Markell, Chamber & Rethugs Rigging the Game for 2016. D ( )eadership AWO(L).
Anybody paying attention can see what’s going on. The alleged D leaders in the General Assembly either aren’t paying attention, or they’re in the bag as well.
Stated simply: Gov. Markell, aided and abetted by his pro-business propagandists, is pursuing a strategy of forcing cuts on the most vulnerable with NO consideration being given to increasing revenues as a means of closing the budget gap.
You’re already familiar with the choreographed calls for cuts to health care, public education, and state employees emanating from the Delaware State Chamber of Commerce and the Business Roundtable.
Here are two illuminating quotes from the linked article:
“This isn’t a partisan issue. This is a Delaware issue,” said Rich Heffron, president of the Delaware State Chamber of Commerce. “It doesn’t just affect the business community. It affects everybody in the state. You can’t keep pushing everything off.”
and
““If these issues aren’t solved and we have these gaps … the only way to solve those issues short term is by the stroke of a pen that increases taxes,” said Mark Turner, the chief executive of the Wilmington-based bank WSFS.”
There you have it. The agenda of these business leaders is to cut services, and to prevent any tax/revenue increases.
And Delaware’s corporate lackey governor joined them with this Friday news dump release.
Responding to pressure from business leaders and Republicans, Gov. Jack Markell created a committee by executive order on Friday to review government spending, and explore new ways to deliver state government services at a lower cost to taxpayers.
A report this month from the Business Roundtable, a coalition of Delaware CEOs, found that Delaware will face deficits up to $600 million annually over the next decade without action to rein in rising spending. Business leaders have cautioned that tax increases alone will not solve Delaware’s problems, and will only cause companies to consider moving business out of the state.
Time out. Let’s just parse that previous paragraph, shall we? First, the ‘report’ from the Business Roundtable ‘found’ that Delaware will face annual deficits of over $600 mill ‘without action to rein in rising spending’? To me, ‘found’ reflects a statement of fact, which is inaccurate. This report is a political screed in report form, and is designed to push the debate in a specific direction. The survey methodology considered certain things, and omitted certain things, thus yielding the result the Business Roundtable paid for. The quoted ‘report’ only identifies rein(ing) in rising spending’. Nothing on the revenue side.
OK. Now, what’s wrong with this sentence: “Business leaders have cautioned that tax increases alone will not solve Delaware’s problems, and will only cause companies to consider moving business out of the state.”
First, the word ‘cautioned’. Again, this implies a statement of fact when, in fact, it’s an assertion. Plus, I have yet to see any proponent of this ‘report’ assert that raising taxes represents even a part of the solution. Plus, the report provides no empirical evidence to tie raising taxes with businesses moving out of state. I think this paragraph was poorly written by the reporter, and inferentially buys into the argument the Business Roundtable and the Chamber are making.
Now on to Lackey Jack. Our Democratic Governor. Who, during his entire tenure, has never proposed a pay increase for state employees, but who has sought to cut employees’ benefits. And he’s looking at doing it again. He has now, through Executive Order, created two task forces to look at the budget shortfall. You will recall that the first one dismissed any call for restoration of a progressive tax structure, and, in fact, called for, wait for it, lower taxes on the wealthy. If you read the Executive Order, this group was not charged with the responsibility of identifying new revenue sources to close any future budget gap. Oh no. Here are the weasel words:
The Council’s review of state revenue sources shall consider and evaluate whether Delaware’s principal revenue resources are appropriately responsive to economic growth, whether they are too volatile, whether they are economically competitive, and, in making such evaluations, note other tax policy issues that pursuit of these objectives may entail.
There is nothing in the Executive Order calling for an examination of fairness in the current tax structure, and that is no accident. The recommendations in the report are what you’d expect from a pro-business-dominated task force with a specific charge. Among them:
Personal Income Tax: Broadening the Personal Income Tax base would improve the portfolio’s responsiveness without increasing volatility or reducing competitiveness. The Council recommends base
broadening via the elimination of itemized deductions and a scaling back of elderly tax preferences. The latter should come by phasing in higher eligibility ages for certain provisions, means-testing, or a combination of both approaches. Base broadening would be achieved in a revenue-neutral fashion by simultaneously reducing tax rates.
Got that? This won’t generate any more revenue, it will just shift more of the burden onto seniors while actually cutting taxes on everybody else. Oh, and check out the Estate Tax proposal:
Estate Tax: The Estate Tax is volatile, unresponsive to the economy, and puts Delaware at a competitive disadvantage. Due to concerns about the Estate Tax’s negative influence on revenues from the Personal Income Tax, the Council recommends repealing the Estate Tax and replacing the revenue it generates via a small increase in the Personal Income Tax.
Oh, those onerous Estate Taxes. Get rid of them, and raise income taxes on everybody (not just those who pay estate taxes), but just enough to offset yet another undeserved tax break for the wealthy. If you read all the recommendations (I recommend that you do so), you will see that this ‘council’ bought the meme that cutting the shackles off the wealthy is the only way to go. As if we’re not doing that right now. This report is dishonest and disheartening, and it’s exactly what Jack Markell wanted. As did business lobbyists. We’ve already got Paul Morrill from the ‘Committee of 100’ calling for the General Assembly to pass the report’s recommendations as soon as they reconvene in January. Uh, did I mention that this whole thing is being choreographed? BTW, who, you may ask, is/are the Committee of 100? A business lobbying group that pushes its economic development schemes in Dover and also in New Castle County. Pam Scott’s on the Board of Directors.
Are you beginning to see a pattern here? The first thing the greedmeisters are seeking to do is to lock in the horrible/bad/no good recommendations of Markell’s first panel. Pass the recommendations. In January. Before anybody knows what’s in them. Hey, then we’ll have Markell’s equally-business-centric task force on cutting spending weighing in later this year. Markell wants this as his legacy. Only the D’s in the General Assembly can stop it.
Did I mention the D’s? Let me be more specific. Speaker Pete Schwartzkopf, President Pro-Tempore Patti Blevins and their leadership minions. You know, those who sold out their caucus members at the end of June to cut a deal with the Rethugs that led, in part, to this latest Markell working group. Well, they ‘wrote’ an op-ed. Not bad as far as it goes. But, other than a brief mention of ‘asking the incredibly successful companies who have long enjoyed Delaware’s corporate hospitality to do a little bit more’, there’s nothing explaining how they’d propose to close the revenue gap. We all know how simple it is: You either reduce costs (cut services) and/or raise revenues. When you have a speaker who can’t even spell gas tax, you’re not gonna raise significant revenues.
For the life of me, I don’t understand why the D’s are so bleeping defensive. Go after these business groups who are organizing this propaganda, and challenge them to pay their fair share. Challenge the wealthy to pay their fair share. That’s the field upon which this battle should be waged. Not one where a bunch of bogus reports somehow are given a weightiness they don’t deserve. And screw Markell. D’s must not allow this to become his lasting legacy. Oh, and John? John? How about getting out front and standing up for Democrats for a change? Fighting this is both good politics and good policy for the D’s. I just question whether those wielding the power believe it.
There is a concerted propaganda campaign under way by Delaware’s Greediest and Delaware’s DINO governor. If it succeeds, only the wealthy will emerge better off. It’s time the Democrats stood up to them. Or got the bleep out of the way.
Tags: Delaware Business Roundtable, Delaware Chamber of Commerce, Delaware Committee of 100, El Somnambulo, Jack Markell, Steve Tanzer Delaware
Why are so many wedded to a policy that is actually ANTI-growth? That’s what I don’t get.
Markell is a smart guy. His people are no dummies. The doctrine that they are beholden to is a proven failure. We don’t have to guess about what happens to an economy when these policies are enacted. We have the empirical, undeniable proof that this upward redistribution of wealth is a long term loser.
We need to get some progressives on those committees to “examine spending.” Let’s put some spending cuts on the table that Jack’s boardroom buddies won’t like.
Puck: That’s one of the key problems. The Governor created these groups via Executive Order. Contained within the Executive Orders were the specifics as to who the members would be.
Other than perhaps a token nominee to be appointed by either the Speaker or the President Pro-Tem, the members all reflect the biases of Markell and the corporate community.
Garbage in, garbage out. Now being marketed as ‘bi-partisan’ by the Governor and the greedmeisters.
One of the dirty secrets of government is, if you control the membership of these committees, you invariably control the results.
