Dead Budget Walking

The House will go through the motions today and approve the Democrats’ budget, which will then go to the governor. If you don’t think a swift veto, accompanied by a finger-wagging veto message, isn’t on its way, then take a look at how the governor responded to the Senate’s passage of the budget last night:

“The Democrats’ budget goes in precisely the wrong direction at precisely the wrong time. It is neither balanced nor remotely realistic … It contains so many holes — together with unachievable spending cuts — that new and higher taxes would be needed each and every year for years to come.”

Therefore, we wait for the House to take action today, and then tearfully send their little budget to its certain doom. Ken Dixon compares it to the Titanic, which is pretty apt except for the fact that, unlike that ill-fated vessel, no one ever had the slightest illusion that this thing would float.

Meaning, of course, that the votes last night and today are about sending a message and establishing political principles, rather than passing an actual budget. It’s a negotiating tactic. The hope is that the governor will now sit down at the table and negotiate some middle way between the cut-heavy budget she proposed and the tax-heavy budget supported by the Democrats. There is no guarantee that will happen, but that’s what the Democrats’ leaders seem to hope.

Still, it’s better than the Democrats’ lack of action up to and following the end of the regular session. Their leadership found plenty of time to criticize the governor’s stingy budget proposal, but only seemed to get serious about the budget they’re passing now in the past few weeks.

Williams and the Senate Democrats

The Senate vote tells us some things about the Senate, mainly that the fiscally conservative Democrats are feeling more comfortable voting against Don Williams and the majority. I wonder if they’ll all lose their parking spaces, and have to hoof it from the Morgan St. Garage for their insolence? They don’t seem too concerned. If the rumors of a putsch against Don Williams are true, he won’t want to alienate them any further.

The numbers are telling. Williams avoided disaster by only a single vote–if another Democrat had jumped the fence, there wouldn’t have been enough votes to pass the budget. That vote seems to have been Sen. Andrew McDonald, who initially was not thrilled by the progressive income tax proposal, which he said would hurt middle class families in his Stamford-area district.

However, a slew of education cash for Stamford later, McDonald ended up voting for it. Sen. Toni Harp denies that McDonald’s vote was bought, but it’s hard not to draw that conclusion.

If so, that’s a desperation move by a leadership that could be on its last legs.

Advertisements

43 responses to “Dead Budget Walking

  1. Joe Sixpack

    McDonald is Williams’ biggest critic in the caucus, and most likely the biggest rival in any leadership fight. If there is indeed a “putsch”, I would expect McDonald to be right out front, waving the flag. So there must be even more to this flip flop than Stamford schools being promised more money. It’s a bad political vote for McDonald on a budget that will be going nowhere – so that money will not even be seen by Stamford. What exactly did McDonald get in exchange for delaying the ouster of Don Williams and his porn stache from leadership?

  2. The numbers are telling. Williams avoided disaster by only a single vote–if another Democrat had jumped the fence, there wouldn’t have been enough votes to pass the budget. That vote seems to have been Sen. Andrew McDonald, who initially was not thrilled by the progressive income tax proposal, which he said would hurt middle class families in his Stamford-area district.

    However, a slew of education cash for Stamford later, McDonald ended up voting for it. Sen. Toni Harp denies that McDonald’s vote was bought, but it’s hard not to draw that conclusion.

    Actually, since Len Fasano couldn’t be bothered to show up for the vote, Williams could have lost one more and still passed the bill. Stamford just gets a really bad deal, and it needed fixing.

    What’s the level at which an increased rate kicks in for “middle class families” anyway, $500,000? So let’s say I’m an upper-middle class family making a just-scraping-by $600,000 a year, what would my tax increase be?

    Answer: $1000. That’s all. Are we really going to shut down social services to save someone making $600,000 a year in this huge crisis a measley thousand bucks? That’s ridiculous.

  3. For your benefit, Samuel, I’ll cut and paste my previous post on this topic. The bottom line is that it doesn’t matter if you make $500,000 or more, or less: this budget will adversely affect the economy of Connecticut, and not in a small way. States that have tried this stunt have seen it fail, and we’re idiots if we jump off the same Dumb State Cliff.

    The Senate Democrats who voted against this budget should be primaried. Rich folks have gotten vast federal and state tax breaks over the past few decades. The tax burden of the wealthy has been shifted to everyone else. Shame on these five who either lack courage or are in the wrong party.

    Kingfish, you are dead wrong. The wealthiest Americans (and Connecticut residents) have been pulling the weight of the rest of us for the last 30 years. If it had any chance of being passed, this grossly flawed budget would shift more of the tax burden on to us, and take it away from them. This is a fact:

    http://online.wsj.com/article/SB124260067214828295.html

    Martin Feldstein, Harvard economist and former president of the National Bureau of Economic Research, co-authored a famous study in 1998 called “Can State Taxes Redistribute Income?” This should be required reading for today’s state legislators. It concludes: “Since individuals can avoid unfavorable taxes by migrating to jurisdictions that offer more favorable tax conditions, a relatively unfavorable tax will cause gross wages to adjust. . . . A more progressive tax thus induces firms to hire fewer high skilled employees and to hire more low skilled employees.”

    More recently, Barry W. Poulson of the University of Colorado last year examined many factors that explain why some states grew richer than others from 1964 to 2004 and found “a significant negative impact of higher marginal tax rates on state economic growth.” In other words, soaking the rich doesn’t work. To the contrary, middle-class workers end up taking the hit.

    Finally, there is the issue of whether high-income people move away from states that have high income-tax rates. Examining IRS tax return data by state, E.J. McMahon, a fiscal expert at the Manhattan Institute, measured the impact of large income-tax rate increases on the rich ($200,000 income or more) in Connecticut, which raised its tax rate in 2003 to 5% from 4.5%; in New Jersey, which raised its rate in 2004 to 8.97% from 6.35%; and in New York, which raised its tax rate in 2003 to 7.7% from 6.85%. Over the period 2002-2005, in each of these states the “soak the rich” tax hike was followed by a significant reduction in the number of rich people paying taxes in these states relative to the national average. Amazingly, these three states ranked 46th, 49th and 50th among all states in the percentage increase in wealthy tax filers in the years after they tried to soak the rich.

