Posts Tagged central pa

PA Business Leaders Reject Wolf Tax Plans


The Governor of Pennsylvania decided to use his perceived electoral mandate to take on one of the biggest issues that has confronted and confounded the commonwealth for decades: property tax reform.  So he advanced a plan that would raise sales and personal income taxes in exchange for a cut in property taxes.

Sound familiar?  The year was 1989 and the Governor was Robert P. Casey whose tax reform plan was put on a statewide ballot referendum and was soundly defeated by voters.  Fast forward to 2015 and Governor Tom Wolf has placed on the table a property tax reform plan that strongly resembles the doomed Casey proposal. Except the Wolf plan doesn’t even include the dollar for dollar reductions required of the Casey effort.

As despised as property taxes are, and polling consistently finds the levy to be the most disliked, finding an acceptable alternative remains elusive.  The Wolf plan appears to have little support in the General Assembly; in fact House Republicans have passed their own proposal.  But it too fails to totally eliminate school property taxes leaving the door open for millage rates to simply increase again over time.

An indication of how unpopular the Wolf tax reform plan is can be found in the recent Keystone Business Climate Survey of business owners and chief executive officers conducted by the Lincoln Institute of Public Opinion Research.  Nearly 70% of the business leaders said the Wolf property tax shift would result in only a temporary drop in property taxes which would then go back up.  Another 14% predicted his plan would actually lead to property tax increases; only 15% expect to see property taxes decline under the Wolf proposal.

Not only does the poll demonstrate disapproval of the Wolf property tax plan, but the survey found the biggest six month decline in business climate optimism since the onset of the Great Recession in 2008.  In fact, in the 20 year history of the poll only during that recession and in the aftermath of the 2001 terrorist attacks has business climate optimism dropped so far so fast.

Last September, for the first time since George W. Bush was re-elected in 2004, more business leaders said the state’s economic climate had improved that felt it had gotten worse.  The indicator rose into positive territory by just 1%, but it capped a steady move in a positive direction.  All of that has changed.  The number of owners/CEOs saying business conditions have improved over the past six months has fallen to just 13%, while the number saying business conditions have gotten worse has nearly doubled since last Fall.

The only variable to change during that six month period was the election of Governor Tom Wolf.  Governor Tom Corbett left office with a 52% job approval rating.  Governor Tom Wolf’s first job approval test yielded just 15% approval with 69% of the state’s business leaders saying they disapprove of the job he is doing.

Driving the dour mood among the people who actually run businesses – big and small – is a general disapproval of Governor Wolf’s budget proposals.  A total of 78% disapprove of his proposed budget.  Overall 80% say the governor’s proposed state budget will harm the state’s business climate.  As a side note, Pennsylvania’s high tax rates and stringent regulatory policies are viewed by the owners/CEOs as the biggest impediments to conducting business in the commonwealth.  They now fear that situation is about to get even worse so the state’s job creators are bracing themselves for higher taxes.

Overall the survey results represent a sound and complete repudiation of Governor Tom Wolf’s first proposed state budget along with the major revisions and tax hikes contained within the proposal.  Like Governor Casey before him, his ambitious tax reform plans are deeply unpopular and may be destined for the same fate.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolnisntitute.org)

Permission to reprint is granted provide author and affiliation are cited.

, , , , , , , , , , , , , , , , , , , , , , ,

Leave a comment

When Gridlock is Good


At both the state and national levels voters have opted to put into place divided government with Democrats in charge of the executive branch and Republicans holding large majorities in the legislative branch.  The differences between the two are stark and deeply ideological.  This leaves very little room for compromise and suggests a two-year period of gridlock lies ahead.

If so, it will reflect the will of the electorate.  The recent election was not about finding common ground, it was about changing course.   In the last six years voters nationally have twice elected Barack Obama to the presidency, while delivering one or both houses of the congress to Republicans.  Government, like the electorate, is deeply divided.  That is not a negative; it means our system of representative government is actually working and is reflective of the nation at-large.

Given the Leftward bias of the mainstream news media we can expect coverage over the next two years to be heavily slanted in favor of President Obama and incoming Governor Tom Wolf.  This despite the fact neither can claim a mandate. Barack Obama’s party has lost over 70 congressional seats during his terms of office.  He himself said his policies were on the ballot.  They were and voters soundly rejected them.  Governor-elect Wolf won the “anybody-but-Tom Corbett” election even while voters sent enhanced Republican majorities to each chamber of the General Assembly.

Executives get to set the agenda so both President Obama and Governor Wolf will push their respective policies – while congress and the state legislature reject them and offer their own paths forward.  This will inevitably give rise to a spate of headlines and editorials lamenting the “obstructionist” Republicans standing in the way of the Left’s version of progress.

But stand in the way is exactly what Republicans should do.  At the national level it would be a mistake to interpret the election results as voter desire for compromise.  The campaigns, especially for U.S. Senate seats, were clear, as was the voters’ rejection of the Obama agenda.  At the state level, polling revealed years ago the voters’ desire to replace Tom Corbett.  It didn’t matter who, or what issues the Democratic nominee ran on, voters were not going to re-elect the incumbent.

To effectively counter Democrats and their allies in the news media, Republicans are going to have to up their game.  GOP congressional leadership in recent years has been mediocre at best, inept and ineffective at its worse.  With majorities in both chambers the time has come for Republicans to put forth a proactive agenda to solving the nation’s problems, pass it, and put it on the president’s desk.  If the president opts to use his veto, so be it.  Republicans could then enter the 2016 election cycle having done their job and with a clear message to put before voters.

Meanwhile, back in Penn’s Woods, the gridlock which gripped state government during four years of total Republican control can only be expected to get worse.  To capture his party’s nomination Tom Wolf had to move far to the Left to eclipse such ultra-liberals as Allyson Schwartz and Rob McCord.  This leaves him little room within which to maneuver.   Republicans increased their majorities in both the House and Senate; then elected new leadership in both chambers far more conservative than the ones they replaced.  Those legislators cannot give into the Wolf policy agenda without betraying the voters who elected them.

So what should Republicans do?  As saying goes: “Dance with the one who brought you.”  Stay true to the party’s principles. Resist the urge to compromise just to silence media critics. And, put forth workable pro-growth policy solutions to the problems that confront our state and nation.  The president and the governor may or may not go along, but passing the wrong policies just for the sake of passing something will long term do nothing to restore our state and nation.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal.  His e-mail address is lhenry@lincolninstitute.org.)

 

Permission to reprint is granted provided author and affiliation are cited.

, , , , , , , , , , , , , , , , ,

Leave a comment