Mike: There has been a lot of ink spilled over Gov. LePage’s budget proposal, but everyone agrees it is balanced. Meanwhile, Congressman Poliquin used his maiden floor speech to call for a balanced budget amendment for the Feds. Is it time to require balanced budgets in Washington?
Cynthia: What Washington needs is to cut spending, invest in the future, close loopholes and right-size government. It doesn’t need some gimmick like a “balanced budget amendment” that sounds too good to be true because it is.
Maine’s lagging economy, low wages, high cost of living and crumbling infrastructure are nothing to emulate. So we “balance” our budget. Whoopee.
Mike: Cut spending? Right-size government? Amen, Cynthia! But those things can be done within a balanced budget. The nice thing about constitutional requirements is they force politicians to make hard choices about taxes, spending, and priorities. That said, I’d be good with some sort of relief valve; we wouldn’t have been able to fight the British, Rebels, or Germans without some deficit spending!
Cynthia: Well that’s just it. America has the biggest economy and is the leader of the free world. A law that says to Congress, “govern responsibly, or else” isn’t practical. We tried that with “sequestration,” and look how that worked out. Republicans including Congressman Poliquin need to talk less about balanced budgets and do more to rein in spending and boost the economy for middle-class families. Under Presidents Clinton and Obama we’ve seen economic growth and reduced debt, while under Presidents Bush and Reagan we heard a lot of lofty rhetoric about “fiscal conservatism” while drowning in red ink.
Congressman Poliquin should put his financial smarts to good use, cut taxes for ordinary Americans and rein in Wall Street and the high-rollers by implementing a financial transaction tax. True reform is desperately needed, not more grandstanding about pies in the sky.
Mike: In what world have we seen reduced debt under President Obama? The national debt was $10.6 trillion when he took office and was $18.1 trillion at the end of 2014. Maybe Bruce can use his financial acumen to show the White House they are going the wrong way! Or maybe he will take the lead on real comprehensive federal tax reform, instead of political ad hoc measures.
It’s like when President Clinton worked with a Republican Congress to reform welfare. Jointly, they governed responsibly, and there were some benefits to the nation. It helped that irrational exuberance drove a dot-com bubble, and winning the Cold War meant a “peace dividend” allowed cuts in defense spending. But the bubble burst in 2000, the towers fell in 2001, and the world changed. President Bush was far from a fiscal hawk, but maybe a balanced budget amendment would’ve helped keep Washington in line.
Cynthia: President Obama has cut the deficit by more than half, and has cut spending dramatically, and this is the wrong direction? Face it, Mike. Modern Democrats are more fiscally conservative than Republicans, and an increase in taxes on the wealthy is consistent with economic prosperity and job growth.
So, yes — let’s work together on comprehensive tax reform. Let’s make the tax code more fair and simplified. Republicans in Washington talk the talk about fiscal responsibility: it’s time they walk the walk with President Obama and the Democrats — like Gov. LePage is doing here in Maine. LePage even went so far as to resurrect a “tax on fun” in his bold new budget proposal! Will the GOP in Maine finally vote for a tax hike they’ve opposed for years?
Mike: Debts and deficits are two different things, each with their own attributes. And that cut in spending you cite is directly due to the sequester you referenced earlier. And taxes on high incomes do not equate to a tax on the wealthy. If you want to work together, let’s begin with a common vocabulary. Precision in language is just as important to America as precision munitions, although the latter generally cost more.
As for Gov. LePage’s proposal, it is not a carbon copy of previous plans. It doesn’t include the Democrats’ magical exemption for lawyers. It puts a mechanism in place to abolish the income tax, not merely lower it so it can be raised again another day. And, ultimately, it results in $300 million in tax cuts to Maine people, instead of the “revenue neutral” fiction of earlier plans.
The plan is bold, touching on every form of taxation levied by the state or municipalities. I’m sure everyone will find some piece they don’t like. So will the GOP support it? I don’t know. But let me ask you: will Democrats support it? Or is it anathema because it originated in the Blaine House?
Cynthia: If the biggest selling point of Gov. LePage’s proposed budget is “$300 million in tax cuts” Democrats will rightfully be wary. Don’t forget — we already got the “largest tax cut in Maine history” in 2011 thanks to Republicans, and look what it did for prosperity, good paying jobs, quality education and a clean environment — absolutely nothing. Maine remains a poor state with really bad roads.
Truth be told, I’m kind of excited about Gov. LePage’s budget proposal. Let’s hope legislators of all stripes work diligently and in good faith to improve it in the days ahead, instead of plotting their re-election.
Mike: I’m all for good roads. I’m all for tax reform. And the only person in Augusta I am certain is not plotting his re-election? Paul LePage.