We’ve all been there. Things are going OK financially and then the car breaks down. You and your family are suddenly forced to scour the monthly budget to find an extra $800 to make the needed repairs and keep the wheels turning.
Since we use our cell phones most of the time, maybe we can eliminate our landline. And we can probably drop the premium channels from our cable bundle. And I guess we can plan a simpler vacation this year.
This is similar to the situation Pennsylvania faces every year at state budget time. Just like a family, the Commonwealth experiences economic ups and downs. We have good times, and we have times, like now, when money is tight and bills are mounting. We must pinch pennies and look for opportunities to save.
The state has a certain amount of projected income to work with each year, and it also has a long list of expected expenses, some of which are federally required. When we sit down to go over the numbers and discover that our expenses are higher than our income, then we must have serious discussions about how to best balance the state checkbook.
In this scenario, the state has two choices. We can raise our income, which means we raise your taxes, putting more stress on your family budget. Or we take a more responsible route and look for opportunities to save, just like you had to do when the car needed repairs.