Monday, April 20, 2009

Escape Artists

While all of the editorial savants are egging on the Senate Democrats to pass the Ravitch toll plan, it is instructive to take a look at the tax context of the suggestion-and the fact that New York State is already reeling from the impact of high taxes. The impact of this high tax climate is just being felt; and, as Jonathan Williams pointed out in the NY Post yesterday, it could very well lead to an exodus of the kinds of folks that the state relies on to foot its bills.

As Williams tells us: "There's an old saying that high taxes don't redistribute income, they redistribute people. Unfortunately for the hard-working taxpayers of New York, this wisdom seems to be lost on Gov. Paterson and a majority of legislators in Albany. For 2009, the Empire State earns the dubious distinction of having the worst economic outlook of any state in the nation -- 50th out of 50."

All of this, however, has been lost on legislative leaders, who have ignored the high tax burden and imposed even more taxes and fees on the state's citizens-and have used the federal stimulus money to promote higher levels of government spending while doing so. And these new taxes were imposed after New York earned its bottom rung rating; 'This is according to the American Legislative Exchange Council (ALEC), a non-partisan membership association of state legislators. And New York's dismal ranking was measured even before any of the proposed job-killing tax increases were on the table."

So how bad is the state's economic climate? "Poor labor policies, high state debt, excessive government bureaucracy, and sky-high property taxes have combined to devastate New York's economic outlook. In fact, only six states in America impose higher property tax burdens than New York. Also of particular concern are punitive state and local tax rates on personal and business income. When you add New York City's income taxes to the state's onerous levies, individuals living in Gotham paid the highest income tax rates in America last year. If you include federal taxes, companies in the Big Apple paid the highest combined corporate tax rates in the industrialized world!"

This is the underlying reality to the clarion call in support the Ravitch plan-a scheme that would add tolls, a further boost in payroll taxes, and higher fares; and its supporters are busy excoriating senate Democrats who are resisting the further burdening of their already beleaguered constituents. Wouldn't it have made greater sense for Ravitch and Governor Paterson to subsume the MTA rescue within the recently concluded budget negotiations, so that the added tax burdens could have been devoted to transit needs?

Instead, we get a budget that's been brought to New York by the taxers at the Working Families Party; and a toll/tax plan on top of this, one that, once again finds the WFP out on the streets agitating for yet another hike-this time for really hard working families of motorists. You really can't get more irresponsible than this scenario.