Shared Sacrifice, My Ass
I tried. I really tried. I tried to understand and even rationalize Gov. Jack Markell’s argument that any additional taxation of the wealthy would work against his efforts to create jobs in Delaware. He made this argument in a meeting with Delaware bloggers a couple of weeks ago. He said, and I’m paraphrasing, that ‘these kinds of things’ (a tax-friendly environment for business executives) are what those considering Delaware for business expansion look for. He also lamented that certain Delawareans, we’d know their names if he mentioned them, have officially established residence elsewhere because of an estate tax increase.
In other words, there are simply certain Delawareans or would-be Delawareans who, according to the Markell Administration, are Too Rich To Tax Equitably (Code Name: TRITE). If we tax them too heavily, so goes the Administration’s wisdom, they will move. Or at least pretend to move. Or not come here in the first place. To which Al Mascitti says, tax the property. We don’t have a statewide property tax and the Billionaires on the Hill, through their decades of basically running this state, are the reason why we don’t. They’d have to pay their fair share. Let’s stop pretending here. If this Administration had the political will to ensure that the wealthy pay their fair share, they’d find a way. And they’d likely have a receptive General Assembly to enact it.
Keep those thoughts in mind as we fast-forward to:
A Town Hall Meeting Last Night at Mount Pleasant High School Featuring the Governor and Members of His Administration.
Let’s do just a few take-outs from Chad Livengood’s story in today’s News-Journal:
At a town hall meeting at Mount Pleasant High School, Markell said he has not supported a specific plan, but he has tasked the General Assembly with reducing state employee health insurance and pension costs by $100 million over the next five years. That could mean a reduction in benefits or taking more out of employee’s checks to cover the escalating costs.
Donna O’Hanlon, who handles Medicaid claims in the Department of Health and Social Services spoke up and said the governor’s call for shared sacrifice would not be equal among all state employees.”Unfortunately, the shared sacrifice is actually felt by 35,000 people who aren’t working today,” Markell replied, noting the official number of unemployed Delawareans.
Shared sacrifice. Let’s make it crystal clear. The only people who are being asked to sacrifice and to ‘share’ the sacrifice are those people with the least to share. It is time for his Administration to excise the platitude ‘shared sacrifice’ from its lexicon, because (a) it’s not true, (b) they admit it’s not true (return to the top of this article) and (c) by now, everybody who is paying attention knows it’s not true. Rather than demand that those whose taxes were cut precipitously during the ‘good’ years sacrifice even a little bit during these ‘lean’ years, Gov. Markell is coming perilously close to demonizing, albeit in more polite terms than Wisconsin’s Governor Walker, those workers from whom he would take the most. And, despite his reputation for being detail-oriented, he is ‘task(ing)the General Assembly with coming up with $100 mill in cuts over the next five years’. The Governor employs all the experts, he should deliver the bad news rather than ‘tasking’ legislators with doing it. Harry Truman was wrong, guess the buck(s) don’t stop at the top any more.
Yep, somehow it must be state workers’ fault that 35,000 Delawareans are unemployed. Some who, by the way, are former state workers. I don’t for one minute fault Markell’s job creation efforts, I fault him for ginning up this intellectually-dishonest imagined standoff between the unemployed and state workers. While the Plutocrats on the Hill open up some fine Bordeaux from their extensive wine cellars.
Let’s now head about an hour to the south until we arrive at:
Legislative Hall- Wednesday’s Joint Finance Committee Hearing on the Department of Health & Social Services:
Let’s just excerpt a couple of highlights from J. L. Miller’s story in today’s News-Journal:
The $3 million general assistance program will be abolished if Markell has his way. About 3,700 unemployable people with virtually no other income receive the assistance.
“These adults are unemployable but nevertheless, they are more able to find resources that could help them,” Archangelo said, adding that she endorses Markell’s $1.5 million transition program.
OK, folks, do you see the false choice that the Markell Administration puts forth here? They frame the choice as either money for needy children or money for the chronically-unemployable. Money for both, they lament, is not an option. They claim that, with a little help from a transition program, these chronically-unemployable, mentally-ill, homeless people should have no trouble navigating the social safety net. Based on all the hand-wringing by the well-meaning folks at DHSS, you’d think that no other option is available to them.
Except, of course, it is, they know it, but the Governor has made clear he will not consider it. And that’s demanding that ‘shared sacrifice’ means requiring those who have made out like (and, in many cases, have actually been) bandits to pay a little more. This is a $3 million program, for bleep’s sake. And the Governor’s proposed budget is full of tiny cuts like this which makes a mockery of the term ‘shared sacrifice’.
