New Democrat Update - November 1999
WHAT NOW?
Voter approval of accelerated highway funding and light rail in the Southeast Corridor will help solve the state's transportation infrastructure crisis. However, while both initiatives may relieve some traffic congestion, they represent small steps toward a much more important and challenging goal - maintaining Colorado's prosperity and high quality of life. That bigger picture requires a more fundamental debate.
In today's global economy, businesses can invest anywhere in the world. The companies with the good jobs go to and grow in those regions that can attract and retain entrepreneurs and a highly skilled workforce - the very same people who demand a first-class infrastructure, clean environment and high quality of life (including reasonable commutes).
In the new knowledge-based economy, over two-thirds of economic growth stems from technological development and commercialization. To boost innovation and foster higher productivity, lawmakers should oppose any initiatives that seek only to divide a slowly growing pie, protect or reward special interests at the expense of overall progress, or slow down the process of change.
With technological innovation and worker skills as the keys to expanding opportunities, the state budget and other policies must be modernized and updated. Developing the knowledge infrastructure of the 21st century requires a world class education system, job training, lifelong learning, as well as strengthening transportation and other infrastructure.
To free up resources for these investments, the legislature's first target should be special subsidies and tax breaks - loopholes that unfairly drain millions of tax dollars from Coloradans for purposes that are often not in the public interest. To make matters worse, these giveaways actually hurt companies because they work against what it takes to succeed in the New Economy - innovation and competitiveness.
The legislature should carefully scrutinize existing programs and reduce, redesign, and eliminate policies that are not working or are no longer needed. To that end, a Colorado Commission on Tax Subsidies should be created to uncover these breaks, analyze their cost, and demonstrate who benefits from them to determine whether their continuance is in the public interest.
For example, Colorado grants numerous sales tax exemptions that have no valid public purpose. Many policies give breaks to traditional industries but still tax high technology companies. That simply makes no economic or social sense.
To cut through special interest politics, this commission would report to the legislature, which would vote on the continuation or repeal of each subsidy openly and on its merits. If necessary, a package of measures could be referred to the voters.
Once implemented, this bold proposal may free up enough of the state's budget effectively to meet Colorado's needs. If the achieved savings exceed the funding requirements to prepare us for the New Economy, the remainder should be used creatively to address a significant public policy problem - a low rate of savings especially by medium and low-income families.
If the expenditure savings generated by the Commission fall short, a new, more honest debate on the best use of future state government surplus revenues is needed. Unfortunately, Governor Bill Owens and his right-wing colleagues in the legislature continue to rehash their old, irrelevant and tired arguments. They say surpluses should be used for across-the-board tax cut or refunds and a dramatically reduced role for government. As voters rightly sense, none of these ideas do anything to propel opportunities in the New Economy.
Most recently, state excess revenues were politicized during the 1998 election over Referendum B - a measure that would have retained part of the state's surplus for road improvements, school construction and higher education. Even though rates were not being raised, gubernatorial candidate Owens characterized the proposal (placed on the ballot by the Republican legislature) as a tax increase - a “creative” definition that forced him into two major awkward positions after his election.
a measure that would have retained part of the state's surplus for road improvements, school construction and higher education. Even though rates were not being raised, gubernatorial candidate Owens characterized the proposal (placed on the ballot by the Republican legislature) as a tax increase - a “creative” definition that forced him into two major awkward positions after his election. First, he argued his highway funding initiative was a good idea because the interest rate on bonds would be lower than the inflation rate of construction costs. However, Referendum B - cash in hand that requires paying no interest - is, by definition, a considerably more cost-effective measure than his own highway-widening bond proposal. Of the $2.3 billion raised by the Governor’s plan, $600 million will be used just to service the debt.
Second, he supported keeping RTD surplus revenues through 2026 to help pay for light rail. Using his own definitions from the Referendum B debate in 1998, Owens pushed for a tax increase slated to last over 25 years!
Political posturing and the old, ideological debates of the Industrial Age have no place in the New Economy. To quote President Franklin Roosevelt, “new conditions impose new requirements.”
Given their choices, voters made the right decisions on November 2. However, to continue its prosperity and lofty quality of life, Colorado needs a higher level of debate and better leadership.
NEW DEMOCRATS AT WORK
The New Democrat Caucus continues to make progress on its legislative agenda for the 2000 session. Its initiatives will boost economic opportunity, strengthen fiscal discipline, fight crime, improve public education and promote smart growth. As demonstrated across the country, a New Democrat message on these issues rallies both the Democratic base and those more independently-minded.
Demanding responsibility from every citizen, rebuilding our communities and making government perform better at less cost, it will help families and communities solve their own problems. Neither the enemy nor the panacea, New Democrats will demonstrate that state government can be used as a tool to tackle Colorado's most pressing problems.
Caucus members include State Reps. Bob Hagedorn of Aurora (Chair), Bob Bacon (Fort Collins), Fran Coleman (Denver), Albert Gagliardi (Alamosa), Dan Grossman (Denver), Gloria Leyba (Denver), Frana Mace (Denver), Carl Miller (Leadville), Tom Plant (Nederland), Abel Tapia (Pueblo), Lois Tochtrop (Northglenn), Jennifer Veiga (Denver), Val Vigil (Commerce City), Suzanne Williams (Aurora), Sue Windels (Arvada) and Paul Zimmerman (Thornton). Senate participants are Sens. Mike Feeley (Lakewood), Stan Matsunaka (Loveland), Ed Perlmutter (Lakewood), Terry Phillips (Louisville) and Frank Weddig (Aurora).
The complete agenda will be announced very soon. Stay tuned for details.
GOING GLOBAL
Last month, the national DLC hosted one of the most important political meetings of the year, focusing on American leadership in the world economy and the new politics of globalization. The Annual Conference featured New Democrat leaders in Congress and the Clinton Administration who are at the forefront of efforts to promote economic policies that help all Americans share in the benefits of globalization.
Fighting the forces of reaction and protection, New Democrats are pushing economic policies to boost the incomes and productivity of every American. Timing of the conference was especially important, given the critical upcoming World Trade Organization meeting in Seattle.