Taxpayers crushed between a rock and a stone

By Camille "Bud" George

If billions of U.S. taxpayers' dollars are good for Iraq and Iraqis, the same should be true for rebuilding America for Americans.

I questioned how spending billions to rebuild Iraq and its schools, water, electric and sewer systems could be portrayed as patriotic while efforts to rebuild America and Pennsylvania routinely are lambasted as wasteful, big-government spending.

If billions of U.S. taxpayers' dollars are good for Iraq and Iraqis, I argued, the same should be true for rebuilding America for Americans.

We're still in that hard place, and the middle class is being squeezed.

A big fault line exists between the federal and state budgets. Gov. Rendell notes that state taxpayers have shouldered more than $2 billion in costs since 2003 because of federal cuts and under-funded federal mandates.

Many of the added costs are being borne by the state Department of Public Welfare, making it a convenient scapegoat.

But Pennsylvania is an older state with the third-highest percentage of residents over age 65. More than 80 percent of those receiving Medical Assistance are elderly, children or disabled.

Those seeking to slash programs ignore the federal rules requiring Pennsylvania and the DPW to reimburse nursing homes and pay for programs for the disabled and special-needs children.

It's tempting to apply Washington logic to Pennsylvania's revenue woes by sending the bill to our kids and grandchildren. However, Pennsylvania is required to have a balanced budget, even as Washington rings up a $319 billion deficit.

I don't see a quick fix. President Bush's 2008 proposed budget, excluding Medicaid, is projected to cost Pennsylvania $474 million compared to 2006, according to the Center on Budget and Policy Priorities.

Some proposed cuts strike close to home. Pennsylvania's 2008 share of the Clean Water Revolving Fund -- which primes the Pennvest pump so communities can provide sewage and water-- would shrink by $17.5 million.

Heating assistance would take a $28 million hit. Community Services Block Grants for Community Action programs would shrivel by $27 million.

Most grating is the unfairness to the middle class. I think most Pennsylvanians could stomach the federal government's shedding of responsibilities if their federal tax burden dropped commensurately.

However, the Bush tax policies have mainly benefited only the top fifth of taxpayers. The only thing to "trickle down" has been added responsibilities and costs to states such as Pennsylvania.

Former Labor Secretary Robert Reich notes that the incomes of most Americans have increased about 2 percent in real terms over the last decade, while the incomes of the top 1 percent has increased by more than 50 percent. The inequality, he argues, tips political power in favor of the wealthy and retards economic opportunities for most Americans.

Middle-class Pennsylvanians have just cause to recoil at the phalanx of proposed fee and tax increases. Yet, most would probably agree with the Republican Speaker of the House who said, "If you want to slash and burn and cut the budget, there are consequences, there's human consequences..."

Pennsylvania is getting the bill for federal irresponsibility, but the middle class is getting the shaft.