cuts? Those with ready money to spend on influence; business interests, the wealthy, the land owners. Over time this has caused Arizona to become precariously dependent on the sales tax for general fund revenues (consumers are not well organized and the tax is pleasantly regressive in the eyes of the organized, who can in any case lobby for an exemption for their stuff, which they have to tune of $10 billion in sales tax expenditures...), which makes our revenues very sensitive to the business cycle. While revenues plummet in bad economic weather, the things we pay for (education, healthcare, prisons, social services for the poorest) tend to rise in hard times.

We should expand and rebalance the tax base by eliminating most tax expenditures, especially the whooping $10 billion expenditures in sales tax exemptions, taxing most services like other consumer goods, and increasing income and real property taxes. The most steady sources of revenue should be dedicated to the spending which most needs stability, such as education and health. All easier said than done, I realize...

How we define a balanced budget. The problem is there is no clear constitutional definition of 'revenue' or 'expenditure'. Thus if the state sells or mortgages a precious asset (like the Capitol building), that's revenue for the year. If the state hawks a future stream of income for instant cash (like lottery proceeds), that's revenue for the year. If the state steals dedicated finds from a program, state agency, or local government, that's revenue for the year. If the state knows it will spend some money, but delays payment on some bills at the end of the fiscal year, that expenditure doesnt get counted in this year. You can play all sorts of accounting tricks with such elastic definitions. And we have done exactly that to produce "balanced budgets" over the past several years. Why? See how we raise revenue, above. This 'problem' has the added 'feature' of allowing the legislature make a surplus appear were none exists, thus justifying further tax cuts for those who can pay the bribes, and making the while problem worse. Which is maybe why it doesn't get fixed...

How we project spending and revenue over time. Arizona is better than some in this regard. We actually do look ahead two years to estimate the impact of new spending and revenue changes in the future. Problem is, that's not enough time: five years is much better. Also, we don't adequately account for the effects of changes in business climate and economic performance. We need to adopt a longer planning horizon for our baseline service and revenue projections so that policy makers will have consider a longer future than the next election.

How we fail to account for the cost of new spending and tax cuts in the future. Arizona should adopt PAYGO accounting over those new five year budget estimates. Every new program and every cut on revenue should be paid for going forward over five years. This would prevent the sort of fiscal cliffs we find ourselves looking over when temporary revenues are used to pay for permanent spending. It makes sense both as a budget control mechanism to prevent unsupported growth in spending, but also preventing cuts in revenue justified by temporary budget conditions. Such a reform has political benefits for both parties and should be possible to adopt, but you would think the same about Congress, and PAYGO reauthorization is being blocked there. I wonder why...

How we fail to save for hard times. In the absence of sensible planning tools, such is five year projections and PAYGO budgeting, the state's rainy day fund is the planning tool of last resort. The problem is that it is far too small already, and has been made smaller so that less revenue could be stashed away in fat years, making budget surpluses a juicy justification for further tax cuts. We should expand our fund as a percentage of revenue to over 10%, at least until we address our state's over reliance on unstable sales tax revenues.

Until sensible budgeting tools are adopted and full representative democratic control over taxation is reestablished, Arizona's budgets will continue to be a shady, poorly-understood, political battleground, instead of a rational means of ensuring the future viability and success of our state and it's people. Count on it like you count on the Monsoons. Oh, well, then climate change could mess those up, too... Maybe count on it like you can currently count on record draughts and extreme weather...

Please share your thoughts and suggestions in the comments, encourage me to keep doing these editorials, or give me ideas for trends and issues to highlight next week. If folks are interested, perhaps next week I'll take an extended look at the impact that Mediaid spending under Obamacare's expansion might have on Arizona's future budgets.

From Baja Arizona,

Michael Bryan

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