Protecting All Pennsylvania's Citizens in this Economic Crisis

At a recent Senate Appropriations Committee hearing, it was predicted that Pennsylvania could face a $3 billion budget shortfall in the wake of the national economic crisis.  An early solution to this problem was to raise taxes to fix this hole.  This is the last thing we want to do.

It is no secret that state revenues have taken a beating as consumers cut back on spending due to the widespread economic turndown.  Currently, the state maintains a $750 million Rainy Day Fund.  As of right now there are no plans to tap into those funds. 

Although it may be early in the game to determine how Pennsylvania’s revenues will look when we begin discussing next year’s budget, we must ensure that all Pennsylvanians are well taken care of.

To do that, it is essential that we keep a strong safety net in these periods of economic decay, because it’s in these tough times that the need for help with groceries, home heating, healthcare, etc. rises.  

The economic downturn continues to hold this country in a tight grip.  Many low-income individuals and families are suffering the greatest from this downturn due to their already fixed incomes.  For them, living in the trenches of a recession presents immense challenges.  It is these individuals who will turn to the social services safety net for support.

During the economic recession of 1991, there was a 16 percent increase in state-funded costs for public welfare as many Pennsylvanians, desperate for relief, looked to the state for help.

In 2003, the Rainy Day Fund was emptied due to a structural deficit left from the previous administration and in an effort to build it back up, taxes needed to be raised.  This was the last time taxes were raised in Pennsylvania.  Since then, lawmakers and the Governor have worked hard building and protecting the Rainy Day Fund as a means to cushion the fiscal blow during this time of financial distress.

While we must maintain spending in social service areas, it is also imperative that we do so without unnecessarily raising taxes.  A large and unjustified tax increase would burden our lower-income and middle-income families.  We must not let low-income Pennsylvanians fall through the cracks in difficult economic times. 

Because of the rising prices of gas, groceries, prescriptions, health care, etc., it is important that social services remain strong enough to deal with the influx of those in need during a recession. With unemployment rates rising and the cost of everything going up, needy families could be left with nowhere to turn if more cannot be provided through state social services.

Because we’ve been fiscally prudent and working to ensure that the state’s Rainy Day Fund stays intact and strong we have the ability to quickly shift funds and deal with short-term budget demands—especially in the area of social services for our low-income citizens. 

To continue this, we must set aside a portion of budget surpluses during booming economic years so that we have adequate funds to deal with when the economy is less stable.

Even though, this current economic slide seems endless, Pennsylvanians can rest assured knowing that, because we’ve maintaining a strong safety net and continued to devote resources to social service programs, they will be well taken care of.  As a result, when the final bill comes for this period of economic stress we can reduce our financial stress, personal stress, maintain services and eliminate the need for unnecessary tax increases.