Saturday, April 11, 2009

Unshared Sacrifice

The mantra of the tax and spenders is, of course, "shared sacrifice," a slogan bereft of its real meaning after it has been squeezed through an ideological blender by the Working Families Party. As the Wall Street Journal highlights: "In New York, Assembly Speaker (and de facto Governor) Sheldon Silver and other Democrats will impose a two percentage point "millionaire tax" on New Yorkers who earn more than $200,000 a year ($300,000 for couples). This will lift the top state tax rate to 8.97% and the New York City rate to 12.62%. Since capital gains and dividends are taxed as ordinary income, New York will impose the nation's highest taxes on investment income -- at a time when Wall Street is in jeopardy of losing its status as the world's financial capital."

But this income tax heist isn't the end of the legislative high jacking: "Oh, and it isn't just high earners who get smacked. The new budget raises another $2 billion or so on top of the $4 billion in income taxes with some 100 new taxes, fees, fines, surcharges and penalties to be paid by all New York residents. There are new charges for cell phone usage, fishing permits, health insurance (the "sick tax"), electric bills, and on bottled water, cigars, beer and wine. A New York Post analysis found that a typical family of four with an income below $100,000 would pay more than $800 a year in higher taxes and fees."

So New Yorkers at all levels of the wage scale will be hit-even while the federal stimulus money is used to increase government spending in an economic meltdown. But, as taxes hit all up and down the income ladder, we at least have achieved a sharing of the pain, right? Well, not quite; as it turns out, the cheerleaders for higher taxes and for the sharing of sacrifice have been themselves granted immunity: "This is advertised as a plan of "shared sacrifice," but the group that is most responsible for New York's budget woes, the all-powerful public employee unions, somehow walk out of this with a 3% pay increase. The state is receiving an estimated $10 billion in federal stimulus money, and Democrats are spending every cent while raising the state budget by 9%. Then they insist with a straight face that taxes are the only way to close the budget deficit."

All of which is a road to ruin for the state's once great economy-with the over reliance on Wall Street an artifact of history: "And so Albany is about to make a gigantic gamble on New York's economic future. The gamble is that the state with the highest cost of doing business can raise taxes on everyone who lives, works, breathes, eats or drinks in the state and not pay a heavy price for it. If they're wrong, New York will enhance its reputation as the Empire in Decline State."

Only when the state gets a real leader, someone who can represent New York's forgotten men and woman-the tax payers and small business owners-will be able to emerge from the fiscal morass that pawnshop politicians have gotten us into. 2010 can't come soon enough.