Moody blues, Part II

St. Louis Post-Dispatch

Salus Populi Suprema Lex Esto" -- "Let the welfare of the people be the supreme law." So says the state motto carved in the stone of the Missouri Capitol.

It's a little hard to square that nice thought with the following: 5,600 teacher layoffs A mass release of perhaps 5,500 state prison inmates.

Higher tuition at state colleges and the canceling of 2,000 student scholarships.

Booting 60,000 people off Medicaid, taking away their health coverage.

Cutting monthly payments to people who take in or adopt foster children.

Denying 9,000 people community mental health treatment and refusing help to 7,600 Missourians with developmental disabilities.

Refusing beds to 2,900 patients in state mental hospitals, putting the patients out on the streets.

Gov. Bob Holden says all those things would happen if the state spread its budget pain equally over all departments with a 15 percent cut. Salus Populi? Better chisel it off the building.

Could the Democratic governor's parade of horribles really come to pass? It very well could, said James Moody, who was budget director for former Republican Gov. John Ashcroft. "The implications are very severe." Across-the-board cutting is just what Mr. Moody recommended in a recent report commissioned by the state's business community. Gov. Holden, by contrast, wants to raise taxes on gambling, cigarettes and some businesses. He'd close two-thirds of the $1.1 billion budget gap with higher taxes and the rest with budget cuts. The tax increases would need voter approval.

Missourians care deeply about quality schools. Public schools consume a third of the state's general budget. Add the state universities, and nearly half of state spending goes to education. Without a significant tax increase, the schools will have to take a big hit. A House committee has already whacked more than $100 million out of the proposed $2.4 billion in public school aid. Another House committee proposed chopping 80,000 children from the Medicaid rolls.

Missourians won't want to solve the state's budget problem on backs of the kids, the sick, the mentally ill or the luckless. Given the choice, we think voters will pay more taxes to avoid the worst of those consequences, especially if smokers and gamblers will pay most of the bill.

But first they'll have to know that the governor and Legislature have cut out all the flab. While higher taxes are necessary, both the governor and the Republican leadership in the Legislature need to look carefully for more low-pain budget cuts, in order to keep the tax increase as low as possible.

The University of Missouri's flabby bureaucracy still needs a financial diet. But Mr. Holden and the Legislature will have to cut muscle, too. Public funding for the arts is important, and a good investment, but the governor is right to ax it in light of the alternatives. The $4 million subsidy for Amtrak is needed to maintain train service to Kansas City, but may also have to go. The state's $2 million gift to ethanol producers also deserves a hard look.

All that is chicken feed compared to a $6.8 billion general fund budget. But the state's massive tax credit programs aren't. They cost $220 million a year and the price may skyrocket because of projects in the pipeline.

Granting a tax credit is not much different than issuing a check. The state grants them mainly to private projects that create jobs, but some credit programs do that better than others.

The state needs to take a close look at the $53 million historic tax credit program, which subsidizes the renovation of older buildings. The program has been crucial to development in downtown St. Louis, and must be preserved. But it may need to be targeted more narrowly to projects that can produce enough jobs and economic revival to justify the cost.

Missouri can't keep adding 1,300 people a year to the 30,000 now in prison. We need cheaper alternative punishments and drug treatment for nonviolent offenders.

A referendum on higher cigarette taxes failed by a whisker at the polls last year. The stakes are higher now. Given the choice of damaging education and hurting the poor, Missouri voters may well vote for higher taxes.

They won't get to decide unless the Legislature puts tax increases on the ballot. The Republican Party gained control of the Missouri Legislature this year for the first time in half a century. The GOP didn't do it by pledging to raise taxes. But it did promise more money for education -- a commitment it can't begin to meet without more revenue.

It would take real courage for the GOP leadership to back a tax increase. The school kids and poor and ill of our state deserve an act of courage.