The state of Nevada


If the whispers are right and Nevada is, indeed, in a $3 billion hole, then all hands on deck -- this is a crisis.

Citizen legislators, the governor, unions, businesses, lobbyists and all those forces that roam the halls of the Nevada Legislature should put aside lesser legislative interests and focus only on how to close a deficit of that magnitude.

Don't wait to the last minute to unveil a "plan." Get it together now and get it into the light of day for public scrutiny. This is no time for business as usual, dead-of-night, back-room deals.

In a perfect world, Nevada would have long ago established spending priorities for a sustainable government focused on service to taxpayers.

Spending restraint and government accountability, however, are not the paths Nevada has chosen. Instead, we live legislative session to session worried more about the raises and benefits of government employees than the service government renders to Nevada's citizens.

I'm sorry to be so blunt. But that's the way it is.

So, how do we get out of this?

I'd start by telling the story of my composite friends Sam and Barbara of Sun City Summerlin. They moved to Las Vegas six years ago. Retired, both with pensions. They bought a modest house, nothing fancy, but comfortable. Nice neighbors, two cars and plenty of room in the budget to accomplish their core Vegas retirement goal -- eat, drink and be merry.

They bought into the Las Vegas boom and were pleased to see their equity grow. It gave them the confidence to spend more today because one day that money could be cashed in for a "second wind" in their older years of retirement.

Then the real estate market collapsed. If there's any equity left in their house now, it would not easily be extracted.

While not destitute, Sam and Barbara feel the pinch. Their income has effectively been reduced by inflation. They know the recession is not over and they've decided it is only prudent to cope by spending less.

So, Sam and Barbara decided after much agonizing to downsize to one car, instead of two. Although a sacrifice, the move would save on gasoline and insurance. They didn't want to do it. It was a hard choice. But in the end it seemed like the right thing to do.

Which brings us back to how can Nevada get out of this budget mess.

It starts with spending. And until Nevada does what Sam and Barbara did -- make real sacrifices that result in effective expense reductions -- a budget gap of this magnitude cannot be closed responsibly.

If legislators try to attack this large of a budget gap with the idea that the only thing that ails Nevada is revenue, they will not only feed the recession by hurting businesses that provide employment for the people, they will have avoided the root of the problem -- sustainable spending.

Look, I don't want to oversimplify the answer to this potential problem. The recession isn't over and Nevada's now experiencing something it has rarely seen before -- selected sector contraction. But ill-concieved tax hikes will turn a crisis into a disaster.

To one degree or another we're all in the same place as Sam and Barbara. They sacrificed and cut spending by downsizing from two cars to one.

All governments in Nevada should first do the equivalent downsizing. Then, and only with great care, should legislators move to the revenue side of the solution.

Sherman Frederick (sfrederick@reviewjournal.com) is publisher of the Las Vegas Review-Journal and president of Stephens Media.

 

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