Well, with a new Congress being inaugurated and Janet Mills taking the oath of office, one thing is coming into focus: Democrats are a study in contrasts.
In Washington, a large contingent of newly elected representatives are calling for a “Green New Deal.” What actual, concrete policy does this slogan encompass? No one is really sure. Meanwhile, Maine Gov. Janet Mills suggested a very real, tangible action in her inaugural address: add solar panels to the Blaine House. A small gesture, but one with some substance behind it.
The divergence continues from there. Mills came out strongly against last November’s Question 1, which would have severely hiked the tax burden on Mainers. To pay for the “Green New Deal” — whatever it is — Rep. Alexandria Ocasio-Cortez suggested instituting a 70 percent top income tax rate at the federal level.
Suffice to say, I’m with Mills.
Those further to the left are either uninformed — or, worse, intentionally misleading — as to how tax policy works. They point to the halcyon days of the 1940s, 50s, and ’60s when the top marginal tax rates were 70 percent or even 90 percent. They are undoubtedly correct. But the real measure with taxes is the “effective” tax rate, or what percentage of their total income a person pays to the government. And that has been pretty consistent over the years, even for “1-percenters.”
As France demonstrated, simply decreeing higher taxes isn’t the panacea advocates hope it will be. Businesses and individuals get to make choices in response to government decisions. Calling for higher taxes is easy as a political rallying cry, but, when the burden of responsible governance is placed upon your shoulders, carrying it out is a much more solemn decision.
That is where the contrast between Democrats comes into sharper relief. Ocasio-Cortez is a leading light for her party and has a knack for marketing. Voters are very supportive of the “Green New Deal” as an ephemeral concept, although the nitty-gritty of policy making does not yet appear to be her forte. I’d be willing to wager a proposal to ban internal combustion engines in light-duty vehicles would be viewed much more skeptically.
Mills takes the other path. Her inaugural address was very well done, equal parts humble and lofty. It didn’t get into the weeds of a wonk, but acknowledged soaring rhetoric untethered to reality does no one any good. And, while other members of her party are offering new firearms regulations previously rejected, she counsels caution.
She may even be able to model the way for her partisan co-venturers in Washington. The Democratically controlled House will find the progressive wish list unable to overcome the GOP majority in the US Senate. Depending on Mills’ approach to “greening” the Maine economy, she might be able to get Republicans on board.
Maine remains the most heavily-forested state in the nation. Creative entrepreneurs, schools, and established companies are working to develop plant-based fuels that can run in existing engines. Building codes are finally catching up to advances in engineered wood. These future industries, informed by our past and our competitive advantages, have the potential to further strengthen the Maine economy, all while advancing environmental goals.
However, massive tax hikes will impede that growth. So, as Washington Democrats try to flesh out what exactly the “deal” is in the “Green New Deal,” hopefully they will have an example from Mills that is reasonable, market-driven, and reality-based.
After all, she has already shown them the right way forward on tax policy.