Senate should delay next tax cut

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6:56 PM Thursday, October 29, 2009

Gov. Ted Strickland proposes filling the state’s budget gap — created when the Ohio Supreme Court rightly shot down his plan for turning racetracks into casinos — by postponing the last phase of an income tax cut. Immediately, the smart money in Columbus said even some of the governor’s fellow Democrats might not like the idea.

After all, Democrats won control of the House of Representatives by winning districts that had been drawn for Republicans. Those legislators are reluctant to support a move that critics are (absurdly) calling a tax increase.

But now the House Democrats have universally endorsed the Strickland plan. The vote came after a clever political move. Democrats added a provision to cut the salaries of legislators by 5 percent (starting with the next legislature, which is the only way it can be done). That apparently gave representatives from the more conservative districts all the political cover they thought they needed.

(Also, the more combative Democrats might argue that their Republican opponents have supported a salary increase for themselves. It’d be a preposterous charge, of course. But if failure to cut taxes can be called a tax increase, then maybe the failure to cut salaries can be called a salary increase.)

Meanwhile, Rep. Seth Morgan, R-Huber Heights, complicated life for the Democrats by proposing an amendment to impose the pay cuts, but to also go forward with the planned tax cut.

Now the Strickland proposal measure goes to the Republican Senate. There’s been talk there — as on the Republican side in the House — of using the budget crisis as an opportunity to cut spending by reorganizing the state government.

One plan would cut the number of state agencies from 24 to fewer than half that, while cutting perhaps 10,000 jobs.

But a budgetary crisis is not the time to focus on something so complicated. Republicans would do better to save the plan until consideration of the next two-year budget. There will still be big problems then. The state will be facing the loss of almost $6 billion in federal stimulus money.

The senators know what has to be done, that suspending the tax cut is the obvious short-term solution. Now it’s just a matter of rising above the contentiousness that the most partisan Republicans want to promote.

As for budget cuts, enough is enough for a while. The state has almost 5,000 fewer employees than it had in 2007, with the vast majority of those reductions being full-time, permanent jobs.

When you add those to all the job cuts that have been made and are threatened in local government, it’s hard to see more job loss as a good thing for the state. For one thing, these cuts undermine the efforts of the federal government to stimulate the economy by creating jobs.

The current $50.5 billion budget is a couple of billion dollars less than the previous two-year budget. That budget was cut three times after it was first passed, as the economy kept shrinking. The cuts hurt real people who are dependent on mental health services, on in-home senior services, state scholarships and more.

Two Republicans in the House voted with the Democrats to suspend the tax cut: Ross McGregor, of Springfield, and Rep. Matthew Dolan, of suburban Cleveland. Rep. Dolan (the son of the owner of the Cleveland Indians) has won a lot of attention for his speech.

On spending cuts, he said, “We are nothing more basically than a pass-through entity to counties. When we beat our chest and say we need to cut more state spending, all we’re saying to our counties who provide the essential services to our constituents is, ‘You find the money somewhere. You go to the taxpayers.’ ”

Any Ohioan who suffers a setback now — such as the loss of a state job or state help — suffers all the more because of the lack of options in this economy. So there’s not much doubt that further spending cuts would do more harm than suspension of an income tax cut which, by definition, would only benefit those who have a good enough income to pay income taxes.

Cox News Service

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Government "jobs" are not real jobs, and the so-called stimulus spending does not improve the health of the REAL economy. The public sectors comprise a fiscal "Wonderland" of smoke and mirrors that we have been living in for over 40 years, and now the reality chickens are coming to roost. Dramatically reduce government spending, non-critical "jobs", and also cut taxes. This is the only long term hope. Otherwise, you are simply giving nitro-glycerin tablets to an economy dying of heart disease.

cda
11:37 AM, 10/30/2009

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Cry no tears for the public employees. They should be eligible to get in line for unemployment like everyone else. When the number of taxpayers decrease, a like number of piglets should get off of the public teats.

itisme
7:19 AM, 10/30/2009

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Ah, those Democrats! They are nothing if not disingenuous. The purpose of a tax cut now would be to stimulate the economy. The Dems, who never met a tax they didn't like, use the excuse that in these tough times, we can't afford a tax cut. Once the economy perks up, they'll use the excuse that a tax cut is no longer needed. Give them credit--they know how to have their cake and eat it too.

pacfandave
7:05 AM, 10/30/2009

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