Did Abercrombie open the door for a GET increase?

Is anybody else starting to feel that Gov. Neil Abercrombie is getting a little wiggly on raising the general excise tax, which he promised not to do in his campaign for governor?

On the KITV4 morning show Monday, Abercrombie wouldn’t rule out a GET increase because of unfunded pension liabilities that are threatening the state’s bonding authority. The pension problem was well-known when he made his campaign promise.

Then yesterday, Abercrombie’s spokeswoman Donalyn Dela Cruz told the Star-Advertiser’s Political Radar that the governor doesn’t support a GET increase and didn’t propose one in his legislative plan, but added, “If a measure to raise the GET passes out of the Legislature because other elements of his plan are not adopted, he will of course consider it as the people’s will.”

Looks to me like a big wink to legislators that if they pass a GET increase, he won’t veto it.

It’s interesting that he’d consider what the Legislature might want to be the “people’s will” ahead of the clear will of the people who elected him on a promise of no GET increase; according to the recent OmniTrak People’s Pulse survey that Dela Cruz was commenting on, 68 percent of the public opposes an excise tax increase.

There was no wiggle room in what Abercrombie promised. His Recovery and Reinvestment Plan released during the campaign stated:

The General Excise Tax will not be raised. Given the public’s lost confidence in government, no reasonable argument can be made to raise the GET. Government will have to make better use of the revenues that it has and grow the economy if more revenues are needed.

In a September candidate forum with Mufi Hannemann, Abercrombie said, “I’m against raising the GET tax without equivocation.”

The governor reiterated his opposition to a GET increase in December, leading House Speaker Calvin Say to declare, “The general excise tax, which is so regressive, is off the table. It’s a Christmas gift to all the general public.”

Are we looking at a special Easter resurrection?

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36 Comments on “Did Abercrombie open the door for a GET increase?”

  1. MynahBlog Says:

    Abercrombie made numerous statements about not raising taxes and fees, but “reallocating” and “re-prioritizing” existing government funds and functions. He promised more efficiency with what we had.

    His campaign promise was more expansive than just the excise tax.

  2. Earl of Sandwich Says:

    Abercrombie never had a good idea of the budget situation before getting into office – a rude awakening to reality awaited him once he started talking with Calvin Say, I imagine.

    Problem with the Gov’s proposals is he’s tying the fee increases to “purposes” to make them more “palatable.” Some of the sugary beverage fee would go to fight obesity. Some of the increase in the liquor tax would go to fight alcohol abuse, etc. Still, most of the revenue would go to balancing the budget. In the end it’s just PR that the people end up paying for themselves. If the Gov’s going to raise fees to balance the budget, just do it enough to accomplish the goal without all the new program window dressing.

  3. hipoli Says:

    In my opinion, the administration should be thinking about and talking about a multi-year plan. Year 1 – Ok, so he didnt quite understand the realities of the budget crisis. So work with Speaker to help him through, which by the way, means no hike in the GET. I personally think Speaker is completely steadfast on that position. I dont know what that means for alternative ways to balance the budget this year, but I do trust ‘them’ that somehow, we’ll muddle a bit and then get through it. We always do.

    But then also start right now, immediately, dont wait for the end of session already, on moving into Year 2 – which per his campaign promise – should be a comprehensive review, overhaul, and reallocation of government functions. Year 3 and 4 will be spent on implementation, bringing us right into the next election, where he will be able to stand up and say ‘SEE, I did what I said I was gonna do.’

    Wouldnt that be a breath of fresh air?


  4. We predicted this almost 3 weeks ago.
    There really is no choice:
    http://honolulunotes.com/2011/01/31/watch-the-get-go-up/

    Honolulu Notes

  5. Alan R. Spector Says:

    Could someone explain in simple terms GET and how it is regressive. There are lots of folks out here who don’t fully understand it.

  6. Anticoqui Says:

    Maybe this State needs some kinda revolution to happen. The State System seems to be so fractured that some departments operate independently on each island; there lacks a single ‘focus’ on proceedures(?) with each island doing as needed for themselves. Maybe Counties should take the lead to run things themselves; why tax or collect fees from all the islands into the State General fund to support Oahu only or whatever sigular entity. fees/taxes stay on the island where collected to fund program(s). Maybe less duplication of work if only one branch of Government exists….no county roads vs. State roads projects within a given distance. Less concern over whose jurisdiction a project falls under…just get it done.

