Gov. Paul LePage made two strong statements when he announced the contents of his budget proposal, but I’m not sure they were the ones he intended to make.
First, his proposal shows that he believes that there isn’t much left to cut in the state budget.
Second, he has unabashedly endorsed raising taxes in order to fill the budget gap.
Both of these may seem like strange ideas to be implicit in LePage’s policy. He is, after all, the guy who constantly claims there’s government waste still to be cut and evangelizes for more corporate and income tax breaks at every opportunity, but there’s really no other way to interpret his budget proposal.
Sure, the budget his administration put forward includes a number of state-level cuts, including to education and a new attempt to eliminate important health care services such as the Drugs for the Elderly program, but as much or more of the burden of this budget has been shoved onto Maine cities and towns through an elimination of state revenue sharing with municipalities and other cuts to municipal funding.
Maine’s towns already have faced year after year of declining state and federal funding and their budgets already are cut to the bone. If there truly were more waste at the state level, as LePage has claimed previously, one would think he would tackle that rather than passing the buck to Maine’s towns.
This shifting of the burden to municipalities also represents a large part of the new LePage tax increase. Faced with the huge budget shortfalls that this proposal would cause ($2.5 million for Augusta and $2.3 million for Waterville alone, according to the Maine Municipal Association), municipalities will be forced to increase property taxes in order to maintain basic services. This regressive move will increase taxes most on the poor and the middle class.
LePage’s budget would make matters even worse by eliminating the circuit-breaker and homestead property tax exemptions for everyone younger than 65, costing poor and middle class Mainers tens of millions more.
Property taxes aren’t the only taxes that would be increased if LePage got his way.
His budget proposal also changes the indexing process for the income tax in a way that will disproportionately affect the poor and raises a number of other taxes and fees.
In fact, the only people who seem to be protected from disproportionate tax increases in LePage’s budget are wealthy individuals and corporations. These privileged groups get to keep the massive new tax breaks that LePage and the Republican Legislature gave them in the last budget.
In a way, this budget proposal is a rhetorical gift to House and Senate Democrats. Virtually no one outside of the small bubble of unreality that encases the LePage administration could possibly believe that these proposals are fair or a good idea. And the tax increases will allow a one-to-one comparison with more reasonable proposals that the Democrats can put forward.
In fact, Democrats already have been beaten to the punch by Republican and independent legislators. Republican Sen. Tom Saviello last week proposed legislation to eliminate the LePage tax income tax breaks for the top 1 percent, a good start toward making things more fair. A group of independent members of the House also met with LePage last week and proposed increasing taxes on the wealthy as an alternative to his cuts.
According to the Village Soup Newspapers, LePage responded by banging his fists on the table, swearing at them and storming out of the room.
Making our tax system fairer by making sure that wealthy individuals and corporations pay their fair share is already incredibly popular (every opinion poll at the state and national level has shown this and the recent federal election and fiscal cliff showdown provide the latest proof) but LePage has made advancing these policies even simpler.
By not being able to find any further state-level cuts and instead relying so heavily on tax increases that target the poor and the middle class (and by being so angry and ineffectual in defending them), LePage has set up a perfect contrast and created an opportunity for more reasonable legislators to come together to replace his tax increases with ones that are much fairer and more progressive.
If it comes down, as it likely will, to a decision between increasing taxes on the wealthy and LePage’s plan to massively increase taxes on the poor and the middle class, even the most hardened conservative lawmaker would find it difficult to stand by the governor.
Mike Tipping is a political junkie. He writes his own blog at MainePolitics.net and works for the Maine People’s Alliance and the Maine People’s Resource Center. He’s @miketipping on Twitter. Email to [email protected]