  4. Maryland tried to soak the rich, but they swam off.

    Trying to settle what liberals here in Connecticut call “a revenue problem,” a cash shortage in their budget, Maryland legislators enacted a higher tax bracket for “millionaires.” Here in the land of steady bad habits, Democrats are seeking to plunder “millionaires” who earn more than $750,000; call them mini-millionaires.

    Democrats hope to raise $1.5 billion in increased income taxes and $125 million in new fee increases to pay for their improvident spending. The Democrat plan, almost certain to face a gubernatorial veto, would raise the state income tax on couples earning more than &170,000 by 7.5%, a 50 percent rate increase.

    Maryland boosted its top bracket to 6.25 percent.

    Result?

    One third of Maryland’s “millionaires” disappeared from the tax roles and took up residence in Virginia, Delaware and Florida, all less tax punishing states.

    And now, even though Maryland is colleting more money from its vanishing “millionaires,” it is hauling in $100 million less a year from the mobile rich.

    National Review, an oasis of good sense in a nation of thoughtless liberals, reasons: “Capital is mobile. So are capitalists.”

    The more Gov. Jodi Rell of Connecticut talks about state finances, the more she begins to sound like Thomas Paine – or Margaret Thatcher, giving the evil eye to political wastrels.

    Connecticut does not have a revenue problem; it has a spending problem. And its spending problem has been caused by Democrat legislatures and Republican governors that together have been folding billion dollar surpluses into the state budget ever since former Gov. Lowell Weicker, who some disgruntled Republicans consider a menace, muscled the legislature into passing an income tax. All that excess money was spent and it bloated future budgets. Now we have a ($37 billion) fat-boy budget on our hands, and Democrats still insist the state has no spending problem. It has, the Democrat caucus iterates in unison, a revenue problem – which means this: “The proposed two year [Democrat] budget,” the Harford Courant reported, “calls for 2.5 billion in tax increases and about $1 billion in spending cuts…”

    As my old Aunt Lena once said, looking somewhat abstractedly at Picasso’s “Portrait De Femme” – “As a portrait of a lady, it’s a failure because the proportions are wrong; as a painting, it’s a failure, because it lacks beauty.”

    The recently proposed Democrat budget – these guys had months to bring forth this improvident mouse – is both unlovely and an insult to the laws of economics.

  5. Thomas Hooker

    ..Here in the land of steady bad habits, Democrats are seeking to plunder “millionaires” who earn more than $750,000; call them mini-millionaires.

    “Plunder”? Come on! That is silly. To be accurate, it is the Republicans who want the pain of balancing the state’s budget to fall on everyone but the state’s wealthiest residents. Rather than tax people making over three quarters of a million dollars, Republican Governor Rell wants to increase bus fares by 50%. And those buses are relied upon by some of the poorest residents of this state. Does it really make economic and moral sense to hurt those people, while taking not a single dime more from the wealthiest and best able to help? No, it doesn’t. It is this heartless approach to governing that has resulted in the Republicans’ rejection by residents of this state, this region, and this country. Only 22% of Americans identify themselves as Republicans today, an all-time low. Is it any wonder that they’ve figured out that Republicans are only in it for the rich, the rest of the country be damned?

    One third of Maryland’s “millionaires” disappeared from the tax roles and took up residence in Virginia, Delaware and Florida, all less tax punishing states.

    I’d really appreciate seeing the source for this. Do you really think that wealthy lobbyists moved to Florida from Maryland and are telecommuting? Of course not. Delaware is also hardly within commuting distance of the businesses and government entities of D.C. Vice President Biden did it, but that was for personal reasons. I hardly think it believable that Maryland lost residents there.

    On the other hand, Connecticut’s top tax rate is barely over half that of neighboring states New York and Massachusetts and substantially lower than New Jersey’s. A study published in the New York Times several weeks ago directly contradicted your conclusion that the wealthy leave the state when higher tax brackets are imposed. It found that there was no exodus of millionaires from the state after the top brackets were raised.

    Does Connecticut really want to soak the poor instead of taking a modest amount from the wealthy? Do we really want to borrow forward ten years’ revenues from a yet non-existent Keno gambling system, which also attracts a preponderance of its gambling from lower-income people in order to balance the budget? Do we really want to punt on balancing the budget by borrowing $2 billion, as Rell wants?

    One more point, the summer edition of Connecticut Economy included the finding that Connecticut’s total spending on state and local government as a percentage of its economy is lower than all but three states. Once again we see that the Republicans have been blatantly dishonest in trying to portray our state government staffing and spending levels as “bloated”, as did Governor Rell in her budget address in February.

    The recently proposed Democrat budget – these guys had months to bring forth this improvident mouse – is both unlovely and an insult to the laws of economics.

    Regarding “an insult to economics”, I would recommend you read the essay by Nobel Prize-winning economist Joseph Stiglitz of Columbia University that asserted that it was less damaging to a state economy to mix spending cuts with revenue increases to balance budgets than it was to rely solely on spending cuts. Before you call the Democratic (not “Democrat”- get your grammar and your insults straight) budget “an insult” to economics, I suggest you win your own Nobel prize in the subject.

    Last point, why not take to task the Republicans and Governor Rell for their blatant dishonesty in refusing to propose a balanced budget, ignoring the real pending deficits? The Democrats are being responsible by accepting the real fiscal facts and dealing with them directly and not shirking their responsibility to be honest with the people of this state.

  6. just-scraping-by $600,000 a year, what would my tax increase be?

    Let’s say you’re self-employed and once in 10 years (or in a lifetime) the planets all align for you so instead of the 47K you earned 2 years ago or the 29K you managed to pull down in 2008, you send the ball out of the park and earn 800K.

    Is this tax structure fair?

  7. I’d really appreciate seeing the source for this. Do you really think that wealthy lobbyists moved to Florida from Maryland and are telecommuting? Of course not. Delaware is also hardly within commuting distance of the businesses and government entities of D.C. Vice President Biden did it, but that was for personal reasons. I hardly think it believable that Maryland lost residents there.