Yeah, I knew that. Just venting I suppose.
“The Estate Tax is volatile, unresponsive to the economy, and puts Delaware at a competitive disadvantage.”
The Roundtable conjures another confidence fairy.
It is ridiculous how eagerly the media bites on this fraudulent bullshit. Some fourth estate we’ve got here.
“The Council recommends Charlie Copeland skate on estate tax for his vast inheritances, while making up the difference through increased taxes mostly from the working class and middle class.”
As is the case so many times in Delaware the “choice” is pro corporate or corporate stooge with little difference. Markell embraces a plan proven a loser many times, money makes you do strange things.
Very good write up, El Somnambulo…this is just sick. Not enough people are aware of what this Governor has done to public workers, especially younger Delawareans who are in love with what they perceive to be a socially liberal Governor.
You would think that in a State where Dems have both houses (and a goddamned Super Majority to boot) and almost every single relevant elected office that we wouldn’t be having these battles. You would think that the Dems running to become the next Governor would make this a focal point and at least pretend to want to make life better for our lowest earners and public workers, but nope we will get John Carney talking about shaking hands with Republicans in Dover and making sure we do whats best for all.
Drives me nuts.
Election year means a whole lot of posturing and demagoguery without any deal for the long term. Roads need a nice chunk of funding, pay raise to state employees, and some type of spending cuts. Legalize and tax marijuana while they’re at it. Also why wasn’t this all solved when the dems had the super majority? Didn’t they have enough foresight to raise taxes?
I’m not sure the key is getting progressives or anybody else on this group, but rather making the effort to insure that there is a political price to pay for continuing to feather their own beds at the expense of everybody else. I see the problem as the complete lack of political consequence for behaving in an economically irresponsible manner.
Why not, oh PDD, start working now to find candidate to primary every one of the “usual suspects” and have those candidates announce this fall, to keep up a running public commentary on the shell game as it occurs. It will be too late to make a meaningful run at any of them after the fact, and they know that. Among other things, it is time to play meaningful politics with the public records of their campaign contributions. Who has taken the money from corporate lobbying groups and now intends to pay them back? Who has taken money from unions and now intends to shaft the workers?
Folks here do not tire of reminding me that in most districts in Delaware the primary IS the General Election, and with the Townsend/Short contest there will be a high turn-out for the primary. Let’s see if Townsend can help muster some coat tails.
I see the problem as the complete lack of political consequence for behaving in an economically irresponsible manner.
All true, but first you have to convince low-information voters that CofC-approved cuts to spending and services IS the irresponsible course of action.
first you have to convince low-information voters that CofC-approved cuts to spending and services IS the irresponsible course of action.
Agreed. But I think that can be done. I just think that somebody out there needs to organize a consistent set of talking points that go in that direction. The WNJ will publish it, and local radio will pick it up … but it has to be a coordinated effort. (It should even be a factor in the mayoral race: “With Wilmington under siege by poverty, violence, and poor schools, is it really the responsible course for the General Assembly to look the other way?”)
The serious question is WHO. Who [individual or group] has got the organizational skills and the sustainable energy to lay out the job and pursue it for a full year? Answer that, and there’s a chance. Proceed with the usual disjointed opposition from (admittedly) talented and committed activists and we will end up with the same results we have always gotten for the past ten years.
All due respect El Som but I’ll wait for the report to be issued. I agree it will probably be the usual “root out medicaid fraud / increase employee share of health insurance” BS. But maybe there are savings? Has anyone noticed that we dont really need a Lt Gov? 17 school districts?
Maybe if the State had a “fiscal watchdog” we would need a special panel to look at spending.
All of these working groups are missing one important fact: Since 2010 Delaware’s workforce has seen negative wage growth:
http://www.delawareonline.com/story/delawareinc/2015/04/03/economistreportwages/25251955/
Delaware was the only state to record negative wage growth during the five-year period, the magazine reported. In particular, wages for Delaware’s professional and business-services workers dropped by one tenth and financial sector employees earned 25 percent less per hour than they did before the financial crisis.
The magazine concluded the loss of two car plants, elimination of manufacturing jobs and high electricity prices all contributed to the lack of earnings growth among Delaware workers.
Low-wage jobs in Delaware have grown since 2010, the magazine reported. Employment in the leisure and hospitality industry has grown by 7 percent since 2010.
Low wage workers have already taken the brunt of the economic downturn, and the jobs that Markell is “creating” aren’t near what people need to raise a family. Losing two car manufacturing plants gutted our middle class, and there is no relief in sight. Raising the cost of healthcare for state employees will just magnify this problem.
It is clear Markell is unable to get what’s left of Delaware’s middle class out of this death spiral, and I don’t see John Carney having the tools to fix the problem, either. We need a better candidate for governor.
Rufus: Of COURSE there are savings to be had. Steve Newton did a superb job of enumerating several of them recently. These are savings that virtually any progressive could embrace. (Steve, could you please repost them? I can’t remember which thread you initially posted it.)
The problem is that Markell has stacked this Task Force with so many of his own appointees and so many pro-business people, that it is next to impossible for this group to deliver anything that could be deemed progressive. In fact, I defy anyone to identify one progressive voice on the task force.
He who controls the composition of the committee controls the results. While I’d love to be surprised, I see no way of that happening.
BTW, here is the committee membership:
The Committee – a ‘bipartisan’ group of government and private sector leaders – includes:
“Chairman Fred Sears – Delaware Community Foundation, appointed by the Speaker of the House and designated as Chairperson by the Co-Chairs of JFC
Fred Cottrell – Richards, Layton & Finger, appointed by the Senate Minority Leader
Rick Gessner – Capital One, representing the Delaware State Chamber of Commerce
Dennis Greenhouse – Former County Executive and State Auditor
The Hon. Joshua Martin – Chairperson of DEFAC; Potter Anderson & Corroon LLP
Robert McMurray – Christiana Care Health System, representing the Delaware Business Roundtable
Mike Morton – Controller General
Ed Ratledge – Chairperson of DEFAC’s Subcommittee on Expenditures; University of Delaware
Jack Riddle – Community Bank, appointed by the House Minority Leader
Jeff Taschner – DSEA, appointed by the Senate President Pro Tempore
Ann Visalli – Director of the Office of Management and Budget
Lincoln Willis – Former State Representative; Willis Chevrolet”.
Uh, good luck. Plus, who the bleep put a former Rethug House member on the panel? The answer: Jack Bleeping Markell.
BTW, the propagandists who pushed the phony baloney ‘report’ from the Delaware Business Roundtable? They EACH have a representative on the committee. Does anyone see a progressive voice on there? Or somebody, ANYbody, who doesn’t have a dawg in this fight?
Most Democrats are just as corrupt and beholden to the wealthy as Republicans. The Dems are just more polite and better on social issues. Primary!!
I read the committee’s charge and looked at its membership, and I couldn’t help but think that this was the work of Colin Bonini.
If I were a certain Republican running for governor I’d be shouting from the rooftops that our Democratic governor is finally doing what I’ve been demanding that they do for the last 15 years.
Absolutely. Markell is the real villain in all of this. He is trying to implement the fondest wishes of Delaware’s Most Greedy. And he really believes he’s doing the right thing. This. Must. Not. Happen.
BTW, as Al Mascitti pointed out on today’s show, Kiplinger’s, KIPLINGER’S, ranks Delaware as the least onerous state in the country when it comes to taxes. Gee, couldn’t we collect just a little more revenue? What’s the worst that could happen? That we drop to ‘only’ #2?
El Som: took me awhile but I found them
Not to agree with many of those posting above, but there ARE cuts to be made:
Corrections: pardon all non-violent drug offenders in the state of DE, moving toward mandatory addiction treatment where necessary, which will allow roughly $26K per former inmate/year to be reduced from Corrections budget (even with treatment costs) and then examine facilities for scaling back due to the abrupt underload of prisoners (there are several thousand).
Education–there are multiple offices at DEDOE to be consolidated removed; DEDOE needs to be converted to a service and Federal compliance organization; I did the serious look at this two years ago, when the possibility was to reduce DEDOE budget by roughly $23 million; return $15 million direct to schools, take $8 million in budget reduction. Then dramatically limit the ability of DEDOE to contract out multi-millions for services to for-profit companies who become employment agencies for former staffers.
Police protection: Eliminate the wasteful and overspending Office of the Secretary (which has ballooned more that 150% since the current incumbent arrived) and task the Commandant of the DSP with critical requirements of that office. Savings on the order of $8 million/year from an office wherein the Secretary has previously said our greatest security threat is snowstorms and hurricanes, not terrorism. Also, force the “black” budget for the DIAC to be placed as a separate budget item; my research suggests it can easily be cut by $6-8 million/year since it produces little decent actionable information.
Health–for God’s sake take consumer protection measures to keep Highmark of DE from achieving the same monopoly status in Medicaid contracting that it currently holds in the private insurance market. Highmark came in with a low-ball initial bid for services and them immediately filed at the end of that fiscal year for a major rate hike.
While we’re at it, let’s just terminate the Insurance Commissioner’s Office until KWS goes back to private life. We’ll save a shitload of money and nobody will notice that the office is gone because it does little or no regulating in the public interest.
Corporate Welfare has not been so much cut as it has been hidden in Markell’s last two budgets. Research is pretty clear that tax breaks are not the major consideration for company relocation, and that there is no causal link or even correlation to the size of tax breaks and the employment habits of the companies, especially since (in Delaware) we don’t actually hold the companies to the agreements they make (hello Bloom Energy).
Higher Education–require truth in budgeting, which means that there has to be someplace in the budget where ALL funds going to UD, DSU and Del Tech are specifically listed and totaled. It’s time to trim back the “extras” that UD and Del Tech in particular are taking home that are hidden in epilogue language and under subcontracts to other agencies. Moreover, make continuance of the state budget lines contingent on increasing fiscal transparencies.
Basic pork: while we have cut the money to transport indigent kids to school or to have police officers in the buildings, we have allowed our legislators to (a) send money to rebuild the nursing department at a private university; (b) build a shooting range in Sussex County; (c) build a horse show ring in NCC that we can’t find anybody who asked for it.
Highways: curtail projects that have been undertaken purely as a form of additive corporate welfare (like the way we dropped $110 million a few years back redoing intersections on behalf of AstraZeneca), and actually spend existing funds for only infrastructure repair. Kill that ridiculous 301 extension project while we still can.
Environment: let’s replace several of our programs of grants to aid polluters in purchasing technology they should have been required (under current law) to have anyway, and instead let’s aggressively collect fines and take them to court to require them to foot the bill for clean-ups. (I realize part of this will be difficult, as 40% of the fines and infractions assessed by EPA from 2009-2013 were on state and local government owned facilities, not private industry, but hey you can’t have everything).
Link any bail-outs to casinos to a removal of the state limit on the number of gambling facilities that prohibits competition. If we’re going to say that it is ethical for the state to raise money from private gaming industry (a dubious proposition at best) then we have no business privileging three specific corporations with a monopoly on the action. That is certainly NOT in the state’s best financial interest.
This is off the top of my head from research I have done over the past 2-3 years and written extensively about in other venues. I’m sure I’ve botched some of the $$ estimates because I didn’t go back and look. But the point is that there is serious money to be gleaned out even the last budget passed if you’re actually willing to look closely enough and question EVERYTHING.
The problem, of course, is that each of these items has its own built-in support in Dover, and few if any of these cuts could ever happen politically. But saying THAT is not the same as saying that the budget is as trim and tight as it should or could be.
“I think that can be done.”
@Steve: I think it can be done as well. But someone has to do something about communication first. The non-political junkies who hear “blah, blah, blah, raise taxes” or “blah, blah, blah, lower taxes”
Just like my dog who most of the time doesn’t have clue what I’m saying, but his ears perk up when I say his name, or the word “walk” and a few sundry other words like “snack”
I honestly can’t blame the people who don’t have the time to wade through a treatise on economic policy or delve into big data to crunch numbers.
Personally, I think the messaging should be about consequences and results. Here is what you bought. Here is what you can’t have. Here is what you could have, etc.
Here you go, the ACA is saving us all money, what a crock!!
22.4 % increase!!!
http://www.delawareonline.com/story/news/local/2015/09/29/obamacare-premiums-going-delaware/73055388/
Oh, wait isn’t our Insurance Commissioner a Democrat!
@Anonymous-
Our insurance commissioner is an incompetent scam artist. The fact that she’s a democrat is irrelevant.
Dave Graham of all people channels El Som in the News Journal today.