  7. Kolea Says:

    HonoluluNotes,

    Thanks for the link. I just read it and would refer Alan to it. A few additional points you appear to have missed. The pyramiding effect is less than one might think from your article. Wholesale purchases are taxed at 1/2% and it takes a lot of 1/2% transactions to add much “pyramiding” to the final price.

    2) It is estimated that about 38% of the GET is “exported” to tourists. It is a pretty good tax increase when you can raise a lot of money and stick outsiders with that large of the burden. That feature alone makes a GET increase attractive.

    3) The GET IS regressive. Alan, a tax is “progressive” or “regressive” depending upon whether you pay a higher rate as your income goes up. The idea of the “graduated income tax” illustrates the principle. Low income people pay a lower portion of their income in taxes than higher income people. (We have to set aside the realities of deductions, preferential treatment of capital gains, etc., to keep the model simple.)

    A “flat tax,” whereby everyone pays the same percentage of their gross income, would be an example of a tax which is neither “progressive” or “regressive.”

    The GET (and sales taxes generally) are regressive because low-income people spend almost all their income on goods subject to the tax as soon as they receive their paycheck. Higher income people put a larger portion of their income into investments or savings.

    There are ways to offset the regressivity of the GET while still “enjoying” the benefits. Low-income people can be given a “low income tax credit” equal to the amount of the increase, for example.

    Finally, nothing is more “regressive” in their impact on low and middle income people than slashing government services which serve those communities. A GET increase can raise a LOT of money, relatively painlessly, to keep those services going. And if we can export 38% of the burden to tourists, where can I sign up?

    I disagree with HonoluluNotes’ idea that Neil has been setting this up. I think Neil has a pretty bad grasp of basic economics and has been balancing people’s OPINIONS about how to handle the budget crisis instead of balancing the numbers. During the campaign, the challenge was how to keep the Venture Captialists happy, while keeping the support of the public sector unions and the parents with kids in the public schools.

    Now that he is Governor, the facts have sobered him up. IF a GET hike is improved, it is because of the basic economic facts facing the administration, not because of any preconceived plan. I have hectored people in Neil’s administration over the GET for the last couple of months and have met a stone wall, so I am happy to see some flexibility entering in Neil’s statements.

    I doubt the Speaker will budge, however. He has a very conservative, small business understanding of economics.

    Neil’s newfound flexibility might reflect a desire to escape the blame for what happens when the GET hike is NOT agreed to. The scale of slashes which will result will create a lot of suffering. Only people ignorant of real world conditions can cling their their illusion that their is a lot of “fat” in the state budget after years and years of hiring freezes and belt-tightening. Neil wants to be able to tell the unions (and the broader public) I was OPEN to raising revenues, so don’t blame me.

  8. Richard Gozinya Says:

    I’ve long maintained that the principal reason the Gov was talking so tough about upcoming union wage negotiations was so he could later claim that the public sector had already taken its lickins and now the only route left for deficit reduction was a hike in the GET. Without (the kabuki of) a public sector contribution, any call for a higher GET would result in populist screams about those “overpaid government union workers.”

  9. ppcc Says:

    Kolea:
    You have got be kidding. To claim no FAT in the state budget is completely trying to mask the TRUE situation. To start the DOE, which comprises of about 40% of the entire State budget, is rampant with waste, graft and corruption. Marion Higa’s audit of the DOE’s contract and purchasing budget where she outlined contractors double and triple dipping on DOE construction jobs, which only just scratches the surface of the out of control waste, graft and corruption in the DOE. What about the low level school aide from one public school just recently convicted of stealing thousands of dollars of taxpayer monies by using a DOE credit card at Sams Club to buy tires, poke, beer, a bed, etc using a DOE credit card and was NOT caught by the DOE, rather it was detected by Sams club when she went over the credit card limit. If she had half a brain she would either called in or went online to check the card limit and not gone over, I bet today she would continue to be stealing from taxpayers and DOE would never have caught her. Also what about the Charter school principal who hired all of her family members, all paid by taxpayers, including a sister(?) who worked FULL TIME as a flight attendant and Hawaiian Air. What about the DOE transportation contracts in which only ONE company bids for each contract and the exhorbinat amounts they bid and eventually awarded is way over the rates of inflation and basic accounting principles. These are just the TIP of the DOE waste/graft/corruption iceberg. So given this mountain of evidence against the DOE, why does Abercrombie protect the DOE by NOT demanding they undergo a full independent audit? Even if the audit cost a million dollars, in the end it would identify hundreds of millions of dollars that is being wasted and/or stolen in the DOE.

