| Much has been said 'round here on the subject of whether Deval Patrick's opposition to the voter-approved rollback of the income tax to 5.0% will prove to be an albatross around his neck. My view: the income tax rollback is a big, important issue, both for the primary and for the general election, and Patrick needs to find a better, more concrete way to deal with it than just saying "property tax relief is more important."
Enter Brian Schweitzer, the Governor of Montana. As you may recall, Schweitzer's election in 2004 was one of the few Democratic bright spots in an otherwise miserable election cycle. Schweitzer has now come up with a creative way to address the hot issue of what to do with Montana's $500 million budget surplus. While Republican legislators in Montana were dithering about how to dole that cash out to Montana's wealthy landowners and corporations, Schweitzer rocked Montana's political landscape with his plan:
He promised $100 million in one-time property tax relief -- $400 apiece for all 250,000 Montana households....
The Schweitzer plan, part of his new Square Deal, provides no tax relief for second homes owned by Montanans or recreation homes owned here by out-of-staters. It would give no tax relief to businesses or corporations, which he said had reaped millions of dollars in tax relief under Republicans.
"This is by far the largest rebate in Montana history," Schweitzer said in Billings. "This dwarfs what the Republicans do."
He poked holes in the Republican plan, saying it would shortchange Montana homeowners while dispatching millions of dollars in tax relief to out-of-state corporations such as PPL and BNSF Railway.
Schweitzer said the GOP plan would cut statewide tax mills permanently for all classes of property -- residential, agricultural, business and industrial. His, in contrast, is aimed squarely at homeowners.
The Helena Independent Record endorsed Schweitzer's plan over that offered by Republican legislators:
Gov’s rebate plan adds up
... It appears clear that the Republican plan will involve a permanent property tax cut, and one that would benefit all property taxpayers, not just homeowners who live in the state.
The idea, basic to Republican philosophy, is that it’s only fair to make sure that those who pay the most taxes get the most tax relief. Otherwise, you end up redistributing wealth like some kind of foamy-mouthed socialist.
But to Democrats, that idea can lead to taking from the poor and giving to the rich, like some kind of foamy-mouthed robber baron.
Schweitzer argues that his plan not only is more fair, but that it is a more effective way to ensure the rebates actually go toward spurring Montana’s economy, rather than sinking with barely a plop into rich folk’s investment portfolios or padding the dividends of out-of-state stockholders....
Democrats also have a point when they argue that “redistributing wealth� is a two-way street. Over the past dozen years Republicans in political control of Montana have given corporations huge tax cuts in an effort to entice development. The parties disagree about the extent to which these cuts have been successful in attracting job growth, but there’s no debate about one thing: Those cuts increased the tax burden on homeowners, as a glance at your property-tax bills over the past decade will tell you. Call Schweitzer’s plan a re-redistribution.
Other area papers have backed Schweitzer's plan as well.
In offering his plan, Schweitzer appears to have humiliated local Republicans, who were caught off guard and have been sputtering and disorganized in their response. But Schweitzer didn't stop there:
In another twist Friday, Schweitzer used his rebate plan as a tool in the fight against Constitutional Initiative 97. The measure would cap state spending at no more than the combined increase in inflation and population.
Schweitzer said CI-97 would stop the $400 check per household from being delivered. The initiative would require any rebates to be distributed on a pro-rata basis to all taxpayers across all classes, based on how much they paid.
If CI-97 passes and Schweitzer's rebate plan passes, instead of every homeowner receiving an identical $400 check, Revenue Director Dan Bucks said the owner of a $100,000 home would get only $123, while the owner of $1 million home would collect $1,234. Out-of-staters with trophy homes here would share in the rebates, as would businesses and corporations.
Now, I know exactly nothing about Montana politics. But you don't need the local color to see how clever Schweitzer's plan is. With one fell swoop, he has:
- undermined Republicans' claims that they are the party of tax relief;
- bolstered Democrats' claims that Republicans are the party of the rich;
- dramatically shifted the terms of the ongoing debate on how to spend the state surplus in a direction far more favorable to him;
- weakened the case for a ballot initiative that is part of Grover Norquist's national strategy to drastically limit state spending; and
- last, but certainly not least, offered up a plan that will actually target tax relief to the people who really could use it, rather than super-rich owners of vacation homes and out-of-state corporations.
Patrick would do well to offer up something like the Schweitzer plan. It's all very well to be for property tax relief. Heck, everyone is "for" property tax relief. But if he's going to stand squarely against a tax relief proposal that is already on the table, and has already been approved by the voters, he's got to be a lot more concrete than just saying he wants to cut the property tax instead. Particularly since property tax rates are set at the local level rather than the state level, it's going to take some creativity on Patrick's part to explain how, exactly, his plan will translate into real savings for families. The Schweitzer plan strikes me as an excellent place to start thinking about how to do that. |
