Sunday, October 5, 2008

Blunt Ax Economics


Many observers would like to dismiss the referendum to appear as Question 1 on the November Massachusetts ballot, as crazy talk. Among the choices facing the voters Question 1 will be an up or down vote on eliminating the state income tax. In round numbers, income tax revenues for fiscal 2009 are expected to provide $12.5 billion against total budgeted expenditures of $28 billion. It doesn't take a fiscal analyst to envision the disruption that such a change would cause. Out-of-state readers must be scratching their heads to learn that Question No.1 is garnering increasing support. Writing in today's GLOBE, house conservative, Jeff Jacoby does an excellent job of tracing the ongoing frustration endured by Massachusetts voters seeking lower taxes. Not only has the state government ignored previous voter initiatives to lower taxes, but the rate of growth in the state budget continues unabated:

"Just last week, Governor Deval Patrick's office promised "hundreds of millions of dollars" in reduced outlays this fiscal year. And yet, somehow, the state budget continues to bloat: It was $22 billion in 2005, $23 billion in 2006, $25 billion in 2007, and $26 billion in 2008. The fiscal 2009 budget adopted in July - the one Patrick now claims he will cut unilaterally - totaled $28.2 billion. But if anything in Massachusetts is certain, it is that when the books close on the current fiscal year, state spending will have gone up by hundreds of millions of dollars, not down."


The Greek chorus of Politicians, public employees and others with a stake in the continued flow of income tax dollars have been sounding the alarm, citing the litany of crucial services that would fall victim to the passage of Question 1. Rather than reflecting taxpayer ignorance, however, the growing support for Question 1 may show the limits of taxpayer patience.

No comments: