NO WAFFLING ALLOWED

Just two months following Governor Shumlin’s first inauguration, I penned this scenario in a VtDigger Commentary.

“For Shumlin, a perfect storm hits the Fifth Floor, should he allow the Legislature to raise taxes rather than trim spending; to raise property taxes rather than contain education spending; and to pass and commit Vermonters to a “trust me now, I’ll bill you later” approach to health care reform. Shumlin need look no further than recent history as to the probable outcome.”  March, 2011

http://vtdigger.org/2011/03/01/pelham-dangers-on-the-road-to-single-payer/

The “perfect storm” did hit the Shumlin Administration but unfortunately it’s worse than imagined. It’s become a hurricane. According to a recent VPR poll, Governor Shumlin’s approval rating was only 37 percent, and this before the scandalous events unfolding in the Northeast Kingdom came to light.

This is not good news for gubernatorial hopefuls. Lest he or she be consumed by the governmental sinkholes they’ll inherit, their first efforts must be to remedy the serious and complicated problems left them by Governor Shumlin and a complicit legislature.  These problems are now hard realities and as such are now non-partisan in nature. They must be solved whether our next governor is Republican or Democrat, or they will swallow the hopes and ambitions of that governor while undermining the quality of life for innumerable Vermonters.

Vermont voters must also take responsibility. The next governor will not arrive with a magic wand. The problems they’ll inherit require prompt dedication to the task and clear and specific plans to complete the task. Voters and the media must demand such plans be transparent prior to the election. It’s going to be rough sailing for whoever gets elected.

For example, since then Senator Shumlin and Speaker Smith successfully overrode Governor Douglas’s fiscal 2010 budget veto, state spending has grown at almost a five percent annual rate inclusive of the 2017 budget recently passed by the House.  That growth equals $693 million, exclusive of federal dollars. If such spending had increased by just two and one-half percent annually, a rate more consistent with underlying economic growth, the 2017 budget would be $361 million lower.  This additional spending has been mostly supported by yearly increases in taxes and fees enacted under the golden dome and now burdening Vermonters across-the-board.

Voters must ask candidates whether even more taxes and fees are necessary to balance the budget or are taxes and fees “off the table” and if so, can candidates list specific reforms they will present to the legislature next January (just 8 months hence) that will balance the budget. There are many such reforms from which to choose but each has its positive and negative political consequences. Politicians too often have a hard time discussing hard choices.  

Or take education spending. In addition to the above taxes and fee increases, property taxes have gone up $137.1 million since fiscal 2010. Yet, the legislature’s recent consultant’s report clearly states Vermont could spend $163.9 million less and still sponsor a high quality education system.  State house leaders, however, have embraced Act 46 which allows education spending growth to continue despite annual reductions in the number of students in our schools. Further, Act 46 pressures school choice districts to give up school choice and herds students into larger school districts farther removed from parents and taxpayers and more easily controlled by the education lobby.

Next January, the new Governor will be presented with school budgets that raise property taxes even more. The driving force behind school spending is the lowest in the nation ratios of students to teachers, students to staff and students to administrators. This is the elephant in the room that our leaders don’t want to discuss for fear of political backlash from the education lobby.  To lower property taxes, as the recent study suggests, elected leaders must be willing to lead responsible efforts to reduce staffing levels in our schools. Voters must ask candidates to “cut to the chase” on this issue and fess-up that there is an elephant in the room.  Whether gubernatorial candidates will continue to kick the property tax can down the road or have a clear and powerful message of affordability and property tax relief is an open question voters need closed.

Further, Act 48, Vermont’s “first in the nation” health care reform effort has brought anything but reform. Vermonters have been herded into insurance policies not of their choosing; employers are now being “assessed” fees for not providing insurance after being advised to release employees to Vermont Health Connect, the public exchange; and the provider network is being corralled into a few large “ACO” monopolies overseen by a five person board appointed by the Governor.  From the dysfunctional Vermont Health Connect serving up unaffordable insurance policies, to the growing takeover of our health care system by centralized bureaucracies and their agents, to cost shifts onto the few remaining private health insurance providers, health care reform in Vermont no longer fits the definition of reform.  Now, five years after enactment, voters must ask candidates whether Act 48 is a failure and if so, what they are going to do about it?

Additionally, the state’s energy policy is ass-backwards. Vermont’s major contributions to global warming are “demand side” related, namely fossil fuel emissions from vehicle tail pipes and chimneys attached to heating systems. Yet our state energy plan emphasizes “supply side” solutions like building wind turbines on top of our iconic ridgelines and solar fields across our agricultural meadows. Further, the energy from these “renewable” investments doesn’t even count toward the legislature’s stated goal of 90 percent “renewable”. As our Attorney General warns us, if renewable energy credits (REC’s) are sold, as they are in most cases, the energy produced on our ridge lines and meadows cannot legally be considered “renewable”.

All in all, the deeply subsidized energy plan of tax credits and rate cost shifts crafted by our Governor and legislature over recent years seems best described as a gravy train for the wallets of “renewable” developers whose product can’t legally be called “renewable”.  An example of ass-backwards if there ever was one and more and more voters are coming to understand this canard.

Many feel that our state house leaders have put Vermont in a downward spiral.  With this election, it’s vital that voters demand clear and precise solutions to the significant troubles before us. Our next governor needs to be ready with solutions on inauguration day. There’s no time to waste and no waffling allowed this time around.

This commentary is by Tom Pelham, who was finance commissioner in the Dean administration and tax commissioner in the Douglas administration and served in the Vermont House as an independent. He is co-founder of Campaign for Vermont.


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