Wednesday, March 1, 2017

OCPA Responds to Sec. Doerflinger, Calls for Honesty in Budget Debate


State Finance Secretary Preston Doerflinger this week “applauded” and then cast doubt on OCPA’s most recent budget recommendations. Secretary Doerflinger wrote, “OCPA calculates its savings as $413 million, but the majority of those savings go in the category of cost avoidance, not revenue creation.” In other words, Sec. Doerflinger conveys a clear preference for increasing taxation as opposed to reducing unnecessary overhead.

Jonathan Small, President of OCPA and a CPA, responded with a call for a more honest budget debate.

“Those who want higher taxes need to start being honest. While it’s amusing to watch politicians talk about ‘revenue enhancements’ and ‘investment,’ if they want higher taxes they need to admit it. Anything less is an insult to Oklahomans.

“Balancing a budget means matching spending and revenue levels. In a shortfall, this can mean raising taxes or cutting spending or some combination of both. Any attempt to dismiss spending cuts (“cost avoidance”) and insist that the only legitimate topic of debate is raising taxes (“revenue creation”) is nothing more than an attempt to avoid debate altogether.

“Sec. Doerflinger’s statement merely points out that most cost-saving reforms do not increase revenue. He compares ‘OCPA Claimed Savings’ to 'FY 18 Revenue' for OCPA’s most recent 13 recommendations and finds that most items do not produce more revenue. Of course, that was OCPA’s point: serious people involved in the budget process will start out looking for ways to reduce costs rather than jumping immediately to impose higher tax burdens on working Oklahoma families.

“In fact, Doerflinger’s statement shows that he has only minor quibbles with OCPA’s numbers—but then, he has access to more up-to-date data than the public does. His real objection seems to be that OCPA does not recommend higher taxes in order to increase revenue for government. Here, Sec. Doerflinger is absolutely right.

“OCPA always takes the position that cost-saving reforms are preferable to tax hikes. The OCPA list is about finding ways to cut spending, what some politicians used to call ‘right-sizing government.' Sec. Doerflinger’s objection that OCPA recommends cost-saving reforms rather than tax hikes is a compliment we gladly accept.”

No comments: