Tag Archives: economic development

The nice and the necessary

Congrats to the House Republican Caucus, which finally came up with something like a budget plan, on the very day the House Appropriations Committee passed a budget. Three observations to begin:

— The committee vote was 11-0. Even so, the Republicans were lambasting the budget even before the vote was taken. Are the committee’s Republican members hypocrites, or is it harder to be a simple-minded partisan when the rubber hits the road and you’re in a small room with your Democratic colleagues, than when you’re facing the camera with fellow Republicans?

— The Republicans clearly didn’t take the budget-writing process very seriously, since they waited until Approps had finished its work before offering a single specific cut. Even worse, during the process Republicans frequently objected to cuts proposed by Democrats — again, without suggesting alternatives.

— The Republicans’ budget plan is unworkable on its face. Its major initiative is a call for zero growth, but that’s (a) impossible because some programs are growing, like it or not (Lake Champlain cleanup, for instance), and (b) an abdication of the Legislature’s responsibility to draw up a budget. The responsible course, as Approps chair Mitzi Johnson has pointed out, is to fulfill the legislature’s duty and make the hard choices. Across-the-board slashing is the coward’s way out.

The GOP caucus did identify some cuts they’d like to make — finally. Most of them are short-sighted as well as mean-spirited:

The cuts [House Minority Leader Don] Turner put on the table Monday include eliminating grants to substance abuse recovery centers, scrapping a childcare subsidy for poor mothers, cutting funding for state colleges by 1 percent, and taking $5 million from a fund that would otherwise provide college aid to Vermont students.

Republicans also say spending reductions on items such as the renter rebate, financial assistance for health insurance and the Vermont Women’s Commission are preferable to increasing revenues that would otherwise be needed to fund levels recommended for those programs in Gov. Peter Shumlin’s budget.

Okay, let’s make it harder for addicts to get clean, harder for poor mothers to hold down a job, make higher education less affordable, and make health insurance less accessible. All those cuts would save money in the short term, but cause even more expensive social damage in the long term. The Democrats are trying to walk a fine line, and craft a budget that’s not fiscally irresponsible while still helping to make Vermont a better place to live.

Which brings me to something that Senate Minority Leader Joe Benning said last Friday on The Mark Johnson Show. I don’t have the exact quote, but the gist was, “There are things that are necessary, and things that are ‘nice.’ At a time like this, we cannot do the things that are ‘nice.'”

That sounds good and responsible, but the devil is in the definitions.

Do you think low-income heating assistance is nice or necessary?

How about broadening access to health care? A social obligation, or an extra?

Let’s talk substance abuse treatment, at a time when Vermont is in the throes of an addiction epidemic. Necessary or nice?

The good Senator apparently believes all these things fall into the “nice” category. Many of us don’t agree.

Okay, now let’s look at some items that aren’t on the Republican cut list — and weren’t on the Democrats’ either, for that matter. Necessary or nice — you make the call!

— The state giving $2.5 million to GlobalFoundries, a move that will do nothing to keep the company in the state. On a worldwide corporate scale, that’s nothing. It amounts to a burnt offering meant to propitiate the corporate gods. And it takes a big leap of faith to think it’ll have any effect whatsoever. Necessary?

— The state continuing to let unclaimed bottle deposits go to bottling companies. That’s a $2 million item, I’ve been told. Is that a necessary giveaway? Hell, I wouldn’t even class that one as “nice.” “Noxious” is closer to the mark.

— When ski resorts purchase major equipment, they don’t have to pay sales tax. That’s another $2 million a year. Is that necessary, in any definition of the word?

— For that matter, we’re letting the ski industry make a fortune thanks in large part to bargain-basement leases of public lands. The industry is understandably loath to reopen the leases, but there are ways to get it done. Instead, we’re letting them ride. Necessary? Hell no. Nice? Only for the resort owners.

— Vermont is one of only a handful of states that exempts dietary supplements from the sales tax. Nice or necessary?

In addition, the state gives quite a bit of money in small grants to private and corporate groups. Here’s a few examples:

— The Vermont Technology Alliance gets a $52,250 grant. Why?

— The Vermont Captive Insurance Association gets $50,000 to pay for “promotional assistance.” I realize the industry is a strong positive for Vermont, but the grant is certainly not necessary.

— The Vermont Ski Areas Association gets $28,500. This is the same group that refuses to reopen the leases. Why are we rewarding their intransigence?

