The Great Tax Cut War of 2000
officially began yesterday. Lexington and Concord it wasn't, but the
formal creation of a committee to oppose Governor Paul Cellucci's
tax-rollback petition guarantees a tumultuous fall campaign.
Led by teachers and the AFL-CIO,
"The Campaign for Massachusetts' Future to Defeat Multi-Billion
Dollar Tax Cuts" filed organizational papers yesterday at the
state Office of Campaign and Political Finance.
To Cellucci and his allies, this
is a fight to fulfill the promise, at least implied during the
1989-90 fiscal crisis, to return the income tax rate, now 5.85
percent, to 5 percent.
To opponents, including many local
officials, it's mindless politics. Since 1990, 36 other tax cuts,
now totaling more than $3 billion a year, have gone into effect.
Cellucci's initiative, even phased in over three years, will
inevitably harm schools, human services, and other important
programs, they say.
It's become a rite: At the start
of each decade, Massachusetts has a bloodletting over tax cut
questions. How much will you pay for your government? In 1980,
Proposition 2½ passed. In 1990, Question 3, a massive tax and fee
rollback, was defeated. In 2000, voters have a full menu -- besides
Cellucci's $1.1 billion rollback, a $700 million offset for road
tolls and auto excise taxes, and a question to make charitable
giving deductible for state income tax purposes, a $200 million
Comparison will be made to '90 and
Question 3, ("It goes too far" was the opponents' winning
slogan). Similarities surely abound, but this campaign may be
decided by the differences.
Foremost is the role of Cellucci,
who has virtually staked his governorship on this issue. The risks
or rewards will be enormous. A better campaigner than chief
executive, Cellucci can at least partly redeem a lackluster 2½
years in the governor's chair with a big win in November. In 1990,
Question 3 backers, led by Citizens
for Limited Taxation and Barbara
Anderson, were much less organized than this year's
Moreover, Cellucci's fund-raising
machine has led efforts to raise about $200,000 so far and hopes to
raise at least $2 million more, said Rob Gray, Cellucci's top
"It'll be a fair fight this
year," said Gray.
In 1990, opponents of a $1.2
billion tax cut outspent Anderson's Question 3 forces about $3
million to $1 million. The Massachusetts Teachers
Association alone spent $1.4 million to defeat the question.
The 88,000-member union will be a factor again this year though some
members are tired of being the open checkbook in every campaign
against tax cuts.
The governor, meanwhile, has all
the toys of incumbency, including the big soap box Thursday night --
his State of the State address -- to campaign for the tax cut.
A tricky variable from the '90
ballot campaign is a problem for Cellucci, however. As he pushes his
own initiative, he's mum on the others. "We're keeping our
powder dry on all the other ballot questions," said Gray.
Opponents aren't. To them, a two-fer
is a bigger target.
"We're going to focus both on
the governor's rollback and the 'Free the 'Pike' question,"
said James St. George, executive director of the Tax Equity Alliance
for Massachusetts. It is neutral on the charitable deductions tax
The toll-excise question is an
ingenious political creation -- a son of toll-repealing "Free
the 'Pike," which was knocked off the ballot two years ago
because it jeopardized bonds vital to funding the Big Dig.
Proponents seek instead a straight tax credit for tolls and have
tossed in the same for auto excise taxes, perhaps the most hated of
all Massachusetts taxes. Its impact would be enormous, though, $700
million a year.
The Massachusetts Taxpayers
Foundation, nonpartisan and fiscally sober, opposes the toll-excise
question and only backs further cuts in the tax rate if tied to
"We see a difficult time
ahead even without the ballot questions," said Michael Widmer,
foundation president. Tax cuts already enacted since 1998 (including
a phased-in reduction to 5.75 percent on the income tax rate) will
cost $1.66 billion, fully implemented. The Cellucci and turnpike
questions would lop another $1.7 billion from state revenues.
Meanwhile, spending is way up -- well over 6 percent annually the
past two years -- and the 1980s "budget busters" of
Medicaid, state employee health insurance, and pension costs are
growing again, said Widmer.
Even as the state logs mid-year
revenues indicating a likely surplus of several hundred million
dollars by June, those are "pincers," Widmer said, on a
budget now at $20.8 billion.
The Great Tax Cut War of 2000 is
under way. How much will you pay for your government?