    Your are correct all the other NON DOE/UH gov’t programs have been decimated and now they are looking to gut these departments even more. However Abercrombie and the State legislatures are avoiding addressing a large and IDENTIFIED portion of this gov’t waste occuring at the DOE and UH. Was just in the news UH president greenwood is still receiving over $60,000 / yr on housing even though the college hill residence in Manoa with hundreds of thousand paid in renovations, Greenwood refuses to move in AND the UH regents still allow Greenwood to receive the additional $60K on top of her salary that approaches 1/2 MILLION per year.

  10. zzzzzz Says:

    Another way to offset the regressivity of the GET is to exempt medical services, prescription drugs, and non-prepared food, as is done in other states. IMO this is preferable to the low income tax credit because of its simplicity.

    The low income tax credit requires more money for the Department of Taxation, as many people who wouldn’t otherwise file income tax forms will do so just to collect the credit. Other low income folks will not benefit from the credit because they don’t know it’s available, or don’t bother to file.

  11. David Shapiro Says:

    Kolea, you’ve hit on our political process in a nutshell: Candidates make drunken promises to win, then feel free to break them when they get elected and sober up.

    The points on Abercrombie’s promises to save money by re-prioritizing and reallocating are well-taken, but I think we need to give him a chance to put out his first budget before we criticize him for not following through on that.

  12. Andy Parx Says:

    I don’t get it Kolea. You say the excise tax is regressive and income taxes are progressive but you seem to favor an excise tax increase. Do you oppose progressive taxation like so many these days?

    I’d like to see the income tax rates progressively increased with maybe an exemption from the increase on those making $XX (median income?) or less. “Just do it”- on the state and federal level and we can be done with all this idiocy of slashing essential services.

    Heck, I’d pay a thousand dollars a year just to stop having to listen to these Dickensian creeps debate WHAT to cut instead of whether to cut or return to sane tax rates.


  13. Kolea,
    Thanks for your comments. We did miss a few points in an effort to keep it simple and short.
    Sometimes it works, sometime we miss a few points.

    We hope people read your clarification.

    Aloha,
    Honolulu Notes

  14. Michael Says:

    Governor Abercrombie is not presently here in Hawaii.
    Let’s see what goes with one Bill and then decide if
    he is a chameleon who changes their color.

    Politicians kiss a baby while behind its back, steal their candy.

  15. Michael Says:

    “Are we looking at a special Easter resurrection?”
    Non-Christians would egg you about it.

  16. Teddy Freddy Says:

    Drunken promises during the campaign and then doing something different after election? Oh my word, this would not happen in the real world would it? The voting public would not base their vote on a promise from a politician would they? Cut to the chase: The legislature passes the budget not the gov. As much as people can whine about the gov not having a budget ready, at the end of the day it is the House and the Senate who work it out and vote and pass a balanced budget. The gov will merely say yes to whatever the leg passes, and possibly restrict funding on projects he does not support. It is the leg that will decide whether or not to raise any tax at all including the getax. The gov will just be along for the ride and will allow whatever budget is approved by leg to pass into law, with or without his signature. When was the last time a governor veto’ed a budget Bill?

  17. shaftalley Says:

    eliminate the state income tax.this will allow hawaii tax-payers to have more “disposable income”.this money goes into the local economy because more people will have more of their own money to shop,to spend,to save,to invest,to start their own business..to do what ever they wanted with their own money.this stimulus will generate more revenue for our inefficient state gov’t.and then our gov’t. can continue to squander a precious resource to maintain power and authority over us.let’s hope they don’t.what a concept.

  18. charles Says:

    @zzzzzz, there is no tax on prescription drugs. If your pharmacist is charging you the GET, call the tax department.

  19. Kolea Says:

    Wow, I go away for a few hours and I get hit from all sides. Here are some brief replies, in order.

    ppcc,

    I never said there was “no fat” in particualr departments. What I am arguing against is the refusal of so many conservatives to understand the state IS facing a severe budget crisis which cannot be solved simply by going after “fat.”

