FOR IMMEDIATE RELEASE
Contact: Chip Ford, Executive Director
Yesterday the
Massachusetts Budget and Policy Center released
a letter from “91 Massachusetts economists” to Governor Baker.
"Instead of budget cuts," the letter urged, "the state should look to
raise revenues to balance its budget."
The “91
Massachusetts economists” asserted:
"States must run balanced budgets. In a recession, balancing the budget
by cutting spending has a more negative impact on economic growth than
balancing the budget by raising taxes. Both the personal income tax and
the corporate tax are fair ways to do this, since they fall only on
persons with incomes and businesses with profits. A one percentage point
increase in the income tax could raise $2.5 billion per year while a one
percentage point increase in the corporate tax rate could raise $180
million per year, even if the income tax base falls by 25% and the
corporate tax base falls by 50% during this recession. These tax rates
could be phased back as the economy returns to its pre-recession level."
“We’re all in
this together” we are frequently assuaged, but inquiring minds would
like to know how many of those esteemed 91 have missed a day’s pay over
the past two-plus months shutdown and historic unemployment surge. When
and if the unemployed are unleashed to again earn an income it is going
to take them months if not years to catch up to what they’ve already
lost — if they ever can. Yet the 91 want to victimize them further with
an income tax increase. That is nothing short of unnecessary abuse,
further cruelty inflicted upon the victims.
But they
assure us, “These tax rates could be phased back as the economy returns
to its pre-recession level."
Perhaps their
proposed tax hikes “could” be phased back, so they are not
outright lying — but most of us know better. Their proposed tax
hike won’t be. Not without a long, drawn-out-for-decades
fight.
Crises are
temporary. “Temporary” tax hikes are forever.
That is not
conjecture or hyperbole. It is a statement of fact based on painful and
hard-earned experience. It comes from disillusioning historic
precedent.
This would not
be the first false promise made that
a tax hike would be “only temporary.” It took two statewide
petition drives, a successful 2000 ballot question, then further
roadblocks by the Legislature until just this year — three decades
after the last false promise was made — to finally force the
“temporary income tax hike” back down to five percent.
Now the 91
philosopher-king economists want to take taxpayers back to 1989 and
start all over.
This current
financial crisis is unlike a typical recession, even the rare
depressions of the past. Its genesis is not financial, not
market-based, not cyclical. It is and has been an intentionally
self-inflicted abrupt shutdown of the entire economy in response to a
once-in-a-century pandemic until “the curve” is bent.
Just three
months ago, in February the Department of Revenue reported a 6.2%
increase of revenue over the prior January; 4.9% ($794 million)
year-over-year to date. The prior Fiscal Year 2019 ended with a revenue
surplus of well over $1 billion. The dilemma for months on Beacon Hill
was how to spend the windfall.
In March
Governor Baker shut down the economy.
“’Never let a
crisis go to waste’ has infected these economists’ thinking,” said Chip
Ford, executive director of Citizens for Limited Taxation. “While
everyone else is thinking about survival and recovery, wondering if they
can get back on their feet, hoping to catch up from their dire losses in
the months and years ahead, these ’91 economists’ — many if not all of
whom can be counted on to advocate for and support any tax increases —
are already scheming to afflict more pain on the victims.”
You
promised it’d be only “temporary”!
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