Personally, I wouldn’t mind paying a higher gasoline tax. As Boston Globe columnist Steve Bailey points out today, the state gas tax hasn’t been raised for years, and is now lower than it is in most nearby states. Besides, it’s good public policy — it would provide a disincentive for gas-guzzling SUVs, and a boost to public transportation as well.
But I have to disagree with Bailey when he writes, “Saying no to gambling is not enough; opponents must be willing to offer an alternative.” Massachusetts ranks 28th in state and local tax burden. So yes, 27 states take away more of their residents’ income, but 21 take away less. That puts us in about the middle.
So even if a higher gas tax makes sense, it’s wrong to say we’re so undertaxed that we absolutely have to do something about it. And certainly not on a day when a story like this appears on the front of the City & Region section. As a private-school teacher patiently explained to Tom Finneran on WRKO Radio (AM 680) this morning when he tried to defend this outrageous expenditure on pension-fund bonuses, most people in the private sector don’t even get pensions.
Bailey has been steadfast in his opposition to casino gambling, and I especially like his nickname for Gov. Deval Patrick: “Governor Slots.” But he’s wrong about this being an either/or proposition. Casino gambling is bad for the state, and opponents do not need to apologize or come up with alternatives. After all, it’s Patrick who proposes to sell out our future, not us.
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mike_b1
Patrick proposes to sell out our future? Dan, that’s harsh — and wrong. It wasn’t Patrick who got us into this mess. It was the previous legislatures and administrations, and the voters who kept returning them to power. What does it say that we’re coming off nearly five years of growth and we still have a wrecked state budget?I don’t want the casinos any more than you do, but clearly there needs to be much greater restraint toward spending and likely higher revenue stream (probably taxes of some form) to return Mass. to long-term stability.
Dan Kennedy
Mike: You’re buying into either/or thinking. A much higher gas tax would go a long way toward getting us out of this mess. But before we even consider new taxes, let’s get this sleazy casino proposal off the table.
mike_b1
I don’t think I’m buying into either/or thinking. After all, state tax revenues from businesses could spike as result of larger demand for the Commonwealth’s goods and services, or from personal taxes on investment gains. That would be similar to what happened in the run-up to 2001. But again, my larger point is that you are inappropriately laying all the blame for a (potential) trainwreck of a future at Patrick’s feet — and tying it to something that hasn’t even taken place. I think you’re jumping the gun.
Anonymous
Well said, Dan. Casino gambling is a bad idea and should be rejected on its face. By Bailey’s logic, we could come up with a plan to legalize and tax heroin, and opponents should argue where we’d get the revenue from alternative sources. Nonsense. When confronted with a bad idea, you reject it first and worry about finding better solutions later.
Rick in Duxbury
I’m no apologist for Finneran but on this one he happens to be right. Why is it “outrageous” for performance-based compensation for pensions? So because private employees may not have pensions, THAT’S a good reason to have bad management on public pensions? This is the same logic that says that I would rather sell my house for $300k and avoid a broker than hire a broker who justifies his existence and gets me $350k. I’ll bet the investment managers don’t get the same time off as that private school teacher but you won’t hear that in this intellectual cherry-picking.BTW, college teachers qualify for pensions from TIAA/CREF, which (appropriately)pays administrators FAR more than any of the people discussed here, (but you knew that.)
Don (no longer) Fluffy
You see. . . You elect a Democratic governor, and what do you get? Casino gambling and, of course, higher taxes. It’s in their genes.
Rick
Why is it always “raise taxes” and not “cut spending”The state budget is out of control.
The Scoop
A higher gas tax is not going to persuade people to drive less. The cut in driving was almost nonexistent when prices were above $3 a gallon, so a couple of extra cents per gallon now surely won’t make a difference either.
Reuben from Plympton
As ever, Dan, thanks.If I may, I’d like to add that there’s a lot more logic to paying for repairs to roads and bridges, as well as subsidizing mass transit with a fuel tax (and other vehicle taxes) than by a casino tax.The whole “opponents must come up with alternatives” argument is touching a very raw nerve with me. Used as it is these days, it’s just a silencing tactic. The governor has an office and a staff and it’s his job to produce plans. Ours, as citizens, is to comment, and vote.
Peter Porcupine
Reuben – we ALREADY subsidize the MBTA and their Pike-like salaries and benefits with the gas tax. Along with bike paths.What on EARTH makes you think the Lege would keep their hands off increased gas tax money, perhaps as a pension fix for those poor out-of-work toll takers until we can usher in GamblePort?
