Wednesday, December 31, 2008

Things will start happening fast now...

Yesterday Governor Patrick announced his intention to make another $1 billion in mid-year cuts to the state budget, likely including cuts to local aid. He also responded to a question about tax increases with this evasion: ""It's a crummy time to ask people for broad-based taxes. But I think there's a lot we have to do to demonstrate greater efficiencies and the impact on services before the public will accept broad-based tax increases."

Watch now for the following progression:

Like the week of the last "cuts," immediately before the November election, we will hear the word "pain" used constantly to describe the supposed impact of the "difficult decisions" the Governor is making. We will hear very little about actual cuts.

Despite all of the "pain," we will not hear about the Governor cutting: (a) his new DC and Western Mass offices; (b) his multi-million-dollar "Commonwealth Corps" volunteerism program; or (c) his bloated staff (whose salaries exceed those paid to Romney's staff by orders of magnitude).

By "coincidence," today Patrick's "blue-ribbon commission" charged with coming up with ways to pay for his multi-billion dollar "Readiness Project" education reform package will issue its report, calling for a hike in the sales tax.

Patrick will bite his lip and furrow his brow, talk a little bit more about "efficiencies," and then proclaim his reforms to be of "critical importance" for "our children" (he believes the children are our future). He'll "reluctantly" go along with the sales tax hike, labeling it an "investment."

Once that horse breaks free of the barn, we'll have a stampede of "new revenue" proposals, from "local option" taxes to a gas tax increase to yet another corporate tax hike and, finally, an increase in the income tax.

I hope I am wrong, but since his campaign - when he promised far more in spending than he could possibly deliver - I have expected Patrick to head down the tax-increase path. Once he started down that road (with last year's billion-plus hike on business), the end point (income tax hike) became almost inevitable. With no viable minority party presence in our government and a mass media that is - with rare exception - enthusiastically on-board with tax hikes, we taxpayers don't stand a chance.

If we are lucky - and I use that word with more than a bit of irony - Patrick's efforts to jack taxes in the midst of a recession will "succeed" to a degree sufficient to break through our electorate's stupor in time for November 2010.

Update:

The "Readiness Project" funding panel report is in. This from the State House News (emphasis mine):

READINESS PANEL SEES NEED FOR "ADDITIONAL FUNDS" | Additional funds will be necessary to maintain basic educational services and to pursue "vital" investments in public education but any revenue-generating measures should be tied to restructuring and cost-saving reforms, according to the final report of Gov. Deval Patrick's Readiness Finance Commission. Commission members are calling for the immediate commencement of cost savings strategies. But the commission, saying savings alone won't be enough, found increasing the sales tax the "most viable" of the revenue-generating options discussed, with the other revenue sources eyed being the gas tax, the income tax, interest and dividend taxes, and the licensing of casinos. ... The commission, in its conclusions, said the education sector "needs to be a top priority for the state, and represents a worthwhile, indeed critical, investment for the long-term growth and success of the Commonwealth."
Hold on to your wallet.

Tuesday, December 30, 2008

Going in for the kill

That seems to be what the Globe is doing with regard to Speaker Sal DiMasi, with no fewer than three articles on his ethics "issues" today. Here, here and here.

It will be interesting to see if any other Reps - especially any other leadership - step up and declare their opposition to his reelection as Speaker. I imagine there is some fairly medieval arm-twisting going on right now to tamp down any such intentions. I'll be particularly interested to see if any new members stick their necks out here.

Monday, December 29, 2008

Depends on how you define "critical"

I'm sure there will be no lack of talk radio and blog outrage stemming from this article in today's Herald. I'll cling to my moorings and refrain from pre-echoing much of what will be written and said. I will offer this observation, however:

Patrick's spokeswoman said: “We have a ‘no net new hires’ policy implemented in mid-September that prevents agencies from adding additional staff, but allows for critical positions to be filled.”

This guy, Patrick's neighbor and a campaign contributor, was hired in October. Patrick's office has declined to confirm the Herald's suspicion that he was hired to fill a brand new position, but I can confirm that there was no "director of real estate services" in the Romney Administration. It's not hard to figure out why they do not want to confirm that the position is new - it's hard to categorize a brand new position as "critical." Somehow the Commonwealth has limped along for a while now without any such official.

I'm not one to get too exercised about either the fact that this guy is Patrick's neighbor, or that he's a campaign contributor. It makes sense to me that officials will sometimes hire people they know and trust, whose qualifications they understand and appreciate. The press tends to view all such hires as inherently suspicious, which is nonsense. And some politicians, fearful of such characterizations, pass over highly-qualified people who could make real contributions.

What bothers me, though, is this pattern we see with Patrick. If he wants to do it, it is "critical." If you disagree, you're a "cynic." In my opinion this is a direct result of the way he was lionized during his campaign in 2006. He read his own press and came to hold himself above criticism.

Maybe it is a good idea to have someone in charge of maximizing the return on the Commonwealth's real estate holdings. That in itself does not strike me as an inherently objectionable proposition. A hiring freeze, though, ought to be absolute - particularly when it is implemented to demonstrate the "sacrifices" being made by the government to get the budget under control. If there is a case to be made for an exception for this hire, then the Governor should make it. I suspect he cannot and so will not. But then, I'm one of those "cynics."

Wednesday, December 24, 2008

Priorities

It didn't get much attention beneath all of the noise about storms, the economy and Christmas, but this week this little tid-bit leaked from the Governor's office: Patrick's "blue-ribbon panel" hashing out funding options for his multi-billion-dollar "Readiness Project" education reform plan are set to recommend a sales tax hike.

Compare and contrast that piece of news with this: 'Savage' cuts loom for Massachusetts. The question leaps immediately to mind: is this the right time to be pondering higher taxes to fund a massive spending program geared at "improving" an educational system that this year produced students ranked tops in the WORLD in both math and science?

The "Readiness Project" is a legacy/ego initiative for our Governor. He won't let go of it easily. We (the voters) should force him to put it on ice and figure out how to fund the very real priorities of government that are endangered by our current budget mess.

Sunday, December 21, 2008

Mission Accomplished

Months of crisis talk have gradually injected deep into the conventional wisdom the notion that we "have to" have "either" a gas tax hike or toll hikes. Take note of the following intro paragraph to this Globe piece:

Massachusetts residents are more willing to embrace higher gas taxes to repair the state's crumbling transportation system than any other proposed solution, including higher tolls or more booths at the state's borders, a Boston Globe poll shows.
(italics mine). "than any other proposed solution... ." Oh, really? Were voters polled on reforming the state pension system? On eliminating the Pike and renegotiating costly labor contracts? On privatizing operations of the Pike for an enormous upfront payment? No, they were not. They were asked to choose between two untenable choices, and they picked one... just as the architects of this scheme knew they eventually would.

Mission accomplished.

Tuesday, December 16, 2008

Calling Lee Majors...

No, not the Bionic Man. I'm thinking more about The Fall Guy.

Almost a year has passed since Governor Patrick promised a plan to overhaul the state's transportation system. "Mass-Trans," he called it. In the meantime, the Pike's bond rating has dipped to just above junk status, the Governor has proposed toll hikes that will double what most Pike commuters pay to get into work in Boston, and Mass Trans... well, it hasn't shown up yet.

So yesterday he pushed out Bernard Cohen, his Transportation Secretary. This is stall tactics 101. For a few days the press will turn from "where's the plan?" to "who's the replacement." When a replacement is named (looks like it's going to be James Aloisi), the administration line will be "the new Secretary is getting up to speed, weighing in on the draft," etc. We won't be seeing Mass Trans in 2008, folks.

Here's hoping the Patrick Administration's latest Fall Guy gets a soft landing.

Monday, December 15, 2008

Let's play "what if"

What if Governor Patrick's push for casino gambling in MA had succeeded at the beginning of this year? You might recall that after an election cycle in which he promised to fund his programs by finding "efficiencies in government," and during which he never used the word "casino," our newly-minted governor suddenly made casinos the centerpiece of his economic plan. That plan was shot down in the House by opponents who argued, among other things, that the casino business does not produce unlimited revenues, and could not be counted upon to balance our budget and fund a bunch of new spending.

So what if? Even without the "promise" of new revenues from casinos, the Governor proposed and the legislature passed a 2009 budget that was $1 billion in deficit from the get-go. What would they have done had they been counting on untold billions of additional revenue from casino licenses? We can only imagine.

Today the Globe published a front page piece titled "Economy deflates hopes for casinos." The article catalogs the series of economic woes being experienced by the casino industry from Connecticut to Vegas. It is quite clear that had we banked on casinos, we'd be hurting even worse now than we are already. It was a good bet to block the Governor's proposal.

Thursday, December 11, 2008

The heart bursts with pride

Our rolling political scandal here in Massachusetts hit the pages of the New York Times today. the money quote (excuse the pun):

Others blame the entrenched Democratic control of Massachusetts politics over the years — Republicans have only 21 seats out of 200 in the legislature — and say it has fostered a tendency to look the other way when a member misbehaves. And while the minority party is railing against corruption now — all of the elected officials under investigation are Democrats — Jack Beatty, an author and student of the state’s political history, said it was just as common when Republicans controlled the legislature a century ago. “When you have one-party rule in the legislature, this just is endemic,” said Mr. Beatty, who wrote a biography of James Michael Curley, a famously corrupt mayor and governor in the early 1900s. “And I don’t see how you increase political competition because the Republicans have really committed hara-kiri in this state.”


He's right, of course. Even as respondents in surveys claim unprecedented levels of outrage with their elected officials, the support continues to pour unabated into the coffers of current officeholders. There's no word yet on how much the political anachronism called the Committee for a Democratic Senate took in at its funder this week, but you can bet it was a lot. Likewise, our Governor held his own holiday cash grab Wednesday evening, where he used his innovative "Seventy-First Fund" to duck finance laws and take in many times the legal contribution limit from single donors. This from the guy who was going to bring a new brand of politics - apparently he meant a new, expensive, designer brand).

Anyhow, supposed voter disgust aside, donors will continue to pour dollars into these events, all but insuring the perpetuation of the single-party system that is rotting our government from the inside out, so long as the single party system holds 100% of the power. Sure, the MA Republican Party has its small, dedicated donor base. But so long as it is completely impotent, it can't raise money from the public at large. And so long as it can't raise money from the public at large, the MA Republican Party will remain completely impotent. In fact, it will become more so - as this election cycle demonstrated. In my own race I was fortunate to be able to raise a good amount of money from my own personal contacts, and by reaching out with one-on-one appeals to statewide Republican donors. The party, for its part, was able to offer me roughly the same amount of support as in-laws in Cleveland. No joke.

Of course this wasn't the party staff's fault, though they always take the blame. Soliciting a donation to support the MA Republican party these days is like asking for money to support the local Rotary softball team as they gear up for their must-win against the Red Sox - a very tough sell. It just doesn't strike most people as a useful investment.

This state of affairs won't last forever. What it will take to break out of it, though, is something more than repeated demonstrations of the corrupting influence of one party rule. Disgusted voters with no viable alternative will just keep electing the same people; the ones who aren't in jail, anyhow. What we need is a galvanizing leader - someone who can inspire crowds, whip up enthusiasm and provide some coattails for down-ballot races. Here's hoping that person is out there and looking at 2010.

Wednesday, December 10, 2008

It ain't broke... so quit trying to "fix" it

This is excellent news. The Globe reports today that "Massachusetts students significantly outperformed their peers nationwide on a prestigious math and science exam, putting the state on an elite international tier".

This is only the latest in a long string of est results that prove without question that education reform is working in Massachusetts. One wonders, then, why our Governor has identified a complete, multi-billion-dollar overhaul of how our state educates its children as one of his principal goals as Governor.

