Monday, February 15, 2010

No Butter For Tortilla Tax, Plus: Bill's Bad Joke And His Reluctance On Taxes, Also: A State Reps "Wifely Duty," Or Was It? 

A giant tortilla
The now infamous "Tortilla Tax" will receive no buttering up as it heads over to the state House this week. Democratic Senators committed one of the more embarrassing PR gaffes in recent legislative history by approving the measure. Reinstating the gross receipts tax on foods deemed to be unhealthy for a nanny state--including such staples of the working poor as tortillas and white bread--will surely be remembered as an example of the utter disconnect in our time between the elected and voting classes.

Unemployment is centered among the poor and blue-collar families, while the well-paying professions are spared the brunt of the downtown. Yet, the Senate's key leaders and the Democratic Governor will not even entertain the notion of a 1.5% surcharge on wealthy taxpayers or even a half percent increase--from 4.9% to 5.4%--in the personal income tax rate that the state rolled back from 8.9 percent in the gravy years. Instead, Mr. and Mrs. New Mexico is presented with the notion of a tortilla tax.

You can hear the catcalls and see the jaws dropping across this enchanted land.


As in Washington, the political process in Santa Fe seems to have become calcified when it comes to correcting the excesses of the Great Bull Market. Historically, when capitalism has ramped out of control government regulators slapped some hands, redirected money from the top of the pyramid and redistributed it to the bottom. This process cleansed the free enterprise system, got it back on its feet and we were again off to the races. If that process is ignored and the very wealthy are not asked to share in the current economic pain, the prospects for this state's middle class is not promising.


It's not all buffoonery in Santa Fe. The lawmakers are moving firmly to clean up the gunk at the State Investment Council. The attempts to plunder the state's permanent funds caused stomach pains worse than bad sour cream. And we should mention that the state House--while shrinking from cutting much fat from the budget--has passed a small income tax surcharge for the well-off, but it's death by a thousand cuts in the Senate.

(Both the Senate and House have now each passed a budget for the next fiscal year, so it is now game on to see what compromise emerges between the two sides.)


Governor Richardson is a lame-duck with little to lose by trying to broker a deal that would restore the progressive income tax system in the state---the wealthy are paying the same 4.9% as the middle classes--but he has been resolute in his opposition.

We've pointed out this stance is in direct disagreement with that of Democratic President Obama. It also severs any liberal roots Bill had remaining to his days as a northern New Mexico congressman as well as those he established as a congressional aide to the late, great liberal Senator Hubert Humphrey.

A friend--not a psychoanalyst--but a New Mexico physician who grew up in India--observes that Richardson spent his formative years in Mexico City and was sent to an exclusive prep school in Massachusetts when he was 13. Bill's mother is from Mexico and his father was a Boston banker who was born in Nicaragua.

The Mexican aristocracy is notorious for a cavalier attitude--that the rules do not apply to the rich. They live in a world of their own, surrounded by squalor. Richardson's advocacy for low tax rates for the wealthy was initially motivated by his decision to run for president in 2008, but I can't help but noticing that his stubbornness today reflects the attitude in the Third World country in which he spent his early years...

Well, that's not a very charitable explanation, but probably as good as any to explain a Democratic Governor's intransigence in pursuing a fiscal solution that fairly applies to all taxpayers. In other words, the natives are restless.


The depth of Richardson's engagement in the state's budget crisis is another open question. He didn't do much to put to rest those concerns when his office came with a tongue in-cheek "disaster declaration." It was headlined:

Declaring a Valentine Disaster in the Sate Capitol Building--In Advance Of The Impending Train Wreck That Traditionally Marks The Final Weekend of the Session...

Well, humor has a hard mark to hit when there's a half billion dollar budget deficit and an unemployment level that continues an upward creep; when government political appointees and double dippers are given a pass and especially when supposedly serious minded solons talk soberly of taxing white bread and tortillas.

The problem in Santa Fe, Governor, isn't an impending train wreck. The problem is a conductor who seems to be napping in the caboose.

Brian & Kelly Egolf
Here's one that had the eyebrows arching. Kelly Egolf, wife of freshman Santa Fe Dem State Rep. Brian Egolf, has sent out an email seeking more press attention for her hubby. She complains that while Egolf's bill geared toward moving state cash out of big national banks and into local banks is getting attention (it passed the House and is pending in the Senate), his name is not being mentioned enough when the measure is referenced in the media:

Always the dutiful wife, I’m really trying to get Brian to get a little more attention for his legislation moving New Mexico’s money to local banks. The bill itself has gotten great press coverage, locally and nationally, and it’s a great opportunity for Brian to get his name out there, which isn’t happening by itself.

The bill was mentioned on ABC World News last night with Dianne Sawyer, but there was no mention of Brian. Just “one legislator...”

Because I know you all care about Brian and want to support his career, would you please send a quick email to them pointing out...that the legislator responsible for this landmark legislation is Rep. Brian Egolf from Santa Fe? It wouldn’t hurt if you wanted to mention that he’s a freshman legislator and the youngest serving member of the NM House, or whatever accolades you might want to offer....

Now the critics are e-mailing that the Egolfs are more concerned about the PR and not the bank bill.

Well, he is a politician and seeking PR is part and parcel of the political personality. But having your Mrs. telegraph your need for attention may not go over with the national media. On the other hand, that must be one happily married dude.

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