By an overwhelming margin, most states tax their middle- and low-income families far more heavily than the wealthy, according to a new study by the Institute on Taxation & Economic Policy. “In the coming months, lawmakers across the nation will be forced to make difficult decisions about budget-balancing tax changes¬which makes it vital to understand who is hit hardest by state and local taxes right now,” said Matthew Gardner, lead author of the study, Who Pays? A Distributional Analysis of the Tax Systems in All 50 States. “The harsh reality is that most states require their poor and middleincome taxpayers to pay the most taxes as a share of income.” Vermont: State & Local Taxes in 2007 (updated to reflect permanent changes in law enacted through October 2009) Shares of family income for non-elderly taxpayers by Income Groups: Lowest 20% Less than $18,000 = 8.2% Second 20% $18,000 - $34,000  = 8.0% Middle 20% $34,000 - $54,000 = 9.4% Fourth 20% $54,000 - $85,000 = 9.2% Top 20%: Next 15% $85,000 - $168,000 = 8.2% Next 4% $168,000 - $412,000 = 7.5% TOP 1% $412,000 or more = 7.5% Nationwide, the study found that middle- and low-income non-elderly families pay much higher shares of their income in state and local taxes than do the very well-off: The average state and local tax rate on the best-off one percent of families is 6.4 percent before accounting for the tax savings from federal itemized deductions. After the federal offset, the effective tax rate on the best off one percent is a mere 5.2 percent. The average tax rate on families in the middle 20 percent of the income spectrum is 9.7 percent before the federal offset and 9.4 percent after¬almost twice the effective rate that the richest people pay. The average tax rate on the poorest 20 percent of families is the highest of all. At 10.9 percent, it is more than double the effective rate on the very wealthy. “Fairness is in the eye of the beholder.” noted Gardner. “But virtually anyone would agree that this upside-down approach to state and local taxes is astonishingly inequitable.” “For lawmakers seeking to make their tax systems less unfair, there is an obvious strategy available,” noted Gardner. “Shifting state and local revenues away from sales and excise taxes, and towards the progressive personal income tax, will make tax systems fairer for low- and middle-income families. Conversely, states that choose to balance their budgets by further increasing the general sales tax or cigarette taxes will make their tax systems even more unbalanced and unfair.”

Now that at least one candidate for Governor has affirmed that there will be hearings in the Senate on S.88 (universal health care), it is time to now squeeze the same commitment out of the chair of the House Healthcare committee, and hold hearings on H-100. Rep. Steve Maier, of Middlebury, has bottled up all discussion on health care for over a year. Welcome to the do-nothing House Health Care committee. But Maier has even gone further than do nothing: he gets rid of the committee members that outshine him, as was the case last year with Rep. Topper McFaun from Barre Town. McFaun had the guts to write a real health care bill that dealt with the hospitals, representing 40% of our health care costs, in an attempt to get a handle on their budgets. For this, he was ejected out of the committee. But more on that at another time.  The plain truth is that we have failed to put a Progressive challenger up against Maier. Do we have but ourselves to blame for the gridlock in the House on health care issues?

I find it so frustrating when an issue that simply can't be ignored is so played on in the press and by politicians that all regular people want to do is stop hearing about it. I had been feeling that way about health care for about a year but now it seems we are poised for Vermont to take a leadership role as we've done so many times before. In the Burlington Free Press this week Senator Bernie Sanders said he is "trying to include a provision in the bill that would allow each state to create its own single-payer system." That makes me really hopeful that Vermonters can come together and push their elected officials to make health insurance a right from birth until death in our state. Did you know there are 45 million Americans without health insurance? That is the same as the combined population of more 20 states. Check out this video on Single Payer for some other very compelling facts. You could also come to the Progressive Convention at the Old Labor Hall in Barre on Saturday (11/14) at 10 and listen to Vermont activist Con Hogan of Montpelier speaking about the future of health care reform in the state. Con worked in corrections before serving as Secretary of Human Services under Republican Governor Dick Snelling and Democratic Governor Howard Dean. Currently I'm aware of 3 Vermont organizations devoted to pushing the legislature to pass a bill covering all Vermonters this year.

