CITIZENS   FOR  LIMITED  TAXATION  &  GOVERNMENT
and the
Citizens Economic Research Foundation

 

CLT Update
Tuesday, January 29, 2002

Sen. Birmingham to "rethink wisdom" of tax rollback!

Senate President Thomas F. Birmingham, who supports delaying the voter-approved income tax rollback and raising the cigarette tax, will rally support for both moves in the Senate this spring. Birmingham said he won't rule out other tax increases if members support them....

Other taxes under serious consideration on Beacon Hill include an elimination of state income tax deductions for charitable donations, an increase in the capital gains tax, and new levies on gasoline and alcohol....

Birmingham said Swift used "games and gimmicks" in designing her budget to avoid reneging on her pledge to avoid new taxes. The state's economic circumstances have changed considerably since the income tax rollback was approved in November 2000, he said, and it's time for state leaders to rethink its wisdom.

The Boston Globe
Legislative leaders eye tax hikes

"It's time for state leaders to rethink its wisdom"?

Excuse me, but when was there any question about their positions on our tax rollback -- since the "temporary" income tax hike was imposed in 1989, since we started asking that the Legislature "keep the promise" and roll it back every year during the greatest economic expansion in recent history?

"Rethink its wisdom"?

Exactly what alleged "wisdom" is it that wannabe-governor Birmingham seeks to address?

Surely not his obsessive opposition to our rollback; his and most legislators' since the early-'90s?

The intransigent Sen. Birmingham and his crowd lost Question 4; we won.

He needs to live with the occasional gray cloud of defeat. Didn't they teach him that at Oxford, if he didn't learn it while growing up in Chelsea?

Just for the record, I've included a number of his past statements over the years. Though highly unlikely, perhaps this is the "wisdom" about which he'd like to "rethink"?

Yeah, Mr. Senate President, we're watching, and we always have been.

As "Honest Abe" Lincoln once noted: "You can fool some of the people all of the time, and all of the people some of the time ... but you can't fool all of the people all of the time.

This is just one of those latter times.

Chip Ford

"Too much too soon" has been the reaction of Senate President Thomas Birmingham, who ... prefers that any tax cuts be targeted to those in need.

The Boston Globe
Jul. 7, 1997
CLT returns to center stage in fight for income-tax cut
By Scot Lehigh

"I wasn't there in 1989, but it appears a promise was made," Birmingham said. "It was represented as temporary."

State House News Service
Jul. 30, 1997
Cellucci calls for income tax cut

Birmingham (D-Chelsea), who opposes Celluci's plan to drop the tax rate from 5.95 to 5 percent, quickly fired back.

"I'm not explaining anything," said Birmingham, adding that the Legislature already eliminated the temporary tax Cellucci referred to.

"The fact is, it was not a temporary tax," he said.

"Cellucci was a member of the Legislature then. It's a profession of incompetence if he thinks it was" temporary.

The Boston Herald
Feb. 27, 1998
War of words over state income-tax cut escalates

Senate President Thomas F. Birmingham called Cellucci's strategy "a shrewd political move," but warned that the income tax cut -- which would cost $1.4 billion at the end of its three-year phase-in -- would imperil bipartisan priorities. "It is going to jeopardize our full implementation of education reform, our expansion of health care, our improvements of public safety -- the list goes on and on and on," Birmingham said. "Unfortunately, I think it is a Pyrrhic victory for the people of the Commonwealth."

But though the Senate president said he didn't detect any huge public hunger for another large tax cut, he conceded that if Cellucci succeeds in putting the rollback on the statewide ballot, it would probably pass.

"I'm not naive about that," he said....

Senate President Thomas F. Birmingham (D-Chelsea) said he didn't expect a Cellucci-backed referendum to scare his members.

"It'll be a factor (but) I don't think it'll force our hand in the Senate," Birmingham said.

The Boston Globe
Apr. 1, 1999
Cellucci would put rate cut on ballot

Lawmakers yesterday dared Gov. Paul Cellucci to take his $1.2 billion tax cut to the voters, saying his threats wouldn't influence them.

"This has been taken to the voters already and they said no to it," state Rep. John H. Rogers (D-Norwood), co-chair of the Taxation Committee, said referring to voters' 1990 rejection of a ballot question pushing a massive tax rollback.

The Herald reported yesterday that Cellucci plans to use his political muscle to launch a referendum drive to slash the state's income tax by $1.2 billion....

The Boston Herald
Apr. 1, 1999
Lawmakers call tax bluff:
Pols tell Cellucci voters don't want cut

Legislators like Senate President Thomas Birmingham argue the state can't afford to cut taxes by $1.4 billion while paying for needed health care and education expansions.

State House News Service
Jun. 16, 1999
Cellucci, TEAM Laying Groundwork for Tax Rollback Campaign

Finneran's plan - approved by the Taxation Committee this afternoon and to likely to see House approval in two weeks - cuts taxes by $135 million next year and then $275 million every year afterward when fully phased in. It would save the average family $135 a year.

