Regarding the current recession, a slight majority (51%), was “supportive” or “somewhat supportive” of Congress spending more on programs to encourage recovery, even if the spending increases the budget deficit. A greater majority (61%) agreed government should currently be doing more to strengthen the economy.

Participants discussed how to close the deficit through a combination of raising revenues and cutting spending. Several propositions received majority support: raise the age for receiving full Social Security benefits to 69 (52%), raise the limit on taxable Social Security earnings to 90 percent of total earnings (85%) and reduce defense spending by 15% (51%).

In the arena of tax reform, 68% of participants support creation of an extra 5% tax on incomes over $1 million per year. Another popular idea was raising the tax rate on capital gains and dividends (59%), and a bare majority (51%) supported limiting the corporate deduction on the depreciation of equipment. Creation of two new taxes also received strong support: a tax on carbon emissions (64%) and a .5% tax on securities transactions (61%).

What do you think about these ideas? How would you reduce the deficit? Let us know by leaving a comment.

Additional reading:

“Deficit reduction should take a back seat to job creation” (John Irons, Fiscal High Road, a partnership between Demos, EPI and The Century Foundation, 6/30/2010)

“In deficit ‘town meetings,’ people reject AmericaSpeaks stacked deck” (John Rickey, Campaign for America’s Future, 6/27/2010)

MECEP is a local partner for the Augusta discussion, and agrees with AmericaSpeaks that “The federal budget is more than the sum of federal spending and taxes, more than the wide array of programs that the federal government runs and the services it provides. The federal budget is an expression of our priorities as a people and our values as a nation.”

To join the discussion, and tell the government what your priorities and values are, register for the event by clicking here. Participation is free and lunch is included, but seating is limited, so register now before it’s too late. The meeting will be from 11:30 am to 6:00 pm at the Richard J. Randall Student Center at the University of Maine at Augusta.

Professor Teitenberg discusses how the costs of delaying passage of climate change legislation are much greater than the costs of acting now. He also makes the case for forcing all fuels to account for their full costs and level the playing field for Maine businesses. Two such costs he identifies are ecological and human health damages.

The oil spill in the Gulf of Mexico too clearly demonstrates these unaccounted for costs that result from an overreliance on fossil fuels. This disaster poses ecological, human health, and economic damages on an epic and unprecedented scale. It will be years perhaps decades before we ever know the true enormity of the costs.

Professor Tietenberg discusses how what we have done in Maine can essentially serve as an example for passing effective climate change legislation. But what has taken place in the Gulf also serves notice that we need to pass such legislation this summer to help reduce the risk of another such unparalleled tragedy from occurring.

• Vote NO on 1 to cut taxes for 9 out of 10 Maine families; for more detailed information, click here.

• Vote YES on 2, 3, 4 and 5 to meet critical infrastructure needs and to preserve and create jobs. To learn more about these four bond issues, click here.

Make your voice heard; make your vote count!

Primarily focused on transportation and other infrastructure projects, the bonds provide:

• $47.8 million for high priority transportation projects, including highway, railroad, and marine projects

• $10.25 million for improved water quality, drinking water, and wastewater treatment facilities

• $26.5 million for investments in off-shore wind and related manufacturing and energy and infrastructure upgrades to Maine’s higher education system

• $23.75 million for various economic development and job creation measures

Collectively, these bonds will leverage approximately $97 million in federal matching funds. The impact on strengthening our infrastructure and on job creation will be substantial.

Maine can afford to and must make these critical investments in order to recover from the Great Recession. An analysis of an earlier, larger bonds proposal indicated that the debt service ratio for Fiscal Year 2011 would have been well below the accepted five percent threshold for general obligations as a percentage of General Fund, Highway Fund, and Revenue Sharing revenues. Moreover, Maine pays off its bonded debt in ten years, as opposed to twenty or thirty as many other states do.

Many other states are laying the groundwork for their economic recovery. Maine must do the same and a YES vote on Questions 2-5 present such an opportunity.

Text of Questions 2-5

MECEP “op ed” supporting Questions 2-5 in the May 26th Bangor Daily News

Three quick points about the reforms are worth reiterating:

• 95.6% of Maine families will receive income tax relief in 2011 with an average reduction in income taxes of about $204. Even after factoring in changes to the sales tax, 87.4% of Maine families will realize an average tax cut of approximately $150 in 2011. More than 9 out of every 10 Maine families will also benefit from income tax relief in 2012 and 2013. Much of this money will be spent in the local and state economies, supporting Maine’s small business community.

• Tax reform stabilizes revenues and is virtually revenue neutral. This reform helps avoid cuts to critical public services, like health care and transportation, and thus saves jobs.

• Tax reform provides additional benefits to low- and moderate-income households. It modifies the Maine Residents Property Tax and Rent Refund program to make it easier to apply for and receive a refund. This program, also known as the Circuit Breaker, provides tax relief to those families with disproportionately high property tax or rent burdens. The reform also makes the state earned income tax credit refundable putting more money in the pockets of low-income working Mainers.