    The “moving” is simply changing your primary residence on your tax form. If you have multiple residences, it’s really quite simple. There is no moving truck involved, but you just choose to pay the bulk of your taxes to the state with the lowest rate.

  8. Let’s say you’re self-employed and once in 10 years (or in a lifetime) the planets all align for you so instead of the 47K you earned 2 years ago or the 29K you managed to pull down in 2008, you send the ball out of the park and earn 800K.

    Is this tax structure fair?

    So when I’m not doing that well, there’s a relatively robust public infrastructure supporting me and my business — and when I am doing well, I’m paying more to support that infrastructure? Doesn’t bother me.

    In this current economic crisis, which is more of a “burden” — a $40,000 income earner losing 10% of the support services our government offers, or a $600,000 income earner losing an extra 1% of their paycheck? Add in that the income tax takes into account the misfortune of those that have lost their jobs or taken up worse-paying jobs to pay the bills, and it seems like the obvious solution.

  9. In this current economic crisis, which is more of a “burden” — a $40,000

    A 40K earner deserves -0- in any sort of “aid”

  10. “Plunder”? Come on! That is silly. To be accurate, it is the Republicans who want the pain of balancing the state’s budget to fall on everyone but the state’s wealthiest residents. Rather than tax people making over three quarters of a million dollars, Republican Governor Rell wants to increase bus fares by 50%.

    No. You’re wrong. The wealthy are already paying a grossly disproportionate share of the cost of the State’s government, and will (not “may”) reduce their tax payments in response to a tax increase.

    What share of the State’s budget do you think the top 1% of income tax payers should pick up? Give us an objective answer. What’s fair? 33% sounds pretty unfair to me, but I’ll take it.

    Does it really make economic and moral sense to hurt those people, while taking not a single dime more from the wealthiest and best able to help?

    No. It makes economic and moral sense for the State to right-size itself. Again, go ahead and try to take an extra dime (or, to be factually accurate, a whole lot of dimes) from the wealthiest 1% in Connecticut. See how far that gets you.

    Here’s what you fail to understand: these tax increases will not bring in the revenue that the Democrats say they will. More accurately, raising the income tax by 50% on the wealthiest residents will not bring in 50% more from these taxpayers. This is not arguable.

    On the other hand, Connecticut’s top tax rate is barely over half that of neighboring states New York and Massachusetts and substantially lower than New Jersey’s. A study published in the New York Times several weeks ago directly contradicted your conclusion that the wealthy leave the state when higher tax brackets are imposed. It found that there was no exodus of millionaires from the state after the top brackets were raised.

    If life is so great for millionaires in Connecticut, why aren’t millionaires flocking here? More importantly, why do we rank at the bottom in terms of attracting them? After all, they’re pulling weight for everyone else in this state. Don’t you think we should try to keep them here?

    Last point, why not take to task the Republicans and Governor Rell for their blatant dishonesty in refusing to propose a balanced budget, ignoring the real pending deficits? The Democrats are being responsible by accepting the real fiscal facts and dealing with them directly and not shirking their responsibility to be honest with the people of this state.

    The Democrat budget is not balanced. Don’t fool yourself into thinking that it is.

    P.S. Tell me again about that fantastic VA health care system, Thomas. That was a good one…

    http://www.foxnews.com/politics/2009/06/24/va-medical-shambles-veterans-groups-say/

  11. A 40K earner deserves -0- in any sort of “aid”

    By that I mean roads to deliver goods on, regulation of accreditations so my clients can trust that I’m not a scam artist, a court system to enforce my contracts when a client doesn’t pay, etc.

    It’s a rare millionaire that’s self-reliant enough to move to a deserted island where they can have private everything.

  12. By that I mean roads to deliver goods on, regulation of accreditations so my clients can trust that I’m not a scam artist, a court system to enforce my contracts when a client doesn’t pay, etc.

    It’s a rare millionaire that’s self-reliant enough to move to a deserted island where they can have private everything.

    Isn’t it true that the things you’ve listed (roads, regulations, etc.) provide a pro rata benefit to everyone in Connecticut — meaning that George David benefits from them just as much as George Jepsen does?

    If that’s the case, why does George David pay so much more than everyone else for them, and is that fair?

  13. Maybe Jodi Rell will sign this bill. I’ll bet some Democrats voted for knowing that Jodi would veto. Thing about Jodi is, you never really know.

    Remember the public funding of candidates? I think many people were surprised when she signed it, and there were likely some that voted for it to save face knowing it’d get vetoed. Now the Senate Vacancy Bill got signed by her. I’ll be a Rep or State Senator or two or three probably didn’t want this to happen but voted for it (State Senators that thought maybe they’d be governor some day).

    So while it’s likely that Rell will veto, you just never really know with her…

  14. By that I mean roads to deliver goods on.

    Fuel taxes cover those expenses and unfortunately are not dedicated to only those expenses, so the massive surplus is squandered on loads of nonsense that most taxpayers don’t even have access to.

  15. Thomas Hooker

    No. You’re wrong. The wealthy are already paying a grossly disproportionate share of the cost of the State’s government, and will (not “may”) reduce their tax payments in response to a tax increase.

    A “grossly disproportionate share”? What do you consider “gross”? The top tax rate for federal taxes is lower than it was under Reagan. Connecticut’s income tax is a flat tax. You are worried about millionaires leaving the state. But statistics show that it is the less wealthy and young workers who are leaving in droves, not the millionaires.

    The progressive income tax has been a fixture of the American economy for more than a century. Those who are able to pay more are charged more in taxes. Now you can rant and rave, but overwhelmingly that philosophy is supported by the American people. If you want to keep protecting people earning in the high six figures from paying a bit more in taxes, that’s your choice. But keep in mind that a lot of ordinary people are hurting in this environment, losing their homes, losing their health care, their jobs. And stubbornly refusing to ask the wealthiest Nutmeggers to chip in a bit more, while teachers are being fired and bus fares raised by 50%, you are simply alienating the people of this state even more from the Republican Party. Your choice.