Once fully implemented, Cellucci's plan would save taxpayers $1.4 billion annually, although it would cost about the same as Finneran's plan in the first year. Finneran said his plan gives lawmakers flexibility to respond to future economic changes.

Senate President Thomas Birmingham said his colleagues would likely reject both plans as too expensive. He said the Senate has "higher priorities."

"I'm not saying it's dead on arrival, but I'm highly doubtful the Senate will do an income tax reduction on the order of the governor or the speaker," Birmingham said at his own press conference later in the day. "I think it is highly doubtful the Senate will do an income tax cut because we have higher priorities" like education, health care and public safety, he said.

State House News Service
Apr. 15, 1999
Birmingham, Finneran, Cellucci
Stake Out Tax Cut Positions

Senate President Thomas F. Birmingham yesterday rejected the idea of a major tax cut this year - just minutes after House Speaker Thomas M. Finneran called for a $270 million income tax reduction.

"We have different and higher priorities," Birmingham said.

Birmingham rejected both Finneran's call for dropping the income tax rate from 5.95 to 5.75 percent next year and Gov. Paul Cellucci's plan to drop the rate to 5 percent by 2002.

"I am highly doubtful that the Senate will do an income tax reduction to match the governor or what I understand the speaker has proposed," Birmingham said, adding there is no current public demand for further tax cuts....

Birmingham said voters are not clamoring for what he called "an irresponsible tax cut."

The Boston Herald
Apr. 16, 1999
Birmingham says no to tax cut:
But House speaker has different view

Now that Cellucci and Finneran both favor a rate reduction, Birmingham is left as the odd man out. That will put pressure on him.

Birmingham faces a basic choice: a rate cut or no sizable tax cut at all. Yesterday, Birmingham seemed determined to follow the latter course.

The Boston Globe
Apr. 16, 1999
Cellucci gains as Finneran gives on tax cut

House Speaker Thomas M. Finneran wants a gradual rollback of the state income tax to 5 percent, conditioned on a strong economy. Senate President Thomas F. Birmingham opposes the rollback and would prefer to spend the windfall on programs such as the Senate plan for senior drug benefits.

The Boston Globe
Jul. 2, 2000
State surplus swells by $200m

Birmingham has called the cut reckless and the theory that it will actually spur revenue growth, "Rumplestiltskinomics."

The MetroWest Daily News
Oct. 15, 2000
Tax cut ballot flashpoint

"It's probably one of the last options, because the voters did vote for it," Birmingham said. "But I think in these fairly dire circumstances, one should never say never."

The Boston Globe
Oct. 25, 2001
As revenues drop, Democrats eyeing a delay in tax cut

Birmingham, a likely candidate for governor, threatened deep cuts in local aid, education and health care if something drastic like freezing the tax cut isn't done to raise money.

"You can't get there without cutting some of the primary functions of government," he said.

Despite his initial resistance, Finneran said he's willing to cut a deal. The House would like to slap economic triggers onto the tax cut, freezing its phase-in only in the economy really tanks, he said.

The Boston Herald
Nov. 8, 2001
Finneran counters Senate with economic trigger plan

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The Boston Globe
 Tuesday, January 29, 2002

Legislative leaders eye tax hikes
Cigarette levy, rollback delay weighed; 
clash with Swift likely
By Rick Klein
Globe Staff

Democratic legislative leaders are laying the groundwork for tax increases this year, which would set up an election year showdown with Acting Governor Jane Swift.

Senate President Thomas F. Birmingham, who supports delaying the voter-approved income tax rollback and raising the cigarette tax, will rally support for both moves in the Senate this spring. Birmingham said he won't rule out other tax increases if members support them.

House Speaker Thomas M. Finneran, while more circumspect regarding his personal beliefs, said that the state's $2 billion deficit in fiscal 2003 can't be addressed without considering new taxes. With budget cuts already taking their toll on programs, and more reductions likely to come, House members appear willing to cast politically unpopular votes to raise taxes, Finneran said.

"The reality is, we don't have the dough," Finneran said. "They're going to see what none of us wanted to see: things that are much more severe and much more stark than they were last year."

It's unclear now whether either chamber has the votes necessary to impose tax hikes. An increase would require the support of two-thirds of House and Senate members, since Swift has vowed to veto any new tax or any change in the scheduled income tax rollback.

Finneran said he and his top budget writers will spend the next few weeks providing House members with fiscal data and polling them about what tax options they would support.

Taxes are emerging as a key issue in this year's budget debate and gubernatorial campaign, with Swift emphatically defending her resistance to any tax increase and her Democratic opponents accusing her of insensitivity by enacting program cuts. The House and Senate could add any new taxes to their budget proposals for fiscal 2003, which begins July 1. Those plans will be released this spring.

