Don't Just Listen to the Speeches. Watch the Budget.

One of the first lessons I learned working in the Texas Capitol was that speeches are written for voters. Budgets are written for governing. 

That's why when I report on the happenings in local and state government, I always watch the budget just as closely as I watch the speeches. 
Last week Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Dustin Burrows instructed state agencies to prepare their next budget requests with a 3% reduction from current spending levels. 

This caught my attention. 

Most Texans have never heard of the Legislative Budget Board (LBB) or read an LBB policy directive letter, but they are important because they quietly begin the state's budgeting process. Every two years, before the Legislature convenes, state agencies receive instructions on how to prepare their initial budget requests. Those requests go to the Legislative Budget Board and the governor's budget office, where budget analysts begin shaping the recommendations lawmakers will eventually use to write the state budget. 

This is the starting point for building a state budget. And this year's starting point is agencies being told to plan for less. 

On its own, a 3% reduction isn't headline news. As a conservative, I think government should always be looking for ways to spend taxpayer dollars wisely. 

It is, however, worth stopping to consider the timing. 

For years, state leaders have been telling Texans that our economy is among the strongest in the nation. Businesses continue moving here. Jobs are growing. The Rainy Day Fund remains healthy. They have built a compelling narrative that Texas is thriving because of conservative leadership. 
The letter from the Big Three says the reduction is intended to demonstrate "prudent stewardship of taxpayer resources" and establish a "fiscally conservative budget." 

Those are reasonable goals. The question is why the budgeting strategy changed now. 

State agencies were asked to make 5% reductions in 2020 as Texas confronted the economic uncertainty created by COVID-19. But the state returned to baseline budget instructions in the next two cycles. 

If prudent stewardship, efficiency and fiscal conservatism have been the guiding principles of this administration all along, why weren't agencies asked to plan for less in 2022 or 2024? 

I think there are a couple of reasonable explanations. 

One possibility is that despite the optimistic message Texans have been hearing, state leaders think the next budget is going to be tighter than the last. 

Abbott, Patrick and Burrows have access to revenue estimates, tax collections and economic projections before most Texans ever study them. They may be seeing signs that the next two-year budget will be tighter than the last. If so, asking agencies to prepare for less is prudent government. 
Politics could also be part of the answer. 

Texas is in an election year, and Abbott is seeking a fourth term as governor. There are predictions that Republicans could lose seats in the Texas House. They also lost a seat in the Texas Senate earlier this year, when Democrats flipped Senate District 9 in a special election. 
Texans are also feeling financial pressure at their kitchen tables, with continuing concerns about affordability, gas prices, insurance and property taxes. In that environment, a tighter state budget makes for a strong political talking point. 

A directive requiring every agency to begin 3% lower helps make that case. It gives Texas leaders something tangible to point to when they talk about smaller government, fiscal restraint and property tax relief. 

There's another piece to this. Abbott is governing for a national audience. 


Florida Gov. Ron DeSantis built his national profile by presenting Florida as the model of conservative government. I believe Abbott is following the same playbook. For Abbott's national ambitions to work, Texas must be seen as the conservative bulwark -- the state that cuts taxes, restrains spending and sets the standard for Republican governance. I believe this directive is part of the political résumé Abbott is building for national office. 
Viewed that way, the budget letter isn't just about preparing the next budget. It's also about sending a political message. 

Of course, those two explanations aren't mutually exclusive. 

State leaders may see enough economic uncertainty to justify caution while also recognizing that spending reductions create a useful election-year message. In government, those two things often travel together. 

The 3% reduction may be a good budgeting move, but that's not the story. 

Either the Texas economic picture is looking bleaker than state leaders are letting on, fiscal restraint makes for a good campaign message, or maybe it's both. 

Politicians spend a lot of time telling us where they think Texas is headed. Budgets tell us where they're actually preparing to go. 

That's why we should all watch the budget.