• Vermont Health Care for All is launching their new website this week - vt4singlepayer.org. It has tons of links to articles explaining single payer and showing how states can take their own initiative as well as easy to use action pages and ways to get involved.
• The Workers Center is running a strong Health Care is a Human Right campaign. They are organizing groups in each county, have action kits for those who want to organize and are preparing to be in Montpelier on January 6, 2010 to deliver postcards supporting this campaign to legislators.
• Vermont Citizens Campaign for Heath is based out of Brattleboro and is also preparing for the upcoming legislative session.

So on behalf of all the Vermonters without health insurance and all the others who have it but find it doesn't cover required medical interventions, please join this cause. Find the organization that excites you and add your name to the many who are already working to ensure we pass a bill before the 2010 legislative session adjourns.

A "Vermont" Democrat makes national news. In the winter of 2008 Peter Galbraith asked me to sit down for coffee. He knew I was close to Anthony Pollina and wanted to talk to me about finding a way where he might be the challenger to Jim Douglas, in a head to head race. Galbraith listed his many accomplishments as proof he was qualified and would make an appealing candidate. I was impressed with him, but his timing was bad. In politics timing is important, very important. I told him he was coming to the dance too late. But today's New  York Times story reveals that Galbraith has been quite good at timing other aspects of his life. Like when he was between gigs at the state department and got work for a Norwegian oil company - DNO. DNO, it turns out, has oil interests in Kurdistan, the northern region of Iraq. This all gets sticky when it's revealed that Galbraith helped Iraq write its Constitution. The very Constitution that spells out how the Kurds have almost complete control over oil found inside their territory leaving the central government in Baghdad high and dry. According to the Times, Galbraith stands to earn a hundred million dollars or more thanks to his handy timing. Heck, even though Jim Douglas is one of the best paid governors in the country it's chump change compared to Galbraith's windfall. Right place, right time? Or was he peddling Washington credentials and high level access to create a comfy retirement?

Below is a memo I sent to the Joint Fiscal Committee. It deals with the VEPC/VEGI background growth rate issue I blogged about on August 13.  The issue is on the JFC's agenda for tomorrow's meeting.  This is an opportunity for the committee (including two gubernatorial candidates) to finally stand up to VEPC and stop wasting the taxpayers' money.  At a time when the administration (often with the approval of the Leg.) is cutting programs and jobs, it is outrageous that this charade continues.  Short of killing the program (only the full Leg. can do that), this is a way to make VEPC more accountable and efficient.  I hope readers will communicate with the members and ask them to do the right thing.

To:    Representative Michael Obuchowski, Chairman Joint Fiscal Committee Date:    9 November 2009 Re:    Comments on VEPC’s pre-filed testimony re. the VEGI background growth rate methodology Cc:    Joint Fiscal Committee The Auditor’s findings highlight a serious flaw in the program that needs to be remedied. As the principal author of the first review of VEPC, I first noted this problem nine years ago. I am grateful that the committee is taking the time to reconsider the issue. VEPC claims that changing the methodology will introduce a “bias” into the cost-benefit analysis. Interesting choice of words. The bias would be toward reducing waste in the program because the current method subsidizes job creation that would have occurred without the incentives. VEPC stated, “Such biases would ultimately and unintentionally discourage job creation from small and recently embarked business endeavors”. There is absolutely no evidence to support this claim. Presumably, the remedy would not affect applicants with little or no history in Vermont. In such cases, VEPC could use the industry growth rate just as it does now. VEPC argued that “The current practice of sector-based, long–term...hurdle rates for background growth is an economically sound process that has worked well”. It may have worked well for companies that received unwarranted subsidies, but not for taxpayers. Applying a 2% industry-wide background growth rate to a firm that has grown at a rate of 6% makes no sense whatsoever. VEPC praised the so-called “standardized approach” that creates a “level playing field”. But why should the “playing field” be level if it results in waste? Many applicants come to VEPC with a history. To ignore that in the name of uniformity is to ignore the intent of the program -- pay only for incremental new jobs. VEPC’s reliance on the “uniformity” card is nothing more than misdirection. VEPC noted that changing the methodology would require increased due diligence. At what point can we say there is enough waste in the program to justify more due diligence? Over time, the cost to the treasury may have been millions of dollars. To me, that seems like sufficient justification. As the legislature looks for efficiencies in state government, no program should be off limits. I am aware that crafting a solution will not be easy; it’s complicated. At the very least, I hope the JFC will convene the technical advisory group to dig in and come back with recommendations.

