Needham Letter to Editor: Pay now or later?

 Letter to the Needham Times, 3/21/2013: 

Over the last 12 years, Needham has lost 40% in local aid from the state, translating to significant cuts in services and education. This is a direct result of two things:

1) ill-conceived tax cuts in the dot-com 1990s, when legislators couldn’t imagine the good times ending, and

(2) the good times ending and the Great Recession.

Due to this loss of revenue, the Commonwealth now has a structural deficit of roughly $1.5 billion dollars.

Governor Patrick and other legislators (through the legislation ‘An Act to Invest in Our Communities’) have proposed plans to raise roughly $2 billion — enough to address our structural short fall and restore some of the cuts to our services (like health care, disability services, more) and education and transportation/infrastructure.

These proposals differ in their details, but both raise the income tax and increase the personal deduction, which has the net effect of keeping taxes level for half of MA income-earners (the poorer half) while effecting modest increases on the other 50%.

GRAPH: Proposed Plans Raise Revenue Fairly 
The Governor’s tax plan affects higher-incomes at a higher rate.
“An Act to Invest in Our Communities” reduces the overall regressivity of our tax code.

In other words, it is a progressive tax increase, which many believe is the fairest kind of tax to fund those things we do together through government. These plans were endorsed last week by 57 Mass. economists.

These are bold and courageous plans, and unfortunately, Beacon Hill as a whole has not yet risen to the demands of our moment. Instead, Speaker DeLeo has signaled he will propose a much smaller revenue package, which would effectively only cover the MBTA crisis — and leave the other fiscal fires to be put out another day (and another tax battle for another session).

We cannot keep going from crisis to crisis. We don’t run our households this way: we plan for future investments, earmarking money for kids’ educations, big home repairs, before the roof collapses, before high school graduation. As a state, we need to make big changes now, restore our investments in those things that make our communities good places to live: quality education, safe communities, reliable infrastructure and transportation, needed services. In our own lives, we make financial decisions based on long-term investments for the future, as well as addressing the needs of now. It is time for legislators to take leadership and do the same.

We must raise substantial revenue to invest in our communities, and we have at least 2 proposals that do this in a way that reduces the overall regressive nature of our state and local taxes. If leadership and legislators don’t like the Governor’s proposal or the “Our Communities” legislation, I challenge our legislators to find another way.

But what we cannot do is kick the can again down the road. We must act now, before the roof collapses, because either way we’re going to pay for it. Let’s do it smart, now.

Harmony Wu


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