Article by Richard Sutphen–Taxes

Since you are so active with Florida politics and have a blog, I thought I would send along an email that I sent to Nate Monroe of the Times Union regarding one of his columns that was published recently.  Maybe some of your readers would like to hear the point that I am making about how we essentially give away our state revenues disguised as tax cuts when in fact they constitute tax spending, or that the Republican unactionable approach to governance is fully intended as part of their small government ideology.

From: Sutphen, Richard
To: Nate Monroe

Nate,

I am a fan of your columns for the TU.  I am a member of Indivisible Mandarin but unfortunately I missed your presentation to the group in late March.

There are many topics that you have addressed in your columns that I would like to respond, however your column today about the Republican obsession with taxes is a good place to start.

I was an advisor to Ken Organes who ran for the State House seat for District 16 (against Jason Fischer) and I wrote a progressive platform for him.  One part of it addressed the state budget and how to implement a real business model for state governance.  The point is that this is directly analogous to Jacksonville’s budget that you write about frequently.

The way that Mayor Curry approaches the city budget is similar to how Republicans have dealt with state governance which reflects their view of the functioning of a “small government” ideology.  As much as they talk about bringing business acumen to governance, the fact is that they promote a business model that is best suited to result in bankruptcy than it is to promote a government that can adequately respond to the needs of a quickly growing state population in a context of a highly competitive global economy.  This model is reflected in a basic observation: In 2008/09 in the midst of the “Great Recession,” the state budget was “tight” lacking any extra funds for government services; in 2018/19 in the midst of a “booming economy,” the state budget is “tight” lacking any extra funds for public education, healthcare, the environment, and other government services.  To the Republicans, this is considered a success – a desired intentional outcome of the business model used for governance; that is the model of the “endless recession.”  Since the late 90’s, it has been the expressed intention of the legislature to reduce revenues.  That is right, this is a business model that seeks to reduce revenues.  It is also one that anticipates limited and rather static investments in human capital (the equivalent of business capital investments) such as education, healthcare, etc.  Bankruptcy anyone?

The governing philosophy of small government limited spending and an anti-tax obsession is frequently expressed in the form of the “all purpose” tax cut that undergirds Republican economic policies.  We all know that tax cuts that favor the wealthy do not stimulate economic growth, they instead lead to budget shortfalls, cuts and deficits.  Ironically, tax cuts are really tax spending (tax expenditures) that fundamentally rebate or spend assessed taxes before they are collected.  There is a document called “silent spending” that is generated annually by the state budget office that shows how this tax revenue is exempted or discounted for certain favored entities and adds up to about 25% of the state budget that goes uncollected.  For example, corporations in Florida pay about 57% of their assessed tax rate. In this sense, we really don’t need tax increases to generate more revenue at the state or city level, we just need to collect the taxes that we already have on the books but that we have given away with cuts.

So, I think you were right in one of your recent column’s that suggested the ideological congruency of selling assets like JEA to generate funds rather than extending the sales tax a half cent or more to pay for needed infrastructure and the proverbial downtown development.

As you pointed out in your article today, solutions to problems such as downtown development are available (as they are for many social problems as well), but when leaders are intentionally stuck in traditional or rigid ideological thinking, they prevent themselves from considering them and instead ride the problem solving merry-go-round rationalizing their impotence while trapped in an “endless cycle.”

Richard Sutphen

I am a retired social work professor and I wrote the article on Medicare For All that appeared in the TU last November.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s