I just returned from spending a week in snowy Minnesota, nursing my college roommate after her stroke. Over coffee each morning we read the headlines…and I found that the similarities go well beyond our respective snow levels. Continue reading “We Are Not Alone”
Tag: Vermont
The Good and the Possible
The Good and/or the Possible. That’s the nature of the choices lawmakers, businesses, and private residents are faced with these days. Good isn’t always possible; possible isn’t always good. You’re lucky if you kill two birds with one stone.
So, when lawmakers reconvene the week of March 16th, they will have roughly eight weeks, if the proposed May 8th adjournment date holds up, to craft the new budget and allocate stimulus monies. And new revenue forecasts will come out in April, which will add another level of complexity to the process.
This is not the time for stimulus monies to further delay the necessary decisions that must be made around the size and scope of state government, though convincing people will be hard. Seven hundred million dollars is intoxicating to think of, so one can’t help but feel that the demon has been held at bay for a little bit. But we’ll hate ourselves in the morning if we go out on a bender and then wake up in two years to find we’re not better off.
Time to Think and Act Anew
The Wall Street Journal’s Review and Outlook article was entitled, “The Decline of California”, but the table included Vermont as having the third highest income tax rate (9.5%, behind California at 10.5% and Rhode Island at 9.9%, and just above Oregon at 9.0%). This is the quote that caught my attention: “The tragedy … is that the political class still won’t address the root cause of its financial problems, which is that the state is becoming less economically competitive.” The article suggests that Californians will not solve their woes unless they reduce their tax burden and adopt more radical spending controls. (http://online.wsj.com/article/SB123491737158404543.html)
Everything is relative, but Vermont’s challenges are similar. Our public generosity has become unsustainable, our tax base is small and capacity is limited, and we now find ourselves on the horns of a dilemma. How do we make it through this recession while inflicting the least harm on the neediest, and how do we invest now in the near term so that we are positioned for a fast start when it’s over? There are certainly proposals floating throughout the halls of the State House that merit thoughtful examination. But in this era of profound pressures and demands on state government, do we have the will to think and act radically rather than incrementally?
In addition to rethinking the structural organization of state government, is there capacity and political will to think anew about how we fund state government? Some would suggest it’s time for temporary tax increases, or whatever euphemism is used to describe the same thing. But, does the current tax structure reflect the old economy or the new economy? Are we taxing the right things? Are the rates at the right levels? Would such an effort accomplish the intended goal?
There is spirited chatter on these questions from all sides. Perhaps it is time after all, as some suggest, for objectively examining the state’s tax structure and all its myriad fees so that we are encouraging those things we desire more of – like the creation of new wealth that can support the state’s reprioritized obligations.