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Montana Viewpoint

MORE TAX BREAKS FOR BIG BUSINESS NOT ANY WAY TO HELP OUR ECONOMY

from the Missoulian, July 14, 2000

A couple of weeks ago I took the opportunity to travel to Great Falls to attend a meeting hosted by Senator Baucus on economic development. Being as how the Montana economy has been in the tank for the last few years, it seemed more than timely to start looking at getting business moving in Montana. It was an impressive line up of speakers: representatives of some of the largest companies in the nation were there to give their opinions on what we humble Montanans should do to get right with business.

And even though the meeting was held in a field house that could have passed for an echo chamber, two messages were delivered with crystal clarity: "The Montana tax structure is unfriendly to business," and "get a sales tax." Get a sales tax? Get a clue! If these business moguls have not heard, a sales tax is less popular than garlic mouthwash in our state. Regardless of the merits or demerits of a sales tax, the Montana public has made it plain that it is an option they do not wish to pursue. The sales tax issue aside, I am still curious about what makes our tax structure unfriendly to big business. Is it because we have lowered the tax on business equipment from 9% to 3%, or is it because we have cut the tax on electric generating facilities in half?

Frankly, I am confused, but there were Microsoft, Montana Power Company, and the new owner of all the old MPC dams and generating facilities, PP&L Global, with tears as big as horse apples rolling down their cheeks. One wonders at what point they will be satisfied with their level of taxation. I have my suspicions, but then, I am the skeptical sort. I do wonder, though, that if these guys are not able to get what they want from a state government that has been run by extremely business-friendly Republicans for the last six years, that maybe their expectations are a little unrealistic.

I have no problem whatsoever with cutting property taxes to help small business and homeowners, and, indeed, some of that has been done in recent years. But when I hear Principle Legislative Fiscal Analyst of Montana say that 80% of the tax cuts have gone to 19 mega-corporations, I despair. Do you believe that Exxon and Conoco needed a $1 million plus annual tax cut to survive? Has the price you pay for gas gone down as a result? How about the guys who make electricity? They got a huge tax cut, and I am sure the 338 miners in Butte who just got laid off because of soaring electricity costs are tickled pink.

The priorities of big business to lower operating costs, including taxes, makes great good sense from a business standpoint. But it makes sense only from a strictly self-serving business standpoint. A corporation doing business in a state also has a need, and, indeed, a responsibility, to protect that well-being of that state. Just as we need responsible, thoughtful citizens, we need corporate responsibility and consideration. To my mind, that means local hometown, small businesses have a big edge in the ethics department, and that these are the folks we should be breaking our backs to keep going. We are failing them.

It also seemed to me the height of presumption for some of the wealthiest men in the nation to propose that we increase taxes on Montana citizens, and decrease the tax on their companies. The citizens and small businesses of Montana deserve a tax break proportionately larger than that given to mega-corporations doing business in our state. They deserve it, but the tax cut trough has been pretty well sucked dry by the out of state companies.

The fact that Montana ranks near last in per capita income, and first in the number of people holding multiple jobs is a travesty. The fact that this has happened during the longest and strongest economic expansion in American history is a bad joke. This sick Montana economy has been doctored by tax cuts and more tax cuts for big business. This may have worked well for the bottom line of businesses, but it has not paid off for working Montanans; and if they do not benefit, what is the point? Meanwhile, the very things that make for a healthy economy have been left to languish; the educational system, including vo-techs, and the infrastructure. Ironically, it is because of the tax cuts that the quality of our infrastructure and educational systems are declining. It reminds me of the old medical practice of "curing" the patient by bleeding him to death. It is time to change our methods.

Jim Elliott
Phone: 406-444-1556
Mail: State Senate Helena, MT 59620

jim@jimelliott.org