Our teachers deserve all the credit in the world for these excellent results. Our teachers' unions deserve all the scorn in the world for their continued efforts to undermine and undo the reforms that made these results possible. Our elected officials ought to start paying less attention to the increasingly-disproved rhetoric emanating from the unions that fill their campaign coffers, and more attention to the stellar results our schools are achieving.

Of course none of that means that there are not many, many improvements that need to be made to our public schools, especially in poorer communities where too many kids "graduate" without a minimum base of knowledge, and far too many don't graduate at all. The Governor's (and the Mass Teachers' Association's) efforts to throw a very healthy baby out with the bathwater, though, ought to be repudiated.

Tuesday, December 9, 2008

From the Unnecessary Effort file

This week I learned that there exists in Massachusetts an active political action committee called "the Committee for a Democratic Senate." Having last seen a Republican Senate majority somewhere around the Great Depression, and holding all but 5 seats in that body currently, one would think the Democrats could have long ago sent this committee the way of, say, the Committee to Repeal Prohibition. But in fact, as I said, the Committee still exists (with an office and a paid Executive Director), and it is holding a $150 per person fundraiser this evening at Tecce's in Boston's North End.

Who would bother to attend, you ask? Plenty of people, apparently. Last year's December event brought in $32,150 (according to the State House News Service).

Other interesting tid-bits from the SHNS: This election cycle there was one - ONE - Democratic Senate incumbent with a plausible GOP challenger (James Timilty. He won.). There was also one Democrat challenger for a Republican seat - Sara Orozco who ran unsuccessfully against Scott Brown (R). The Committee for a Democratic Senate didn't give Ms. Orozco a dime. That makes sense, when you think about it, since her election would have had no more impact on the "Democratic Majority" than did her defeat. The Committee did, however, pay plenty of money to well-connected consultants.

So why will so many people crowd into Tecce's tonight, to fund another year of incestuous handouts to party operatives? They certainly won't be going to bask in the warmth of the assembled legislators' radiant personalities. They will go because they and their clients want stuff out of the next session.

I suppose we ought to be thankful. At least the money changing hands tonight will be recorded and reported. Presumably there will be a basket to collect the checks, so that nobody needs to suffer the indignity of restaurant bra-stuffing.

Monday, December 8, 2008

More cuts to local aid

Speaker DiMasi today predicted that we'll see a major cut in local aid next year - as much as 10 percent. That is not much of a surprise, given both the national downturn and the fact that the legislature budgeted as though the long-over economic boom would continue in perpetuity.

The more interesting angle will come as we see what is *not* cut. Local aid apparently is now on the table - perhaps even on the chopping block. Is Governor Patrick's multi-million dollar "Commonwealth Corps" program likewise up for a cut? That's the one that's to pay people to volunteer, remember? Or what about the Governor's new DC and Western MA offices? Nice to have, sure, but are they more important than local services? And of course despite the severe downturn and rhetorical belt-tightening, the Governor's blue ribbon commission continues to study ways to fund his multi-BILLION dollar education reform initiatives, including free -re-school and community college for all students. Again, nice in the land of money trees, but should that commission not shelve its efforts until we can pay for the public schools we already have?

If cities and towns are going to be asked to cut back services by as much as ten percent, is it too much to ask our Governor to let go of his legacy projects and concentrate funding on the basics?

Sunday, December 7, 2008

It isn't one or the other

From today's Globe: Taxes rise, spirits fall as state OKs local rates

This was at the heart of Governor Patrick's campaign for office two years ago. He was going to "focus like a laser beam" on property tax relief.

