Gov. Wolf's $30 billion, everything-and-the-kitchen-cabinets spending plan landed heavily Tuesday in a legislature that abhors anything smacking of ambition. But Pennsylvanians should be relieved that their new governor wants to dramatically alter the state's finances. Given that the commonwealth is limping toward the next fiscal year with a $2 billion deficit and job growth nearing a rounding error, the "fundamentally new" approach Gov. Wolf called for is certainly in order.
The Democrat's plan marks a necessary departure from four years of reductionist government under his predecessor, Tom Corbett, whose policies fared as poorly with the electorate as they did with credit-rating agencies. Wolf's budget would begin to repair the cuts of the Corbett era, most importantly in basic education.
Moreover, Wolf valiantly proposes to shift education costs from regressive, local property taxes - and, in Philadelphia, the growth-killing wage tax - to statewide levies on natural gas and income, which could harness more of the state's wealth for its most crucial and neglected service. The governor's budget rightly aims to boost K-12 spending by half a billion dollars, increase the state's share of the burden to 50 percent, and reduce average property taxes by half.
That alone would be a remarkable achievement for one budget, but Wolf's plan is ambitious to a fault. It would increase spending by a staggering 16 percent and raise more than $4 billion in new revenues, expanding or creating taxes not only on income and gas extraction, but also on sales, cigarettes, cigars and smokeless tobacco, and financial institutions. It would include the largest income-tax increase in 25 years and the first statewide sales-tax hike in nearly 50 years.
Of course, given that a Republican legislature must approve the budget, Wolf's plan amounts to a negotiating position. It will behoove him to have proposed some expendable tax hikes, which he certainly has.
His priority should be a natural-gas tax in line with those of other major energy-producing states; as Wolf noted, the state deserves "to be fairly compensated for the use of our resources." And while the state income tax is relatively low and preferable to property taxes, the governor should not abandon his campaign promise to reduce the burden on low and middle incomes before raising the rate.
It should help his case that besides property-tax cuts, he promises to finish phasing out taxes on net corporate wealth - which provoked a uniquely bipartisan round of applause Tuesday - and to halve the high tax on corporate income while closing a loophole that allows many to evade it.
To get more of what he wants, Wolf should give more on pension reform, having offered an unconvincing plan to borrow more billions to shore up the system. The former cabinet manufacturer threatens to compound that mistake, and undermine his business credentials, by paying off the debt with "profit increases" from the state's liquor monopoly, an anachronism that many Republicans rightly want to sell off.