I hope Mary Suhm is right and I’m wrong, but …

Dallas City Manager Mary Suhm unveiled her recommended budget for fiscal year 2011/12 this week and most agree it was not as austere as originally predicted. The reason given is that the state did not cut as much funds to municipalities as was expected.

The city’s budget, as most budgets are, is not predicated on how much money the city has on hand, but on how much it expects to earn during the 12 months in question. The city gets money from many sources — the aformentioned tax dollars returned to it by the state, grants and other funds from the federal government, but mostly from fees it charges to businesses and individuals, property taxes and sales taxes. It’s that last source of income that has me concerned.

According to this item from Rudolph Bush, who covers City Hall for the Dallas Morning News, Suhm said in releasing her proposed budget: “Our budget situation this year, with the economic situation improving a bit, has enabled us to do some things we weren’t sure we’d be able to do.”

Frankly, I don’t see “the economic situation improving a bit.” Suhm is basing this on better than average sales tax receipts over the past couple of months. I fear that might be a temporary silver lining before the big black storm hits.

Look at the typical economic measuring tools — growth, consumer spending, manufacturing, housing prices, stock prices — and the news is not good. They all indicate a struggling economy. The only way an economy can prosper is through the exchange of money. But today consumers aren’t really spending and neither are businesses. That leaves only one leg of the triangle — government — but, as we all witnessed last week, Congress decided to move drastically in the opposite direction.

President Obama is saying, now that the argument over the debt ceiling is over, he wants to concentrate on job creation, which is the only remedy for our ailing economy. But like just about everything else from this administration, he will be all talk and no action on job creation. Fulfilling this pledge which would require a major investment from government and we all know that’s impossible giving the opposition by Congressional Republicans to any new spending or revenue enhancing measures.

According to figures released last week by the Labor Department, the unemployment rate dropped from 9.2 percent to 9.1. percent. That statistic is terribly misleading because it does not include the long-term unemployed who have simply given up looking for jobs. If you count those as well as individuals who can only find part-time jobs, the actual unemployment rate is an astounding 16.1 percent.

Unless you have working people, the city won’t get revenue from sales taxes. When spending is cut, more jobs are eliminated and the city gets even less revenue. Every dollar spent creates jobs.

The last time the federal government cut spending this drastically was in 1937, a move that led to what was called the Second Great Depression — the unemployment rate jumped to 19 percent, industrial production declined by 30 percent, manufacturing output fell by 37 percent, producers reduced expenditures on durable goods, and inventories and consumer spending declined. Only World War II snapped us out of that and I don’t wish for potential global annihilation as an antidote to our current economic woes.

I have a feeling Suhm did not factor the Congressional budget cuts into her revenue projections for the next fiscal year. Our economy won’t feel the ramifications of those cuts for perhaps another couple of months. But too many economists are predicting a double digit recession looming, predictions that resulted in Thursday’s Wall Street disaster. If those predictions are true, Suhm’s optimistic predictions are going to result in a major budget gap come next calendar year.

But, again, I hope I’m wrong about that. I really do.