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The Daily Wildcat

The Daily Wildcat


UA’s budget crisis: Who’s responsible?

The disorder of Arizona’s fiscal house has had far-reaching ramifications, but the university system has borne the brunt of this budgetary nightmare. As the Arizona Board of Regents prepared its preliminary budget for fiscal year 2010, it had to take into account both an increase in student enrollment and decrease in funding from the state. This resulted in massive tuition increases from anywhere between 15.7 and 20.4 percent. These tuition hikes, in tandem with workforce and salary reductions, department closures and increased class sizes, have left all three of Arizona’s major universities, UA, ASU and NAU, writhing in pain. By now, we all know that the university system is in dire straits financially, but how did it get to this point and who is to blame?

In 15 of the past 17 years, Arizona has cut individual and corporate taxes more than any other state in the country; the Republican-led Arizona Legislature’s unhealthy infatuation with tax cuts is responsible.  Arizona had the 41st-lowest tax burden in the nation as of 2008 and currently has a deficit projected to reach $2.6 billion for the 2011 fiscal year.

The Arizona Legislature seems to believe cutting taxes will increase state revenue. This flawed reasoning is what has caused the state’s exorbitant deficit. Furthermore, the tax cuts were not initially matched with spending cuts. The legislature lowered taxes and spent money the state didn’t have. Cutting taxes without implementing commensurate spending cuts means a massive budget deficit down the road. Now that the legislature has finally realized this, in order to offset the state’s lack of revenue, they have slashed expenditures with a dull hatchet, which for the university system has meant higher tuition and a budget crisis of epic proportions.

Conventional wisdom among most economists is that cuts to expenditures during a recession do far more harm than good. Drawbacks in public spending will result in a reduction in the quality and quantity of government services and will decrease the demand for private sector goods, which will only worsen economic conditions. Not to mention the effects it will have on the K-12 and university systems, which are already reeling from a lack of state funding.

The only way to effectively increase revenue without adversely impacting the economy and education system would be to increase taxes. It is the only alternative the legislature has at this junction. But the Republican majority has completely stonewalled efforts to reform Arizona’s tax policy. Furthermore, they have firmly aligned themselves with partisan anti-tax organizations like the Tea Party Patriots and Americans for Prosperity. Grover Norquist, president of the taxpayer advocacy group Americans for Tax Reform, is said to be held in such high esteem among Republican members of the legislature that Arizona has one of the highest percentages of lawmakers who have signed his pledge to oppose all increases in federal and state taxes. With a legislative body that subscribes to a political philosophy as radical as Norquist’s, it is no surprise that Arizona’s budget is headed off a cliff.

To the legislature’s credit, it has, to a certain extent, come to terms with the fact that its love affair with low taxes has proven detrimental to the state. Although the Republican majority is steadfast in its opposition to any increases to individual and corporate taxes, they at least had the decency to pass a resolution in February of this year to place Proposition 100 on the ballot and allow the people of Arizona to decide whether a policy of excessive tax cuts is best for the state’s future. It was even supported by Arizona’s conservative governor, Jan Brewer. Voters approved the measure which implemented a 1 percent increase in Arizona’s state sales tax. Two-thirds of the revenue allotted from this increase will fund K-12 education and the other one-third will fund human services and public safety. But as this tax increase is only temporary, it has left many to wonder what will happen after the measure expires on May 31, 2013. Even though Proposition 100 was lauded as a solution to the state’s financial crisis by its proponents, it is only a Band-Aid. Five years from now, Arizona will more than likely find itself in the same budgetary predicament it is in currently unless there are significant reforms to the state’s tax policy.

— Nyles Kendall is a political science junior. He can be reached at

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