Citizens for Limited Taxation & Government
"The Commonwealth Activist Network"
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*** CLT&G Update ***
Wednesday, May 6, 1998

The Aftermath

Greetings activists and supporters;

Leave it to the minority party leadership, speaking through House Minority Leader Rep. Dave Peters, to join the ranks alongside our other critics like Jim St. George of the "Tax Everything And More" crowd. I wonder how many of the 985 signatures we got in the City of Worcester he’d like to claim; did anyone see him show up at the Greendale or Auburn malls in his area to lend a hand? I suppose a big frog in a small pond thinks of himself as too important to swim with the tadpoles. (We had a difficult time staffing the Auburn Mall, but did have the help of Rep. Paul Frost, R-Worcester. And Rep. Ron Gauch, R-Shrewsbury, also gave us a hand in Worcester County, along with former-Rep. Bob Hawke of Gardner. Where was Minority Leader Dave Peters?)

But let us not go too negative on the pitiful fellow yet— instead of bringing attention back to his and his Republican caucus’ own irrelevance, maybe he’ll prove to be more successful getting the promise kept than the people were.

I would not advise holding your breath, though.

And wait until you get to the Boston Globe editorial.

Emboldened by the defeat of our petition, they’re now sighting in on Proposition 2 next!

Time for a good, long vacation.

Chip Ford—

The Boston Globe
Wednesday, May 6, 1998
Metro | Region
Power shifts in debate over tax cut
Lack of ballot item seen hurting Cellucci
By Scot Lehigh
Globe Staff

With the ballot question to slash the state income tax rate officially dead, House Speaker Thomas M. Finneran has a stark message for Acting Governor Paul Cellucci: You’ve lost the clout to drive the tax debate.

"He is in a position where he has to take almost anything that is sent," Finneran said yesterday, reflecting on the changed dynamic on Beacon Hill.

The initiative petition to cut the earned income tax rate back to 5 percent had been a stick for Cellucci to prod the Legislature, Finneran said.

But with Monday’s court ruling that the question, sponsored by Citizens for Limited Taxation & Government, has failed to make the ballot, "That stick has been taken out of his hands," Finneran said.

Cellucci is still pushing his own plan to cut the income tax rate from 5.95 percent to 5 percent, a reduction that would cost about $1.2 billion, more than twice the $500 million in tax relief that Finneran and Birmingham favor.

But without CLT&G’s question on the November ballot, it is now unlikely Cellucci will get a tax cut of anywhere near that magnitude.

"Now he is left to his own persuasive ability to say, ‘$500 million, that is a good step, but keep walking with me,’" Finneran said.

But Cellucci’s arguments are not likely to change his mind or Birmingham’s, said Finneran, noting that both have "indicated that a $500 million step is a giant step and we will pause and evaluate our circumstances after we take that step.

The Senate president agreed yesterday that with the ballot question dead, the tax-cutting dynamic will take on a different flavor on Beacon Hill.

"I think that this allows us to have more open debate about doing tax cuts that are focused on working- and middle-class people," he said.

The $500 million tax-cutting plan Finneran favors would reduce the tax rate on earned income and unearned income to 5.7 percent and offer larger exemptions and deductions.

Birmingham’s $473 million tax cut doubles exemptions for all filers who pay the earned income tax and gives seniors of moderate means a tax cut on unearned income by increasing their exemptions.

But Ilene Hoffer, Cellucci’s press secretary, said the acting governor would continue his quest to drop the income tax rate back to 5 percent, where it stood before the fiscal crisis of the late 1980s.

"The question may not be on the ballot, but that does not change the fact that the taxpayers of Massachusetts overwhelmingly want and deserve a tax cut," Hoffer said. "Governor Cellucci will fight to get that tax cut all the way down to 5 percent."

Cellucci won’t be alone in pushing for a larger tax cut.

The Democratic Party’s two leading gubernatorial candidates, Attorney General Scott Harshbarger and former state senator Patricia McGovern, both favor larger tax cuts than the ones favored by the legislative leaders.

