Peter Shumlin, as quoted in the Brattleboro Reformer:
“Our patchwork of broad-based taxes that have accumulated over the years, combined with overburdened property taxes, require our attention. But let me be clear — as we tackle the difficult challenge of balancing our budget, we must not and cannot succumb to the idea that Vermonters have the capacity to pay higher taxes right now,” he said. “In order to grow jobs and be more competitive with neighboring states, we must resist the temptation to raise broad-based taxes.”
I want to start by saying that I am thrilled that Shulmin is governor and very happy to have him in office. But that doesn’t mean we, as activists, bloggers and liberals, don’t have an immense amount of work ahead of us. It’s our responsibility to push him in the right direction.
So in that vein: of course some Vermonters have the capacity to pay higher taxes and to try to give the wealthiest Vermonters relief from tax burden will do nothing to stimulate the economy, nothing to promote growth, and nothing to help our state.
A common refrain from the more wealthy comes from people who do not wish to pay taxes on their 2nd homes or part time residences. The problem is that these people are not doing nearly as much to contribute to the economy of Vermont as the full time residents. They, apparently think of it as though it’s a hotel that they should only pay for part of time.
While I can understand this, people who do not live in an area they reside some of the time still use up state resources and civic services: fire stations and police are still on call to protect their house, even if they’re almost never there. Dead end roads to private residences still need to be maintained.
Yet they do not buy much of their food from the local vendors. They do not go to local stores. They don’t put nearly the contribution to the local economy that people who are of their primary residence put in.
We can talk, in general, about tax burdens, but the real question is one of what we get for the taxes we pay and whether they are fair.
Taxes that focus on the poor, such as sales taxes, would be great to lower, especially for essentials. Taxes that focus on the wealthy, such as high-end property taxes, taxes on large business that can be used to alleviate their health care costs? Those aren’t just good to increase. They’re actually of benefit to do so.
How do you stimulate the economy? You give relief to people who are holding on to their money because they’re scared to spend it. How do you just help people line their pockets? You treat the wealthiest among us as though if you just give them money, they’ll give it back. They don’t. They hold on to it, save it, and accumulate it. I’m not criticizing them for that. I don’t blame them for that. I just don’t think we need to be rewarding it with tax cuts.
Like I said, I’m thrilled Shumlin is governor, and I could spend a lot of time writing about all the things I love about his opening address (and there are quite a lot), but I don’t think we’re going to find our way out of this recession by treating taxes as a necessary evil that must only used in the most dire of circumstances. Taxes are what fund and fuel the works of government, and without them we would be lost. The important thing is not how much we pay, but if they’re administered fairly and if we get what we pay for.
Here are some excerpts from an interview of Peter Shumlin by Angelo Lynn published in this week’s Essex Reporter:
Shumlin: “Furthermore, you’re not going to solve this problem we have (by increasing) revenue. You’re just not. That’s the reality. If you could do it to all 50 states, I’d say raise income taxes on people who make $250,000 of more; that’s what I do. But we don’t have that luxury. We compete with New Hampshire; we lose wealthy residents to Florida, and we lose them to other states around us at the top margins. …. In short, this theory that you can milk the wealthiest residents as hard as you can milk them and somehow more are going to come than leave, just doesn’t work. The question should be, ‘How do we double our customers?’ You’re not going to do it by raising your income taxes higher than they already are at the top margins.”
Here is a quote from Glen Wright, the poster boy of the impoverished wealthy, from Vermont Tiger:
“The recent legislative action reducing the state income-tax deduction, the estate-tax exemption reduction and increasing tax on capital gains will have a significant negative impact on us. Becoming Florida residents eliminates our entire state income-tax burden. We will also experience a significant reduction in our property taxes. The value of our house in South Hero is approximately the same as our residence in Ocala, Florida. My property taxes in Vermont last year were in excess of $12,000.00. My property taxes in Florida after claiming the homestead exemption will be $4,000.00.”
So, has Peter Shumlin become a disciple in the cult of Glen Wright?
Furthermore, I know two local politicians where I live who, on commenting on a legislative hearing where complaints were fielded about our high income tax burden, shared the following view: We have to do something for Rich Tarrant!
You remember poor Rich, the former Senate candidate, hobbled by Vermont’s confiscatory taxes, don’t you? Go to https://www.broward.county-tax… That is the Broward County, Florida, website. You will find that Rich’s property tax bill for 2010 was $193,480.59. Poor guy; poor, poor, poor guy.
