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Governor determined to control state spending to encourage prosperity

By Randy Kraft, WFMZ.com Reporter, RKraft@wfmz.com
Published On: May 15 2012 05:34:40 PM CDT

Randy Kraft, 69 News

BETHLEHEM, Pa. -

Pennsylvania is the eighteenth largest trading entity in the world, one that is equal to many other entire countries, said Gov. Tom Corbett.

But to remain competitive in the global marketplace, the state must get its fiscal house in order, he said. He added the way to do that is not by increasing taxes, which scares away businesses, but by controlling government spending and allowing businesses to flourish.

“We‘re not going to increase taxes,” said Corbett. “By controlling our taxes, you in our businesses, and our tax base, are going to grow. You are the solution to the economic problems we have. As you grow, the state can grow.”

The governor, who has earned a reputation as a hard-line cutter of the state budget, spoke to about 300 business and political leaders early Tuesday afternoon in the grand ballroom of Hotel Bethlehem

Since becoming governor, said Corbett, he’s learned Harrisburg has five seasons: spring, summer, autumn, winter and “budget/protest time.” He said the “very tight” state budget for the next fiscal year will be finalized over the next four to six weeks.

Corbett acknowledged he is perceived as being “really tough” but said it’s because “we haven’t been tough in the past.”

He said Pennsylvania’s government has not been living within its budget, which increased “from $22 billion to almost $29 billion in eight years, during the greatest recession since the Great Depression. Many of you did not have business growth during that period of time. We have to start thinking differently. We have to get our spending under control.”

The governor acknowledged some people want more money in the new budget for education and social programs. He indicated 40% of the budget is used for education and nearly as much is spent on social welfare.

While not apologizing for his position, the governor admitted he feels great anxiety for the difficulty it is causing parents, teachers, students and people on welfare. But he added: “We were out of control. We do not have the money.”

“How many of you think I cut education funding?” asked Corbett. “How many of you read that I cut education funding?” The audience laughed.

He said the state got one-time federal funding that the previous governor and legislature warned school districts “was not coming back again.” He said to make up that lost federal money, the state would have to raises taxes a total of $1,200 for an average Pennsylvania family.

Corbett was the keynote speaker at a luncheon to celebrate the 50th anniversaries of Lehigh’s Economic Advancement Project and Northampton County New Jobs Corp. The two loan agencies are credited with helping to finance 1,900 jobs in the Lehigh Valley during the last 50 years and with creating, retaining and/or expanding 80,000 local jobs.

The programs were precursors to the Lehigh Valley Economic Development Corporation, established in 1995 to promote economic development.

Corbett presented a proclamation congratulating LVEDC on the success of the two programs.

“You have been doing something that many regions are just starting to learn how to do – working together and working on behalf of the citizens,” he said.

He told the audience “You are the job creators, not government. We need to get out of the way.” He said since February 2011, 18,000 private sector jobs have been created in the state. “You hired the people.”

The governor recently returned from a trade mission to France and Germany. “It was not tourist time,” he said, adding it involved 46 meetings in six days. “We were out there looking for business for Pennsylvania. The mission went well. We have a lot of new leads.”

“We have to get our fiscal house in order to trade with the world and to bring growth businesses to Pennsylvania,” said Corbett.

Corbett sprinkled his 25-minute talk with a few personal comments, including that he recently became a grandfather and once taught ninth grade for a year. He also kept the audience involved by asking for a show of hands on various questions.

No hands went up when he asked: “How many of you think the economy is getting ready to really take off?” Said Corbett: “I agree.” But, like many who raised their hands in the audience, he said he is cautiously optimistic that the economy will grow.