Mario Burgos

Clear thinking and straight talk from the top of a mountain.

Thursday, February 04, 2010

Wall Street Versus Main Street Continues

I've wondered aloud on more than one occasion why the vast majority of stimulus efforts on the federal level were given to Wall Street versus Main Street. Of course, we all know the reason.  Democrats are providing special favors to their favorite campaign donors and making sure that big inefficient businesses with powerful unions can keep their doors open regardless of the lack of demand for their product.

Well, as near as I can tell, the same thing is happening in the New Mexico legislature - the interests of large business at the expense of small business. Only instead of giveaways of taxpayer money, we're talking about who the Democrats in the legislature are opting to tax.  Mind you, I say Democrats because the Republicans have made it clear that reining in the size of government should happen before increasing taxes:
Republicans in both the House and Senate are expected to take a hard-line approach against tax hikes, although they bristle at suggestions they're merely trying to block the Democratic agenda.
    

"They've never asked us to be part of the solution," said Rep. Jimmie Hall, R-Albuquerque.
    

Hall said he thinks there are still ways to trim the budget — by targeting administrative and vacant positions — without hurting core services.
    

"I can't support any tax increases until we shrink state government down to a level that a populist can support," he said. 
So, back to the tax, tax, tax enamored House Democrats. Let's take a look at their proposed solution:
Gov. Bill Richardson said Wednesday he supports the House's budget approach, which includes temporarily raising the gross receipts tax rate and imposing a personal income surtax on high-earning New Mexicans. 
I've explained in a previous post that what is really being proposed is a tax increase on the profitable retained earnings of remaining small businesses.  In other words, the money they need to weather the storm and keep key employees at work is the target of the tax increase. Now, yes, I'm of the mind that significant spending cuts should be made before even considering any tax increase, but I can't help but wonder if the Democrats are so bent on raising taxes, why they are targeting small New Mexico businesses instead of large Wall Street firms.


Think about it.  The general consensus is that small, not large businesses are the key to a true economic recovery. The irresponsible stimulus spending may have helped keep the doors open of those who are "too big to fail," but it did nothing to keep your neighbors, family and friends employed:
Unemployment rates were higher in December than a year earlier in 371 of the 372 metropolitan areas and lower in 1 area, the U.S. Bureau of Labor Statistics reported today. 
President Obama is finally awakening to the fact that America (and his popularity) is hurting because he has put the interests of Wall Street and unions before that of Main Street families:
Faced with a national 10 percent unemployment rate and a corresponding erosion in his popularity, President Obama delivered his first State of the Union address tonight and offered up a laundry list of proposals aimed directly at the small businesses who do 60 percent of the hiring in America.
So, you've got to wonder why House Democrats in the legislature have targeted small businesses and left big businesses alone. Sure some big business tax bills were introduced, but bills like HB 62, which would could raise taxes on large out of state corporations, got a pass in favor of taking more money away from job creating small New Mexico businesses.

Come Election Day 2010 the House Democrats, all of whom are up for re-election, are going to find that it is the Main Street business owners, employees and their families that are going to vote.  You know, the ones that actually live in the state.

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