SWIFT’s highest-ranking financial expert, Stephen Crosby, says the governor has little to fear. "The challenge here is to recognize these problems immediately, face them honestly, and come up with a plan," says Crosby, the state’s secretary of administration and finance, who last Thursday announced Swift’s plan for closing the budget gap. "I think the governor has been doing an admirable job of addressing these concerns." Under Swift’s plan, the state will cut spending by $600 million, take $500 million from surplus monies (the so-called rainy-day fund), divert $300 million from the tobacco-settlement fund, and cut payments to the already underfunded state-employees’ pension fund by $100 million.

Those might not be the most popular moves in the world, but political misery loves company, and Swift may find it if Finneran and Birmingham also take political heat for the financial chaos. They probably will, since the two legislative leaders still haven’t agreed on a budget. "If it’s between the governor and the legislature, most people are going to be suspicious of the legislature," says Crosby. "They don’t have a track record of performance that is all that great."

To that, Birmingham aide Alison Franklin says: "Crosby’s remarks dismayed the Senate president. The governor needs a secretary of administration and finance, not a secretary of point and blame." But the budget is already 17 weeks late — a delay just three weeks shy of the one that made front-page news in 1999. That time, TV cameras showed footage of Birmingham negotiating on the State House balcony all summer; this year, on the other hand, public awareness of the delay has been minimal. That will change, though, when Swift, Finneran, and Birmingham have to get up and sell a budget with massive cuts in it at the 11th hour.

Besides, Crosby says, a late budget causes a lot of fiscal pain: "It makes it very difficult for the people of Massachusetts to go a third of a year and not have a budget. Managers don’t know what their budgets are. Personnel can’t be hired. We’ve had to shut down some programs because we have no way of knowing whether we can fund them or not." Already, for example, the state has closed down the Massachusetts Corporation for Educational Telecommunications, laying off 41 employees; among other duties, the agency provided Internet access to schools in rural areas.

As counterproductive as it may seem, Finneran may actually have let the budget get held up on purpose, speculates Barbara Anderson, a long-time observer of state budget battles as the executive director of Citizens for Limited Taxation. In June, when state leaders were supposed to have finished the budget, revenue forecasts were signaling a budget surplus for the year. But Finneran, with his legendary fiscal caution, may have doubted that the optimistic forecasts would pan out — and if so, he was right. Now, the delay will allow the legislature to forge a budget based much more closely on the latest revenue projections. Hedlund, the Weymouth senator, echoes Anderson’s theory about the budget deadline, though he says he has no special insight into the workings of the House (or the mind of Finneran). "It is strange that it may turn out to be fortuitous that we shirked our responsibilities in getting a budget done," Hedlund says. "We have a chance to address the shortfall we now see is real before the budget is reported."

For the record, Finneran spokesman Charles Rasmussen denies that that’s what Finneran is doing: "I don’t think that’s ever been his goal. The legislature understands the importance of getting this done quickly." But if the Speaker had held up the budget on purpose, he might reasonably have thought it would be easy to put a good spin on the trickery. Finneran, who became chairman of the House Ways and Means Committee in the midst of the fiscal crisis in 1991, is generally regarded as a budget hawk who has kept spending down and opposed tax cuts. In fact, his public admonitions on this score have become a trademark. In his Speaker’s address last February, for instance, Finneran warned that "the economic and fiscal uncertainty created by a number of events beyond our borders and our control will require a swift and skillful adjustment on our part." So in an ordinary year, it might not have been hard to persuade the public that delaying the budget was merely an effort to save legislators from themselves.

This year, however, it’s another story. For example, the Speaker will probably use the lateness of the budget as an excuse to push cuts through the House with only a modicum of debate. This type of behavior is also a Finneran trademark, and the public often tunes it out. But this year, voters are facing real fiscal pain; they may resent it if their legislators are denied a chance to argue publicly on their behalf. Another difference is that this year, delaying the budget has not served as a cap on rampant spending, as it has in the past. When there is no budget, legislative leaders and the governor agree that spending can continue on a month-to-month basis at one-12th of the previous year’s budget. This means that the state can’t spend more money in a given period than it did over the same period the year before. That’s fine as long as revenues continue to grow. But this year the state may have less money than it did last year — so what was once a dam on spending has become a sieve.

"When we’re in an interim-budget situation like this, we have no tools to manage what’s being spent," says Crosby. "We went two or three months expecting there would be a budget. It’s absolutely a chaotic mess that the legislature has created."

Swift’s team may be trying to blame the unfolding fiscal mess on the legislators, but there’s one thing she can’t pin on them: the damage done to the budget by the income-tax cut that passed in a ballot referendum last year. Both Finneran and Birmingham opposed the measure. So did Treasurer Shannon O’Brien, Secretary of State William Galvin, and businessman Steve Grossman, all of whom are Democratic gubernatorial hopefuls. Swift, by contrast, backed the move; it was "Chicken Little thinking," she said, to warn that cutting the state income tax back to five percent would worsen the state’s fiscal position in the midst of an economic downturn.

It’s a position that her administration maintains even today. "I think [the financial situation] has probably been made better," says Crosby. "The income-tax cut is what has made the Massachusetts economy as strong as it has been in recent years." As for the current predicament, Crosby says: "Every economy always slows down, and this downturn was exaggerated by something nobody could have imagined."

Logic suggests that all the insiders will pay at least some of the price for the state’s fiscal woes, as they did in 1990. It’s less clear who will benefit. Hedlund laments that the state GOP is not prepared to exploit Democratic dysfunction the way it was in the late ’80s. "The difference is, then you had a Republican State Committee who helped define the issue," says the senator, who was one of the Republicans elected to Beacon Hill in 1990. "They educated the public about what the problem is."

The biggest beneficiary will surely be the Democrat who can best position him- or herself as an outsider who warned of Beacon Hill excesses. Swift’s would-be rivals O’Brien, Galvin, and Grossman are the leading candidates for this role. Last year, O’Brien invoked the crisis of the late ’80s when she opposed the tax cut: "We can’t make these mistakes again," she warned. Last week, she was quick to express her "dismay that the Swift administration has once again decided to raid the pension fund." Grossman, who helped his company MassEnvelopePlus survive the ’80s downturn, has called Swift’s proposals "draconian"; he’d prefer to see the state spend $750 million in rainy-day dollars. "I think her approach is absolutely wrong-headed from the get-go," he says.

Other Democratic gubernatorial hopefuls may find it harder to take advantage of the situation. Former state senator Warren Tolman, for example, has so far focused his campaign on Clean Elections; with the state in the position of having to cut $1.1 billion from the budget, funding the law becomes a lower priority. As for Tom Birmingham, he will have to work harder than the rest of the Democrats to separate himself from Swift and Finneran.

But no matter what her potential opponents are or aren’t able to do, Swift seems to recognize the danger she might get into simply by being the bearer of bad news. The most striking thing about last week’s announcement of her administration’s budget, after all, may have been the messenger: Swift delegated the job to Crosby. This stands in stark contrast to what happened when William Weld faced hard times in 1991. As Weld’s advisers explained to him in a strategy session, the usual practice was for the governor to deliver a brief statement about the budget, then allow the secretary of administration and finance to address the details of the plan. Weld rejected this approach, saying: "I’ve got to be the person who explains everything." By the same token, when the state’s finances finally turned around, Weld delighted in taking credit.

The absence of the governor from the podium last week may be a sign that Swift has a sense of where the economic winds are blowing. And unlike the Republicans of the ’90s, she and the rest of the state GOP may not be the beneficiaries. This time they may well be the victims.

Seth Gitell can be reached at sgitell[a]phx.com