So, what gives? Robert Bellah, who authored the memorable book “Habits of the Heart”, also wrote “The Good Society”, wherein he and his coauthors lamented the sacrifice of common purpose and public spirit on the altar of the maximization of individual self-interest. He speculated as to why the vast majority of Americans would acquiesce in the destruction of our commons, and he recalled Ronald Reagan saying something like, “I want America to remain a country where anyone can become a millionaire.”
The problem there is that the probability of becoming a millionaire (which should be adjusted upwards from Reagan’s day) for any individual American is relatively low. Just recall the aspirations of so many inner-city young men who long for the NBA, trying to fulfill their individual “hoop dreams”, the name of the documentary about just such a quest; their chances of succeeding were infinitesimal.
Yes, Vermont has problems, and, yes, it cannot afford everything Vermonters might want. Yet, when we continue to make an icon of wealth, we will become less the Good Society and more the gated one, where some are comfortably ensconced in their private Shangri-la while the vast majority are locked outside, elbowing each other aside to gain a glimpse at what they most likely will never attain.
These are extremely important points to make, over and over and over again; because the same old tired idea, that easing the tax burden of the rich somehow “trickles down” economic benefit to the poor, just hasto be retired.
to remember & very true. Merely throwing money @ any problem just doesn’t work. Doesn’t solve the problem & can actually make it worse.
A number of supposed favorable economic conditions supposedly occur when there are ‘tax cuts’. To give tax cuts in a time of such dire financial prognostications is irresponsible.
Douglas plan to reward the most wealthy on the backs of the rest of the state which Dubie would have surely done is an example of the utmost in irresponsibility.
Thank God he didn’t make it.
Tax cuts are no different. It is throwing money back to the ppl who paid them, true, but w/no guarantee that there will be any change, the desired results will be achieved or that it will benefit anyone other than those who recieve it.
I could go along w/this if & only if they are targeted. This way it rewards those who contribute to & invest in the economy.
I have seen studies & analysis of tax cuts & they do not seem to add up to the benefit to the economy they are claimed to be.
I’m disappointed in the statements from Shumlin and Shap Smith that tax increases are not going to be considered.
In the last decade, tax rates on items that overwhelming affect the wealthy (such as capital gains and the penalty for withdrawing land from the Current Use Program) have decreased. These tax cuts have not produced jobs, and the rates should be returned to previous levels.
If public employees are asked to “share the pain” by taking paycuts or paying more toward benefits, then the wealthy must “share the pain” by paying more in higher taxes.
Before we all get over-heated, let’s give the new folks a chance to submit the new budget on 25 January. Then, if things are going off the tracks, we can do our protest dance.
Do not go to war until attacked.
Peter’s views on this subject are well known.
I think he’s dead wrong but he seems unlikely to change in the near term. It’s unfortunate because he is a smart guy who obviously cares about working people and has a number of very good positions on other issues.
What troubles me most is that as a bright guy he should not be swayed by the anecdotal self-serving views of people like Glen Wright. There is a wealth of data showing clearly that Trickle Down has failed and that the concerns about interstate competition are largely without merit (with a few exceptions for things like sales taxes along state borders).
Like Julie, I’m very pleased that Peter Shumlin is our governor (and was proud to campaign with him). I can only hope he keeps an open mind about this particular issue.
perhaps. If he raised taxes as one of his first items on the agenda & right off the bat, it could be costly political move.
If he has to, then @ some point he could make the case for this if he could show it was for a specific reason so hopefully they won’t feel targeted.
Most “nonresidential” property is in fact owned by Vermonters. In an earlier post, there were concerns about how the City of Barre treats renters. Make nonresidential property taxes high enough, and there will be no rental housing.
I own an 800 sq. ft. house that is taxed at $3100 because it is considered nonresidential. It cannot be income sensitized. With mortgage, taxes, and insurance, I cannot make enough in rent to avoid a loss. I can’t sell it because I owe more than I can get for it, thanks to the Fannie/Freddie mess Congress allowed to happen. I had to spend over $2000 in legal fees, etc., to evict some tenants who didn’t pay for months and made a huge mess. There were drug needles all over the floor where toddlers had been crawling. What about landlord rights? People who do not wish to pay taxes? How about those of us who’d just like to pay the same rates?