Members of the Joint Fiscal Committee Representative Michael Obuchowski, Chair Senator Ann Cummings, Vice Chair Senator Diane Snelling, Clerk Representative Janet Ancel Senator Susan Bartlett Representative Martha Heath Representative Richard W. Hube Representative Mark Larson Senator Peter Shumlin Senator Richard Sears

After my recent inquiry into state services and attempting to get information from Catamount for a constituent, I am imagining what it might be like for folks out there who have been laid off, forced into early retirement, or who are falling off the unemployment lines, trying to get state services to survive. On Friday, I was attempting to find information on the cost of Catamount for a family of two, the enrollment process, and the state's criteria for a subsidy with Catamount premiums. I have to admit, I was frustrated after an hour or so on the phone. Not to mention time spent on the websites, which eventually lead me to placing the call. During this grueling hour or so, I was on hold in a voice mail system with bad music, with a "canned" message promising to assist me soon all the while letting me know that they knew my time was important and thanking me for my patience. Out of that hour or so on the phone, I spent approximately 6 minutes total talking with three different individuals who ultimately sent me bouncing between two entities: Catamount and the State. In the end, I was referred to the Banking and Insurance Department's web site as a place where I might be able to find a contact for my questions, or a contact to send email. I didn't have any time left on Friday as State offices were closed by the time I got done, so I will pursue my quest for information on another day. Frustrated and "stretched-to-the-limit" with my own experience, I decided to do some research to try and find some public interest stories reporting how the working class folks losing their jobs have fared while applying for state services. Services that are being administered with bare bones and overworked staff to a growing number of unemployed and unemployed who have fallen off the unemployment lines. I was on a quest to find out how the desperate would go about applying for state services, what kind of problems they were experiencing, and what they could do if they encountered problems. I wondered just how many laid off working folks were experiencing the same problem as I was, except I wasn't the desperate one, my constituent was. Even more to the point, I wonder how many were having problems getting the service once they had the information. I thought surely the Vermont media would be covering these types of human interest stories, sharing real live stories about problems accessing critical services that are so important to the many Vermonters who are losing their jobs. I've seen and heard the media giving information on web sites, but simply pointing folks to a web site for assistance didn't work for me. And I may be more familiar with computers than many of my constituents. I couldn't imagine what a daunting task it might be for someone laid off, without a computer and without affordable access. Where does the media fit in with these human interest stories? After all, it is (to me and the thousands of unemployed) headline breaking news and current events. During my research, I came across an article that at least seemed to mention unemployment in the private sector and the state's ability to deliver services. The article, by Jack Hoffman and Paul Cillo, hit the nail on the head. It reads:

"Few among policymakers, opinion leaders, or the press have discussed, or even acknowledged, the effect of public sector layoffs on the state’s capacity to deliver services. The administration’s goal has been to reduce the payroll, not to improve efficiency or make state government more effective. The Legislature recently hired an outside firm to look at ways the state might save money through efficiency or perhaps through discontinuing specific services that no longer need to be provided by the government. Such research should be done before state jobs are eliminated and state employees are pushed into the unemployment lines."

