Saturday, September 04, 2010

McDonnell's plan to raise taxes speaks volumes

It's worth taking a moment to go back and recall where all of this supposedly started: transportation. The Republican Party of Virginia steadfastly refused to raise taxes on motor fuels--gasoline and diesel--in order to pay for much needed and neglected repairs to Virginia's road system. A small tax of a few pennies per gallon would be the simplest and best way of addressing the commonwealth's transportation problems. The use of motor fuels is directly related to the use of the road system. If we raised the tax on gasoline, the more people drive on the roads, the more fuel they buy, the more money would be available to fix the roads. Simple. Elegant. Fair. People who don't own cars and don't use the roads would pay nothing directly.

But the Republicans refused this simple, fair solution saying that under no circumstances can we raise taxes. Ever. On anything.

Fast forward to now. Governor Bob McDonnell wants to sell the commonwealth's ABC stores to his corporate friends for next to nothing. The profits from these stores pay for all the operations of the ABC and turn over a profit of $250-300 million a year over to the general fund. Bob McDonnell wants Virginians to give up that money in exchange for a single lump sum of say, $500 million.

For a long time Bob McDonnell denied the very obvious: the proposed sale was a sweetheart deal for McDonnell's friends and a total rip-off for Virginia's tax payers. McDonnell assured us that there would be no loss in revenue, that somehow, magically, the numbers would balance out.

Well, now the other shoe has dropped. Bob McDonnell wants to raise taxes on small business owners who operate bars and restaurants. To pay for roads . . . or so he says. Now let's unravel this whole thing, let's get to what it is really about. Hint: it ain't about fixing roads.

This is about Bob McDonnell raiding Virginia's treasury to hand over valuable assets--our ABC stores--to his campaign donors for less than a tenth of their value. McDonnell then proposes to make up for the value Virginians will lose if this deal goes through by sticking a different group of tax payers, small business owners, with the bill, making them pay for the revenue he gave away by paying a new tax--a tax they will in turn have to pass on to consumers. It's a tax that bears zero relationship to roads. In fact, the more people drink, the less they would use the roads--or at least we should hope they use the roads less.

McDonnell's proposal to sell the ABC stores for a song and make up the difference with a new tax is self-contradictory. Republicans know in their heart of hearts that whenever a new tax is imposed, it seldom ever goes away. It will just be repurposed. It cheats Virginia tax payers in more than one way, all to benefit a small clique of people, all of whom happen to be campaign donors to Bob McDonnell.

The General Assembly must unite, Left and Right, to oppose this irresponsible, and possibly corrupt, attempt to sell off Virginia's assets for a song.

Forward this message to your friends and family: oppose the selling off of Virginia's assets for a pittance. Oppose the imposition of new taxes on small business owners.


Scott said...

First, I agree 100% that small increases in fuel taxes are the appropriate solution for funding our transportation budget. I also believe that it is fundamentally ridiculous to have the state in the business of selling alcohol. ABC stores should be privatized, it should NOT be a function of government to sell liquor. Taxation is a function of government.

The Richmonder said...

Scott, the 21st Amendment to the U.S. Constitution gave states the right to decide how they would regulate--or even allow--the sale of alcohol for human consumption. The elected representatives of the citizens of Virginia decided that the best way to do that was by operating ABC stores.

Now we, collectively as Virginians can decide to do something different in the future, but as for it being or not being a function of government, it has previously been voted upon in accordance with both the U.S. Constitution (as amended) and the Virginia state constitution.

Right now, as per the will of Virginia voters as previously expressed, selling liquor is a government function. As I said before, we do have the right to change our laws and over ride the wisdom of the Virginians who voted to make selling liquor a function of government four or five generations ago, but don't try to delegitimize what our forefathers did by simply saying "selling liquor isn't a function of government."