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A Question
of Intent
June
21, 2003
By David Michael Rothschild
New Jersey has a very interesting cycle. The voters elect
Republicans (Kean and Whitman) who cut taxes too much and
do not cut spending. Then they elect Democrats (Florio and
McGreevey) to fix the mess by raising taxes and cutting spending.
Then they throw the Democrats out of office for raising taxes
and cutting spending (who wants that!) and the cycle repeats.
With this cycle, the central question is one of intent. When
Governor Whitman cut New Jersey's taxes in the beginning of
her first term, so much so that Jersey had to borrow several
billion dollars, was she contemplating the short term financial
windfall for millionaires like herself, was she considering
the inevitable cuts that her successor would be forced to
make, or was she assuming that her successor would raise taxes
to save the State's vital services? In the case of Governor
Whitman raiding the state's pension fund, I need to conclude
short-term greed was her main motive. In the case of Bush
risking the liquidity of Social Security, Medicare, Medicaid,
and all of those other crazy liberal programs, I come to a
more sinister purpose.
Last week there were two columns in the Newark Star-Ledger
about Governor Whitman's economic mess; one concluded that
she created the mess to serve her conservative ideology, the
other that she did it out of liberal compassion. The moderate,
John McLaughlin, notes that while it was a long and winding
road, the State of New Jersey is going to have to cut major
services for it citizens and it is a direct result of Governor
Whitman's reckless tax cuts. While she talked about "giving
back" and "trickle down economics," she was simply destroying
the budget on purpose. The conservative, Paul Mulshine, concludes
that Whitman was just too much of a liberal at heart to make
the proper spending cuts to offset her tax cuts. He coldly
notes that one cannot be a "compassionate conservative." Compassion
costs money and conservatives do not want to spend money on
services that can be privately funded. Whitman, he figures,
is a just a pure "tax and spend" liberal, without the integrity
to raise taxes.
McLaughlin is, I assume, being a little "tongue and cheek"
about Governor Whitman being so sinister. She never appeared
to intend to destroy the basic social services of the State,
especially because she created many of the major social services
that they are now being cut. Yet, I cannot conclude that anyone
is stupid enough to believe that one can cut taxes and raise
spending without having inevitable budget problems. If she
really were the "bleeding heart liberal" that Mulshine concludes,
then the current spending cuts would not have been her goal,
and I would have to conclude she is incompetent. The only
reasonable explanation is that she never considered the long-term
effects of her actions. She just did not care what was going
to happen to the State when she left. All she wanted was to
pillage the State's coffers and pass the blame onto others
(she got both the money and popularity from giant income tax
cuts and the popularity of increased spending).
Governor Whitman also used another popular ploy to pay off
her tax cuts; letting the lower levels of government raise
the revenue that she eliminated. What happens when you cut
aid to the municipalities and the counties? They are forced
to raise taxes and cut services. What happens when you refuse
aid to the states? They are forced to raise taxes and cut
services. Even if the lower levels of government could avoid
cutting essential services, the problem with shifting the
tax burden to local sovereignties is that each level of government
has increasingly regressive tax structures. The federal income
tax is progressive. States raise money on generally less progressive
income tax structures, sales taxes (which are at best flat),
and lotteries (which are completely regressive). Property
taxes (at best flat) are the most common way for counties
and municipalities to raise revenue. Governor Whitman was
looking for a way to defer the pain of taxes to local governments
away from her domain. The prospect of power and popularity
drove her to create a more regressive tax structure, although
I am sure that she understood that she was shifting the tax
burden to the working poor. While I have concluded that Whitman
is a power- and money-hungry popularity hound, with no true
convictions, the similar play on the federal stage is much
more sinister, with much more disastrous consequences.
The federal government, run by the Bush regime, is basing
its tax model on New Jersey. It is cutting taxes, but not
spending (although it is not increasing spending on most services,
standardized programs such as Social Security and Medicare
are increasing on their own), and shifting the tax burden
away from the wealthy, to the middle classes. Are the Bush
idealogues simply looking for short-term financial boons (read
$350,000 to Dick Cheney)? Are they planning to destroy those
programs that create equality of opportunity, healthcare,
and financial security for the working classes, but are afraid
to directly attack those programs? Are they using the word
"double taxation" to create a regressive tax structure (many
extremely wealthy people will pay less than 5% of their income
in taxes when the stop taxing income from investments)?
When Governor Whitman "retired" from the EPA last month,
the Newark Star-Ledger concluded, "she was relegated
to shilling for an attack on the environment that she had
fought as governor of New Jersey." Lacking any firm ideological
principles, Governor Whitman was abused in her quest for power
by an administration that has no bounds to its vision of unbridled
wealth for a select few. After Gulf War II, the cuts in basic
services, the attacks on civil liberties, the environment,
healthcare, and education, I must conclude only the worst
about President Bush's intentions and long-term aspirations.
Nothing in this administration happens by accident. We are
heading for an economic disaster, and there is only one thing
that can stop it: You. Get angry, talk to your friends, register,
and register your neighbors. We need to win in 2004, for your
children's sake.
Mulshine
- May 23, 2003 - Newark Star-Ledger
Editorial - May 22, 2003 - Newark Star-Ledger
McLaughlin - May 28, 2003 - Newark Star-Ledger
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