I think it's the public's right to know how difficult it is during these tough economic times for someone to get help, and to know of the State's inability to deliver services to the growing numbers of folks being laid off in the private sector. Could headline stories concerning these issues replace headlines stories focusing on crime, violence, war or politics and who's running for Governor? Or at least share the front page? We are not reading about the finanial struggles of real folks. These stories should be important to folks with political aspirations of being our Governor. Real human interest stories from different walks of life. One description of a newspaper, is "a publication that appears regularly and frequently, and carries news about a wide variety of current events. A daily or weekly publication that brings news of general interest to large portions of the public in a specific geographic area". Right now, I think a large portion of the public is the unemployed and the geographic area is Vermont! The "Penny Press" made its debut on the streets of New York in 1833; its four letter-size pages filled with human-interest stories and short police reports. And it was popular. Most of the American penny papers were less interested in politics, nevertheless, history shows us that they did have the effect of bringing many working class people into the political process by providing them with a source of news they could use to keep well informed. I think human interest stories would also keep politicians informed. I wonder if the local newspaper sharing the different perspectives on Vermont's unemployed and the State's (in)ability to service them during reductions in force would carry any weight with the voters at the polls? Who knows, these stories just might wake up the politicians who are making the headlines!

Ray Shadis will speak at the Progressive Convention on November 14th. Ray did not set out to be an activist in the nuclear power battles.  Like so many activists, he got engaged because of problems in his own back yard. The following background information on Shadis is taken from the New England Coalition on Nuclear Pollution newsletters. The story of Ray Shadis is an epic tale of David and Goliath, Ray being the David who takes on a take-your-pick of nuclear giants: Maine Yankee, Entergy, the U.S. Nuclear Regulatory Commission, and the Vermont Public Service Board. Shadis got a bachelor of fine arts from Fairmont State College in West Virginia, and then moved to Edgecomb, Maine, and wound up buying a farm about a mile and a half downwind from the local nuclear power plant. On March 28, 1979, in Pennsylvania, Three Mile Island Unit 2 had a partial core meltdown and everything changed. "I tried to call the regulators," Shadis said. "I tried to get a number for the Atomic Energy Commission, not having realized it was no longer in existence; it was now the U.S. Nuclear Regulatory Commission. I got a hold of a very pleasant NRC person down in King of Prussia, Pennsylvania, and they said every licensed nuclear power station has, somewhere in the near environs, a public document room. So I went to the public document room for Maine Yankee in Wiscasset at the local public library. "At the time all of what they got in was in paper, and they had a stack of paper there with a new list of documents that had just arrived that morning. I started to go through them and found that sometime a few weeks prior, Maine Yankee had had a spill of a couple of thousand gallons of radioactive coolant in the containment. The vents were open at the time, but the radiation monitors on the vents were not functioning, so they had a release of radioactive iodine that was essentially unmeasured and unmonitored, but no one was following these things at that time." Shadis began to follow them. Closely. He and his wife formed an organization and held meetings and protests, leading a petition drive and march on the statehouse. Ultimately, three citizens' referendums failed to get enough votes to shutter the plant, but Shadis and other activists kept the pressure on, insisting on an independent safety inspection that revealed serious problems. In 1997, Maine Yankee's owners decided it wasn't worth it to try to fix the reactor and mothballed it. By 2005, all but the nuclear waste was gone. In tandem with his Maine activism, Shadis had been working with the Brattleboro-based New England Coalition since the 1980s, and with the demolition of Maine Yankee complete, he turned his full attention south. Vermonters in 2001 were facing the sale of Vermont Yankee to Entergy, followed in quick succession by a 20 percent power uprate, the storage of nuclear waste in Vernon, bids by Entergy to increase the water temperature of the Connecticut River and change the way radiation is measured, all in the context of a 20-year license extension intended to keep the reactor operational until 2032. With Shadis' guidance and tutelage, the small clan of activists at NEC became the first organization in the country to have their arguments formally heard before a federal nuclear regulatory appeals panel.