Unfortunately, this was a con then and it is a con now. Candidate Patrick used the notion of property tax relief to duck questions about income taxes - specifically why he believes the legislature can continue to ignore the voters' command in 2000 to roll back the income tax rate to 5.0%. Each time he was asked, he'd pivot to property taxes. "The tax we need to focus on is the property tax." Voters, who have long since become accustomed (numb) to the reality of the fact that the legislature has no intention of complying with the 5.0% mandate, but who are in truth drowning in property tax hikes, were all too happy to let Patrick get away with his dodge. The problem, of course, is that the dodge assumes a falsehood: the notion that in order to get property tax relief we need to trade away the possibility of income tax relief.

The notion that these two taxes are inseparably intertwined was also at the heart of the anti-Question One campaign. Setting aside for the moment the stark political reality of that initiative (it never would have been implemented even had it passed), voters were told that an income tax cut = a property tax hike, period. One or the other.

Governor Patrick was elected and the income tax rate remained at 5.3%. Property taxes went up. Question One was defeated. Property taxes are going up.

Property tax rates are set at the local level, as local governments struggle to fund local programs. The Governor does not and cannot set property tax rates. Sooner or later voters might notice that each time they are presented with this "one or the other" falsehood, they in fact get both - high property taxes and high income taxes. Until we - the voters - force our elected leaders to do something about this state of affairs, it will continue and it will get worse. Question One (again, assuming for a moment it would have been implemented) was too radical a step. Holding elected officials who refuse to respond to the will of the voters accountable at the ballot box, however - that would be neither radical nor revolutionary. That would be democracy. Maybe next time around, we'll wake up to the con game and insist on some new thinking. Maybe.

Friday, December 5, 2008

there's more to it

The Globe editorializes today on our state's "over-reliance" on capital gains taxes ("The state's binge-purge diet"). They get it right, but only partly.

It is correct, as the Globe states, that Massachusetts is one of the top three states in terms of the percentage (this year, 7%) of the budget that relies on revenues from capital gains taxes. Cap gains revenues are notoriously difficult to predict with certainty; however it is a fairly easy thing, on a year-to-year basis, to accurately forecast whether such revenues will increase or decrease.

For the last few years, as our economy boomed, cap gains taxes came in consistently above projections - in some instances far above. Rather than take those overages and either (1) return them to the taxpayers; (2) pass them along to our cities and towns in the form of much-needed local aid increases; or (3) deposit them in the rainy day fund (the Globe's preference), our legislature predictably spent those surplus dollars. Worse, they rolled an expectation of those surpluses into the next year's budget.

As the legislature - and the Governor, for that matter - crafted the 2009 budget, economic storm clouds were clearly visible on the horizon. Nobody can be fairly criticized for failing to accurately predict the extent of the downturn. Legislators can - and should - be roundly criticized for what they in fact did: they ignored the storm clouds and packed for yet another year at the fiscal beach. In other words, they budgeted as though the record capital gains revenues of recent years would continue, when anyone with half a lick of sense could and would have bet a limb on a serious fall-off in those revenues.

That fall-off having now happened, a good part of our budget mess can be attributed to the legislature's whistle-walk past the graveyard just a few months ago, during the budget process.

Thursday, December 4, 2008

Signs of the Apocalypse

Frank Foresees Sweeping Regulatory Overhaul
House Financial Services Chairman Rep. Barney Frank (D., Mass.) predicted that 2009 will be the "best year" for public policy since the New Deal.

Speaking before the Consumer Federation of America Thursday, Mr. Frank said Congress would pass a regulatory overhaul comparable to the antitrust laws of the late 19th century and the creation of the Securities and Exchange Commission in 1934.


Well, that's about the scariest thing I've read all week. Bad enough that Frank continues to rail against the very practices (sub-prime lending to people who clearly could not afford a house) that he facilitated, encouraged and protected for years. Now he thinks it's his mission to "fix" the system, through regulatory enactments comparable to the most far-reaching measures of the past century and a half. We're in for it now, folks.

"We have a bill to pay"

"We have a bill to pay," said Governor Deval Patrick on today's Egan & Braude radio program on WTKK. "It isn't the Mass Pike's Bill. It's the public's bill."

