With the fate of education, health care, and public safety hanging in the balance, the Rappaport Center for Law and Public Service brought together 50 of the state’s most influential decision-makers and economic experts in January to brainstorm about how to address the state’s current budget crisis.
“We can’t solve the problems of the world in 90 minutes, but we can help set the terms of a discussion that will roll on for months to come,” said Alasdair Roberts, Rappaport Professor of Law and Public Policy, at the start of the discussion.
The roundtable came two days after Massachusetts governor Deval Patrick announced his proposal to address a $2.5 billion budget shortfall in the current fiscal year and a $4 billion gap in the budget that begins in July. Among the attendees were state senator Steven Panagiotakos JD ’89, chairman of the Senate Ways and Means Committee, who said that the state’s situation may be even worse than the governor’s projections indicate.
“The governor is predicting a 59 percent decrease in revenues from the capital gains tax this year, but I think our exposure could be even greater—it may be as high as 70 percent,” said Panagiotakos (pictured bottom). “This may not be the Great Depression yet, but it certainly is the Great Recession.”
Panagiotakos also expressed concern that the governor’s plan will use half of the state’s rainy day fund in one year, even though the current economic crisis is likely to affect state budgets for at least four more years.
State comptroller Martin Benison agreed.
“If we rely on the stabilization fund and the stimulus package—if we plug in this money without making fundamental structural changes—we will just be delaying disaster,” he said. “We need to think about what we can stop doing and what we can do differently.”
James Stergios (pictured top), executive director of the Pioneer institute, a public policy think tank in Boston, said the only way to develop a long-term solution to the fiscal challenges facing the state is by operating more intelligently.
“Our view is that every private sector company has reduced staff but gained efficiency through technology—with no loss in service,” he said.
The roundtable was the second in a series of topical dialogues held at the Rappaport Center; the first, held in October, addressed the ramifications of the nation’s financial meltdown.
“Our goal is to get groups of people together who might not normally get together,” said Roberts. “If we make some connections or help shape the debate, then we have accomplished our goal.”
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