Jon Ralston thinks Gibbons still has a (slim) chance to save Nevada

When Gov. Jim Gibbons convened the first Summit to Save the State, that time because of soaring foreclosure rates, the atmospherics were awful.

He barred the public, invited only lenders and held it at the chamber of commerce headquarters. The governor then emerged to say there was no housing crisis and that the attendees had told him not to worry and be happy, so he was.

That was just over a month ago. This week Gibbons proved he had learned the lessons of that first gathering, perhaps because the second one was to deal with a quarter-billion-dollar projected shortfall that his budget chief Wednesday attributed mostly to ... the foreclosure crisis his boss so recently had denied existed.

This summit was open, ecumenical and potentially - repeat, potentially - productive. I say that because within the constraints of such an event, where some performing is inevitable, those who want to keep their money were frank with the man who says he must take it away. And if Gibbons actually collaborates with the local government folks and key legislators before he lops what could be hundreds of millions out of the budget, he will make better decisions and could catalyze a discussion of spending and taxing that should have started at least 15 years ago.

You want irony? How about Mr. No New Taxes having to make draconian cuts that could pave the way for serious changes in the tax structure?

Lest you think I am (more) delusional and just so no one is taken in by the fiscal legerdemain, a little math and history are in order:

Ten months ago, when Gibbons unveiled the two-year spending plan he is about to eviscerate, the governor bragged in the "Executive Budget in Brief" that his spending plan was only 5 percent of so-called "enhancement" items. That is, the base budget expenditures (81 percent) and maintenance costs (14 percent) swallowed up most of his budget, partly because, the document says, "it will cost nearly $500 million just to maintain current programs once caseload, inflation and other growth-related costs are taken into account."

To distill: Nevada is growing so fast, with so many more students and social service recipients , that much of any budget increase just keeps up with growth.

Gibbons proposed no significant cuts to the previous biennium's budget and increased spending - get ready for it, conservatives - by $1 billion, much of that simply to avoid sliding off the back of the fiscal treadmill. The Legislature , as legislatures do, tinkered with the governor's budget, didn't change much and approved the $7 billion spending plan.

And here we are. Again. Still.

So we heard familiar pleas from local government types to hold child welfare and juvenile justice harmless (Homer Simpson could figure that out, and the governor should have declared them sacrosanct when he had the chance) , and heard several summiteers, most notably Reno Mayor Bob Cashell and Las Vegas Mayor Oscar Goodman, make a pitch for the larger discussion to break the build up, build up and cut cycle.

Gibbons is correct when he points out that no revamped tax structure will be immune from economic vicissitudes. But the same conservatives who take tax increases off the table while voting for the $1 billion (did you absorb that number?) in new spending never present a list of hundreds of millions of dollars in cuts to offset the argument that the base needs to be stabilized. They don't because those kinds of cuts without pain don't exist in a state where the serial break-even budgets keep us - listen to Gibbons mimic former opponent Dina Titus - at the bottom of all the good lists and the top of all the bad lists.

So you see what will happen if Gibbons has to make cuts, if he doesn't tap the rainy day fund or delay projects or programs to bridge the gap: He is going to cause serious pain. (How much we don't know because of the inanity of trying to project revenue for two years, which no economic savant could do.)

And that gives me hope that next year the atmospherics are going to be ripe for change. The teachers and rabble-rouser Kermitt Waters proposing to raise the gaming tax along with Chancellor Jim Rogers agitating for business income taxes will only make the climate riper for this discussion, no matter how touchy-feely it may sound, to decide exactly what kind of state we want to live in.

Maybe that could be Gibbons' next summit subject, and this time he really might save the state.

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