Taxes & Spending: Commentaries

EAI believes Vermont is spending money on government services at an unsustainable rate. In order to pay for these services, Vermonters are being asked to pay more in taxes and fees with each passing year. Taxation must be circumscribed and limited else it will “defeat and render useless the power to create.” By what principle should it be limited? There is a principle embedded in our system which provides inherent limits to all taxation. It is so basic to our political institutions that it should govern every legislator, every executive, and every judge. It precedes all our constitutions, all our laws, and all our political institutions. It brought them into existence; it sustains them; without it they are a nullity.

All Commentaries

Commentary: The Consequences of Doing Nothing

Imagine you have a mortgage. When you close on your house, the bank gives you a schedule of payments that you’ll have to make each month to pay down the principal and interest. After 15, or 20, or 30 years of fixed payments, the mortgage will be paid off.

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Commentary: Questions for the Climate Council

As the Vermont Climate Council readies its plans to dramatically reduce Vermont’s greenhouse gas emissions, they embarked on a series of public engagement events to field questions from curious citizens. Here are some we all might consider asking.

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Commentary: Unsustainability Crisis Facing Seniors

            The national debt is $28.43 trillion and rising steadily. Even at historically low interest rates, that can’t last forever, the Federal government is paying almost a billion dollars a day in interest on its debt. Social Security will run out of money to make promised payments in 2034. More seriously, The Medicare HI Fund will have to reduce expenditures by nine percent as early as 2026 – and two years earlier than that if Congress and President Biden enact the Sanders $3.5 trillion entitlement bill. What’s the remedy? At the very least, don’t make this worse.

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Commentary: Opting in and out of Government Spending

A large insurance company has been flooding the television channels with an advertising slogan “Only Pay for What You Need.” It’s an interesting exercise to apply that idea to various public spending issues.

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Commentary: State Spending is Out of Control, Taxes to Follow

Steve Klein, Chief Fiscal Officer for the legislature’s Joint Fiscal Office, recently made a presentation to the Pension Reform Task Force. The Task Force is charged with coming up with a plan to fix the state’s public pension crisis, the result of decades of underfunding and financial mismanagement that has led to a $6 billion and rapidly growing unfunded liability. Currently, just keeping the state pension system afloat consumes over 12% of all General Fund state spending and fixing the system will take even more money. So, the Task Force asked Klein where such a pot of cash might be found. The resulting slide show was not encouraging.

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Commentary: Climate Council Wants “A River of Money”

The Vermont Climate Council, charged with coming up with a plan to reduce Vermont’s greenhouse gas emissions to 26% below 2005 levels by 2025, 40% below 1990 levels by 2030, and 80% below by 2050, is finally putting forward some details about what policies it will take to do this. While they have not yet discussed many specifics of how to pay for these programs, member Richard Cowart summed it up at their July 26 meeting saying “a river of money” needs to be diverted into the cause. A river indeed!

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Commentary: Large Tax Changes on the Table

The Vermont Tax Structure Commission has delivered its report, and its recommendations should trigger an intense debate. Switching public education support to the income tax and expanding the sales tax to include services will be very controversial. It’s regrettable that the legislature didn’t begin with a performance review, to decide what state government should be doing with $4.5 billion a year, and then address the tax structure needed to pay for it.

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Commentary: More Funding! More Funding!

The Public Utility Commission, at the direction of the legislature, has “joined the chorus of voices seeking climate action”. Its all-fuels energy report takes note of the state’s ambitious carbon dioxide emission reduction goals, and almost screams what’s needed on every page: “More Funding!”

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Commentary: Retirement Fund Blues

Vermont’s state employee and teacher retirement funds, plus their associated Other Post Employment Benefit obligations, now total $5.657 billion – a Billion dollar increase in just the past year. The pension funds are just 66.4% and 52.3% funded, respectively. The clock is ticking toward calamity, including downgrading the state’s credit ratings.

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Commentary: Combating “Welfare for the Rich”

A new book “Welfare for the Rich” explains the many ways that government policies benefit the rich, leaving the not-rich to hold the bag. We need to “raise the hue and cry” to put a stop to it.

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Commentary: Elections Over, Challenges Ahead

The 2021 legislature faces major challenges on Fiscal Worries, Revenue Shortfalls, Retirement Fund Deterioration, and Electric Grid Challenges, but the governor surely won‘t launch a much needed Performance Review.

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Commentary: Candidate Questions for 2020

Here are 16 incisive questions, fairly stated, to put to your candidate for the legislature, Governor and Lt. Governor. Voters deserve to know what they’ll get by giving their votes. That’s what makes democracy work.

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