    Unlike our last Governor, I have no problems with doing audits of government agencies to spotlight instances of abuse, fraud, waste or incompetence. Higa has provided a valuable perspective.

    zzzzzz, I like your inclination, but if we were to exempt food and drugs from the GET, the tax on the remaining items would have to increase dramatically. If part of the reason to use a GET is to export some of the tax to non-residents, it is a mistake to assume all “tourists” are eating their meals out. A significant number of them are doing vacation rentals and preparing most of their meals. And the definition of “tourist” has gotten a bit wobbly. We have a lot of relatively affluent “snowbirds” who live in the islands for a significant part of the year. Let’s tax SOME of their activity.

    Dave,

    Yep, politicians say the darnedest things. None of the three main candidates for Governor provided good answers as to how to get out of our budget crisis. It is a weakness of how we conduct elections–and that means political activists like me and journalists like you– that we could not have a frank, SOBER discussion about the issues.

    From the pushback I have gotten from people in his administration Neil clearly wants to try to honor the “no GET increase” pledge, but it was a dumb thing to have said. (I thought so at the time). He also seems honor bound to keep the high tech tax credits flowing as he promised the Venture Capitalists in exchange for their support. But those of us who relied upon the fact that we “knew him enough to trust him” to be a friend of labor, a good liberal on social programs, were naive. Unlike the Venture Capitalists, we did not demand an explicit promise, so apparently he feels free to betray our expectations.

    Andy,

    I used to be hardline against a GET increase. I thought Cayetano’s Economic Revitalization Task Force proposal to cut the income tax while increasing the GET was regressive as all heck and spoke out against it. A lot of Democratic Party people did. (Ben’s income tax cut went through, reducing state revenue significantly. The planned GET hike failed. The net result was an unanticipated bleeding away of revenue which has contributed to our fiscal crisis today.)

    But despite its regressivity, the GET is an easy tax to implement. It starts the revenue stream immediately. It exports 38% of the tax to non-residents. It captures some of the money which passes through the “cash economy,” which is significant. If people evade income taxes by working for cash, at least their purchases get taxed.

    I support increasing the income tax at higher levels. Let’s repeal the “Cayetano tax cuts.” Marcus Oshiro did engineer a small tax hike on the high end two years ago, but it passed largely unnoticed. But the budget crisis is immediate and we need money ASAP. The top economists in the state argued last year in favor of a “temporary” hike in the GET to get us through this crisis. (Their call got almost no media coverage. I wonder why?) I agree with them. And with the critics skeptical about any “temporary” tax increase.

    Without an influx of money, programs which are already threadbare –in both the public and non-profit sector– will be destroyed and it will take years to rebuild them or to start replacements from scratch. I would say institute the GET hike now, while developing a plan to raise the higher end income taxes.

    I am interested in convincing the Governor, the Lege, and “the chattering classes” to take seriously the need to raise taxes, as quickly and as “progressively” as possible. The “Austerity Economics” being pushed by the rightwing promotes false economics. As Paul Brewbaker said last year, “we cannot cut our way out of the budget crisis.” Slashing government spending during a recession only serves to deepen and prolong the recession. Obama has embraced the rightwing “Austerity” framework. I hate to see Abercrombie go down that same road.

    If you disagree with me, hey, I welcome the debatte. But I am trying to work here on Oahu on this, You can help by delivering the Kauai delegation. Let me know how that works for you, now that you’ve lost Hooser and Morita. (Now maybe you can understand a bit better why I am aiming less at the “ideal” tax policies and have lower my sights to what has even a remote chance of passing).

    I will repeat what I wrote above: there is nothing more regressive than slashing government services which help middle and low income families.

  20. Capitol -ist/WassupDoc Says:

    Had a very interesting experience last night at Pearl Ridge Elementary listening to these “poor” retirees bitch, piss and moan about having to to pay taxes on their retirement incomes which cross over the $75,000 bridge.

    They have probably paid off their mortgages and get senior discounts on everything from a cup of coffee to a movie ticket to UH sports to shopping at various thrift stores – and can ride TheBus for an entire year for $30. NOTE: I pay $720 a year for my monthly bus passes.

    These people do not get it – the state must balance its budget and there are only three ways to do so: Raise taxes & revenues by legalizing gambling; reduce spending; stop providing government services.

    What would YOU do?

  21. Kolea Says:

    CWD,

    Coupla quick points.

