David Hoppe

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:: Pence v. Republicans

Legislature overcome by reason

by David Hoppe

Credit where credit is due: The Indiana state legislature, a law-making body hardly known for sense, let alone sanity, is showing a bit of both in its remarkably cool treatment of Gov. Mike Pence’s proposal to cut personal income taxes by 10 percent.

This is remarkable for a number of reasons.

In the first place, both wings of the Statehouse are dominated by Republicans. Mike Pence is a Republican. And Republicans have rarely met a tax cut they didn’t like. They have their reasons for this, mostly having to do with the notion that wealth amounts to moral virtue, meaning the more of it a person has, the better that person is. It follows, therefore, that those who have managed to accumulate wealth must be the best judges of what to do with it. Better, at least than the government, which looks out for those who (by Republican lights) aren’t clever, good or enterprising enough to accumulate wealth of their own.

The problem with this philosophy is that one of the ways wealthy people manage to stay that way is, in fact, thanks to a government that, through taxation, relieves these folks of having to build things like roads, bridges and sewer systems all by themselves.

This, you’ll recall, became an issue in the 2012 election when President Obama had the temerity to point out that no one in this country builds a fortune in a vacuum, that businesses are able to succeed thanks, in part, to the quality of the infrastructure created by something that most of us like to call Society.

This plain-as-the-nose-on-your-face observation jerked a brief spurt of resentment among Republicans, who prefer their pronouns capitalized and singular, as opposed to the lower case  “we” and “us.” This resentment, however, was not enough to enable them to prevail in elections around the country, where we and us trumped I in most races.

Not so much in Indiana. Here, it seems, we continue to believe not in a government for and by the people, but in the magnanimity of the rich — that the wealthy will provide us with good-paying jobs, and charities, and, well, whatever they feel like. I mean, when we have Eli Lilly’s beneficence, who needs taxes?

That, at least, is what Mike Pence appears to think. As noted, Pence arrived in Indiana, touting a plan to cut the personal income tax. This, after spending 12 years hectoring about the evils of Big Government in Washington, DC. There was a time, early in Pence’s career, when tax cuts were a Republican mantra in Washington. Those were the halcyon days of George W. Bush, Inc. Republicans had inherited a budget surplus from the Bill Clinton administration and used it as a pretext to cut taxes not once, but twice.

Prosperity was supposed to ensue; this did not happen. The rich got richer, all right, but 99 percent of us fell further and further behind.

Maybe this explains why Indiana Republicans are a little shy about embracing Pence’s scheme. This state’s income tax rate is already the second lowest in the nation. Or, as Indiana Senate President Pro Tempore David Long (Republican, of course) has said, “We do pretty well there.” Our property taxes are capped. We’ve been ranked first in the Midwest in terms of Business Tax Climate by the Tax Foundation and fourth in the nation for business tax and regulatory climate by the U.S. Chamber of Commerce and the National Chamber Foundation.

Indiana taxes are already so low a lot of our mayors are wondering where they’ll find the money to pay teachers, police and fire fighters.

Fortunately, Indiana also enjoys a budget surplus. In this, it is rather like the US government back in 2001, the year Mike Pence began voting for tax cuts in Washington. Could it be that Indiana’s Republican state legislators have been struck by a feeling of deja vu?

They are certainly acting as if this is a movie they’ve seen before — and they don’t like the way it ends. So far, the Republican-controlled House has chosen not to include Pence’s tax cut in its version of the state budget. Many Republican senators also appear to be keeping their distance.

Ironically, it’s been the Democrats pushing for a vote on Pence’s proposal. This, however, seems motivated less by enthusiasm for cutting taxes than by an inconsequential desire to try a Republican talking point on for size. It’s come off as a stunt that’s left the new governor acting as nonplussed as a new kid in school, finding himself befriended by the uncoolest clique in the lunchroom.

The funny thing about all this is that, at a time when we keep hearing about the importance of bipartisanship, Indiana Republicans, thanks to their super-majorities, seem overcome by reason. Were the Democrats more competitive, Republicans would probably feel the need to take the ideological bait and we would be on our way to getting a tax cut we don’t need and can’t really afford. Since they haven’t got the Democrats to contend with, they’re actually thinking about what Pence wants to do and finding it neither sensible nor sane. It’s a moment worth savoring.