State Finds New Red Ink

Massachusetts yesterday announced a new budget shortfall for this fiscal cycle, with Secretary Gonzalez indicating that the shortfall could be up to $295 million, leading to charges by Charlie Baker of fiscal ineptitude by the Governor. From the Baker campaign:

“This is just another example of Deval Patrick and Tim Cahill’s fundamental incompetence when it comes to the Commonwealth’s budget. In the face of the worst economic times since Governor Dukakis, their failure is intolerable. Our state’s budget should be the top priority for the Governor and the Treasurer yet time and time again unanticipated spending and rising costs catch both of them off guard. Their lack of leadership on the budgetary process is unacceptable and the taxpayers and business owners of Massachusetts deserve better.”
From today’s State House News Service story, “New budget gap seen opening for state, could near $300M”:
“The rising red ink will likely force the state to deploy some array of painful late-year budget cuts, new withdrawals from the already heavily depleted stabilization fund, and tightened spending management in the executive agencies. ‘We’ve gotten information in recent days that suggests we have an additional $195 million to $295 million dollar exposure for this year,’ Gonzalez told the News Service.”

The Governor, through Secretary Gonzalez, fired back:From the Globe:

Gonzalez called Baker’s criticism that the shortfall caught the administration off guard “a complete mischaracterization of what’s going on here.’’

“It’s the exact opposite, in fact,’’ Gonzalez said. “We are actively managing our budget and addressing it promptly.’’

Gonzalez pointed to three major rating agencies, which reaffirmed the state’s healthy bond rating this month.

Moody’s, for example, cited the state’s “effective management during economic downturns, with a willingness and ability to promptly identify and close gaps through use of both new revenues and spending reductions.’’

Cahill got involved, decrying the health care spending he claims is bankrupting the State.

Cahill, who argued earlier this week that the state’s universal health care law is bankrupting Massachusetts, said the latest shortfall “is further evidence that we have a broken and mismanaged health care system in this state.’’ “I warned on Tuesday that health care spending in Massachusetts was blowing a hole in the state budget,’’ Cahill said in a statement. “I’m glad that the governor’s office is finally acknowledging that fact.’’

Cahill’s critics point out that the new Massachusetts health care law consumes only one percent of the State budget, but Mass Health, the program that predates health insurance reform in Massachusetts, consumes $10 billion, according to this Globe story. That is simply not going to be able to be sustained. And that number has left the other budgetary stakeholders fighting amongst themselves for the shrinking balance of the budget not devoted to health care. Another piece of bad news for the Governor.

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3 Responses to State Finds New Red Ink

  1. Jules Gordon says:

    Your Honor,

    Are you surprised? It does show the budget management skills of our short term Governor.

    Here’s the question; Got more magic budget bullets in you back pocket?

    How many short fall cycles can Methuen stand?



  2. Bill Manzi says:


    The bullets are running out. With health care and pension costs exploding there is not even a way that you could tax yourself out of the problem. It is truly that bad.



  3. Jules Gordon says:

    Your Honor,

    My plan;

    1. Un-incorporate. Declare the town is now a village.

    2. Tell the state to go to h…..oh, you know where.

    3. Rip up all contracts concerning outlandish salary and retirement costs as well as language that impedes the towns ability to manage economically.

    4. manage within the budget.

    How’s that for starters?



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