  16. Thomas Hooker

    The Democrat budget is not balanced. Don’t fool yourself into thinking that it is.

    Really? Would you care to provide details to support your assertion? The Democrats are using the $8.9 bn deficit figure that the non-partisan Office of Fiscal Analysis announced in February, while Rell and the General Assembly Republicans are still pretending that the deficit will be nearly a billion dollars less. Rell depends on over $2 billion in borrowing. How can you support that?

  17. Thomas Hooker

    If life is so great for millionaires in Connecticut, why aren’t millionaires flocking here? More importantly, why do we rank at the bottom in terms of attracting them? After all, they’re pulling weight for everyone else in this state. Don’t you think we should try to keep them here?

    I really don’t know where this is coming from. Connecticut ranks first in the nation in per capita income- still. The states that impose higher tax rates on wealthier residents- New York, New Jersey, and Massachusetts- rank next in terms of per capita wealth. If you can quote a source for that assertion, it would certainly help advance the dialogue. But it certainly seems that Fairfield County has not only attracted, but created its share of multi-millionaires, including movie stars, hedge fund moguls (Fairfield County is the center of hedge fund investing globally), attorneys, and others. Mel Gibson? He’s here. Paul Newman? Yep, he was a long-time resident. How ’bout Scott Frantz, Republican state senator from Greenwich? He’s an investment millionaire. Livvy Floren? Her husband has donated millions to his alma mater Dartmouth.

    So where does your assertion come from?

  18. Thomas Hooker

    Here’s what you fail to understand: these tax increases will not bring in the revenue that the Democrats say they will. More accurately, raising the income tax by 50% on the wealthiest residents will not bring in 50% more from these taxpayers. This is not arguable.

    Might it result in a 46% increase rather than 50%? Perhaps. But that’s close enough. Clearly the Laffer Curve has been discredited and discarded many years ago. Reagan, GW Bush, GHW Bush all figured that cutting taxes would bring in more revenue than the tax cut. Each and every time they were proved wrong. The federal budget rose by over 50% under GW Bush, and that was before the financial meltdown beginning in September last year. The two biggest deficits in America’s peacetime history were recorded under Reagan and GHW Bush. On the other hand, Bill Clinton raised taxes on wealthier Americans and the country registered its first fiscal surpluses in forty years, and the biggest federal surpluses in decades more. And the economy not only didn’t tank, it recorded its strongest sustained growth with the lowest inflation in nearly a century.

    It’s high time for Republicans to discard their ideologies based on pure fiction and join the reality-based community. If Republicans continue to hold to their don’t tax the rich meme, they will fall even further out of favor with the American people. Keep in mind that from 1932 to 1994, the Democrats controlled congress for all but two years. That could happen again.

  19. Thomas Hooker

    http://www.foxnews.com/politics/2009/06/24/va-medical-shambles-veterans-groups-say/

    I’m sorry, but I have absolutely no trust in anything Fox News spews out. No rational individual gets his news from Fox. It’s a propaganda outlet, and nothing more.

    I stand by the assertion that the VA improved into the best health care system in America under Bill Clinton. Of course, George W Bush was in charge of it the past eight years, so there’s no telling how miserable it’s become now. Under George HW Bush, FEMA was a hopeless organization loaded with his Republican cronies. Bill Clinton improved it immensely. Then George W Bush came in and appointed “You’re doing a heckuva job, Brownie”, and it tanked again.

  20. Thomas, you seem like a well-intentioned and extremely loyal guy. However, you couldn’t be more wrong, factually, on a consistent basis if you tried. In fact, you’re refusing to acknowledge facts that are as plain as day, in favor of what you really, really believe. In that sense, you’re a lot like a Cubs fan — you believe what you believe, and even if your guys suck year after year, you love them just the same. It’s honorable, but equally silly.

    A “grossly disproportionate share”? What do you consider “gross”? The top tax rate for federal taxes is lower than it was under Reagan. Connecticut’s income tax is a flat tax. You are worried about millionaires leaving the state. But statistics show that it is the less wealthy and young workers who are leaving in droves, not the millionaires.

    A grossly disproportionate share is 40-to-1, i.e., when 1% of the population pays 40% of the income tax — and that’s exactly what’s happening on the federal level:

    In the year Ronald Reagan took office (1981) the top 1% of income earners paid 17.58% of all federal income taxes. Twenty-five years later, in 2005, the top 1% paid 39.38% of all income taxes. Source: http://online.wsj.com/article/SB120122126173315299.html

    I like it when you argue that everything is a popularity contest…

    The progressive income tax has been a fixture of the American economy for more than a century. Those who are able to pay more are charged more in taxes. Now you can rant and rave, but overwhelmingly that philosophy is supported by the American people. If you want to keep protecting people earning in the high six figures from paying a bit more in taxes, that’s your choice.

    …but if that’s the case, then the debate is over. Jodi Rell is the most popular governor in America, and defeated her Democratic opponent by four times the margin that Obama won over McCain. If you’re talking about the “overwhelming… philosophy” that is supported by the people of Connecticut, Jodi Rell is right and Democrats are wrong. End of story. Right? We should only do what the majority of people think? Is that fair? If so, thanks and have a great weekend.

    Really? Would you care to provide details to support your assertion?

    A balanced budget means that every dollar spent comes from every dollar received in tax revenues. The Democrat budget doesn’t come close to accomplishing that. They’ve raised rates, they haven’t raised revenues. (This isn’t hard to figure out.)

    I really don’t know where this is coming from. Connecticut ranks first in the nation in per capita income- still. The states that impose higher tax rates on wealthier residents- New York, New Jersey, and Massachusetts- rank next in terms of per capita wealth. If you can quote a source for that assertion, it would certainly help advance the dialogue. But it certainly seems that Fairfield County has not only attracted, but created its share of multi-millionaires, including movie stars, hedge fund moguls (Fairfield County is the center of hedge fund investing globally), attorneys, and others. Mel Gibson? He’s here. Paul Newman? Yep, he was a long-time resident. How ’bout Scott Frantz, Republican state senator from Greenwich? He’s an investment millionaire. Livvy Floren? Her husband has donated millions to his alma mater Dartmouth.

