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Mon, 01 Nov 2004A fellow policy nerd writes: Second, from reading your site, it would appear that you believe that raising Rhode Island's taxes is the answer to a lot of our problems. We also disagree with that conclusion... But I see I will have to watch my rhetoric. I don't believe that "raising taxes" will solve a lot of Rhode Island's problems. In fact, I don't believe I've made the kinds of blanket assertions about taxes you attribute to me. It's a common mistake, though. Pretty much all the anti-tax crusaders I've met aren't interested in hearing about progressive vs. regressive taxes or taxing wealth vs. taxing income or fairness issues. To them, all taxes are bad and anyone who wants to make these fine distinctions must be a tax-and-spend liberal: the enemy. But I believe that an honest look at who pays which taxes will uncover some real injustices done in the name of "cutting taxes." I further believe that raising some taxes to relieve pressure on others will move us toward a system that is fairer than what we have now, and that it's largely political cowardice and the refusal to acknowledge the reality of the tax burden's distribution that got us to the place we're in now. In our town, for example, a recent revaluation left Wal-Mart and Home Depot with hundred-thousand-dollar property tax cuts, while most of the town saw (sometimes vast) increases. The burden of funding our town's services has been shifted from commercial property to residential property. One town councillor suggested a split rate, where business property is taxed at a higher rate. This would have restored the distribution of the tax burden to something closer to what it had been. But businesses called it a "tax increase" and the local Chamber inveighed against it, and so the council cowered and all the businesses got a big cut and my taxes went up a bundle. You may think that's fair, and you may not, but I think honesty demands that we admit the vast bulk of my tax increase is going to pay for Wal-Mart's tax cut, and that only a tiny portion of it is going to pay for teacher health plans. Against that backdrop, to see people arguing about how fiscal responsibility demands that the rental rates at the community hall be raised, or that the town start charging local soccer leagues more rent for the fields occasionally seems bizarre. Maybe both of those are prudent, but to call them the source of the problem is simply false. The dominant thread in discussions of the town budget has been that somehow a 2% school budget increase is responsible for people's 35% tax increases. I don't mean to denigrate the anger. People are angry, and they have every right to be. But lashing out at the wrong target has only made the situation worse over the time I've been watching. You're in business. Ask yourself which is the most onerous tax your company pays. Is it the corporate income tax, or the property tax? My vote has it that the property tax is much worse. But over the past decade we've slashed the corporate taxes, and slashed school aid, too. The result: lower corporate taxes and higher property taxes. I know for a fact that there is waste and inefficiency and bad labor contracts all over our state and municipal governments, and I intend to do my part to find and illuminate them. But I also think that by identifying those as the worst of our problems, we will miss (and have already missed) some much more serious ones. |