Yesterday, Harshbarger said the fate of CLT&G’s question has not changed his mind about his own tax-reduction plan, which would cut $1.53 billion over five years by lowering the tax rate on earned and unearned income to 5.25 percent, doubling the personal exemption, and excluding the first $1,000 of dividend and interest income from taxation.

"My tax plan is about changing the rules in favor of working families and putting families first," Harshbarger said. "The important thing is that the Democratic Legislature believes, as I do, that working families and seniors should get most of the benefit of any tax reduction."

Further evidence of how fractured the conservative tax-cutting movement has become came from House Minority Leader David Peters, who blasted Anderson for failing to get her question on the ballot.

"Barbara Anderson has been very critical of the Republican leadership, but at least we are pushing for tax cut votes and not dropping the ball," Peters said. "We are doing our job. Barbara Anderson ought to do hers."

Anderson shrugged that off.

"We did the petition drive and we are not going to end up with a tax cut. He is pushing for votes, and he is not going to end up with a tax cut," she said. "So I think he is living in a glass house and throwing stones."

The Boston Herald
Wednesday, May 6, 1998

Tax Break for the people?
Don’t everybody yawn at once
By Howie Carr

The anti-tax movement in Massachusetts isn’t dead. It just looks like it is.

But there’s nothing wrong with it that a good, solid bone-crunching recession can’t fix.

For the moment, though, it looks a lot like 1987 on Beacon Hill. The only difference is, the peasants with pitchforks seem to be MIA.

I mean, who could ever imagine that the tax-cut forces of Barbara Anderson couldn’t get enough signatures to put an income-tax reduction referendum on the ballot this November?

The date on the death certificate is Monday, but the patient had been on life support for months. Sure, you can say that the smaller-government crowd was spread too thin—what with the petitions for term-limits (another loser) and Free the Pike (that will make the ballot, knock on wood).

But I knew the income-tax cut was in deep doo-doo last fall after putting in a few hours one Saturday afternoon working the petition table at the Natick Mall.

It didn’t take long for me and the two libertarians with me to figure out what we thought was a great sales pitch. At shoppers strolling by, we yelled, "Give yourself a pay raise!"

And they looked at us like we were . . . scum. They just stared straight ahead, picked up their pace, and grasped their Gap and The Limited bags closer to their gym-hardened bodies.

You’re telling me a family earing $50,000 a year couldn’t use another $500?

The difference between 1990 and now is this. A lot of people have convinced themselves they’re millionaires. They own an SUV, ergo, they’re rich. Their houses appreciated 10 percent last year. Therefore by 2002, it’ll be worth another half-mil.

Don’t tell these people what happened to the stock market in October 1987. That’s ancient history.

It’s funny how being broke makes you a lot more concerned about, say, your quarterly property tax bill.

But right now, nobody seems to get excited when Mistah Speakah starts talking about retroactive pay raises for the legislative lackeys . . . er, leadership all the way back to January 1997.

The taxpayers are asleep and the hacks are stripping the gold off the dome. They’re doing sweetheart deals for retired federal judges so that they, of all people, don’t have to pay state income taxes on their bloated pensions.

But ask anybody to think about politics and what reaction do you get out there in TV-land?

Don’t everybody yawn at once.

But this will pass. The bubble will burst. Funny how The New York Times reported Sunday that as a lot of the big mutual-fund managers on Wall Street continue to hurl their clients’ fund in the maw of the beast, they themselves are going . . . liquid. Do they suspect something that the soccer moms won’t realize until it’s too late?

And when "downsizing" is back in common currency, a $500 pay raise won’t look so shabby.

Let’s close with a little something from Mr. Dooley. He was talking about how the Democratic electorate would return to its senses. I’ve cleaned up the dialect and modernized the names, but take heart, Barbara Anderson, because this applies to you and your tattered forces:

"There’s always one ray of light ahead. We’re sure to have hard times. And when the lads that are baskin’ in the sunshine of prosperity with Bill Clinton and Mistah Speakah find that the sunshine has been turned off and their fellow-baskers have relieved them of what they had in the dark, we’ll take the boys by the hand and say" ‘Come over here with your own kind. Beacon Hill broke you, but now that you’re down we’ll not turn a cold shoulder to you. Come in and we’ll keep you—broke.’"

