$3.5 billion budget shortfall goes missing – authorities are baffled

by Dan Lucas

A very big story developed in the last few weeks, and went largely unnoticed. Since last summer we’ve all been hearing about a multi-billion dollar budget shortfall. In recent months, it became the widely-accepted $3.5 billion budget shortfall. With Governor Kitzhaber’s recommended budget that came out on Feb 1, 2011, the $3.5 billion budget shortfall has largely disappeared.

Harry Esteve at The Oregonian ran a nice obituary on February 7, 2011, for the fallen shortfall: “Kitzhaber never mentioned the shortfall in his budget remarks. As a result, the number has all but vanished from conversations about the state’s financial condition, which worries some Democrats.”

The real story is how did so many in the media and government come to accept the “shortfall” as something real in the first place? If it were real, how could it go away so quickly and quietly by the non-efforts of one man?

To read more from Dan, visit www.dan-lucas.com

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Posted by at 05:00 | Posted in State Budget | 7 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Knewallalong

    The reason is that these morons in Salem couldn’t balance a budget if their lives depended on it. They don’t have a clue as to what they are doing and they are inept, corrupt, and moronic.

    How can anyone believes these idiots on anything? Get real. They are buffoons.

  • Ron Marquez

    See Steve Buckstein’s article on the $3.5 billion short fall. Link posted below.


  • Nothing is decided until it is, but it appears that some in Oregon government are beginning to Face Reality on the budget. The $3.5 billion shortfall was never real. No shortfall from “wished for” spending is real. The profligate spending of the past two decades is a relic that should be publicly rejected by Legislators of both political parties. It did not work for Oregon and has threatened the financial health and fiscal future of this state and destroyed jobs and lives.

  • Bob Clark

    The media is still using the $3.5 million “shortfall” I hear on the radio from time to time – even earlier this week. Mostly legislators who can’t break from the past perpetuate the concept of budget gap. But I don’t see the shift from Kitzhaber as anything to shout postively about. His cuts education funding, effectively transferring the funds to soaring spending for DHS and OHA. Same o Same o.

    F government as in Freeze Government at all levels. All we are getting is poorer and gloomier, the more the government governs.

  • Bob

    This is really a matter of symantics and language. Either you don’t understand budget development or you’re cloaking budgetary issues as a “gotcha” to create spin. That’s not, or shouldn’t be, the issue.

    Previously, when there wasn’t yet a budget on the table, there legitimately was a shortfall if they were to try to maintain current service levels. In other words, if we want to continue doing what we’re doing, we will be $3.5 billion short, all of which, at that time is BASED ON the then-current budget.

    However, this goes away the moment the new budget is released. Why? Because you’re no longer short because you’ve changed what you’re going to be spending based on the revenues for the new period. The only way you can now say we have a gap is if you intend to spend more than you take in.

    The same happens in household or corporate budgets. You look at your year-end and say, “Whoa! we keep spending like this and we’ll go in debt next year.” (Hence, the gap at that time.) So you adjust your spending to fit your income, maybe a few less donuts or don’t buy the equipment you wanted. Now, there is no gap. Why? Because it’s new budget.

    Either you’re getting lost in the language or you don’t understand the process. Either way, that doesn’t help push the real issue, which should be that they’re spending too much to begin with.

  • Bono

    Missing $3.5 billion? Seems like they would sent out wanted posters and not let this go without a fight

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