By the way, do you know what that $95 goes for? By DHSS’ own admission, it goes for (a) bus transportation; (b) prescription co-pays; and (c) personal hygiene products. When you think about it, this is brilliant leveraging by the Markell Administration. If the clients can’t get transportation to and from the services they need, the state can cut back on those services as well, hey, maybe even DART; if they can’t afford prescriptions without co-pays, they’ll have to do without, they can die sooner, and save the state some more money; and the well-scrubbed and well-coiffed Billionaires on the Hill will never come in contact with poor people with poor hygiene b/c they can’t afford to take the bus to Greenville. Everybody wins except those with nothing more to sacrifice!
Based on what we’ve seen, Gov. Markell’s definition of ‘shared sacrifice’ means (a) pitting state employees against the unemployed; and (b) needy children vs. the chronically unemployed, many of whom just happen to be mentally-ill and/or homeless. I’m sure you can come up with your own examples of false choices being floated.
I find the resolute refusal of Governor Markell to require shared sacrifice from all Delawareans to be unconscionable. When times were good, the State ensured that those who were at the top of the food chain benefited disproportionately. We created a flat tax just for them. Everybody else got some benefits as well, but they were crumbs compared to baguettes the wealthy use to sop up their foie gras with. Now that times are bad, the State is taking the few crumbs left from those who have nothing else, while making sure that the wealthy live high off the hog. Hey, some gold-plated plutocrat just might bless us with his largesse, which is French for ‘large ass’.
Speaking of which, when it comes to calls from this administration for shared sacrifice, I will respond just like that fictional plutocrat, and all the real ones, for that matter:
Shared sacrifice, my ass.
‘Bulo is of course dead on.
Logic is nice, but I think the best way to make the case is with a mountain of statistics. We need a kind of anti-CRI assembling a library of quotable statistics showing where Delaware ranks in tax burden and budget among other states, and where Delaware ranks against its own tax and budget history. And being reality based, these statistics would take into account and explain the structural factors that affect the numbers.
Maybe some embittered former bank employees could use their skills for this project.
How can he be right when he fails to blame DL bloggers for our situation?
The most recent federal temporary budget extension actually includes cutting many of those federal programs that the administration portends to offer as an alternative to the General Assistance Fund recipients. This $3+ million item cut should not and cannot happen.
John Kowalko
A politician with guts would be saying something like this:
I wish to God you’d been at the Markell BAD meeting, El Som. We got the same speech, and then went on to talk about wind power and puppy rescue.
I can’t imagine a downside to having fewer millionaires in this state, unless our economic plan is the same as during the Depression… create a feudal environment where the only employment is work on “Uncle Dupie’s” estate, and ride those waves of gratitude into the next century.
Yes, one big thing would be to treat investment income like every other source of income. Perhaps a different way to sell the shared sacrifice would be to sell it as “tax reform.” I bet there are numerous loopholes that only the wealthy are taking advantage of to bring in additional revenue.
As far as the super-rich moving away – let ’em. We as a country can no longer afford welfare for the wealthy.
careful on this subject, people around here like being invited to round tables
Markel has it right.
If you start taxing the rich, they don’t have money to put back into the stock market that then can be invested in companies that are creating jobs. Even if those jobs are being created in other countries and are low paying. And even if the money they have never trickles down.
It all makes sense if you think about it.
I’m glad Delaware has this guy. De’s good for the business community in Delaware.
How People are surprised by his logic is surprising to me.
Anyone working at Fisker around here?
That’s another predictable “nay” vote. I’d honestly like to know where (outside of this blog and JK’s statements) anyone has raised the idea that there should be a revenue side solution to the budget problems?
It simply isn’t happening. So suggesting DL bloggers are in the bag is really just stupid and churlish.
El Som, my relatives in NY state tell me about their outrageous property tax; my friends in New Jersey also tell me about their heavy property tax burden (btw, a lot of those people have moved to DE in recent years (retirees at most of those 55-plus communities) and elsewhere (sussex county resort areas and SNCC and Kent).
I’ve never been a tax expert by any means. We(DE)don’t have property tax? What is that tax I have to pay on my mortgage? Is that simply real estate tax? I’m being serious, I don’t know. Please advise.
Great post, El Som. I’m glad DL is not letting Markell off the hook.
Newshound – there is no statewide property tax. There is a county property tax and a school district property tax (which is what you pay), but the state gets none of that money (at least directly).
Once again El Somnambulo, GREAT POST!
This one is another of yours I’ve bookmarked.
Civics has never been more interesting to me thanks to you and many others on here.
color me churlish! and well, maybe a little stupid.
That’s all for now, I gotta run and go interview a tree!
all done my interview
I thought on Republicans effed with state employees pensions?
Pro Business Dem and a Republican are different how?
it’s possible ceo’s make it clear to politicians that if their taxes go up, they will fire 100 or so employees. The bosses treat the workers like hostages and slaves. Taxes might not have anything to do with job creation, but what is to stop a private company…. in an ever more deregulated market…. from laying people off out of spite. What do they care?
