January 12, 2013

Maine Voices: Governor's spending cuts wrong way to keep economy functioning

Ending the 2011 tax breaks will boost funds for needed services and educating the workers of tomorrow.

SCARBOROUGH - As a small-business owner, I have more than a little experience with making difficult decisions. I know what it's like to have to have to look beyond the fast and easy solutions to a problem in favor of a path that will lead to profitability.

For small-business owners, long-term survival and success demand that our decisions be thoughtful and responsible. Making ill-thought-out decisions leaves no path for future growth.

That's part of the reason why I'm so disappointed at Gov. LePage's spending curtailment order, a budget measure that disproportionately cuts needed services for the hardworking people of Maine.

Rather than make thoughtful cuts that will have the least impact on our most vulnerable populations, a heavy hand has been applied on those who are struggling mightily to stay afloat in this economy. These are the very people who look to people like me for jobs and opportunities to get ahead. And yet, these cuts erect even more barriers for those who need a hand up in order to compete for the jobs that small-business owners provide, and they impede the future success of the economy of Maine.

Let me give just one example. As a former high school teacher, I know that the proposed cuts to education are potentially devastating. If the state fails to contribute its share to educating our children, our cities and towns will be forced to pick up the shortfall.

Since there are very few ways to raise revenue at the municipal level, any additional money generated will come from increased property taxes, user fees and local sales taxes. In the meantime, the quality of instruction in the classroom will be degraded. This means that our children -- our future -- will be shortchanged when it is their turn to join the work force.

A vicious cycle will ensue where employers lack skilled workers because workers lack the needed skills. The economy will continue to stagnate. Local tax rates will continue to increase, and we will be no further along as a state in developing well-paying opportunities for our people.

I believe there is a better approach. The state can finally ensure that the very wealthy and big corporations pay their fair share in taxes.

Before slashing away at education funding, the governor could and should propose an end to the tax breaks of 2011, which disproportionately benefit the wealthy in Maine. While touted as giving tax relief ($7 on average) to the bottom 20 percent of earners, the reality is that these tax breaks allow Mainers in the top 1 percent to save more than $2,800 a year. That's not fair.

Restoring tax rates for the top earners and corporations makes sense to Maine people. In a recent poll conducted by the Maine People's Resource Center, 52 percent of respondents said that raising taxes on income for wealthy individuals would help the economy. Only 27 percent said it would hurt the economy.

With President Obama's re-election, voters chose a path forward that asked elected officials to put the middle class ahead of millionaires.

In the fight over the fiscal cliff, all four members of Maine's congressional delegation -- two Democrats and two Republicans -- voted for a bill that increased taxes on the wealthy for the first time in more than 20 years. Asking the wealthy and corporations to pay their fair share is an idea that crosses party lines. It's an idea based in fairness and economic security.

My husband and I own three small businesses. We pay our fair share of taxes. We return money to the economy through purchasing goods and services that we use in our businesses.

We believe that returning money to the economy through progressive and fair tax policies that strengthen our public schools and provide a hand up to those who are struggling to make it every day is the best economic development program in the world.

Maine's economy needs to work for all of us, not just the select few. We need a better plan than Gov. LePage's curtailment order; we need a plan with positive solutions that protect our foundational programs and ensure that Maine's economy works for everyone.

Jean-Marie Caterina of Scarborough is owner of the Caterina Maclean Group and two other businesses.

 

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