The increase in the current state budget was greater than the inflation rate and the rate of population growth in Georgia.
Libertarian Party of Georgia on Thursday, December 6th, 2012 in a press release
GOP lawmakers in Georgia don't walk the walk on spending, Libertarians say
The term "supermajority" worries some Georgia Libertarians -- and they say you should be concerned, too.
Republicans are very close to two-thirds majorities in both chambers of the Georgia Legislature, a "supermajority," which is described as a majority so large Democrats and independents would be unable to block proposed changes by GOP lawmakers to the state constitution.
Leaders in the state’s Libertarian Party tried to emphasize their trepidation in a recent press release. Republicans, they say, are not the best managers of state finances. One claim in the press release seemed worthy of a fact check.
"While Republicans held a large majority for the past few sessions, we saw an increase in the state budget for FY 2013 greater than the rate of inflation and population growth," said party Chairman Doug Harman. "That certainly is not the limited government spending promised by Republican candidates on the campaign trail in 2010."
The Libertarian Party endorsed James Camp in the race to fill a vacant state Senate seat that became open when Gov. Nathan Deal appointed Bill Hamrick, a Republican, to the Superior Court on the Coweta Judicial Circuit. An election is scheduled for Jan. 8, 2013.
We wondered if the party’s claim about the growth in the state budget was correct, and if it is the best way to measure such growth.
The party’s executive director, Brett Bittner, explained how they reached this conclusion. They compared the amount of money approved by the Georgia Legislature in the two most recent state budgets. That’s about a 5.4 percent increase. Georgia’s budget runs on a 12-month schedule that begins July 1 and ends June 30.
Bittner said they calculated the increase in inflation between 2010 and 2011, which he said was 3.16 percent. He added that number and the percentage of Georgia’s population increase between April 2010 and July 2011, which was 1.32 percent. Combined, that’s about 4.5 percent.
"[T]hat means the budget grew BEYOND inflation and population growth," Bittner wrote in an email.
Several experts we interviewed agreed that the Libertarian Party’s claim is accurate, if you make the comparison using Georgia’s population increase and the inflation rate between 2010 and 2011. But they said that’s not the best way to measure such things. They also said there’s some context that should be considered when examining the state budget.
"I don’t think this formula is the one I would prefer," said Jeff Humphreys, director of the University of Georgia’s Selig Center for Economic Growth.
Humphreys believes a better comparison would be to measure any increase in state spending against Georgia’s economic growth through its gross domestic product.
Georgia’s nominal gross domestic product, which measures the value of all the goods and services produced in current prices, grew by 3.9 percent between 2010 and 2011, Humphreys said. He noted, though, that increase is between one calendar year, as opposed to a fiscal year.
Humphreys said a multiyear study of state spending is a more effective approach. He and others noted that state spending is about $1 billion less than it was before the Great Recession took hold in 2008.
The biggest increases in state spending between the last two budgets occurred in education and community health. Alan Essig, executive director of the Georgia Budget and Policy Institute, a nonprofit group that opposed the Legislature’s decision to cut some taxes earlier this year, said the current budget had to be increased. Enrollment in state-funded colleges has increased by 100,000 students over the past decade, The Atlanta Journal-Constitution recently reported. Another factor in increased state spending is Medicaid, which Essig said has been underfunded.
"Ninety percent of (the budget increase) was keeping the state afloat," Essig said.
He and others pointed out that Deal has asked state agencies to make further cuts.
Carolyn Bourdeaux, the former director of the Georgia Senate Budget and Evaluation Office, said in fiscal years 2012 and 2013, the state had to replace federal stimulus funding and state reserves that were used to shore up general fund spending in prior years. For instance, she said the state took about $850 million in reserves between 2009 and 2011 from employee retirement health benefits and the state’s health benefit plan to help keep the state budget afloat.
"At least some of these funds must be replaced," said Bourdeaux, now associate director of Georgia State University’s fiscal research center.
Bourdeaux continues to track state spending against population, the consumer price index, gross domestic product and other factors. Her research shows state government real per capita spending has grown by only 2 percent since fiscal year 2009. Bourdeaux’s data also shows real per capita state spending has declined by 23 percent from its height in fiscal year 2001.
Bittner said they decided to compare spending against population growth and inflation because Georgia Republicans contend they’ve kept pace with those two categories.
"It did grow faster," Bittner said of state spending.
Bittner rejected the argument that the state has been hamstrung by other budgetary matters in recent years, particularly since they dominate both legislative chambers and hold all of the constitutional offices.
"We should see much greater cuts," he said. "It further indicts them."
To summarize, the Libertarian Party of Georgia claimed that the increase in the current state budget was greater than the inflation rate and the rate of population growth in Georgia. Their numbers are accurate, but per capita state spending is actually less than it was a decade ago and has been flat since the recession. Meanwhile, Georgia has had a record number of college students and has other areas where it must spend more.
The claim is technically accurate, but it ignores some facts that would give readers a different impression.
Under our rating system, this claim is Half True.
Published: Wednesday, December 12th, 2012 at 6:00 a.m.
Subjects: State Budget
Libertarian Party of Georgia email, Dec. 6, 2012.
The Atlanta Journal-Constitution, "Deal signs budget but vetoes some lawmaker add-ons," May 7, 2012.
The Atlanta Journal-Constitution, "Concern over enrollment drop at Georgia colleges," Oct. 8, 2012.
Email and telephone interview with Libertarian Party of Georgia executive director Brett Bittner, Dec. 6 and 10, 2012.
State of Georgia 2013 governor’s budget reports.
Telephone interview with Jeff Humphreys, University of Georgia Selig Center for Economic Growth, Dec. 7, 2012.
Telephone interview with Georgia Budget and Policy Institute executive director Alan Essig, Dec. 10, 2012.
Telephone interview with Carolyn Bourdeaux, associate director, Georgia State University fiscal research center, Dec. 10, 2012.
U.S. Bureau of Labor Statistics inflation calcuator.
U.S. Commerce Department, Bureau of Economic Analysis report on state real gross domestic product, June 5, 2012.
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