Outraged Liberal
Sorry Dan, but we part company here. I think Bailey was absolutely right. It may not be an either/or issue, but there needs to be a discussion about spending and revenues in context — and not the no tax and spend vacuum we’ve lived in all these years.I’ve argued repeatedly over at my place (http://baystateliberal.blogspot.com/)that if you oppose one revenue source you need to come up with an alternative. Or you need to cut.But what are you going to cut? Yes, there is some room for reform in the pension system that is now Target #1, But remember reforms will be a drop in the bucket compared to the liabilities owed to past and future retirees. And it should be noted, in passing, that public employees don’t collect Social Security.So you’ve picked up some change from pension reform. What’s next? Education? Public Safety? Oh yeah, transportation!Pension reform won’t make a dent in the $20 billion gap in infrastructure needs. If not the gas tax what else is there? Corporate taxes. Sal say no. Casinos? Sal says no.I am ambivalent about casinos, even in the face of the farce that has played out so far. But I am for a discussion about options.If we discuss and reject casinos — what are our options?
mike_b1
Again, it seems Patrick is getting a bit of a bad rap. The legislature, the citizens, the business community, etc.: all of us have a stake in this outcome. There are those in this forum who were insistent that certain programs not be cut, yet at the same time they have not adequately addressed the situation that even without adding any programs the cost to run the state rises over time. I’m no Republican, but I agree with Rick that what is missing is a good hard look at what can be cut. Dems won’t let Patrick do that, though, which forces his hand. Patrick is dealing with the mess the rest of you (I’m still a newbie to this state) created, you voted him in and yet you don’t even want to listen to his ideas.
Dan Kennedy
Outraged Liberal: I’ve provided the context. Taxes here are 28th in the country, not particularly high, but also not particularly low. Casinos are a terrible idea. Anon 10:33 puts it well. Get casinos off the table. Then we can talk about alternatives.
Anonymous
dan, you perdicated this discussion on the contrasts among the casino and gas tax revenue options and the “outrageous” performance bonuses for pention managers. you can’t now say we can’t talk about the vast and horizonless problem of budgeting ONLY after we kill off casinos. upping perf bonuses for pension investors is part of good longterm budgeting if it’s designed to keep the fund in the black. you’re welcome to be a single issue voter but the rest of us can still weigh the pluses and minuses of a full panoply of options.
Dan Kennedy
Anon 10:10: No, of course not. All I’m saying is that I object to the idea that we are required to keep casinos on the table unless and until we’ve figured out a way to offset the money that casinos would bring in. We should cut where necessary and raise taxes where necessary without worrying about the casino proposal, all the while working to kill it.
mike_b1
Dan, I took a look at that link to the Tax Foundation tax burden data. Yes, Mass. is 28th among the states in local/state burden (although the mean data aren’t shown, so we don’t really know whether we are high or low). But, you ignore that Mass. citizenspay way more to the federal government than the state receives in return. Mass. — or more to the point, Mass. citizens — gets crushed in this regard, ranking 7th nationwide of late and consistently in the top 10. We are a donor state, helping to foot the bill for everyone else. Bottom line is the bottom line: We pay enough already.
Dan Kennedy
Mike: Then fine, we should be able to cut our way out of this mess. It certainly doesn’t mean we should build casinos.
mike_b1
That we can agree on.
Anonymous
Hey, I posted a comment in this thread yesterday and it never showed up!
Anonymous
You guys are mixing up income tax which is a rate, with the gas tax which is 21 cents. If you look at the value of the dollar versus gold, oil, the Euro, the loonie etc., we are obviously in the middle of a serious inflation which is cutting the value of the dollar in half. If you raise the gas tax 100% or the pike tolls 100% for that matter you will simply be taking in the same actual money you were taking in before. wellbasically
Mike from Norwell
Anon, which actually speaks to the price of oil right now, which is pegged to the dollar. Do the OPEC nations automatically take a haircut because the dollar is falling? I don’t think so (and they shouldn’t, considering this is a global market).As an aside on the pension issue touched on by Finneran yesterday (coming from a pension actuary):1) The performance based bonuses I don’t have such a problem with, although realistically we are talking about rewarding people who are selecting the investment managers generating the superior returns, rather than rewarding the managers themselves.2) Private sector plans deal with maximum eligible salary and benefit limitations that for some reason are completely exempted for government plans (geez, I wonder why). The whole Billy Bulger extra salary case would be moot under a private industry plan, as the maximum compensation limitations under the IRS Code are well below what he already had credited under the plan. Ditto with the farcical MBTA pension wherein Mulhem at age 48 is collecting a $130,000 annual pension; not even possible at half that amount in a private sector plan. Now one could argue that limitations should be applied to private sector plans since extra contributions to fund these benefits represent deduction loss to the government; countering that would be that if you didn’t allow such gross abuses on the government side that you would reduce expenditures.3) The Pension Protection Act of 2006 focused on “reforming” private sector pension plan funding, but actually rises in artificially low long-term interest rates have taken care of much of the liabilities. But you could take the most egregious private sector plan and compare that to the best government plan, and would find that the private sector plan was probably in better shape. The kicker is that if a private sector plan fails, the PBGC steps in, but has a drastic limit on the maximum benefit guaranteed (in the mid 40k range at 65). But what do you think will happen when a government plan “fails”? Hope you like paying more taxes.4) This whole “the government worker doesn’t get Social Security and has to contribute to his pension” is a real red herring. Sometime, take a look at how your Social Security benefit is calculated for your 15.3% haircut (and if you want to argue that your employer pays half, do you still patiently wait to see what Santa Claus brought you at Christmas)? I’d gladly take contributing 11% for an 80% pension v. 15.3% for 20%.