    Thousands and thousands of times, I’ve cited the statistic that Connecticut is 46th in terms of attracting millionaires. If everything was peachy keen here, wouldn’t we be 1st? Or 2nd, maybe? Instead, the only states worse than ours include your old favorites… New Jersey and New York. Hooray!

    Your dissonant arguments border on the absurd.

    I’m sorry, but I have absolutely no trust in anything Fox News spews out. No rational individual gets his news from Fox. It’s a propaganda outlet, and nothing more.

    Let me get this straight… are you saying:

    1. That the VA didn’t potentially expose 10,000 people to HIV and/or hepatitis? Check out what that right-wing propaganda outfit called ABC News has to say about it: http://abcnews.go.com/US/wireStory?id=7836367
    2. That the head of the American Legion didn’t testify before Congress that the “[l]ack of inspections, lack of transparency” were likely to blame?
    3. That this statement by an attorney who represents, uh, veterans, is false? “Generally speaking, the physicians that work at the VA work there because they have no interest in private health care, and in some situations are unable to find jobs in private industry.” I’m sorry, but that’s what you can expect under government health care: no more, and probably a LOT less.

    Your hatred for George Bush is downright alarming.

  21. Dempsey Dem

    OK…

    Higher taxes are bad and to be avoided…
    Reducing or eliminating programs are bad and to be avoided…
    Cutting your program is regrettably necessary, but cutting mine is verboten

    Now the Democratic budget is/is not (Please select) balanced, offers higher taxes, some cuts, but doesn’t cut enough spending

    The Republican plan was out of balance from day one, and it’s not getting better. The Governor and the Republican ‘Followship’ want the Democrats to carry the budget-cutting baggage while the Governors minions stand on the siderlines blathering that it’s not enough – that they could do better – but offer no specifics

    The unions accepted givebacks and 1/3 more state employees took early retirement; but it’s not helping.

    As I said elsewhere, pass the last submitted Republican budget as is with it’s 2 billion dollar plus deficit and higher fees for anything that goes ‘klink’ in a cash register. Democrats can easily run against those cuts and fee increases.

    And we all know that next year the Legislature, on their white horses, will gather once again in the election year to address the unanticipated deficit and the ‘devastating effect’ of whomever’s budget cuts, and after spending three months assigning blame, will ease thye pain by borrowing or rigging the books to restore the most politically beneficial funds.

  22. A “grossly disproportionate share”? What do you consider “gross”? The top tax rate for federal taxes is lower than it was under Reagan. Connecticut’s income tax is a flat tax. You are worried about millionaires leaving the state. But statistics show that it is the less wealthy and young workers who are leaving in droves, not the millionaires.

    This reminded me of a movie quote:

    “We Italians have family. The Jews have tradition. What do you people have?”

    “We have the United States of America. The rest of you are just visiting.”

    It’s obviously not your country, Thomas.

  23. One third of Maryland’s “millionaires” disappeared from the tax roles and took up residence in Virginia, Delaware and Florida, all less tax punishing states.

    I’d really appreciate seeing the source for this.

    Always happy to oblige the founder of Connecticut: http://nrd.nationalreview.com/print/?q=MjAwOTA2MjI=. You’ll have to scroll down a bit.

    Now don’t you go demagoging National Review, Tom.

    The present two year budget is $37 billion, give or take a billion. The last non-income tax budget, projected out two years, was around $15 billion. The difference between the two, roughly $22 billion, represents the state’s increase in taxes over 18 years, much of it paid by Connecticut’s mobile rich, as Dobb has pointed out. That is on the spending side of the ledger and is the principle reason why, in a flat economy, we are now in the hole. First law of economics, according to Pesci, is: When you find yourself in a hole, stop digging = stop spending; and if Stiglitz does not agree with this proposition, I suggest the noble committee revoke his prize.

    Please provide me with references showing the number of occasion during this spend-fest when Democratics (if you insist on the grammar) in the state legislature have provided me and you and Dobb with sufficient tax cuts – no rebates, please—to balance this orgy of spending.

    You do know, of course, that the income tax began as a one percent tax on millionaires. Didn’t take to long for them birds to come home and roost in your wallet, did it Hooker? What percentage of your pay check is devoted to the federal income tax?

    Mine is above one percent.

  24. The first peace time income tax was supported by Democratics (if you insist) in 1894. It was a two percent tax on incomes over $4000 — $88,4000 in today’s dollars.

  25. Wait, did I really get moderated for favorably comparing Thomas Hooker to a Cubs fan?

    That’s awesome.

  26. You know, Hooker, I must confess I was afraid for a moment that, reading the link I provided in National Review, I may have put you in mortal danger; because National Review, as you may know, is to right thinking folk (will you please stop calling them conservatives, neo-cons and other nasty names!) what C.S. Lewis’ God is to atheists.

    Atheist can never be too careful, Lewis warned: God is an unscrupulous fellow; everywhere bibles are left open, enticing music wafts out of church doors…

    My fear is that in reading the link in search of the relevant passage, you might have stumbled upon some large truth and suffered conversion.

    On the use of “Democrat/Democratic” when referring to the party of Jackson and Jefferson and Hooker, the expression “Democratic Party” just seems grammatically clumsy to me. Spell check does not rebuke me when I write the line: “The Democrat Party wants to plunder mini-millionaires to support its improvident spending.” But both ways are proper. And since this is the case, I am going to refer to your party from now on as the Democratic Party, treading heavily on the grammatical cramp it will give me – provided, as the lawyers say, you can assure me of one thing.

    I intend at some point to start my own political party. Fetching around for names, it strikes me that “Democrat Party,” the name you so heartily reject, might be a possibility. So then, if I’m able to accomplish my aim, can you assure me that I may have ownership of the title without fearing a copy write infringement suit from your party, the Democratic Party? If I’m sued – partisan lawyers are very undemocratic sometimes – can I count on you to foot the bill? You are a lawyer, aren’t you, or a professor, or a preacher, or a Democrat (oops! Democratic) functionary in the party of Jackson, Jefferson and Hooker? In this endeavor, may I count on your support – your blood, sweat, tears and post-tax money, so to speak?

