BCT Editorial – 5/7/06

This page was last updated on May 7, 2006.

Too political; Editorial; Beaver County Times; May 7, 2006.

Below is a detailed critique of the subject editorial.

“Property tax debacle shows the need to outsource the job

“Republicans in the state House were right to reject the compromise property tax package when it came before them last week.

“House Republicans were right to cite the uncertainty of the linchpin of the agreement - that the state would receive $1 billion annually in tax revenues from slots machines that are to become legal in Pennsylvania next year.

“They were right to object to the use of surplus lottery revenue to bridge the financing gap until slots revenue kicked in.

“They were right to criticize the distribution of money as favoring the elderly over the middle class.

“They were right to revolt against it because it was a bad deal that had more to do with election-year politics than in doing what was best for all of the people of Pennsylvania, not a select group.

“The Associated Press reported House Republicans revived their months-old argument that a state-level tax shift would be a more comprehensive and reliable way to shift more school funding off property taxes. In addition to using gambling dollars, such a strategy could involve raising other state taxes, such as those on sales or income, to offset local property tax cuts.

“But that’s a nonstarter because senators are opposed to taking those steps.

“So, after months of negotiation, politics and brinksmanship, the issue of property tax reform is still unresolved - and that’s not a bad thing. Let’s take our time and get it right, or as right as you can get it when it comes to taxes.

“First, House Republicans were on the mark in regard to slots revenue. As we have argued before, it’s far wiser to wait until we see how much revenue these machines will generate before spending the money. People have been throwing around the $1-billion figure for so long that it’s seen as a sure thing when it’s not.

“Second, Pennsylvania needs tax modernization, not piecemeal, election-year pandering to a select age group. Property taxes are an issue in large part because they are the only major tax that senior citizens must pay. Pennsylvania does not tax income from pensions and Social Security, and the sales tax is fairly forgiving because it is not levied on food or clothing.”

[RWC] At least eight previous editorials since October 2004 have talked about “tax modernization.” As a reminder, the Times idea of “tax modernization” is the elimination of local taxes in favor of taxes levied by the state and federal governments. In other words, the Times really wants tax centralization. Centralized taxing – and thus power – is completely consistent with socialistic principles.

“Third, Pennsylvania’s most pressing need is to do something about business taxes. Overall, Pennsylvania doesn’t have a bad business tax environment. It does, however, have a couple of whoppers that scare off business and inhibit growth. Instead of using the revenue from slots for minor property tax cuts, why not use it to reduce business taxes and to fund economic development programs?”

[RWC] The “Pennsylvania doesn’t have a bad business tax environment” comment is a recurring position of Times editorials. The most recent were “No excuses” and “Ohio envy” from March 1^st. Please read those critiques for my reaction.

“As the property tax debacle shows, coming to a consensus on taxes is virtually impossible, and reaching common ground often leads to compromises that are not in the best interests of the commonwealth as a whole.

“Because of this politically volatile atmosphere, lawmakers and Gov. Ed Rendell need to outsource this job to a blue-ribbon, independent panel that is charged with coming up with two modernization options that would be subject to an up-or-down vote in the General Assembly, much as Congress does with the closings of military bases.”

[RWC] This is at least the third time since December 2005 the Times has brought up the “independent panel” idea. Here’s what I wrote when a December editorial brought up the “independent panel” idea: “If our elected officials can’t do their jobs, we need to replace them. Appointing a bunch of unelected boobs is running away from responsibility.”