The Wall Journal editorially applauded Gov. Pawlenty for his veto of the Legislature’s last balanced budget bill. From the editorial:
“Earlier this week Democrats who control both legislative houses passed a three-year $1 billion income tax increase. This would raise the top tax rate to 9.1% from 7.85%, taking the rate even higher than that in New Jersey and New York (outside of Manhattan).
Yesterday Mr. Pawlenty vetoed this tax foolishness, as he has three previous tax hikes as Governor. The tax increase was targeted at the rich, but it applied to individuals with an income of $113,100 for singles and $200,000 for joint filers. Note how the definition of ‘rich keeps becoming more expansive.”
The Journal didn’t deign to note that the vast majority of the DFL plan balanced the budget through cuts. WSJ didn’t specify the additional cuts that would be necessary to finish the job without tax increases. It did give a good statement of the semi-official conservative caricature of Democrats:
“Today’s Democratic Party default is always higher taxes. Dominated by government-employee unions, they refuse to rethink government spending despite the steep recession. Last year six states raised income tax rates, and this year another five are attempting to do so.”
The editorial applauded TPaw’s previous attempt to balance the budget through unallotment, because it thinks those were cuts. It didn’t note that the majority of the unallotment was accomplished by accounting shifts, mostly for k-12 education, that didn’t reduce spending but pushed it into the next biennium without providing any new resources to pay for it then. Nor did it note that Pawlenty’s unallotments included zeroing out a program that allows very poor, very sick people to afford diets that their doctors say is necessary for their health.
The full editorial is here.
It’s always been the DFL position, as I understand it, that an unfunded education shift is a cut. It’s been Gov. Pawlenty who has been claiming that it is a shift.
The Wall Street Journal has placed itself in the awkward position of praising the governor for a policy position he rejects.
Talk to you local school administrators about whether shifts are cuts.
They result in increased interest costs on bonds whose payments have to be delayed.
Since most costs are fixed (salaries, for instance, or utilities), they can’t be delayed, so the options for delayed payments are very limited.
Of course what’s good for Wall Street is not usually got for the country as a whole.
I know if my employer were to shift my paycheck from bi-weekly to delayed by a year I’d perceive that as a cut.
Schools can’t believe this won’t happen again next year, perhaps on a larger scale. To pay back their IOU they’ll get another IOU. To get current again, the state would need a major surplus.
IOUs aren’t payments, especially IOUs from people/governments who can’t afford to repay them. We really aren’t saving taxes as local government has to take on this liability, we are just saving on State taxes. It is disappointing to see the WSJ supporting fiscal recklessness, but it isn’t terribly surprising. As long as families making more than $1,000,000 per year are ok, the WSJ will tell you the country is ok.
Tried to read the article, but subscription is required. Ah, well. Not THAT interesting.
On the topic, however, EB seems to suggest that to consider only the tax increase portion of the bill(the part that Pawlenty himself says was the make-or-break part)represents a distorted picture of it.
While not disagreeing that going into the cuts portion would have presented a fuller picture, I do not see that it would have altered the view of the crucial issue, except perhaps to add some smog to the discussion. (Of course, I can’t KNOW if they in fact made no mention at all, as I am not a subscriber and so cannot read the article. I’ll take EB’s word for now.)
On balance, I believe an article which addresses the veto of a bill that increases taxes by a billion dollars is relevant with or without the added details.
It would be nice to see discussion in the media (and here, perhaps?) of the negative aspects of the health care bill, without emphasis on the positives. You know — in the interest of “balanced” presentation.