    Unless Neil has changed his “tax the pensions” proposal, the tax is NOT on that portion which exceeds $37,500 ($75K for joint returns). If a retiree’s income exceeds the trigger point, theri ENTIRE pension is subject to taxes. This is absurd and violates basic priciples of fair taxation.

    Look at the graduated income tax. If my income exceeds a particular income range, only that portion in excess of the cut-off point is subject to the higher rate. Take two people, one earning $37,400 and one earning $37,600. Under Neil’s plan that $200 dollar difference in income will result in one person paying a MUCH higher tax. That is absurd.

    If Neil modifies his proposal so that only the portion which exceeds the cut-off point is taxed, it will reduce the objections. It is still an unjust, one-sided renegotiation of a collective bargaining agreement reached years ago. But if the administration can demonstrate a comprehensive package of tax changes which are TRULY shared equitably, I expect retirees will be more accepting of the idea.

    Secondly, why the resentment against people who have “paid off their mortgage”? Suddenly that makes these folks “rich”? How many years do you think most people have after “paying off the mortgage” before their looming nursing home bills will swallow up the value of their home?

    At one point, it was the embodiment of “the American Dream” for working people to be able to afford to own their own home. Now, under the stress of the current economic crisis, you want to target these folks as the ones who should pay for the collapse of the economy?

    You may not have noticed, but for the last few decades, the rich HAVE been getting richer while the middle class has collapsed. Even in handling the current economic crisis, the politicians OF BOTH PARTIES have made sure to protect the interests of the Wall Street bankers who got us into this mess. And the stock market has rebounded tremendously.

    Maybe instead of turning on each other, we should try to figure out how to restore the American Dream, rebuild the American middle-class and re-establish (relatively) shared prosperity. Tearing apart public unions and taxing the pensions of retirees, even those “wealthy” enough to have paid off their mortgages, seems to distract us from a more productive course of action.

  22. Capitol -ist/WassupDoc Says:

    Kolea:

    Based upon Neil’s own statements last night, virtually every single anti-pension tax person at the meeting last night would not be paying a single nickel on their pensions should the legislation pass.

    Still, their general position is that they and the rest of the now-retired public employees have earned the right to be tax-free and get their bennies.

    Several of them said that it was up to The Government to cut services to other people in order to pay for their benefits – including Medicare B.

    In the past ten days or so, I’ve attended hearings where “average citizens” have raised objections to everything from “soda taxes” to increasing the “barrel tax” to a fee on single-use plastic bags to raising any other tax that would impact them.

    At one hearing, the Chair asked one especially snarky person what services the testifier would be willing to give up in order to balance the budget and support state government. His response – get rid of the public educational system and privatize it so that the government can spend its money on important things like meeting pension obligations.

    As someone who will be paying rent for the rest of my life – unless, of course, I either win the lottery or outlive my SigOth in which case I will be living for free under the nearest bridge – I have absolutely no empathy whatsoever for mortgage-free homeowners who complain about paying their fair share for social services for all.

    If I outlive SigOth and become seriously ill or intellectually incapacitated so that I can no longer work, then I will have no choice but to find someone to sell me drugs to kill myself. I really do not want to live under the nearest bridge – even here in Hawai`i Nei – or wind up shaking a tin can on a street corner or lining up at an emergency shelter to get a free meal.

    I don’t disagree with your statements about the American Dream and the dissolution of the middle class, but we still have to face budget deficits and lack of revenues.

    What services would you be willing to give up in order to balance the budget and to support state government’s obligations to provide services to its citizens? What taxes are you willing to raise – or establish?

    Gotta go to work and won’t be back until very late tonight, but I do look forward to reading your responses.

  23. Michael Says:

    To make money, one has to spend money wisely.
    GET is hard felt by businesses and passed on to customers. Businesses cannot make a profit so they raise prices of consumer goods sold. Customer pays more. Simple and yet many think it so complicated.

    If you have money, Money talks. Money is power.
    The poor or uneducated are fooled by those who Wall Street and Ponzi. Medicare fraud. Mortgage scams. etc. Old News but people keep repeating their mistakes. Truth is finally public. As if we were born yesterday.

    Right now it seems inmates are the more fortunate.
    They have no freedom but are fed 3 meals a day. A place to sleep and no Taxes to pay. Everything is paid for them. Maybe we should Tax inmates. Everything is free to them, including Medical, which many who are free don’t have. Makes me think in Hawaii we have two classes. Inmates and not Inmates.
    Either way we are imprisoned by someone.

