The truth about the state budget crisis. Every member of Governor Mitt Romney's staff, every legislator, and every no-new-taxes automaton should be required to sit down and read this article in today's Boston Globe, by Peter Orszag, of the Brookings Institution, and Joseph Stiglitz, a Nobel Prize-winning economist.
The executive summary:
- Raising taxes is often the least damaging way out of a fiscal crisis in terms of harming the economy.
- Compared to other states, taxes in Massachusetts are relatively low, both in relative and absolute terms.
- The tax cuts of the 1990s primarily benefited the wealthy -- those who can most easily afford an increase now.
- Nearly all of the spending increases of the '90s went to vital areas such as public education, health care, and prisons.
Sadly, elected leaders are giving into populist demogoguery of the anti-tax forces, as Boston Herald columnist Wayne Woodlief notes today. Mind you, Wayne thinks that's good. (You'll have to pay to read Woodlief's column. Is that a tax or a fee?)
The Herald website also points to a column by Tom Moroney, who works for the MetroWest Daily News, a sister paper. Moroney asks a lot of questions of folks he doesn't like, such as the Massachusetts Teachers Association and the AIDS Action Committee.
Read it for yourself, but in the meantime, I have a challenge for Moroney: explain precisely what is wrong with Orszag and Stiglitz's analysis. If you can't, are you willing to change your mind about the need for new taxes? And can you think about this in structural terms, rather than nitpicking it to death with little things that most of us already agree on, such as the need to reform the Quinn law?
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