The Center for Budget and Policy Priorities, a national policy research organization, noted that only nine of the 50 states are continuing to enjoy budget surpluses. A healthy coal market is cited for West Virginia's success.
Many people also would give some credit to the administration of Gov. Joe Manchin for fiscal prudence. Manchin knows the cyclical nature of the economy in West Virginia and used much of the revenue growth in his first term to pay down debt.
While other states are enacting budget freezes and seeking federal bailouts, Manchin and West Virginia remain fiscally sound and even have been able to reduce taxes. That will make the state even more attractive during a national recession.
Apparently, not everyone is pleased with Manchin's fiscal policy.
Ted Boettner, executive director of the liberal West Virginia Center for Budget and Policy, said, ''We're going to see a decrease in demand for West Virginia goods. And that's going to play a role in West Virginia's budget.''
That is obvious. Economic slowdowns do affect tax revenues. But rather than blame the economy, Boettner blamed tax cuts.
''Over the next couple of years, we're definitely going to see a budget shortfall due to the tax cuts and the weakening economy,'' Boettner said.
That is nonsense. Even Barack Obama, who campaigned for president by railing against President Bush's ''tax cuts for the rich,'' is backing down from raising taxes during a recession.
Reducing taxes increases revenues in the long run because it spurs economic activity. Seven years after the first round of Bush tax cuts became law, federal tax revenues reached an all-time high this year.
Unfortunately, so did federal spending.
Manchin and the Legislature have shown restraint in state spending and in state taxation. This bodes well for the state as it appears to be headed to the down side of the business cycle.
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