Cutting Taxes for the Right New Mexicans Governors, Local Government, National Leadership, New Mexico, Policy Issues, Statewides

Joaquin over at The Plaza (Bill Richardson's campaign blog) showcases some new economic incentives the Governor is proposing. The main focus is tax cuts for working families, veterans and people that invest in New Mexico. Some highlights (I used ellipsis to designate snipping, check the post to read the whole package):

WORKING FAMILIES Working Families Tax Credit - the centerpiece of the Governor's tax-cut package, which is modeled after the federal Earned Income Tax Credit. This tax credit will reward work, and help working families--who earn between $11,000 and $36,000. As many as 139,000 taxpayers will benefit by an average of $180 per return...

MILITARY AND MILITARY RETIREES...
Tax Cuts for active-duty military - exempting military pay from state income taxes, which means an average of $1,340 in tax benefit to 7,000 New Mexicans...

BUSINESS-ECONOMY...
Gross Receipts Tax Deduction for Hospitals - Most of the hospitals affected operate in small, rural areas and on the front lines when it comes to caring for those most in need. This tax cut will allow more money that can be invested in local jobs, technology and direct patient care.

Gross Receipts Tax Relief for Mutual Funds - an incentive for investment management firms to bring well-paying financial services jobs to New Mexico.

Angel Investment Credit - an incentive for New Mexicans who invest in high-tech, start-up companies.

Now I know that tax cuts aren't the natural red meat for Democrats around the country. But isn't that the point? In Chain Reaction: The impact of Race, Rights, and Taxes on American Politics (Norton, 1991), the authors argue that

The tax revolt was a major turning point in American politics. It provided new muscle and new logic to the formation of a conservative coalition opposed to the liberal welfare state. The division of the electorate along lines of taxpayes versus tax recipients dovetailed with racial divisions...The tax revolt provided conservatism with a powerful internal coherance, shaping an anti-government ethic, and firmly establishing new grounds for the disaffection of white working- and middle-class voters from their traditional Democratic roots.

It is wonderful to see Democratic politicians such as Richardson using the language of taxation to advance a progressive and electorally successful agenda. Since working families have a higher marginal propensity to consume, the state of New Mexico will even see greater rewards from this system. Too often in national or local politics, conservative Republicans use the language of the tax revolt to mobilize white working or middle class, decades after the true revolt occurred. That is because the language is power (your money, your freedom) and Democrats have often neglected to speak the language effectively.

I look forward to the day where national Democratic politicians challenge the GOP along these lines in a highly publicized way and ask them to come out against tax cuts for working families and veterans while supporting those for millionaires.

Landon Mascareñaz | October 18, 2006 | Comment on This Post (1 so far) Permalink: Cutting Taxes for the Right New Mexicans Governors, Local Government, National Leadership, New Mexico, Policy Issues, Statewides

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