Saturday, April 07, 2018

Solvency In The State Of Insolvency: Malloy Gets His Tax On

Fool me once, shame on you; fool me twice, shame on me – an Italian proverb

House Bill 5046, which would re-establish tolls in Connecticut, is yet another tax, a tax being money that flows from private wallets to public treasuries.

According to popular delusion, people traveling from states bordering Connecticut will pay the tax. The trick in taxing is to find someone else to pick up the bill. Senator Russell Long of Louisiana put it aphoristically: “Don’t tax you, don’t tax me, tax the fellow behind the tree.” The truth is: We are the people behind the tree. Even when the tax burden appears to be paid by someone else, as in business taxes, the burden of taxation comes home to roost. Businesses collect corporate taxes from the consumers of their products and services. Like your smarmy politician, the taxed business is a tax collection operation.

In the case of transportation tolls, the imposture is thin and transparent. Only about 30 percent of congestion tolling will be paid by the people from out of state using Connecticut roads. The bulk of it, 70 percent, will be paid by Connecticut tax camels carrying heavy loads, and some are warning that the add-tax will be the straw that breaks the camel’s back. Other skeptics ask: Why is the transportation fund in need of such massive capitalization?

That question is not answered in departing Governor Malloy’s approving statement now that a bill to establish tolls has passed – by one vote – Connecticut’s Democrat dominated Finance Committee. Malloy’s statement is brief enough to be quoted in full. When you are a politician in full pant collaring the fellow behind the tree, the less said the better.

“This is an important step forward as we work to ensure the long-term solvency of the Special Transportation Fund, and I applaud Finance Committee leadership,” Malloy said. “The truth is that if we do not find new revenue, we will not be able to keep our roads, bridges, tunnels, and rails in a state of good repair, and we will be forced to significantly increase fares and dramatically reduce services on bus and rail services. If we fail to take action this year – on this bill and on my proposals to ensure the short-term viability of the transportation fund – we will put the safety of Connecticut drivers at risk and cause unnecessary harm to our economy (Emphasis mine)."

One wants to know why does the most insolvent tax collector in state history regard yet another tax – which follows two massive tax hikes, both imposed by Malloy and the Democrat dominated General Assembly – as a “step forward?” What precisely is the state of Connecticut stepping forward into?

The two hefty and wealth destroying Malloy taxes, the largest and the second largest in state history, evidentially have not opened the door to fiscal stability. Following these encroachments on personal wealth and prosperity, taxpayers in Connecticut even now are staring down the barrel of massive state deficits. Connecticut’s current “balanced” deficit is $224 million,  this to be followed by yet another deficit of $2 billion in the next fiscal period which, when it rises like a menacing cloud over Connecticut, obscuring the sun, blasting hope, will not cast a dark shadow on Malloy, who has declined to run for a third term as governor.

And good for him. Malloy can always escape the inevitable consequences of his ruinous policies by fleeing to some other more tax hospitable state, a trek may of our brothers and sisters and nephews and nieces already have made. Connecticut is still the only state in the union that has continuously lost population during a recession that ended in much of the country nine years ago.

Given the past practice of spendthrift politicians who in the past have unlocked lockboxes with their grandmothers' hair pins, pilfering their contents and depositing the loot into the general slush fund, why should anyone suppose that another tax burden will not be used to relieve a necessary pressure upon prodigal spenders to permanently change their destructive habits. A permanent inhibition is the ONLY reasonable solution to Connecticut’s metastasizing debt. Even if the special transportation fund lockbox were to be tamper proof, the tax increase will facilitate more spending, which is the devil in the details of Connecticut’s deepening debt ditch. Connecticut did not arrive at massive tax increases, followed by massive spending increases, followed by massive debt, followed by more massive tax increases, through prudent, permanent, long term, cuts in spending.

And there is anti-democratic poison in the toll tax brew. “The toll bill,” said Senator Toni Boucher, “would give the entire authority over instituting, placing, pricing, outsourcing and any other decisions to the DOT. This was a big NO vote for me.”

Indeed, the transfer of legislative authority over the use of public dollars to the Department of Transportation (DOT) places getting and spending beyond the reach of taxpayers who will no longer be able to vote in or out of office those cowardly legislators who do not want, for obvious reasons, to execute their constitutional getting and spending obligations. This shameful flight from constitutional responsibility is what now passes for democracy in the Constitution State.

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