DC's Budget Deficit: That Didn't Take Long...

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As the primary election campaign for the Mayor of Washington DC heated up this past spring, then-candidate (and now-mayor) Adrian Fenty took a stance that clearly separated him from the rest of the Democratic field-- he took a no-new-taxes pledge. It was a myopic, politically expedient move, from a guy who (many thought) was just saying it to differentiate himself from the rest of the Democratic candidates, and plenty of people (including Talking Taxes) said so at the time.

Funny thing, though-- Fenty won the election, so now he has to live up to this promise. And it's taken a grand total of three weeks since his election victory to show how short-sighted his stance was. A front-page story in the Washington Post this week notes that the city's latest budget projections show a $300 million shortfall over the next two years. (To put this in context, the city's total tax collections were a hair under $3 billion in FY 2006-- so we're talking about a per annum shortfall of about 5 percent of tax collections)

This doesn't mean the sky is falling, of course. Budget shortfalls happen all the time, and sometimes they can be closed quite easily. But these latest projections are a sobering reminder that you never know what's coming around the bend fiscally-- and that it's simply irresponsible for any elected official to take half of his/her fiscal policy options off the table before the next crisis emerges. Fenty's pledge may yet come back to haunt him.

Thank you for visiting Tax Justice Blog. CTJ and ITEP staff will soon retire this domain. But ITEP staff are still blogging! You can find the same level of insight and analysis and select Tax Justice Blog archives at our new blog, http://www.justtaxesblog.org/

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