    I really need a clear, non-political answer to this question before we proceed, because I am not one of the mini-millionaires your party proposes to plunder; and, being taxed to the hilt, I don’t have the money to afford legal representation.

    Perhaps Bruce Rubenstein can offer a hand-up here.

    Now then, I am going to ask you a very clear question, and I’d like a very clear answer in return… pretty please.

    The dominant Democratic Party, which fashions and controls final budgets for the state, has over the past 18 years increased the bottom line on the state’s budget from $16 billion to $37 billion per bi-annum. That’s an increase of $19 billion throughout the income tax years. This represents an increase of approximately 100 percent.

    Well sir, as any fourth grade math student could have advised the Democrats who fashioned these budgets, which were heavily reliant on taxes paid by the guys with monocles and top hats living in Connecticut’s Gold Coast, that false bottom was bound to fall through when the economy soured and the guys with monocles finally got their comeuppance.

    And it did – leaving us awash in red ink.

    Democrats in the legislature, as you know, now have proposed a tax increase/spending cut split to discharge this deficit. The proposed two-year budget fashioned by Democrats calls for $2.5 billion in tax increases and about $1 billion in spending cuts.

    You, Hooker, consider this eminently “fair,” to use a word much abused by Democrats in the legislature.

    Are you ready for the question? Here it comes.

    What is fair today must have been fair yesterday. Applying the current Democrat formula to yesteryears, Democrats should have been raising taxes and cutting spending by a similar ratio.

    Since taxes were raised $19 billion over the 18 year period, an increase stoked by the institution of the income tax (thanks a lot Lowell!), spending should have been reduced $7.6 billion according to the current Democrat formula.

    Where is the $7.6 billion in spending cuts? Rebates don’t count, because the economic effects of rebates and cuts are different. Show me the cuts.

  27. Thomas Hooker

    On the use of “Democrat/Democratic” when referring to the party of Jackson and Jefferson and Hooker, the expression “Democratic Party” just seems grammatically clumsy to me. Spell check does not rebuke me when I write the line: “The Democrat Party wants to plunder mini-millionaires to support its improvident spending.” But both ways are proper….

    Mr. Pesci, this is the same sort of virulent drivel that conservative Republicans insist on spewing out that is part of the reason that Americans have become fed up with the Republican Party. No less a body than the Republican National Committee introduced a resolution recently to rename the Democratic Party the “Democrat Socialist Party”. So while America desperately needs to pass a national health care plan, manage the withdrawal of our troops from that senseless war in Iraq that the Neocons conned us into, pulling our economy back from the brink of a “once-in-a-century” financial meltdown, and rebuilding ties with the rest of the world frayed or severed by President Bush, you insist on indulging in name-calling and petty insults. I would be very surprised if you really are incapable of discerning the proper grammatical uses of “Democrat” and “Democratic”. But that reveals far more about you and your ideology than it does about anyone else.

    I won’t waste any more time on your puerile questions about the party name. I will simply let other readers of this site judge the level of maturity that produced them and leave it there.

  28. Thomas Hooker

    The dominant Democratic Party, which fashions and controls final budgets for the state, has over the past 18 years increased the bottom line on the state’s budget from $16 billion to $37 billion per bi-annum. That’s an increase of $19 billion throughout the income tax years. This represents an increase of approximately 100 percent.

    Well sir, as any fourth grade math student could have advised the Democrats who fashioned these budgets, which were heavily reliant on taxes paid by the guys with monocles and top hats living in Connecticut’s Gold Coast, that false bottom was bound to fall through when the economy soured and the guys with monocles finally got their comeuppance.

    Mr. Pesci, to put it bluntly, economics isn’t your strong suit. First, when judging the relative size of the tax burden on an economy, one measures taxes against the total size of that economy. You have simply quoted one side of the equation, spending on taxes. Over the same period that you mention, what was the increase in gross state product, the standard measure of a state’s economy? Furthermore, what was the drag on the state’s economy caused by our massive federal deficit with Washington? According to the last figures I saw in The Tax Foundation, our deficit with D.C. is equivalent to roughly 7% of GSP. That is enormous, and it is no wonder that our state would have to increase taxes in order to offset that deficit. Yet we are still a moderate-spending and taxed state, if you would ever bother to look at the data.

    I will direct you, once again, to the summer issue of Connecticut Economy and to the data showing that Connecticut’s spending on all taxes, state and local, as a percentage of the state’s economy ranks us 47th in the nation. Once again, only three states spend a smaller proportion of their economy on taxes compared with Connecticut. Are we straight on that? Again, you simply cannot quote a single side of the ledger and put that forward as an honest picture of the economy. Once again, I will direct you to the U.S. Census Bureau’s data on employment figures. Once again, the state of Connecticut’s total state government employment as a percentage of the population puts the state right in the middle compared with the fifty states. I will repeat that state employment over the past six years fell by several thousand, it did not increase. If one measures all government employment in the Nutmeg State as a percentage of the population, one sees that we are well below the average for all states. And keep in mind that we have achieved that moderate level of government employment in spite of the fact that our state requires relatively high levels of government workers: we need workers to clear leaves and snow, to repair the roads and fill potholes that appear far more frequently than in more moderate climate states. And our populace demands a relatively high level of education for its youth. The data show that the biggest classification of state workers are employed by the state university system. With private tuition moving further and further out of reach, students are turning to public institutions. Do you want us to cut professors and close facilities at precisely the point of greatest demand?

    Last, you slammed the Democrats “who fashioned these budgets”. But you fail to point out that from 2001, the last year in which we suffered a recession, until this year, the Democrats who fashioned these budgets engineered surpluses every year which went into the $1.6 tn rainy day fund, resumed payments to the teachers’ retirement fund that had been permitted to fall well into arrears, and increased spending on the university system as more and more students demanded access and better quality.