Recently, I was watching a morning show that was highlighting the end of this decade and decades before, along with some of the products of the 70's that changed the world and our lives. Of course, the seventies were my days and over the years my children have heard me say, "in my day..." They would just respond with "yeah, yeah, yeah, we've heard it all before." But for me the 1970's were monumental, fun and full of life changes: I protested at my high school and as a result female students were allowed to wear pants, not just dresses and skirts. I graduated. Gay rights saw increased awareness.  Coca-cola was one of the hottest products.  Walkmans made the scene. We saw technology change with the Apple II. I was married. We saw the first Burton snowboard. YMCA was a huge musical hit. I had my first child. The Charlie Daniels Band was popular. The McDonalds Happy Meal came to be. We celebrated the end of the Vietnam War, but we also saw trauma with the Iran hostage crisis. The 70's came and went and these things are just a few mentionings from those days. As I sit here today I wonder how I really feel about the days that I thought were so carefree and important for me. I think: "What kind of an impact did they have on our world today, and what's different or better?" Hostage situations are still occurring today, soda and Big Macs are a cause of obesity and a big part of health care discussions today, technology has changed dramatically since the Apple II, but the price may be that our privacy has been severely compromised, "YMCA" is still popular and today the Charlie Daniels Band's hit song: "The Devil Went Down To Georgia" could be changed to a song titled "The Devil Lives Down in Vernon". Not such a big hit!! Thank goodness for the first Burton Snowboard.

John Bloch's Oct. 26th blog on the skyrocketing in-state cost of health care is sobering. As I read the myths, horror stories, lies and other information in the health care reform discussion, what amazes me most is how many intelligent, otherwise well-informed people believe that health care must be accessed through insurance companies. What must we do to get the truth across? Health insurance companies are there to make money--large amounts of money. Do they achieve this by providing health care coverage to everyone who needs it? No, they achieve this end by denying coverage whenever they can get away with it and their administrative costs add tremendously to the bottom line in total health care costs. The wealthy and powerful insurance company lobbyists are doing one incredible job in selling a gross falsehood to the American people.

The recent issues in the news about Burlington Telecom (BT) have obscured one of the most important facets of our efforts in Burlington: providing a high quality and local alternative to large conglomerates like Comcast and Fairpoint.  These large companies in effect create monopoly conditions where consumers are subject to predatory pricing and poor customer service. And we’ve seen that these companies are also vulnerable to failure – Fairpoint recently declared bankruptcy as did Adelphia a few years ago – leaving many customers at risk of losing their only broadband option.  Comcast is not making its decisions based on the best interests of Burlington or Vermont. They are working to shut down their competition and making decisions from corporate headquarters. Internet services are not a luxury. They are essential to our basic communication infrastructure and economic development.  Burlington is building a green infrastructure in order to color all of the city’s jobs as green jobs. Vermont has made universal broadband a stated priority – Burlington is in the forefront of this commitment. Burlington Telecom provides local, high-quality, state-of-the-art services – fiber to the home that is ready to accommodate future technology – to 4800 Burlington residents with a capacity to provide services to 100,000 households within city limits and across Vermont. The issues related to BT’s Certificate of Public Good need to be addressed and the City is moving forward through an extended process with the Public Service Board to do so. We should not lose sight of the fundamental need to provide a competitive but fair environment for the future of broadband services in Burlington and beyond.

This morning I read that the State of Vermont has just contracted with an out of state firm, TPI, to advise the State of Vermont on using IT more efficiently and cost-effectively. This equals dollars leaving the state. David Tucker, the interim Commissioner and State CIO says that "IT is increasingly critical to performing the core missions of state government, especially in economically challenging times". It is unbelievable that the state CIO (interim or not) would use these tough economic times to finally decide that IT is critical; it only shows where his head has been over the years when dedicated state IT workers have tried to get that point across. Now, is seems that Tucker will use critical dollars to look at outsourcing and send those dollars out of state instead of keeping jobs in state government. Of course, this shouldn't come as any big surprise to us. Given where Tucker sits he doesn't know any better. But we should beware because this only adds to the trend that we are seeing from folks that should know better, for Vermont labor's sake. After all, Jeb Spaulding brought in an out of state law firm to advise - this equals dollars leaving the state. A law firm, by the way, that admits as one of their practice areas counseling businesses on how to stay "union free." Earlier we learned that an out of state group, "Public Strategies Group," was hired to come in to help the state identify "reform and redesign opportunities." This again equals dollars leaving the state. Get the picture? Dollars leaving Vermont. Add them up. Dollars that could stay in Vermont and keep Vermonters working!