CLT
UPDATE
Sunday, October 10, 2004
Big-Business Fat-Cats shill again
MTF to issue another "report" against tax rollback
A prominent watchdog group will issue a report next week arguing that the state faces a long-term budget gap of at least $750 million, undercutting Governor Mitt Romney's campaign-season push for a $225 million cut in the income tax.
The Massachusetts Taxpayers
Foundation, a business-funded nonprofit that studies taxes and government spending, plans to release a report Tuesday detailing the so-called "structural deficit," or the gap between recurring revenue and ongoing expenditures.
"It's clearly the wrong time for a major tax cut or large spending increases; you can't have either without identifying areas you'll have to cut," said Michael J.
Widmer, who heads the foundation....
Widmer's view echoes that of leading Democrats, who also say that Romney's tax cut would be unwise as the state slowly regains its footing after a harrowing fiscal crisis....
David G. Tuerck, executive director of the conservative Beacon Hill Institute at Suffolk University, said the structural deficit is a political concept, not an economic one.
"The whole idea of a structural deficit assumes that savings on the spending side of the equation are off the table," Tuerck said. "But when the Massachusetts Taxpayers Foundation and others talk about this structural deficit, they are assuming fixed growth in state spending. There's no need to assume that at all. There are plenty of ways the state could trim expenditures, if it has the political will to do so."
The Boston Globe
Saturday, October 9, 2004
Budget report to cite gap of $750m
Not time for tax cut, says watchdog group
Chip Ford's CLT
Commentary
Here come doomsayers Michael Widmer and his so-called
Massachusetts Taxpayers Foundation with yet another
"report" intended to deny regular taxpayers their long-overdue
tax rollback. Again they resuscitate and prop up the same old cadaver of
a "structural deficit" that they've dragged out for years
whenever tax relief is discussed for anyone except MTF's Fat-Cat
Big-Business membership.
It's always a good "responsible" soundbite,
timely cover for his tax-and-spend friends, but over all the years MTF
has touted a "structural deficit" it never goes away, is never
resolved. It's always there whenever MTF needs to dust it off, resurrect
it to deny lunch-bucket taxpayers any tax relief.
Everyone but apparently Widmer has recognized by now
just where the surplus revenue goes if not back to the taxpayers where
it belongs. As always, it's spent on growing government, much to the
satisfaction of the Boston Globe editorial elites and others of their
ilk who'll never be satisfied with however much is taken from us and
spent by government.
Even during the booming '90s when the state had and
spent billion-dollar annual surpluses, when the state budget doubled,
Widmer's alleged concern for this "structural deficit" was
ignored, summarily dismissed.
For decades we've strived to point out this indisputable
reality to Widmer and his MTF, but time after time the Fat-Cats' trojan
horse has inevitably led the state into unsustainable spending growth,
fiscal crises, and higher tax burdens. MTF has consistently provided the
deceptive cover of quasi-legitimacy that has enabled, encouraged the
boom-and-bust cycles to occur over and over. They're now leading the
charge once again.
As economist David Tuerck of the Beacon Hill
institute noted:
"The whole idea of a structural deficit assumes that savings on the spending side of the equation are off the
table But when the Massachusetts Taxpayers Foundation and others talk about this structural deficit, they are assuming fixed growth in state spending. There's no need to assume that at all. There are plenty of ways the state could trim expenditures, if it has the political will to do so."
For more revealing historical information about the
so-called Massachusetts Taxpayers Foundation click
here.
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Chip Ford |
The Boston Globe
Saturday, October 9, 2004
Budget report to cite gap of $750m
Not time for tax cut, says watchdog group
By Scott S. Greenberger, Globe Staff
A prominent watchdog group will issue a report next week arguing that the state faces a long-term budget gap of at least $750 million, undercutting Governor Mitt Romney's campaign-season push for a $225 million cut in the income tax.
The Massachusetts Taxpayers Foundation, a business-funded nonprofit that studies taxes and government spending, plans to release a report Tuesday detailing the so-called "structural deficit," or the gap between recurring revenue and ongoing expenditures.
"It's clearly the wrong time for a major tax cut or large spending increases; you can't have either without identifying areas you'll have to cut," said Michael J.
Widmer, who heads the foundation. "There's still a large mismatch between ongoing revenues and ongoing spending."
The state budget for fiscal 2005, which began July 1, is balanced, but only because the state is using "one-time revenue," or money that doesn't flow into its coffers every year, to pay for all the spending. The extra dollars are coming from the state's reserves, the federal government, and other sources.
The fast-growing Medicaid program, debt service, and the state's relaunched school construction program are among Beacon Hill's most expensive obligations, Widmer said. He added that his group's calculation assumes that the state will collect more in taxes in fiscal 2005 than it is currently projecting.
Widmer's view echoes that of leading Democrats, who also say that Romney's tax cut would be unwise as the state slowly regains its footing after a harrowing fiscal crisis. Democrats also point out that the Supreme Judicial Court may order the state to pour millions more into public education as a result of a lawsuit filed by poor districts. Shortly before he left Beacon Hill, former House speaker Thomas M. Finneran criticized Romney for proposing what he called an orgy of tax cuts at such an uncertain economic time.
But Republicans point to recent revenue figures, which show that the state has collected about $100 million more than it projected through the first quarter of fiscal 2005, as evidence that the time has come to reduce the burden on taxpayers. The state finished fiscal 2004 with $724 million more than it expected, though lawmakers spent more than half of that money in a supplemental budget.
The governor has proposed reducing the state income tax rate to 5 percent, a decrease of about $100 for the average taxpayer. In 2000, voters approved a gradual lowering of the income tax rate, which was 5.85 percent at the time, to 5 percent. But in the depths of the state's fiscal crisis in 2002, the Legislature froze the rate at 5.3 percent. Now that the state's economy is rumbling back to life, Romney said, it's time to follow through with the full tax cut.
Lowering the tax rate to 5 percent would cost the state between $200 million and $225 million in fiscal 2005. But it would reduce revenue by twice that amount in fiscal 2006, when it would be in effect for the entire year.
"Even though Halloween is three weeks away, the Democrats are trying to scare people into believing we can't afford a tax cut; the facts prove them wrong," Lieutenant Governor Kerry Healey said this week at a press conference featuring about a dozen GOP candidates. "They will use every excuse in the book to stop change and to deny the people of Massachusetts the tax cut they voted for in overwhelming numbers."
David G. Tuerck, executive director of the conservative Beacon Hill Institute at Suffolk University, said the structural deficit is a political concept, not an economic one.
"The whole idea of a structural deficit assumes that savings on the spending side of the equation are off the table," Tuerck said. "But when the Massachusetts Taxpayers Foundation and others talk about this structural deficit, they are assuming fixed growth in state spending. There's no need to assume that at all. There are plenty of ways the state could trim expenditures, if it has the political will to do so."
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