Gov. Peter Shumlin may think he is pulling a Howard Dean-like maneuver, confounding liberals in his own party in order to demonstrate a fiscally conservative approach to social problems and establishing credibility with the business community.
How else can one explain the peculiar proposal that was the centerpiece of his inaugural address last week? With great fanfare he announced that he would devote $17 million in new funding to make pre-kindergarten programs available to all Vermonters. This proposal was the foundation of his new education agenda, which would be the foundation of a program to bring economic growth and prosperity to Vermonters.
But he also proposed paying for the program by taking money from one of the best programs supporting low-income workers — the earned income tax credit.
Shumlin’s impersonation of a Republican has not impressed even Republicans. The governor had shrugged off the harm that reducing the earned income tax credit would do to the budgets of low-income Vermonters, saying, “Are there winners and losers? You bet.”
House Minority Leader Don Turner responded: “Working Vermonters are already struggling. We can’t afford to take something that they were getting and take it away from them. So I know there are always winners and losers, but we don’t want working Vermonters to be the losers in this case.”
Thus, Shumlin has managed to make the Republicans the defenders of the working man while he has assumed the role of Ebenezer Scrooge: “Sure, you can have a Christmas turkey, but will we have to reduce your coal ration? You bet.”
Shumlin ought to remember that he is a Democrat. That doesn’t mean that he ought to propose new programs without regard to their cost. Governors, Republican and Democrat, need to balance the budget, and the state has limited means. But if Shumlin wants to make a splash with an expansion of child care for Vermonters in need of help, then he ought to be serious about actually providing help.
About 45,000 Vermonters benefit from the earned income tax credit, which is a federal program reducing the worker’s tax bill. If the credit exceeds the tax bill, the worker receives a refund that supports his or her income. The state has chosen to augment the federal tax credit with extra money, spending about $25 million a year to bolster the income of low-income workers. The program has been called one of the best anti-poverty programs because it rewards work, helping to lift the working poor out of poverty.
One of the obstacles that low-income Vermonters face in trying to advance is the high cost of child care, and Shumlin’s proposal to spend $17 million to support child care and pre-K programs addresses a significant need. But it is perverse to pay for child care by reducing support for low-income workers. If there have to be winners and losers, why do low-income workers always have to be the losers?
Members of the Legislature, including the chairman and chairwoman of the tax-writing committees, appear to have different ideas about who should be the winners and losers. Indeed, one of the great projects of the coming years is to shift the rules of the game, which until now have been rigged against low-income and middle-class Americans, creating the greatest disparity in wealth since the free-wheeling days of the Roaring ’20s.
It ought to be a guiding principle of the tax-writing committees that working people no longer serve as the losers when policymakers shape our tax law. If the point is to fund child care for low-income Vermonters, then resources must be obtained from a source where it can be drawn doing minimum damage to working people.
The Legislature may or may not be able to find money to provide an additional $17 million for child care. But if they can’t do it without robbing the pocketbooks of the poor, they might as well not bother.
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