  24. WooWoo Says:

    @kolea- I think you sell Neil short. He is not dumb, he knew he was going to need to raise the GET. He also knew that the strong campaign position against raising it was essential to winning.

    Cwd- I have all the respect in the world for your passion, but you really see the world through glasses that are so colored liberal that it blinds you. Overwhelmingly, the people in our community that have paid off their mortgages are the ones we need to hold up as positive examples. You don’t accidentally or luckily make 30 years of mortgage payments. These people have scraped together money to make a down, lived below their means in order to enjoy a comfortable retirement, and have taken care of their financial affairs so that they won’t have to depend on tax payments from future generations.

    Like so many on the left, I think you lean too far to the side of believing that outcomes in life are about luck. These comfortable retirees are merely lucky. To be fair, many on the right think that everything is on the talent and work ethic of the individual. This is equally false; luck plays a significant role. But luck alone usually does not make a comfortable retirement, nor does hard work alone.

  25. Kolea Says:

    CWD,

    I have written so much in various fora on this over the last couple of weeks that I will not repeat it all here.

    If you review the PoP poll, it shows people generally want to retain their government services, while avoiding any tax increase that hits them. Welcome to the human race. “Dog Bites Man.”

    I have suggested, and I repeat it here: Neil needs to patiently demonstrate that his tax hikes AND spending cuts truly represent “shared sacrifice.” He cannot just rely upon that slogan and get annoyed if people look at his high profile proposals: cut public workers’ salaries 5%, tax the pensions, tax the soda, stop paying for Medicare Part B and conclude they hit low and middle income people harder than the well-off.

    I strongly suggest his tax people draw up “typical taxpayer” scenarios to illustrate how his various proposals will hit people at different income levels and who derive that income from different sources. In part, I suggest this because I am not convinced his own people have run the numbers. Second, if he can actually show that the “sacrifice” is shared equitably, I think most people will reluctantly accept it.

    I would raise the income tax on higher earners and raise the GET temporarily. In addition to the immediate cause of this budget crisis arising from the recession, the problem also has its roots in teh botched attempt by Cayetano to change how taxes were collected. His Economic Revitalization Task Force proposed cutting income taxes, but offsetting the revenue loss by raising the GET. (I opposed this plan at the time). The income tax cut was debated first and was, surprise, popular. The proposal to hike the GET to offset the lost revenue was unpopular and defeated. As a result, the state has suffered a decline in re4venues since that time, which has been a source of the repeated hiring freezes and layoffs in the intervening years.

    So the simplest answer, with poetic justice would be to “repeal the Cayetano tax cuts.”

    Cutting government spending dring a recession is shortsighted and “pennywise, pound foolish.” Every public employee who is laid off or suffers a decline in wages reduces consumer demand and prolongs the recession.

    Neil appears to have embraced the conservatives who have repealed Keynes in favor of Calvin Coolidge. Obama has done the same thing, but at least he has the excuse of having a formidable Republican opposition.

    What’s Neil’s excuse?

  26. Teddy Freddy Says:

    I will repeat and cut to the chase again: The gov just needs to keep his head down and wait for the House and the Senate to come to terms. In the end, he approves what they submit anyway. In the end, he has no choice and the govs budget is just proforma. The govs budget proposal will only be used as a punching bag or as a foil upon which the House and Senate will point to and say “see our proposals are better than the govs”. The House and the Senate will negotiate and they will avoid the political untouchable like taxing pension benefits (except maybe for the wealthy) and they will avoid “take aways” from public workers. They will kick the can as far down the road as they can and in the end the budget will be balanced and the Gov can move on.

  27. shaftalley Says:

    the reason we have a loss of revenue in hawaii is not because of tax cuts!it is because the citizens of hawaii have become forced consumers of state services.and our state and local gov’t. continues to try to get more of it’s citizens on all these programs without realizing the economical consequences that is harming all of us.the political ruling class in our state have always targeted middle class and low-income people for potential votes for their continued privileged existence.and the despicable and cowardly alliance with certain special interest groups and private businesses.to give certain people and businesses preferential treatment at the expense of the rest of us is part of the reason for unrest in egypt.we tax-payers have rights,dammit!and no gov’t. can give it to us,or take it away from us.hawaii is on the road to gov’t.nationalization.going against the local politics and politicians and organized labor is like trying to topple a communist/socialist state.but eventually regimes fade away whenthey run out of other people’s money. liberty and justice for all.