    Once again, if you take off your ideological blinders and carefully examine the economic data, you must admit that your notion of a state saddled with a wildly bloated budget and public employment is pure fiction. But it is up to you to remove those blinders.

  29. Thomas Hooker

    Thousands and thousands of times, I’ve cited the statistic that Connecticut is 46th in terms of attracting millionaires. If everything was peachy keen here, wouldn’t we be 1st? Or 2nd, maybe? Instead, the only states worse than ours include your old favorites… New Jersey and New York. Hooray!

    Please give us the data on this. It makes absolutely not sense. You are aware, aren ‘t you, that Connecticut remains the state with the highest per capita income of all the fifty states? I have no idea where this figure comes from, but to argue that Connecticut is pushing away the wealthy when we continue to rank as the wealthiest state in the union is simply nonsensical.

  30. Thomas Hooker

    “We have the United States of America. The rest of you are just visiting.”

    It’s obviously not your country, Thomas.

    SamuelCT, I have no idea what you’re trying to say here. Are you telling me to leave America? Are you trying to tell me that because I am a registered Democrat, you are questioning my patriotism? Are you trying to tell people at this site that if you’re not a conservative, you’re not a patriot? Really?

  31. Thomas Hooker

    A grossly disproportionate share is 40-to-1, i.e., when 1% of the population pays 40% of the income tax — and that’s exactly what’s happening on the federal level:

    Mr. Dobb, as with Mr. Pesci, you are attempting to prove a point by quoting only one side of the ledger, and that is misleading and false. You are correct that a tiny percentage of the population pays a very large percentage of all taxes. But in today’s America a very tiny percentage of the population accounts for a massive percentage of all income as well. Though the percentage of taxes paid by the top 1% has increased, as you say, since Reagan, it is also true that while the middle class has seen its real incomes go sideways since Reagan, the top 1% has experienced an explosive increase in income relative to the rest of the country. Yet while you assert that taxes paid by the top earners is out of line, in fact, the top tax rate today is lower than it was under President Reagan, and that after President Obama increased the top tax rate.

  32. Hooker,

    I just don’t know where to begin, so I won’t. I just want to point out one thing: If you think that doubling and even tripling the bottom line of a state budget within the space of three governors is not excessive spending, well then that that’s what you think. And if you think that spending multiple surpluses – which by definition is the amount of money that the government needlessly has taxed its citizens – did not contribute to the swollen bottom line of successive budgets, well then that’s what you think. A surplus is money raised in excess of budgetary needs. In my untutored opinion, that money should have been returned to the citizenry. But it wasn’t, was it? Democrats in the Democratic Party in the legislature and compliant Republican governors spent every bit of it. And that lump sum – billions of dollars each fiscal year – inflated the spending side of the ledger; that’s the side people like you are not interested in. You haven’t been interested in it because, until recently, there were always those reliable lush rich pillows in Connecticut’s Gold coast you could fall upon. Not any more. You ought to be interested in the spending side of the ledger. If it does not peak your interest sometime soon, I have a feeling that the Democratic Party whose interests you serve will feel the pinch at the polls. But we’ll see. It’s always possible that Lincoln was wrong when he said you couldn’t fool all the people all the time.

  33. Hooker, you’d be doing yourself a huge favor by controlling your temper and not engaging in the exact behavior which you purport to abhor. I tried to read your five posts but found it too tiresome which is unfortunate because you may have actually made a relevant point in there somewhere but it was lost in the name calling and ranting.

  34. Thomas Hooker

    I just don’t know where to begin, so I won’t…if you think that spending multiple surpluses – which by definition is the amount of money that the government needlessly has taxed its citizens – did not contribute to the swollen bottom line of successive budgets, well then that’s what you think. A surplus is money raised in excess of budgetary needs. In my untutored opinion, that money should have been returned to the citizenry. But it wasn’t, was it?

    When you put funds into the “rainy day fund”, you are not, “by definition”, “spending” taxpayer funds, but engaging in public sector saving. Putting those funds into bank accounts is the same, according to economics, as a private individual putting funds into a bank account. Economic statistics are kept for both public and private savings figures. Putting money that is required by law toward teachers’ retirement accounts that has not been allocated for several years is called being responsible and doing what is right for our teachers. You will recall that the state is still several billions of dollars behind in its contributions. Spending money to enlarge and improve our system of public universities is viewed as an investment in education and is usually considered a step that leads to enhanced economic growth in the future. Investing money in public health and hospitals, such as a helicopter service for seriously wounded residents, is also usually seen as an economic positive as it saves the lives of those who can contribute to economic growth in the future, and preserves the lives of individuals who support their families.

    Now if you want to argue that our system of public education should be cut back to the level of, say, Arkansas, and that you are willing to accept declining levels of educational attainment as a result, you should also be willing to acknowledge that you will accept the falling levels of quality of life and the future loss of technology companies to better educated states. I believe that investment in technology and education is an economic positive, and that Connecticut should aspire to more than raising chickens and tobacco. We should acknowledge that this state, for all of its problems, still ranks as America’s wealthiest. State and local government is not the problem, as Reagan used to say; it’s an integral part of any economic development plan.

  35. Thomas Hooker

    Hooker, you’d be doing yourself a huge favor by controlling your temper and not engaging in the exact behavior which you purport to abhor. I tried to read your five posts but found it too tiresome which is unfortunate because you may have actually made a relevant point in there somewhere but it was lost in the name calling and ranting.

    Dear Brenda, I am disappointed that you appear so unwilling to acknowledge the anger expressed by conservatives on this site. I think conservatives are surprised when Democrats stand up to them and stand up for their values and policies. For too long, the Far Right has gotten away with the most vicious rants on any number of topics. Have you listened to Rush Limbaugh lately, Brenda? Bill O’Reilly. We Democrats are fighting back. We’re fed up with the factless arguments upon which so many of conservative arguments are based. Take a look at the arguments here about economics. Clearly, the conservative commentators here are using facts far out of context and in ways that mainstream economics simply doesn’t ever employ. You will also see that I have pointed out the absurdity of so many arguments put forward here, including the one that Connecticut ranks next to the bottom of the fifty states in attracting millionaires. If we are the wealthiest state in the country, can we really be pushing away millionaires? You will see that the writer who asserted that has failed to respond. And Mr. Pesci has likewise declined to respond directly to my pointing out the flaws in his economic assertions. On the contrary, we get instead of reasoned arguments based on solid data, rants based on ideology.