I just hope Barbara Anderson’s phone number is still in the book when that day comes.

The Boston Herald
Wednesday, May 8, 1998

Lead Editorial: Tax cut battle not over

The untimely demise of the latest tax cut ballot effort is unfortunate for the state’s taxpayers. While making tax policy via the ballot box is admittedly an often clumsy and second-best solution, the mere threat of such pending measures is usually enough to focus the attention of otherwise reluctant tax-cutters in the Legislature.

This year there is at least agreement on Beacon Hill that a tax cut is more than warranted. Democrats have settled on a $500 million cut—although House and Senate leaders are still not agreed on its exact form. But this is a far cry from the $1.2 billion cut that taxpayers deserve and might have been able to give themselves through the November ballot.

Still, there is little reason for the if-it-moves- tax-it crowd to be euphoric. And the comment of Jim St. George, executive director of the Tax Equity Alliance of Massachusetts -- "People are not, it turns out, screaming for a tax cut" –is mere wishful thinking.

This is, let us not forget, an election year for governor and for the Legislature. There is more than one way to make sure a rollback of the state income tax from 5.95 percent to 5 percent is on the November agenda, and that’s to ask each and every candidate where he or she stands on the issue.

Taxpayers can still grab victory from the jaws of this defeat. It’ll just require a little more effort.

[Chip’s comment: "*a little more effort*"? You’re dreaming!]

The Boston Globe
Wednesday, May 6, 1998


The latest tax-slashing petition was ruled off the November ballot in Massachusetts on Monday, the same day the Commonwealth’s students began taking the standardized tests mandated under education reform. If pure chance was involved in these two events, it was only in the timing, because the two are closely linked.

It is no stretch to say that the state’s Education Reform Act of 1993 was to a large extent a belated response to Proposition 2 , the 1980 initiative petition that thrust Barbara Anderson and Citizens for Limited Taxation to prominence as state policy makers but damaged some local services severely.

This year’s tax cut petition - to drop the income tax rate from 5.95 percent to 5 percent - was too fast, too deep, and, like many ballot measures, too blunt. As the Massachusetts Taxpayers Foundation noted, the plan depended on the already robust state economy actually improving markedly for the next three or four years, an unrealistic premise. Instead, the state’s prospects include a decline in federal highway money, a need for more education funds, and a variety of other demands for capital projects and social improvements.

But the sound arguments against the petition were not what killed it; it expired from insufficient support. Some backers carped that political maneuvering, directed in part by the Massachusetts Teachers Association, left them only 26 signatures short of the 64,928 needed to put the issue on this November’s ballot. But short is short, and the judge therefore didn’t need to rule on another 6,000 signatures that were in dispute. In addition, this should have been a relatively easy year to collect signatures for a popular issue. In 1992 and 1994, such petitions required 72,737 signatures - nearly 8,000 more - because the figure varies with the turnout in the previous gubernatorial election.

The message is that there is no groundswell for radical tax cuts in Massachusetts now.

The state’s experience with Proposition 2 provides immediate historical context. The pressure it took off overburdened property taxes was doubtless beneficial, but the costs were high. The state, acting responsibly, boosted local aid to cities and towns, but many services slipped badly. The number of teachers dropped from 66,000 in 1980 to 56,600 in 1984 - precipitous even considering declines in enrollment.

John R. Silber, chairman of the state Board of Education, said in a recent CommonWealth Magazine interview that in many poor communities, Proposition 2 "is absolutely disastrous and choking, crushing."

It also still makes life difficult for many communities with fast-growing school enrollments.

This is not the time for a tax cut as deep as proposed by the backers of the ballot initiative. The time may never be right for a radical, rigid, and complex tax cut presented in a simplistic ballot question.

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