Starving The Beast

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Conservative Responses to the Fiscal Crisis in the States

Seeing the wide spread negative effects – and human costs – of all of these cuts in services, programs, and investments on the state level, you might expect that conservatives would have second thoughts about their anti-tax and anti-spending policies. But amazingly, these kinds of problems have actually been welcomed by anti-government activists. Reports indicate that the Bush White House was happy to see states and their citizens caught in a fiscal crunch and forced to cut programs, and had no desire to help bail them out. Numerous administration officials stated privately that the states’ fiscal problems would play a useful role in shrinking state governments.26 And anti-tax activist Grover Norquist has seemed almost gleeful about the fiscal troubles being faced by states, remarking that “I hope a state goes bankrupt.”27

Another typical conservative response to the fiscal problems of the states has been to search for scapegoats – someone they can blame for these problems and thus distract the public from the role played by their anti-tax policies. Their preferred scapegoat is public employees. There has been a coordinated campaign to portray public employees as a well-to-do class who are grossly overpaid and enjoy sumptuous benefit packages. Never mind that study after study has shown that public employees are actually underpaid compared to their counterparts in the private sector.28 Many of them do have decent pensions, but these were often won by giving up pay raises. In addition, many public employees are not eligible for Social Security, so their pensions are not as generous as they first appear.

This assault on our public employees has been widespread and surprisingly nasty. Some conservative commentators have called on them to give back part of the pensions they are living on. Republican legislators in Wisconsin passed a bill that stripped nearly all the collective bargaining rights from the state’s public workers. Ohio passed an even harsher law that allows state and city officials to impose whatever contract terms they want on public employees. Similar bills are being considered in other states where conservatives hold power.

Some anti-government ideologues have actually argued that because workers in the private sector are having a tough time – high unemployment, low wages, and shrinking benefits – that public sector workers should be made to suffer as well. Conservatives are trying to provoke resentment against these workers, calling them “haves” when many Americans have become “have nots.” But we should be proud that we treat our public employees decently. Undermining the economic security of public workers and making it harder for them to live a middle-class life will only create more suffering in society, not less.

There is an Alternative

It doesn’t have to be this way in state governments. In fact, it hasn’t always been this way. In the days before the anti-tax movement took hold in the U.S., many states had a vibrant public sector with healthy investments in infrastructure projects and adequately funded social programs for state residents. In his book, Paradise Lost, Peter Schrag offers the following descriptions of pre- and post-Proposition 13 California:

California was once widely regarded has both model and magnet for the nation – in its economic opportunities, its social outlook, and its high-quality public services and institutions. With a nearly free and universally accessible system of public higher education, a well-supported public school system, an ambitious agenda of public works projects – in irrigation and flood control, in highway construction and park development – and a wide array of social services and human rights guarantees that had no parallel in any other state, California seems to have an optimism about its population, possibilities, and future....

But California ... is no longer the progressive model in its public institutions and services, or in its social ethic, that it once was. California's schools, which 30 years ago had been among the most generously funded in the nation, are now in the bottom quarter among the states in virtually every major indicator – in physical condition, in public funding, in test scores – closer in most of them to Mississippi than to New York or Connecticut or New Jersey. The state, which had almost doubled in population since the early 1960s, has built some 20 new prisons in the past two decades, but has not opened one new campus of the University of California for nearly three decades. Its once celebrated freeway system is now rated as among the most dilapidated road networks in the country. Many of its public libraries operate on reduced hours, and some have closed altogether. The state's social benefits, once among the nation's most generous, have been cut and cut again, and then cut again. And what had once been a tuition-free college and university system, while still among the world's great public educational institutions, struggles for funds and charges as much as every other state university system, and in some cases more.29


Schrag laments what he has termed the “Mississippification” of California. He has nothing against Mississippi, but is simply referring to the reputation that state has for stingy social programs, abysmal schools, inadequate health care programs, and a poor quality of life. This is what could be in store for all of us if government is reduced to an emaciated state. If the anti-government and anti-tax crusaders have their way, we will all be living in Mississippi, whether we want to or not.




For more on how anti-government activists have been using budget issues to attack vital government programs, see "The Deficit Scare: Myth vs. Reality."





1. Paul Krugman, “The Tax Cut Con,” New York Times Magazine, September 14, 2003, p. 57.

2. The Cato Institute, Cato Handbook on Policy (Washington D.C.: The Cato Institute, 2005) p. 113.

3. See William Greider, “The Education of David Stockman,” Atlantic Monthly, December 1981.

4. Krugman, “The Tax Cut Con.”

5. Urban Institute, “Bush Tax Cuts,” January 16, 2008.

6. Paul Krugman, “Maestro of Chutzpah,” New York Times, March 2, 2004, Page A23.

7. David Brooks, “Reinventing the GOP” The New York Times, August 29, 2004.

8. Paul Krugman, “The Tax Cut Con,” New York Times Magazine, September 14, 2003, p. 57.

9. Ed Kilgore, “Starving the Beast,” Blueprint Magazine, June 30, 2003.

10. Paul Krugman, “The Tax Cut Con,” New York Times Magazine, September 14, 2003, p. 56.

11. Ibid. p. 56.

12. Dean Baker, “Representative Ryan Proposes Medicare Plan Under Which Seniors Would Pay Most of Their Income for Health Care,” Center for Economic and Policy Research, April 6, 2011,

13.January Angeles, “Ryan Medicaid Block Grant Would Cause Severe Reductions in Health Care and Long Term Care for Senior, People with Disabilities, and Children,” Center for Budget Priorities, May 3, 2011,

14. Center for American Progress, “Divesting in America.”

15. Robert Greenstein, “CBO Report: Ryan Plan Specifies Spending Path that would Nearly End Most of Government other than Social Security, Health Care, and Defense by 2050,” Center for Budget and Policy Priorities, April 7, 2011,

16. “Dangerous Games,” The New York Times, Saturday, April 23, 2011, p. A16.

17. Robert Greenstein, Chairman Ryan Get’s Nearly Two-Thirds of His Huge Budgets Cuts from Program for Lower Income Americans,”  Center for Budget and Policy Priorities, April 20, 2011,

18. Center for Budget and Policy Priorities, “Statement of Robert Greenstein on Chairman Ryan’s Budget Plan.”

19. Brian Beutler, “CBO:  GOP Budget would Increase Debt, Then Stick It To Medicare Patients,” TPM, April 5, 2011,

20. Center for Budget and Policy Priorities, “At Least 39 States Have Imposed Cuts that Hurt Vulnerable Residents,” June 29, 2009.

21. Center on Budget and Policy Priorities, “A Brief Update,” p.1.

22. Center for Budget and Policy Priorities, “TABOR: A Threat to Education, Health Care, and Social Services. May 20, 2006.

23. National Center for Public Policy and Higher Education, “Measuring Up 2006: The National Report Card on Higher Education.

24. “The College Aid Crisis,” New York Times, May 25, 2004, p. A26.

25. American Society of Civil Engineers, "Report Card for America's Infrastructure: 2009 Progress Report,"

26. David Firestone, “Does Pain Makes States Stronger?” New York Times, April 27, 2003, p. 4.

27. Ibid.

28. Center for Economic and Policy Research, “State and Local Workers Earn Less than Private Sector Workers, Even Factoring in Benefits,” September 15, 2010,

29. Schrag, p. 7-8.



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