Monday, March 26, 2012

Sanford-Haley advisor denies critique of state's economy

A couple of old adages come to mind here. One is that a kicked dog barks. The other is that figures lie and liars figure.

I think the average South Carolinian feels the truth as it's described in an economic report issued by TD Economics recently, which says that our state lawmakers' budget decisions over recent years contribute to our inability to rebound after the recent recession.

Ordinary South Carolinians -- members of the hard-working class -- would likely agree that times have been hard in our state, especially hard on people who work for their living, and that any recovery being felt elsewhere in the nation is taking its sweet time getting to our neck of the woods.

So it seems a little odd to hear an old ally of former Governor Mark Sanford taking issue with this new economic analysis and defending the priorities of Sanford and his legislatures.

A recent TD Economics study, which is disputed, paints a bleak picture of South Carolina’s ability to recover to pre-recession levels anytime soon, based on a gap between the revenue the state needs to spend on services and the amount it needs to account for inflation, population growth and potential cuts in federal spending.

“South Carolina, for example, has one of the largest adjusted-revenue gaps in the country, with Georgia and Florida not too far behind,” the TD report says.

“In fact, South Carolina’s fiscal hole is so deep that even if revenues were to grow at 7 per cent a year, the state wouldn’t close its adjusted-revenue gap until 2021.”

Chad Walldorf, chairman of the South Carolina Board of Economic Advisors and budget director during Gov. Mark Sanford’s first term in office, said TD economists used “misleading” revenue data by focusing solely on the state’s general fund.

If memory serves, Walldorf is also a co-founder and former co-owner of the Sticky Fingers barbecue restaurant chain, featuring locations in Mount Pleasant, Charleston, North Charleston, Hilton Head, Columbia and Greenville, and elsewhere in Tennessee, North Carolina, Georgia and Florida, now headquartered well beyond South Carolina's borders, in Atlanta.

And he's the man tapped by Governor Nikki Haley to replace her principled nemesis, John Rainey, as chairman of the Board of Economic Advisors. This must be why Greenville-based Community Journals turned to him for a response.

Walldorf, who was asked by the Journal to read the TD report, was particularly concerned by the conclusion that South Carolina’s “real per student K-12 education funding is 24 percent below 2008 levels,” which TD said was the largest cut in the nation and will take time to restore.

That, Walldorf said, “is just not true. Per pupil spending has consistently gone up, whereas the report states the opposite.”

In fact, he said, spending was $10,566 in 2008 and “every year it has been increased. In the current budget, it is $11,754 per student.”

Walldorf added that in defense of the TD economists, education funding “is just so convoluted that unless you’ve spent a lot of time looking at it and talking to people, it is going to be very difficult.”

Yes, it's very complex.

Tax revenue is collected and deposited in the General Fund, including the full revenue from the one-cent sales tax implemented by the Education Improvement Act of 1984.

The Education Finance Act of 1977 dictates by formula the amount that will be appropriated from state funds annually as a "base student cost." This amount is to be transmitted to school districts, from which these districts adopt and implement their own budgets.

Additional revenue from local taxes can be added to those local budgets, and funds from the federal government are intended to be passed through the state to districts, too.

So far, so simple.

Where it gets complex is here: Conservative ideology encourages the dismantling and privatization of public schools, because wherever dollars flow, private-sector profits may be realized.

Public education, when appropriately funded, represents the largest part of any state's budget -- a pretty big pot of honey to tempt the average corporate bear.

So, to undermine public confidence in public schools, ideologues conspire to underfund them, starve them of resources, over-burden them with bureaucratic red tape and paperwork, complicate them with overbearing high-stakes testing models, strip the rights of their employees and encroach on the authority of local school boards.

At the same time, these ideologues invent and promote every sort of alternative to public education, from charters to vouchers to virtual schools, to give lawmakers optional channels through which to get public dollars into the private-profit sector.

And, as propaganda demands a skewed truth to fit this alternate universe, it must be insisted that public schools are better-funded than ever, leading the ordinary observer to the most obvious question: If we're spending all this money, why aren't we getting results?

Therefore, former Governor Mark Sanford's former advisor is absolutely correct in his complaint that education funding “is just so convoluted that unless you’ve spent a lot of time looking at it and talking to people, it is going to be very difficult.”

I bet George Orwell would understand it in an instant.

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