Saturday, December 26, 2015

Oklahoma, Another GOP Failure: Earthquakes and a Looming Budget

Embattled homphobic Oklahoma Gov. Fallin
As noted in a number of posts on this blog, Kansas, where Republicans were going to implement their dream of slashing taxes - especially for the wealthy and businesses - turned out to be a fiscal disaster and but for pounding the anti-gay marriage drum and prostituting himself even more thoroughly to the Christofascists in the GOP base, Sam Bownback might have lost his re-election bid.  Brownback's neighbor to the south, Oklahoma Gov. Mary Fallin (R) is similarly facing a fiscal debacle.  Added to Fallin's dilemma is the rapidly rising number of earthquakes hitting the state due to unfettered fracking and secondary and tertiary practices of the oil industry.  Even her strident anti-gay animus may not be enough to save her political capital.  A piece in Politico looks at another red state where things are going very wrong.  Here are excerpts:

A few days after Thanksgiving, Oklahoma City residents huddled in their homes watching a thick layer of ice snap power lines and split stubby trees. Only a few days later, as the ice started to thaw and power was restored in most neighborhoods, a 4.7-magnitude earthquake shook the state a couple hours before dawn.

The epicenter was 100 miles north, in a region where oil and gas have for decades driven the state economy. Scientists suspect the practice of injecting deep into the earth the salty wastewater from the drilling process may be causing the earthquakes, or at least increasing the frequency. 

Prior to 2009, the state had just two quakes per year. Now on average, quakes shake the state twice a day, more than anywhere in the lower 48 states, a fact that is stoking outrage among residents who are growing tired of worrying about the foundations of their homes and whether to buy earthquake insurance. The quakes are an unwelcome byproduct of the oil and gas industry, but they are also a powerful metaphor for a looming fiscal crisis driven by falling fuel prices.

When the Legislature convenes at the beginning of February, it will face a projected budget shortfall of at least $900 million. . . . . The state already absorbed a $611 million budget shortfall last year, so the shock waves from coming cuts will likely be felt even in corners of the state the floor-shaking tremors don’t reach.  Some school systems are considering four-day weeks to save money. Prisons may have to cut half their guards. The state’s health care authority may have to continue to reduce payments to Medicare providers. 

None of this is welcome news for Gov. Mary Fallin, who was elected to her second term with 56 percent of the vote in November 2014 and has been flirting with a larger national profile. 

Oil has dropped 70 percent since 2008 and natural gas prices are at 14-year lows.  . . . “Oklahoma has done a great job of diversifying its economy, but energy is still one of its top industries. Unfortunately, President Obama’s anti-oil and -gas policies have caused financial distress across all states with abundant energy resources,” Fallin said.

But if Obama is unpopular in this deeply red state, Fallin’s stock is not much better. She currently ranks last in favorability among Oklahoma’s current and most well-known statewide elected officials, according to recent survey by Sooner Poll, an independent nonpartisan polling firm in the state.  “In a state with a crisis like this, and the executive and legislative branches doing nothing to address it, it’s really not a case to put her on the ticket,” Gaddie said. 

Though Oklahoma’s deep reliance on its energy economy may have delayed acceptance of the science linking injection wells and earthquakes, “only a hardcore conservative in denial could argue there’s no link,” Gaddie explained. “It’s a scientific issue that’s also politicized, but now the science has pretty much prevailed over the politics.”

The question is what to do about the problem. Pressure is mounting to shut down the wastewater wells, or at least limit the volume pumped into them. But the oil and gas industry fears that will only hurt their already bruised bottom line.

To add to the state’s woes, a report this month by the U.S. Bureau of Economic Analysis shows Oklahoma posted the worst performance among all states over the past quarter. That’s scarier than any earthquake and raises a question for Republican lawmakers: Will Oklahoma have to follow in the footsteps of Kansas and reluctantly raise taxes? 

Critics say the problem is Oklahoma’s tax cuts are not triggered by an increase in actual revenue -- just projections. So in 2016, the state’s top income tax rate will fall from 5.25 percent to 5 percent, in spite of Oklahoma’s revenue shortfall. 

State officials can’t claim they weren’t warned. Treasurer Ken Miller has been trying to raise the fiscal alarm since taking office in 2011. 

A bigger problem, he said, is that lawmakers never learned to how to live with less.  More than $1 billion in non-recurring revenue has been used to fill budget holes during the past five years. Using such large amounts of alternative revenues to prop up the state budget is an admission by policymakers that they don’t have enough money to spend as they please, Miller said. 

What is frightening is that Oklahoma has practiced the voodoo economics lauded by every member of the GOP 2016 presidential nominee clown car.   Thirty five years of experience has shown that the GOP economic model does not work long term  Yet no one in the party is willing to face this reality.

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