That’s just a few I happen to know about. I’m sure there’s lots more. Are grants to industry “necessary” or “nice”? If we’re asking the poor and downtrodden to take major hits to the social safety net, couldn’t we ask our industries to accept at least a haircut?

And if we want to promote business in Vermont, why not take back all these penny-ante grants, put part of the money into a coordinated statewide campaign (like the one proposed by Lt. Gov. Phil Scott’s economic-development crew) and bank the rest?

Also, the state Senate is considering a bill that would make Vermont’s economic development incentives easier to access. Supporters, such as Republican Sen. Kevin Mullin, posit the bill as an investment in Vermont’s future. 

Which is fine. But so is increasing access to higher education, providing child care for working mothers, and helping addicts get clean. Those social programs aren’t just “giveaways,” they are investments in a safer, healthier, more productive Vermont.

Unfortunately, they are investments on behalf of Vermont’s voiceless. LIHEAP recipients and working mothers and addicts and prison inmates can’t hire lobbyists or mount a PR campaign. So we too often fail to invest in them, while we’re more than happy to invest in corporations that might or might not use the money productively — but in either case, it’s definitely in the “nice” category, not the “necessary.”

So you see, Senator Benning, I agree with you. I just have different definitions of “necessary” and “nice.”

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Shap the Triangulator

“It’s probably better to have him inside the tent pissing out, than outside the tent pissing in.” 

                      –Lyndon B. Johnson

ICYMI, House Speaker Shap Smith has done something a bit unusual on two key issues, education funding and economic development. He solicited public input, and created special brainstorming committees to evaluate ideas.

Let's… Make… a Deal!

Let’s… Make… a Deal!

The existence of these committees is interesting enough; it smacks of a legislative leader angling for the bigger stage. This process amounts to an informal, back-office policy shop, and gives Smith  a very central role in crafting policy instead of, say, waiting for Governor Shumlin to initiate. His work with the committees also can’t help but endear him to some pretty prominent people.

More evidence of ambition can be found the makeup of the two groups. The education panel included ten current and former lawmakers: Democrats, Republicans, and independents. Good for building nonpartisan street cred.

The economy group included many of The Great And Good of Vermont’s business community, including Betsy Bishop of the Vermont Chamber of Commerce, Tom Torti of the Lake Champlain Regional Chamber of Commerce, and (Lord help us) Bruce Lisman of Campaign for Vermont Prosperity. The chair, Paul Ralston, is a former Democratic legislator who alienated many of his caucus mates during his single term*, and ended by partnering with Republican Rep. Heidi Scheuermann in Vision to Action Vermont, a PAC that’s just about as nonpartisan as Campaign for Vermont.

*I’ve heard him described as a junior-grade version of Peter Galbraith for his self-centered ways. Love his coffee, though.  

The group also includes a healthy share of relatively progressive businessfolks, like Andrew Savage of All Earth Renewables, Andrea Cohen of Vermont Businesses for Social Responsibility, and Cairn Cross of FreshTracks Capital. But there was no one from the labor movement, and no one from any progressive or environmental organization.

It smacks of triangulation, the favored strategery of upwardly mobile Democrats and the bane of liberals. And it smacks of building networks of support among the deep-pocketed donor class. Which tends to lead to centrist policymaking, not to mention one of Gov. Shumlin’s favorite pastime, kicking the hippies.

I’m not ready to call Smith a sellout. A recent report on VPR lists some ideas emerging from the job-creation committee, and they actually sound pretty good: identifying ways to unlock capital for small businesses and startups, matching technical-school curricula with the needs of Vermont tech companies. Also, Cross is quoted as saying that Vermont’s business climate has more to do with quality of life and a clean environment than the old bromides of tax breaks and deregulation.

That sounds like a relatively progressive approach to economic development. And truth be told, there’s a need for a strategy that cuts through the standard liberal/business debate — that encourages job growth without abandoning liberal principles.

For instance, there is probably room for — and please don’t shoot me — some modest reform in the permitting process. The very phrase “permit reform” has been uttered by so many Republicans for so many years, it raises immediate hackles in the liberal community. Can we find a way to ease the process for the kinds of enterprise that create good jobs and contribute to our economic vitality without simply greasing the skids for strip malls and subdivisions? We probably can, and maybe — just maybe — Smith is trying to break the usual pattern and find a third way.

I’m willing to wait and see what emerges before passing judgment on the process and on Smith’s motivations.

As for the political question: Is Shap Smith running for governor? I don’t know. And at this point, he probably doesn’t either. But he’s certainly developing relationships and laying the groundwork for a future run, should he decide to do so.