Last night Governor Baker outlined his many accomplishments, as well as priorities for the fourth and final year of his first term in office. He touched on finding solutions for the opioid crisis as well as investing in public housing and our aging population. He cited nationally recognized achievements such as being ranked #1 in innovation for the past two years according to Bloomberg, as well as getting an A- for small business friendliness from Thumbtack up from a D+ just a few years earlier. While these are noteworthy accomplishments, we must be diligent in addressing the areas where we struggle.
According to the latest Tax Foundation study, Massachusetts currently holds the highest debt per capita in the country. This debt load is often raised as a concern by credit rating agencies. Despite this, the legislature continues to pass borrowing bills, adding to an already massive problem.
Truth in Accounting’s annual Financial State of the States study refers to Massachusetts as a “sinkhole” state. Each year, the Commonwealth’s outstanding bills increase due to the rise in pension liability and bonds payable, while our assets continue to decrease, resulting in an “F” grading for 2017. A study by the Mercatus Center ranks Massachusetts as 48th in the nation for fiscal health.
As we have mentioned in the past, last year MassHealth made up over 40% of the state’s budget. Although a reform bill is promised in the legislature, we are not sure if it will do enough to address this problem. Instead of trying to stem the growth of this financial liability, last year Beacon Hill passed a tax on employers to help pay for the massive increase in MassHealth. Spending on the program has more than doubled over the last 10 years. If our state is to ever get a handle on its out of control spending, we need to stop kicking this can down the road and pass serious, comprehensive reform on this out of control program.
This November we face multiple ballot questions that could potentially hurt the very people and employers that create and sustain jobs here in MA. We have the possibility of passing a $15 an hour minimum wage, as well as enacting a paid family leave proposal. Both will have major, negative impacts on small businesses across the state. Further, Proposition 80 has the potential to scare away our state’s highest income earners. Under that proposal, the 900 top earners would pay 53% of the new tax revenues.
While the issues presented above are extremely complex and will certainly force our lawmakers to make difficult decisions, the long-term health of our Commonwealth is at stake with each and every one of them. We cannot simply forget about these issues and push them down the road for future generations to deal with.
We look forward to the release of the House and Senate budgets that begin to tackle our state’s long-term, structural budgetary problems.