Swift said yesterday that she relishes a fight with Democrats over taxes, and expressed confidence that the voters will side with her in November.

"An economy that's limping along should not put a further tax burden on families who already live in a very high-cost state," she said. "The good thing for the voters is, I'm sure the Democrats feel strongly as a matter of conviction in terms of their position as well. And so letting people decide, based on people who have different convictions and different beliefs, I think is a good thing."

Delaying the income tax rollback and hiking the cigarette tax appear the most likely paths legislators will pursue. The 50-cent-per-pack increase in the cigarettte tax would fund health programs, while revenue generated by freezing the income tax could be appropriated any way lawmakers choose.

Other taxes under serious consideration on Beacon Hill include an elimination of state income tax deductions for charitable donations, an increase in the capital gains tax, and new levies on gasoline and alcohol.

Swift's budget proposal, filed last Wednesday, avoids tax hikes but slashes spending on public health and human services. It eliminates dental benefits for poor adults on Medicaid and cuts state spending on antismoking efforts by 60 percent. But critics say her spending plan also relies on questionable economic assumptions, which could leave it as much as $1 billion out of balance.

Birmingham said Swift used "games and gimmicks" in designing her budget to avoid reneging on her pledge to avoid new taxes. The state's economic circumstances have changed considerably since the income tax rollback was approved in November 2000, he said, and it's time for state leaders to rethink its wisdom.

"I believe that the governor's position is a function of a pledge, not an economic philosophy," Birmingham said. "That is not leadership. It is not even reasonable."

Even if legislative leaders succeed in winning approval of tax hikes, the increases will not be enough to solve the state's fiscal problems. Both Finneran and Birmingham have warned of program cuts, though they say those reductions will not be as severe if other methods, like taxes, are used to generate new revenue.

The income tax rate, now at 5.3 percent, is scheduled to drop to 5 percent in 2003, saving the typical family $150 a year, according to the state Department of Revenue.

Michael J. Widmer, president of the nonpartisan Massachusetts Taxpayers Foundation, said Swift is taking a risk by refusing to consider new taxes. She's counting on voters deciding that lower taxes are more important than social and health care programs, he said.

A Boston Globe poll last week found that 74 percent of Massachusetts voters favor the increased cigarette tax, and that a majority want to delay the income tax rollback until the economy improves.

"It is a gamble, given the severity of the revenue decline," said Widmer, whose group would like to tie future income tax drops to economic indicators. "There's no way to close the gap without dramatic spending reductions or fiscal gimmicks, or both."

Last fall, faced with a revenue shortfall when completing the fiscal 2002 budget, the Senate was within one vote of having two-thirds of members support a freeze to the income tax rollback, Birmingham said. Now, having already approved some cuts last year and faced with another shortfall, more senators are likely to support the tax change, he said.

But Finneran mentioned another factor that could move representatives and senators in the opposite direction: this fall's election. All House and Senate members are up for reelection this year, and many loathe the prospects of going back to their constituents having voted for a tax hike.

The speaker, well known and often criticized for autocratic rule in the House, said he will allow members to vote their conscience.

"They have to assess and gauge for themselves," Finneran said. "This is not an arm-twisting exercise. It can't be."

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The Boston Globe
Tuesday, January 29, 2002

Swift sticks by stance on tax cut despite poll
By Stephanie Ebbert
Globe Staff

Responding to Sunday's Boston Globe/WBZ-TV poll that indicated voters disapprove of her position on taxes and her job performance, Acting Governor Jane Swift said she is determined to stand by her convictions.

"I'm not going to change my policies based on polls," Swift said. "I'm not going to change my convictions based on polls. And I don't let myself get too taken with myself when the polls are good, or I don't beat up on myself too much when they're bad. But obviously, I look at them like anybody in this business does, and realize there will be challenges ahead."

A KRC Communications poll of 400 registered voters last week found that 31 percent have a favorable opinion of Swift while 43 percent view her negatively, an extremely weak position for an incumbent politician. Twenty-one percent rated her performance as good orexcellent, one-third judged it fair, and 40 percent said she is doing a below-average or poor job.

Fifty percent of voters said they would delay the income tax rollback that Swift had championed in 2000 and intends to maintain, despite an estimated $2 billion gap in revenues. One-third of voters wanted the tax cut to stand and 17 percent didn't know or refused to answer. The poll had a margin of error of plus or minus 5 percent.

Swift suggested that voters know that the state's economic climate is not as dire as it could be because of the sound fiscal policies instituted in recent years.

"But that doesn't mean that the threats to our economy are minimal or that we should ignore the tax and fiscal policies that I think positioned us so well," she said. "My job is to articulate those positions, to take policies like investment in worker training and adult education and convince the electorate that those are the right prescriptions for the economic challenges that face us."

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