I don’t understand Markell? He’s wimping out and losing the over-powering narrative for the common man here. He sure has enough support in the legislature.
Action.
In front of his office.
Let’s sing”Where Have All the Flowers Gone?” except change the words to
Where have Markell’s testes gone?
if just a FRACTION of the businesses incorporated here taking advantage of our business laws (and paying franchise taxes, which is where most of our state revenue does come from) were phsycially headquartered here we’d have jobs out the wazoo.
Thanks for the info liberalgeek.
Socialistic Ben,
Nothing —-See the 100 “chicken catchers” unceremoniously and cruelly deprived of the job/pay opportunity they have enjoyed for decades in Sussex County by Perdue ($5 Billion business) to quote “allow Perdue to remain competitive”. For those unaware of the details. Perdue has canceled there contract and outsourced their jobs to a North Carolina company. In the interest of full disclosure these working poor will be allowed to reapply, albeit at a significantly lower payrate then their already paltry salaries. This social injustice is unfair, inhumane and permitted by our wonderful pledge to guarantee a free-market and unfettered greed by corporations. (Don’t wanna tax those poor babies how will they keep up their mortgage payment in Aruba). Nary a peep from any political, labor or chamber of commerce leaders on this not to mention my constant plea to numerous media outlets for coverage on this subject has been met with deafening silence. Maybe the word “boycott” would be appropriately placed here.
John Kowalko
John Kowalko,
I actually agree with two things you’ve said recently. 1) that Gov. Markell needs to hire a replacement for Carolann Wicks from ‘outside’ Delaware (esta muy importante)!
And 2)that there needs to be some kind of law that reins in the abject political cronyism between elected officials and their getting state jobs. I’m not sure how that legislation could be broached because of the coziness of current legislators, relatives and friends and state jobs, but Rome wasn’t built in a day, either.
Perhaps our resident legislative sensei El Som could bestow some wisdom on us given his wide knowledge of Legislative Hall in Dover as well.
Every time you Dems grow the government too big during fat times (Ruth Ann Minner & Tom Carper, NCC), you want to try to make up for it by taxing the hell out of the rich in lean times. Just cut all those extraneous government jobs that were added. And if you want to beef up the inheritance tax, then tax the “poor” estates at the same rate. See if that gets you re-elected. DelDOT has been a fraud racket since its inception and that will never change. And every other chicken company except Mountaire outsourced their chicken catchers years ago.
How much do you make dumbass?
*crickets chirping*
Here is some dumbass Republican who makes maybe $60,000 a year who knows nothing about how estate taxes work, trying to say that Charlie Copeland’s taxes are too high.
but he will not could, will be rich one day. And when he is, you he will have himself and his ilk to thank for keeping taxes low.
Just watch, his dues are coming, you just have to stick with the long term theory of Trickle Down.
duh
You forgot to say that if he does (by some miracle) get to be very rich, he will have earned himself some of the vaporware shared sacrifice that our politicians keep promoting.
AND don’t forget that when he is rich (not if) he also needs to fight for the death tax. B/C all his millions shouldn’t be taxed twice.
See, it’s not that hard once you realize that you just have to work hard and not be lazy and want other peoples money.
Delbert’s post reminds me of the major takeaway that I had when we met with the Governor — which was that I was sadly watching the most persistent part of the Reagan legacy in action. The whole idea that somehow everyone gets all of the government they can eat without paying for it — that persistent part of the Reagan legacy.
I understand about not wanting to raise taxes, especially if you think that the environment is not good for doing that. What I *don’t* understand is not being clear with people that the price of lower or maintained taxes is a service cutback. If gasoline costs more for me, it costs more for the government too. If concrete costs more for me, it costs more for the government too. Not raising taxes to pay for typical government operations, means that you have reduced the capacity for government to perform the services people want. Providing those services by *just* asking government workers to bear the increased cost of the services we all share is, frankly, despicable. I would much rather have a government that treated me like a grownup and told me that while there would not be any tax increases, there would be commensurate service AND personnel cutbacks. Pretending that you can continue to give people all of the government they can eat if you just ask workers to take pay cuts continues to AVOID the real decisions that have to be made.
One of the things I admired about Jack Markell was his down-to-earth, straight shooter style. That style seems to be failing him here. Because the thing I know for certain is that you aren’t going to do much about improving the quality of life here by trying to manage like a Walmart executive.
UI writes “Yes, one big thing would be to treat investment income like every other source of income. Perhaps a different way to sell the shared sacrifice would be to sell it as “tax reform.” I bet there are numerous loopholes that only the wealthy are taking advantage of to bring in additional revenue.”
In DE, there is no lower state income tax rate for ‘qualified dividends’ or ‘long term capital gains.’ That differentiation (lower, preferential rate) is only at the federal level.