He was referring, of course, to the $2 billion in debt to pay for the Big Dig that our legislature, in all its wisdom, piled onto Turnpike commuters in 1997, and he was arguing in *favor* of implementation of the massive toll hike the Pike board passed at its last meeting.

How does that thinking work, exactly? "It's the public's bill," the Governor scolds - suggesting that those who oppose toll hikes are working against the public interest; but he wants one small slice of "the public" to continue to pay that bill - as they have done for 11 years now - while the rest of the state continues to get a free ride through the Big Dig.

I'm not advocating for statewide tolls. The Pike is a mess, toll collection is a horribly inefficient way to collect money, and the last thing we should be looking to do is to *expand* that dysfunctional system. For the Governor to suggest, though, that east/west commuters along the Pike have some obligation - soon to DOUBLE - to pick up the check on behalf of "the public" is, well, offensive.

Wednesday, December 3, 2008

Pike piece

Analysis: The Future of The Mass Turnpike

It isn't often that WBUR turns for public policy analysis to the Reason Foundation. The audio clip linked to the brief article above is well worth a listen. I do not like the "given" that Mr. Poole takes as his foundation - steadily increasing tolls on the Pike, in perpetuity. Aside from a perceived trend away from gas taxes and towards user fees, he does not cite any support for that "given," and I'm not there yet. The comparison of the Pike's shocking inefficiency (79% of dollars collected go to operating costs) in comparison to the national average (44%) and especially to privately-run European toll roads (under 25%!) is sobering.
I'm not sure the concept of transportation Public-Private Partnerships (PPPs) has much of a chance of taking hold here in MA. There is a deeply-ingrained hostility to the notion of "privatization" in our government, so much so that our anti-privatization statute (the Pacheco Law) is the strictest in the nation. But if ever there were a time when the possibility of a cash infusion might shake some of that opposition loose, it would be now.
As I said, the notion that increasing tolls on the Pike are inevitable bothers me. On the spectrum of possible alternatives, however, the predictability and control over those tolls that would be realized through a private-sector lease is certainly more appealing than the free-for-all that exists now.
I will be attending the Transportation Committee hearing on potential PPPs this afternoon, hopefully to learn something more rather than to listen to a bunch of demagoguery. We'll see.

Wonks on this issue will want to take time to read this brand new report by the Pioneer Institute.

Well, that's something anyhow


Georgia Sen. Chambliss wins re-election in runoff

Georgia Republican Sen. Saxby Chambliss handed the GOP a firewall against Democrats eager to flex their newfound political muscle in Washington, winning a bruising runoff battle Tuesday night that had captured the national limelight.

Chambliss' victory thwarted Democrats' hopes of winning a 60 seat filibuster-proof majority in the Senate.

An important result, and not just because it serves to stop - or at least pause - the Republican hemorrhaging for a while. A filibuster-proof Senate would have been too much power, too soon for the new President. More, it would have fostered the kind of ideological excess that many on the left want, and many on the right fear, but would serve the country poorly.

Meanwhile, here in MA, this election cycle brought the minority party to the brink of literal impotence, reducing R numbers in the House from 19 to 16. 16 votes (10% of the membership) is the minimum number required to force a roll-call vote on legislation, what the MetroWest Daily News editors recently called "the minimum standard of accountability." In other words, without 16 Members to raise an objection, any and all legislation may be passed on a voice vote - "the ayes have it." And with no way to record individual votes, the voters have no way to see or to know how their Representative has voted. With 16 Members, the Republicans are in a tough position. Quite literally, no Republican can miss a vote; not for a vacation, not for a family emergency, not to run to the bathroom after a bad taco. As soon as one R leaves the House chamber the Democratic leadership will know the leash is off. If you think they won't pay close attention, if you think they won't hold back controversial votes, hoping to outlast one or two Republican bladders, well... you clearly haven't spent any time watching our legislature in action.

Oh, and over in the MA Senate there are five Republicans. FIVE. The last time the they had the luxury of contemplating a fillibuster was during Bill Weld's first term.