  28. Capitol -ist/WassupDoc Says:

    WooWoo:

    A successful life is not founded on good luck but based on hard work. As someone who held my first job at the age of 2 – a child actor – and earned five graduate degrees and three undergraduate degrees and am working on a fourth one in order to start up my 16th career, I understand what it takes to make a life worthwhile – working hard and doing good to do well.

    Just being a prog-lib has nothing to do with one’s financial outcomes. What does make a difference is whom you know and where to go.

  29. WooWoo Says:

    Good thing that Dave left us with a topic big and meaty enough that we can flog it for the entire time he’s gone!

    Kolea- while an analysis of how tax changes impact a typical taxpayer are useful to some extent for public relations, it really represents a deceptive incrementalism that fails to hold govt accountable. I’m not a rabid righty demanding the end of of govt. But some of your assertions are great backhanded examples of how govt is sclerotic and inefficient due to it’s inherent monopoly status.

    When you say that you don’t think that Neil’s people have run some of the numbers, I agree. Why haven’t they? Because the state’s systems are so archaic that these basic scenarios become guessing games.

  30. Kolea Says:

    Teddy Freddy,

    Thanks. You are right. It is the Lege who will make the choices, not the Governor.

    OK, but Neil’s proposals are the most public. They give the public something to react to, a chance to express our opinions within earshot of the legislators.

    Neil has staked out some a pretty extreme position on taxing of pensions and reneging on the State’s contractual obligation to cover Medicare Part B. That may create the opportunity for an acceptable “compromise” when the Lege proposes taxing only higher income pensions, as in Ige’s version. And for changes in the Medicare coverage for future hires.

    Tax revenues have started to rise, so maybe the recovery is starting to be felt. But good luck to the legislators trying to balance the budget without there being a major mutiny. I guess the easiest thing for them to do is to cut services to the least powerful people in our society.

  31. charles Says:

    Assume that the $850 million deficit is real. And even if it’s a bit off, I think it’s safe to say we are not heading for a budget surplus any time soon.

    Abercrombie’s taxing of soda, pensions, and eliminating Medicare Part B seems all but dead at the legislature.

    I hear the hue and cry to “cut the fat” from government. But even if you eliminated whole departments, you don’t get close to closing the deficit.

  32. Teddy Freddy Says:

    Kaleo: You are correct that while I continue to maintain that the budget is really all about the political decisions that will come out of the House and the Senate, I do not want to overly downplay the role of the gov – even though at the end of the day he will simply say “yes”. The gov should show leadership and show his cards and ideas if he has any. The nitty gritty detail of the funding for each department of course is important and should be reflected as such in the govs budget proposal. But the “big items” – ie. the question of a ge tax or not, a soda tax or not, the take aways from public workers or not, the new tax credits or not – the big numbers and the big decisions will be made in the back halls of legislative offices and not on the fifth floor. At the end of the day the Gov will simply say yes. After all, has any governor ever vetoed a budget? The discussion now should not be focused on whether the gov does or does not want a getax or any tax, but rather what the leg will do.

  33. Capitol -ist/WassupDoc Says:

    Don’t count any tax increases out – unless, of course, you want to wisonsin-ize Hawai`i.

    Check out this interesting article http://www.commondreams.org/headline/2011/02/18-9 as the Grand Old Party/s Grand Old Scheme.

    Maybe it’s time to march in the streets after all.

  34. Teddy Freddy Says:

    Meant Kolea. Sorry

  35. shaftalley Says:

    regarding CWD’s link to an article written by robert reich,i think the republicans,tea party members should distance themselves from billion-aire charles koch.the koch empire is truly a power elite.anti-liberty and freedom.neo-conservative.they have funded libertarian organizations,like the cato institute.but it was simply done for total control.the koch brothers are making a move into wisconsin.and the republicans,especially the governor,walker are being bought willingly.koch wants to take over certain industries in wisconsin,and gov.walker will give him no-bid contracts.

  36. el guapo Says:

    Read the second paragraph in this article. New Jersey wants their public employees to pay 30% of their health benefits, up from an average of 8%.

    Most public employees in Hawaii paid about 40% of their health benefits prior to the increases under Lingle (which Abercrombie recently reinstated). Certain classes of employees pay about 30%.


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