There is a deduction on DE state income taxes for ‘pension income’, which for folks under 60 is annuity/pension/IRA payments, but 60 and over get to additionally deduct interest and dividends and capital gains. There is a cap ($2,000 if under 60 and $12,500 if 60 or older). This is a benefit for passive income that is not available to wage-earners while they are still working [Note–I am going off memory on this, but I think that it is accurate.]
“Because the thing I know for certain is that you aren’t going to do much about improving the quality of life here by trying to manage like a Walmart executive.”
…and of course when we get to the low tax paradise that conservatives claim to want, they will see the third-world services, as proof that Government does not work.
Here’s an example: the budget was fine when the gambling legislation was passed on the pretense of aiding the ailing horse racing industry that was on its last leg (so to speak). A prudent government would have created a huge slush fund or allocated its share of collections in advance. Not Delaware. As soon as the cash gate was open and flowing you saw more state cops riding around and anything else the special interest feeding frenzy shark winners ended up spending future revenues on (salaries for the new jobs). It didn’t occur to any of them, or they didn’t care, that the neighboring states would see where all their nearby residents were visiting and spending their pension/SS checks; and have to follow suit WHICH THEY DID (PA and MD). Now Delaware put itself in a position where it would be dependent on those gambling revenues, and the revenues are not and won’t be what they once were. “DUH”. You had a State that balanced a budget for 200 years without gambling that now would be bankrupt without it. Real smart. And no, I’m not rich. I’ve been a small business owner for 25 years. And people in my position that stay in business are the ones who learn quickly NOT TO SPEND MORE THAN YOU MAKE and save for lean times.
I find it ironic you blame the government and not the people begging the government for the money and rigging the game to suck money from the government.
You know, the people that promise jobs and lollipops to the state then cut jobs and still keep their tax cuts.
Dear don viti,
Let’s once and for all put away that misguided and misnamed adventure in gouging the middle class ie.,Trickle Down economics.
And let’s call a spade a spade: It’s TINKLE DOWN economics as in PISS on YOU middle class!
You seem to forget how Jack Markell got elected! They had a bunch of republicans change their vote to democrat to get him elected. Now were those republicans from Kent County or Greenville…common sense please.
Wanna cut the budget? Lets get rid of all those senators and house members who are huge double dippers in both parties!
When the blogger meeting took place, the question “what are the wealthy sacrificing” in this policy debate should have been asked.
Fleeing the state so you die at a lower estate tax rate does not count as sacrifice.
Anon, it was the first question asked, and I asked it. Here is the question (I prepared it in advance):
GOVERNOR MARKELL, ONE CONSTANT DURING YOUR TERM HAS BEEN THAT THE STATE HAS FACED BUDGET SHORTFALLS, NONE OF WHICH WERE OF YOUR MAKING.
STATE EMPLOYEES HAVE BEEN ASKED TO SACRIFICE AND HAVE SACRIFICED, AS HAVE MANY OTHERS.
THIS YEAR, PROPOSED CUTS WILL HURT MEDICAID RECIPIENTS, SOME TO THE TUNE OF $94/MONTH, AND THOSE WHO HAVE TAKEN THE STATE UP ON THEIR PROMISE FOR SCHOLARSHIP FUNDING IF THEY MEET AND MAINTAIN CERTAIN STANDARDS WILL EITHER FIND THEIR DREAMS DEFERRED OR DASHED.
ONE GROUP HAS EVADED ANY SACRIFICE…THE WEALTHY. WHY ARE THOSE WHO HAVE ALREADY GIVEN AND THOSE WITH NOTHING TO GIVE BEING CALLED UPON FOR MORE SACRIFICE WHEN DELAWARE’S WEALTHIEST CITIZENS, MANY OF WHOM WERE BORN WEALTHY RATHER THAN EARNING IT, AREN’T BEING ASKED TO SACRIFICE A SINGLE PENNY?
YOU COULD RESTORE SOME PROGRESSIVITY TO OUR TAX SYSTEM BY ADDING A FEW NEW BRACKETS, AND YOU COULD RAISE SUFFICIENT FUNDS TO FUND SOME OF THE MORE ESSENTIAL PROGRAMS. IF YOU WANT, YOU COULD PUT A SUNSET PROVISION ON THE INCREASES.
ARE YOU WILLING TO CONSIDER SUCH A PROPOSAL, OR SOMETHING LIKE IT? IF NOT, WHY NOT?
His answer is at the top of this article. Sorry for the caps, my eyesight isn’t what it once was. It was Markell who brought up the fact that some wealthy Delaware residents ‘moved’ b/c of the estate tax. I agree that they have not been asked to sacrifice a bleeping thing, hence this article and the ones that have preceded it.