Harrisburg, Pa., Mar. 7, 2023 — Commonwealth Foundation Senior Vice President Nathan Benefield issued today the following response to Gov. Josh Shapiro’s first budget address:
“The budget was not what many expected to see, and was disappointing, given the bipartisan issues Shapiro campaigned on.
“He backtracked on his campaign commitments to accelerate corporate tax reductions, to work with the legislature on RGGI, and to support educational choice.
“This budget feels more like Governor Wolf’s ninth budget than the fresh start Pennsylvanians were expecting from a new governor. The budget proposal that Shapiro presented will not be able to gain bipartisan support, which would be needed in this era of divided government.”
Benefield Highlighted Several Additional Takeaways in His Analysis:
First: Any talk of Pennsylvania’s “budget surplus” is a myth.
Pennsylvania doesn’t have a “budget surplus” but a structural deficit. Lawmakers need to practice restraint now or we will face a tax hike in 2026. Shapiro’s budget exacerbates that structural deficit, spending almost $2.9 billion more than ongoing revenue.
Second: Shapiro’s budget fails to address the need for welfare reform.
We have to tackle escalating Medicaid costs and enrollment. Unfortunately, Shapiro completely ignores this cost driver, and misses the opportunity to reform the welfare system to focus on the most needy and incentivize employment.
Third: Shapiro failed to deliver on his promise to expand educational opportunity.
On education, Shapiro’s budget takes the wrong approach. The recent education funding lawsuit ruling didn’t order “more money.” In fact, Pennsylvania already spends $4,000 per student more than the national average, even before last year’s record increase. What the ruling said was that every student must get a “meaningful opportunity.” The only way to deliver this is through educational choice. But Shapiro walked back on his campaign promise to expand educational opportunity and instead throws more money at the same broken system.
Finally: Shapiro’s budget hinders prosperity.
Lawmakers need to focus on policies to unleash Pennsylvania’s economic potential. Unfortunately, Shapiro’s budget ignores his campaign commitments to cut corporate taxes and includes a tax on electricity through the Regional Greenhouse Gas Initiative (RGGI), which will hurt working families and employers.
You can also click here to access audio of Benefield’s statement and analysis.
Nathan Benefield is a senior vice president of the Commonwealth Foundation where he provides expert analysis on public policy issues related to the state budget, taxes and spending, public sector labor reform, education, and economic development.
The Commonwealth Foundation transforms free-market ideas into public policies so all Pennsylvanians can flourish.