The artificial budget crisis created by Gov. Ed Rendell over his dispute with the state legislature was settled last night, with both sides saving face by claiming the deal accomplished their goals. Rendell got some parts of his agenda, including increased funding for mass transit and pre-kindergarten education, while Republicans were able to pass a budget with no new taxes, despite increased costs.

Late Sunday night, Rendell followed through on his threat to shut down nonessential state government services, furloughing nearly 25,000 state workers in his showdown with the legislature, mostly Republicans in the Senate. Late last night, he rescinded the furlough.

Though only the governor and a handful of party leaders know what really happened, it appears that Rendell backed off his earlier stance of demanding passage of his ambitious initiatives for energy, transportation and health care, before he would agree to a budget deal.

What became clear in the days leading up to Monday's partial shutdown of the state government was that the showdown was not over the state budget. There was general agreement on next year's spending plan for the state. And a $650 million surplus would make it possible to increase spending without raising taxes.

Rendell's earlier insistence that the legislature give him what he wanted in terms of his initiatives in energy, health care and transportation was not essential to the passage of the state's $27 billion budget.

Paving the way for last night's agreement, Rendell withdrew his demand for a new fee, or tax, on electricity bills to help fund $850 million in bonds for his energy initiative. That plan, plus other proposals that would increase state debt by about $1.5 billion were major sticking points for Republicans, and even some Democrats.

As part of last night's deal, lawmakers agreed to hold a special session on energy on Sept. 17, when they will consider a plan that makes $60 million a year available to support alternative energy projects.

An earlier agreement to delay until September the consideration of Rendell's comprehensive energy proposal would have totally averted the so-called budget crisis.

To many observers, it appeared that Rendell had heaped too much onto the legislature's plate with complex and far-reaching plans for energy, transportation and health care. Each of those proposals required time, analysis and debate, but the crisis atmosphere created by the budget standoff made careful consideration and full understanding impossible.

Last night's agreement was an appropriate resolution to a crisis that never should have happened.

Playing chicken with the legislature and taking the "all or nothing"posture that he maintained until yesterday was wrong. By law, the budget is supposed to be in place by June 30 — Rendell's other priorities were tied to no such deadline.

Though last night's agreement might reduce Rendell's leverage to get what he wants, he still can make his case for the unresolved elements of his energy and health care plans.

Over the weekend, Senate Republicans reportedly agreed to pass some parts of Rendell's special initiatives and work on the remainder in the fall. Rendell's response to that reasonable proposal was "no deal."

That was unfortunate, and only escalated tempers in Harrisburg.

With Monday's partial shutdown of state government, Rendell was demanding that state lawmakers approve complex and far-reaching proposals in a high-pressure, crisis environment. These programs, which contain progressive, and sometimes complex, ideas worthy of consideration, should not have to be decided in such an environment.

Among the items waiting for further debate in September is Rendell's proposed Jonas Salk Legacy Fund, which is a $500 million bond issue to pay for biotechnology clinics across the state.

There was some appropriate give and take in reaching last night's agreement, but it's clear that the entire process should have begun weeks or months ago. Over the weekend Rendell admitted as much saying, "We didn't start early enough. I think everybody is at fault." Everyone might share some fault for this crisis, but Rendell should shoulder most of the blame.

The so-called budget crisis was artificial and escalated tempers. Veteran lawmaker Sen. Vincent J. Fumo, D-Philadelphia, noted the practical and psychological aspects involved saying, "I think everybody's trying to avoid a catastrophe.... (But) nobody wants to walk away saying they lost."

The spin early today, as expected, found both sides claiming victory. "All of our budget priorities have been preserved" is the way Rendell put it.

But Rendell's ambitious agenda originally included seven tax increases. And in referring to last night's deal, Senate President Pro Tempore Joe Scarnati, R-Jefferson, said, "Today there are no new taxes. We're proud to say we stuck to our core values."

Rendell's gamble on creating a budget crisis to force the legislature to pass his ambitious agenda worsened the perennially-bad atmosphere of partisan politics in Harrisburg. Now that a budget agreement has been reached, there will be time for both sides to back away from partisan rhetoric and talk about ways to move Pennsylvania forward toward a brighter future.