Mike: Things are getting down to brass tacks in Augusta. Or, in this case, less tax. Have legislative Republicans found fertile new ground away from the governor and the Democrats?
Cynthia: Republican lawmakers are out there, all right. Their “new” plan raises taxes on low- and middle-income Mainers to pay kindergarten teachers and police officers, while handing out tax cuts to those at the top like candy.
I guess you could say that by pitching a ridiculous scheme that would exacerbate income inequality, Republicans have made the LePage proposal look moderate. Let’s just hope they find some middle ground to hoe in Augusta.
Mike: Cynthia — I agree! Time for everyone in Augusta to row together toward viable tax reform. But Democrats need to abandon this class warfare of “sticking it to the top,” especially when the “top” consists of small businesses that file under the fiction that they are individuals.
Cynthia: Except that “the top” isn’t small businesses that file under the fiction that they are individuals — it’s the decile of households with the highest income. Under the LePage plan 50 percent of income tax relief goes to to this top 10 percent, whereas under the Democrats’ plan, 98 percent of tax relief goes to the bottom 95 percent.
Republican lawmakers say their new proposal will keep money in “working Mainers’ pockets” on the one hand and that it “closely mirrors” the governor’s plan on the other. This isn’t middle ground, it’s waffling. Is the GOP blind to the cavernous income gap between the super-wealthy and the rest of society in Maine and America, Mike? Talk about fiction!
Mike: If that top decile doesn’t include the “small businesses filing as individuals” fiction, how about we pass the Democrats’ plan, but exempt any small business income from their tax hike, or even from taxes altogether? Sounds like a fair compromise; no waffles necessary.
Meanwhile, the “income gap” charge rings hollow in Maine. We’re one of the “most equal” states in the nation, and one of only nine without a billionaire. I’d be fine with more inequality in Maine — even concentrated in the hands of Democrats — if it meant our businesses were growing, hiring, and succeeding. I seem to recall some Democrat going on about rising tides and boats…
Cynthia: Republicans talk like experts on business and the economy — and boats — but their policies don’t hold water. Many Democrats are wealthy and understand the role of government in a capitalistic society. We are willing to pony up and not scapegoat the poor, unlike some GOP zombies stuck in a voodoo saga about voodoo economics.
Look at Gov. LePage’s 2012 “largest tax cut in Maine history.” The way it’s bandied about, you’d think he performed a miracle. But what did it do for the economy? Nothing. Maine ranks 49th in the country in job creation since the recession, people are dirt poor and kids are going hungry. Maybe the income gap isn’t as pronounced here as it is in other places, but being the most “equally bad off” is nothing to brag about.
Mike: We agree on not bragging about our “equality.” It’s the old Churchillian take on socialism, where everyone is perfectly equal as everyone is equally miserable. I’d rather have some inequality coupled with shared prosperity — the tide lifts yachts, dinghies, and trawlers alike.
And if you don’t like the 2012 tax package, you should love the current iteration. As you pointed out, the governor’s plan is less regressive than the Democrats’ 2009 plan, while the preliminary Republican legislative proposal will be fairly attacked as “tax cuts for the rich.” So let’s pass the gist of the governor’s moderate plan and get it done! Democrats voted for those 2012 tax cuts and the 2009 revenue-raising “modernization,” so why are they hiding from it now?
Cynthia: Churchillian? Oh, right. Because nothing says “tax reform” like Winston Churchill. Or trawlers.
Seriously, though. Republicans overturned the 2009 reform law that lowered income tax rates and broadened the sales tax base, and instead just slashed rates for those at the top in 2012. This plan sucked needed resources from Maine’s economy and failed, so they want to do it again?
Tax cuts for the rich is dumb economics, Mike. It’s time the GOP abandons this sinking ship and throws a lifeline to the broad swath of sinking middle-class families instead. Rats help their fellow rodents in distress, why can’t Republicans?
Mike: A consumption tax in lieu of an income tax will help all families who squirrel away savings and live frugally. And, someday, they’ll be able to buy a bigger boat…and pay sales tax on it! Democrats supported the concept in 2009 — let’s hope they remember it in 2015.