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Lowman Henry: Where’s Pennsylvania’s ‘Capt. Courage’?

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Pennsylvania’s “full-time” Legislature is now off on a two-month summer recess, essentially ending the productive phase of the current session. Yes, the General Assembly will reconvene in mid-September but with legislative elections looming in November, it is unlikely any substantial or even mildly controversial action will be taken during the pre-election period.

The reviews are mixed on the first two-year session under Gov. Tom Corbett and with Republicans in complete control of the General Assembly.

Chief among the accomplishments are two consecutive state budgets passed on time — with no tax hikes — and with spending held in check. Given the record of the preceding eight years, this actually represents something of a minor miracle or at least a major change in direction for state government.

Praise also is merited for legislation expanding the Education Improvement Tax Credit to include a special program for the state’s failing school districts. Additionally, small decreases in certain job-crushing business taxes and eliminating inheritance taxes for farming operations stand out as major pro-growth steps that will enhance the commonwealth’s business climate.

All of this, however, amounts to little more than rearranging the deck chairs on the Titanic. It looks better, but we are still about to hit an iceberg.

That’s because none of this gets to the structural problems that lie ominously submerged just beneath the surface of the state’s fiscal waters. And that is the stranglehold labor unions have on state government.

Noticeably absent from the accomplishments are the passage of school choice legislation, privatization of the state’s antiquated liquor store monopoly or the indexing of the “prevailing wage” for inflation, all of which were hotly debated and died a slow death during the just-past legislative session.

The common thread is that all were opposed by organized labor, which continues to control a bipartisan majority in the General Assembly.

Gov. Corbett has been noticeably absent from this fight. In fact, the governor’s spokesman, Kevin Harley, recently told the Trib: “The governor lives in the real world. That (confrontational approach to unions) may be nice in a think-tank white paper, but in reality, these are the people we work with every day.”

Harley’s comments amount to little more than a white flag of surrender.

Apparently the “real world” Harley speaks of does not include states like Wisconsin, Indiana, Ohio, Virginia and New Jersey, where Republican governors have taken on the labor unions and brought about significant structural change.

Indiana actually enacted a Right to Work law and Wisconsin Gov. Scott Walker reversed his state’s economic decline by enacting sweeping labor reforms.

Unions and their allies forced a recall election in Wisconsin but were trounced by Walker, who easily retained his office. As a result of Walker’s leadership, Wisconsin now is reaping the benefits.

The state budget there has been balanced and the structural deficit has been reduced. School districts and counties have saved billions, giving relief to property taxpayers. The improved business climate has triggered something of a boom in job creation.

Meanwhile, here in Penn’s Wood, the Corbett administration guaranteed three more years of fiscal insanity by caving in to union demands during last year’s contract negotiations. That, coupled with the failure to enact even the most modest labor power reforms, means the state’s underlying structural problems remain unaltered.

As a result, the pension crisis will continue to deepen, the unemployment compensation fund will go further in debt and the state will not experience the type of economic growth that will help us steer clear of the approaching fiscal iceberg.

The reason these problems are not confronted is that the solutions are controversial, difficult and unpalatable. It is the nature of elected officials to avoid such decisions. Few have the intestinal fortitude to stand up for change the way Walker did in Wisconsin, John Kasich has in Ohio, Mitch Daniels did in Indiana or Chris Christie has in New Jersey. So far, no one in Pennsylvania has proven himself or herself to be up to the challenge.

And so, while the chairs on the deck of Pennsylvania’s ship of state are arranged a bit better these days, we continue to travel full steam ahead with a gigantic fiscal iceberg directly in our path. It is too bad we can’t find a captain with the courage to risk a bit of confrontation to avert a catastrophe.

Lowman Henry is chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.

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