A BIG MISTAKE, BUT NO SURPRISE

1 Stan Roseberg speaks

^ He has a plan, but it’s the wrong plan, and it won’t happen — yet : State Senate President Stan Rosenberg

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Those who want Massachusetts government to spend more money have taken exactly the wrong approach to arriving at their desire : they want higher taxes.

Specifically, Raise Up Massachusetts, an advocacy team that successfully pushed for hiking the State’s minimum wage, now proposes something far less sensible or likely : it wants to almost double the state income tax rate on high earning workers. Those affected will be asked to pay 9 % of their income in taxes rather than the present 5.15 %.

The proposal isn’t very likely because, first, it requires a Constitutional amendment, as Massachusetts does not allow different tax rates for different people. Twice in the 1990s advocates sought such an amendment; both times it was soundly defeated. Second, the proposed amendment cannot appear on the ballot unless tits supporters present some 64,750 valid signatures, after which at least one quarter of the entire legislature must, in two separate sessions, vote to advance the proposal. Will this happen ? Not as long as Robert DeLeo is Speaker of the House, it won’t. Governor Baker also intends to oppose it actively.

The State Senate is another matter. Its leader, Stan Rosenberg, has made it a point to advocate “progressive” causes, especially those which spend more state money and/or which bolster the protected position of public worker unions. So far, Rosenberg has lost every significant battle to the solid alliance of Governor Baker and Speaker DeLeo. Rosenberg is not deterred. As I wrote for Here and Sphere months ago, Rosenberg is playing a long game, one in which losing, for the time being, is perfectly acceptable as long as he can provide a beachhead for “progressives’ and, slowly but surely, increase their power within the Democratic Party and the State House. Rosenberg may well have 2022 in mind; both Baker and DeLeo will likely be finished by the end of that year. It may well take that long for him to achieve his aim, and he seems acclimatized to a long battle.

The tax hike move is also the wrong way to achieve higher state tax revenue. Grabbing an additional $ 40,000 and up from the 14,000 earners who will be affected hurts these earners but does not in any way assure those dollars will be well spent. Baker doesn’t need the extra funds — yet — and a succeeding governor will likely not have Baker’s singular persuasiveness and skills as a budget manager. To grow state tax revenue the right way — assuming that’s needed — we should do the following:

1.improve the state’s primary and secondary education, so that graduates are ready to do at least entry level jobs that will be needed — or to handle the still more demanding “gig” economy that portends even now. Governor baker has already proposed education reforms that will head Massachusetts toward this major policy goal.

2.raise the state’s minimum wage to $ 15.00 an hour,  in Boston maybe even to $ 22.00 an hour. Workers earning this sort of money rather than the present $ 10.50 minimum will actually pay taxes rather than be recipients of the expanded EITC. They’ll also be able to spend into the discretionary economy, thereby boosting the taxable earnings of others ! Raise Up already pursued this wage raise course successfully; why are they now changing the policy ?

3.keep the building boom going in Boston and extend it to gateway cities. A Building Trades union worker earning $ 150,000 pays $ 7,500 or so in state taxes; that same union worker laid off pays no taxes and in fact needs public assistance. This means supporting the Boston 2024 Olympics, Imagine Boston 2030, and the Governor’s Gateway Cities municipality-state compacts.

Please note that my plan for growing the economy is not a standard, right wing “job creators” argument. I am fully aware that consumer demand grows the economy; that the more that people earn, the more they can spend, and that that in turn causes more hiring and more earnings, thus more state tax revenue. My plan fits the Left-wing scenario no better than it accedes to the Right side. But it makes sense.

Of course, that might be the problem., Sensible isn’t an especially sexy point of view in these temper tantrum days of revenge taxes, blame games, and facile illusions.

—- Mike Freedberg / Here and Sphere

Author: hereandsphere

Here and Sphere is an online journal of news, opinion, reviews, advice, & bits n' pieces of everything else - from HERE to SPHERE...... Co-founded by Michael Freedberg, a long-time Boston Phoenix journalist, and Heather Cornell, a South Coast Massachusetts columnist and editor.

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