    I would urge you, Brenda, to both look for the facts in the argument, and to also recognize the fury that is so regularly spewed out by conservatives here. Please don’t penalize Democrats for showing backbone and finally standing up to conservative rants.

  36. Don,

    Your post #32 IMO says it all very well. I would like to add my comments to some of your points.

    Your point, ” A surplus is money raised in excess of budgetary needs. In my untutored opinion, that money should have been returned to the citizenry. But it wasn’t, was it? Democrats in the Democratic Party in the legislature and compliant Republican governors spent every bit of it.”

    I agree with you that a surplus is money raised in excess of your budgetary needs. I think it should be pointed out however that when in order to produce a “balanced budget”, your need to defer payment for some of your obligations to some future date ( for example the billions on top billions in under funding of the state worker pensions, not to mention the billions more in teacher pensions, and retiree benefits ) then IMO there never was a real surplus to return to the citizenry. The fact is we were simply not taxed enough in the first place to cover all of our obligations. To me to claim we were generating budget”surpluses” all the while we were adding billions to our pension debt is reprehensible at best. Not to mention we doing it again this year and have the nerve to call it a state worker concession.

    Your point, “And if you think that spending multiple surpluses – which by definition is the amount of money that the government needlessly has taxed its citizens – did not contribute to the swollen bottom line of successive budgets, well then that’s what you think.”

    Again I agree, but IMO your comment leaves out the worst part. We didn’t just squander “multiple surpluses”, we squandered money that was really never “surplus” to begin with because we had not fully covering all of our pension etc. expenses each year, we deferred a large part of them. As a result we now not only are left with budget requirements that are billions out of balance, but obligations that clearly can not be sustained.
    We also decided to defer to our kids not just the financial burden of our collective irresponsibility but also the job of doing what is necessary to solve this problem because our current collection of elected officials don’t have the courage, guts, and common sense to do it themselves. That is the very height of irresponsibility and no one should need a degree in economics not to understand that.

    Your point, “I just want to point out one thing: If you think that doubling and even tripling the bottom line of a state budget within the space of three governors is not excessive spending, well then that that’s what you think.”

    How can anyone not agree with your point there? Can any of us run our households doubling and tripling our expenses without doubling or tripling our income or running up an un payable credit card debt at the same time?
    Can any of us just decide to not pay our mortgage this year, or defer our insurance payments to some future date so we can “balance” our household budgets while we continue to spend as we wish without regard as to how long we can go on getting away with that?
    Can any of us just go to our bosses and extract more money from them to pay for our fiscal irresponsibility while at the same time telling them that the mess we created for ourselves is really all their fault because they don’t give us enough of a fair share no matter how much they give to fund our way of life?
    Of course not. Yet it seems those in charge in Hartford, many of them I assume are home owners and should know better, seem to think they can run our state that way.
    It seems somewhere along the way to LOB in Hartford there must be a place where far too many of our elected officials are required check their brains for safe keeping.
    While I know this might sound like a conservative rant the reality of how we have gotten ourselves into this fiscal mess is the real problem, not those of us who are actually concerned about it.

  37. I just don’t know where to begin, so I won’t. I just want to point out one thing: If you think that doubling and even tripling the bottom line of a state budget within the space of three governors is not excessive spending, well then that that’s what you think.

    That’s no surprise — a billion dollars in 1990 is worth 2.02 billion in 2008 dollars. The budget could have doubled over that time without adding a single service or employee to the state rolls.

  38. That’s no surprise — a billion dollars in 1990 is worth 2.02 billion in 2008 dollars.

    Nice try.

    You’re entitiled to your own opinions, not your own facts.

    $1.00 in 1990 had about the same buying power as $1.67 in 2009.
    Annual inflation over this period was about 2.73%.

  39. You’re entitiled to your own opinions, not your own facts.

    Of course we are. You think the cost of milk has something important to do with the cost of running a state government. I think the nominal GDP is a more valuable measure than the consumer price index.

    Also, by changing the date from 2008 to 2009, you manage to discard a quarter of the difference between the two stats.

  40. Tom, I’m not “penalizing Democrats” when I criticized you for babbling on and on and on and on and engaging in the same behavior you criticize others for.

    Now you’re doing something equally irresponsible by claiming my criticism of you is something completely different.

    You’re wrong and unfortunately cannot accept that fact and as I pointed out earlier, you whine and complain about a variety of things but engage in those exact same thing yourself.

    You’re the ultimate hypocrite and as I suggested to you earlier, you may actually have some valid points however it all gets lost in your rants, vicious attacks and factless arguments.

  41. Thomas Hooker

    You’re wrong and unfortunately cannot accept that fact and as I pointed out earlier, you whine and complain about a variety of things but engage in those exact same thing yourself.

    You’re the ultimate hypocrite and as I suggested to you earlier, you may actually have some valid points however it all gets lost in your rants, vicious attacks and factless arguments.

    And you told me to “control my anger”, Brenda? Really? Who’s calling whom “the ultimate hypocrite”? Once again, it’s the conservatives that rant and call names, yet are offended when a Democrat stands up for himself.

    “Control my anger”? Pulleeze!!!!

  42. tom, I’m not calling you names, I’m simply stating fact. You’re a hypocrite.

    Now you’re resorting to lying and twisting facts. You said I “told (me) to ‘control my anger'” which is not true. Go back and look at exactly what I said. I simply suggested in a non-confrontational manner that you control your temper. It was a friendly suggestion that you’ve now twisted into something other than that which is unfortunate.

  43. Thomas Hooker

    OK. And calling me a hypocrite and accusing me of lying and twisting facts is the way you control your anger, right? Got it, Brenda. We’re all crystal clear here now!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s