This tax reform package, like any legislative compromise, is not perfect. But it does represent the most substantial reform to Maine’s tax code in almost four decades. It makes Maine’s tax code modestly more progressive and State revenues more stable. Perhaps most importantly, reform provides tax relief to 9 in 10 Mainers at a time when they need it most.

MECEP urges Mainers to vote NO on Question on the June 8th ballot.

For more detailed information and analysis, visit the special tax reform issue page on the MECEP website.

Our own Senators, Olympia Snowe and Susan Collins, played key roles in ensuring this legislation passed the Senate. Thanks to their leadership and independence, the legislation expands oversight of the banking system and financial markets, with new restrictions imposed on the practices that heavily contributed to the massive market collapses in 2008. The bill also creates new consumer protection rules, protects taxpayers from future financial bailouts, and strengthens the supervision of big bank operations.

This legislation is critical to ensuring that we don’t repeat the financial and real estate meltdown. With unemployment in Maine at 8.1%, with more than 57,000 Mainers unemployed and with many Mainers having lost significant values of their homes and pensions, we are still feeling the effects of the egregious lack of regulation of financial wheeling and dealing that had enriched the Wall Street and sacked the Maine Street.

The U.S. House of Representatives passed their own version of financial reform last December, which was supported by Reps. Chellie Pingree and Mike Michaud. In the coming weeks, a conference committee will merge and reconcile the two bills.

We hope that the entire Maine delegation continues to demonstrate leadership on this issue and ensure that the final bill retains rigorous measures against systemic risks, prevents “too big to fail,” and protects consumers from misconduct by all financial institutions, whether they are auto lenders, credit card companies, or investment banks.

For more information, read my commentary which ran in the (Lewiston) Sun Journal on May 16th.

Members of Maine’s Work and Family Coalition—Maine’s Women’s Lobby, Maine People’s Alliance, Maine Center for Economic Policy, Maine Children’s Alliance, and Restaurant Opportunities Center of Maine—attended the summit and visited the offices of Senator Collins, Senator Snowe, Representative Michaud and Representative Pingree. Together with a restaurant worker from Yarmouth and a small business owner from Auburn, we presented a strong case for the Healthy Families Act (HR 2460, S 1152). This important bill guarantees employees 7 paid sick days per year.

Jobs. Jobs. Jobs. This is the foremost reason for providing workers with paid sick leave. Currently, nearly 40% of private sector workers nationwide do not have paid sick leave. They have to choose between their health or their families’ health and their jobs. Paid sick days can help people, especially low-wage workers, keep their jobs and their paychecks. It gives them job security and financial stability. A healthy and stable workforce is critical to Maine’s economy.
Contrary to persistent misconceptions that paid sick leave inflicts hardship on business, the savings from paid sick days far outweigh their cost. Employees and employers will benefit from reduced turnover, lower healthcare costs, and increased productivity. The Institute of Women’s Policy Research estimated that the Healthy Families Act could save at least $3.50 per worker per week.

Our coalition expressed our gratitude for Rep. Michaud and Rep. Pingree’s support for the Health Families Act and urged Sen. Collins and Sen. Snowe to sponsor it in the senate.

Since the first Earth Day in 1970, Maine and America have achieved some historic environmental milestones.  For example, we need look only to passage of the Clean Water Act, authored by Maine’s own Senator Edmund Muskie. 

But in 2010, more than ever, Earth Day must serve as a call for action.  The undeniable threats from climate change pose one of the greatest challenges in world history.  Policymakers in Washington must answer the call by passing effective climate change legislation NOW.

This legislation should address a wide variety of topics, including energy efficiency, clean energy jobs and greenhouse gas emissions.  It must also minimize the economic impact on low-income households by providing direct, targeted relief.   Congress must fully protect low income consumers from any increased costs resulting from effective climate change legislation’s shift away from fossil fuels.

Today, as we celebrate our past successes, let us redouble our commitment to combat climate change effectively.  Our economy, our quality of life and our legacy to future generations depend on it.

Many seem to have a similar relationship to government and taxes. They get agitated when government doesn’t use their tax dollars the way they think it should. But when all is well they hardly take note.

Largely overlooked in the discussion this year is the fact that because of legislation enacted last year, 99% of Maine’s working families paid, on average, nearly $1,000 less in 2009 taxes.

Rather than fixate on whether you paid too little or too much this year, imagine a world without government or taxes.  It’s an interesting exercise. Where would we be without safe roads and bridges, public education, safe drinking water and so many other things we take for granted?

At MECEP, much of our work focuses on taxes. How much is enough? How should they be spent? How do we make sure they are fair?

Our answers to these questions reflect our values. MECEP believes government can and does play a role in providing for our economic security and promoting shared prosperity for all. Who pays how much in taxes is just as important as how they are spent in realizing these outcomes, particularly for low- and middle-income families.  This is why dealing with the estate tax and tax reform are such important issues in the months to come.

We recognize that taxes are a tool.  They are not inherently good or bad. As with most tools, how we use them determines whether they build or demolish.  I need to look no further than my son’s tree house or the hole he dug in the middle of our garden to be reminded of this.