Does Vermont coddle the Middle Class?

Gov. Jim Douglas thinks so, and he may have a point.

No, the governor didn’t use those words. But take a look at his budget message of last Tuesday and some of his other recent proposals.

“Maintaining coverage for the greatest number of people will mean scaling back benefits for some,” he said in his speech to the Legislature.

At that point, he was talking about health benefits. But the same theme echoed throughout the speech: In order to protect the services and subsidies that go to the poor, Vermont would have to cut back on those services and subsidies for the not-so-poor.

And while some of those not-so-poor are very low income, many are not. In both tax and social policy, Vermont provides benefits to thousands of people whose earnings are close to – or higher than –the middle of the income spectrum.

For instance, a family of four can get health care assistance in Vermont if its total income is under $68,400. That’s way above the poverty line for a family of four ($21,834 in 2008). It’s even higher than the median household income in the state (about $66,000) before the Recession started.

Then again, it’s less than the median income in Vermont for a family of four. That’s was $71,382 a couple of years ago, one of the highest in the country. Still, by any reasonable definition, a family of four living on $68,000 a year is neither poor nor low income. It’s right there in the middle.

Meaning, at least according to conventional assumptions, it ought to be able to support itself. After all, this is America, the richest country in the world and the one that created mass affluence. Shouldn’t moderately affluent people pay their own bills?

Nor is health care the only example. A large family – two parents and six children – can get state help winterizing its home if its income is higher than $74,000. In all, Douglass said, “nearly one-third of our population receives services from the State… Since the beginning of the decade, overall spending for human services has more than doubled – a growth rate of three-and-a-half times inflation.”

Conventional assumptions, to be sure, ought to be challenged from time to time. As it happens, most Americans no longer live better than their counterparts in many other countries, partly because those counterparts don’t have to pay separately for health care at all. And in this country, health care has gotten so expensive that it could pose a heavy burden even on the moderately affluent.

Still, the case made by Douglas and other economic conservatives is not frivolous. If nothing else, they are asking a legitimate question: In a culture that values (or at least claims to) self-reliance, where should the line be drawn between personal and social responsibility?

Despite the claims of some of his liberal critics, Douglas remains a moderate, not one of those ultra-conservative Republicans who believe – as Newt Gingrich proclaimed in 1995 as he prepared to become Speaker of the U.S. House of Representatives – that government ought to do little more than defend the country and print money. Douglas proposed expanding several state programs in his speech, and did not call for abolishing any.

But he does want to save money, mostly by cutting services to middle-income and even some affluent people and by raising their taxes.

Again, he didn’t put it precisely that way. No sane politician is going to say, “I want to raise the taxes of middle-income and upper-middle-income homeowners.”

But that would be the result of Douglas’s plan to alter the “income sensitivity” provisions of the statewide school property tax. Instead of all households with income under $90,000 protected from paying more than 1.8 percent of their incomes on that tax, those earning between $60,000 and $75,000 could pay as much as 2.25 percent; for households between $75,00 and $90,000, the limit would rise to 3.5 percent.

Of course that might not be a tax increase if local school districts froze their budgets, as Douglas proposed. But they don’t seem likely to follow his advice. Either way, families who earn $90,000 a year, even big families, are in the top 20 percent of all earners. By any definition they are affluent. Why do their property taxes need to be subsidized?

Democrats claim that income sensitivity is not a subsidy, but a method of linking taxes to each taxpayer’s “ability to pay.” It may be that, but it is also a subsidy; whatever the homeowner saves on property taxes because of income sensitivity is made up for by funds from other taxes, mostly the income tax.

And that tax, in turn, is disproportionately paid by upper-income earners. When economic conservatives, including Douglas, complain that Vermont is a high-tax state, what they really object to is that it’s a high-tax state for high earners. Lower and middle-income Vermonters – even those up near the $90,000 range – pay little if any more in state and local taxes than do their counterparts in many other states, especially in the Northeast. But because the state tax structure is relatively progressive, the wealthy pay a bit more. Among other things, they are subsidizing, through income sensitivity, the affluent as well as the poor.

Unless income sensitivity is altered, then, there might be renewed pressure to raise taxes on the very wealthy to help make up for what the merely affluent don’t pay in property taxes. Douglas adamantly opposes any such tax increase. In fact, he wants last year’s small hike in taxes on the wealthy rolled back.

This debate, then, is, among others things, a class conflict. Not the traditional version in which the workers with their pitchforks storm the banks. Not even the more recent brand in which the bankers with their lobbyists and their pseudo-think tanks storm the government and the media.

This class conflict is more nuanced, more interesting, and perhaps necessary. It’s all about precisely who qualifies as “middle class,” who in that middle class deserves tax breaks and government services, and who will pay for them. A healthy debate as long as it does not degenerate into a situation in which everybody is trying to protect his/her own government benefits and tax breaks at the expense of everyone else.

It would be irresponsible to leave this discussion without noting that some of Douglas’s proposed budget cuts would hurt the very poor. For instance, he noted that Vermont’s Medicaid system allows an “unlimited number of emergency room visits” by recipients. “Capping ER visits that do not result in hospitalization at 12 per year will bring Vermont more in line with peer states – saving money to preserve this benefit for everyone in the system,” he said.

No doubt it would. Not only that, but it’s a good bet that some of those emergency room visits, being unlimited and free, aren’t really necessary. But those unlimited visits also probably help explain why Vermont is regularly designated the healthiest state in the union. The most obvious consequence of reducing health care services for the poor is that the poor will become less healthy.

Program Note: The News guy had a personal appointment Tuesday that kept him from Gov. Jim Douglas’s annual budget address to the Legislature in Montpelier. The contents thereof, however, will not be ignored for long. Tune in Friday.

As it happened, Tuesday’s activities did not leave enough time and/or energy for a full post today. But the following correction – or at least clarification –of part of last Friday’s post can not wait. So here it is.

In last Friday’s post (scroll down for the full piece), appeared the following: “Vermont’s old abortion ban remains on the books. It’s 13 V.S.A. § 101, and should (the Roe v Wade US Supreme Court ruling) ever be reversed, (the law) would have to be repealed or abortions would be illegal here.”

Not exactly.

The law is on the books. But so is Beechman v. Leahy, the 1972 Vermont Supreme Court decision invalidating the statute.

Meaning that even if the controversial 1973 Roe decision were overturned (itself hardly likely in the foreseeable future), abortion would not be illegal in Vermont.

At least not unless the Legislature amended the statute to meet the Court’s objection. And a quick examination of both the law and the ruling shows unlikely it would be for the lawmakers to do any such thing.

The statute and the court ruling both relate to the over-all subject of Friday’s post – the introduction of bills that would convey some right of personhood to the fetus. In this context, what is interesting about the law is that while it protects the fetus, it does not treat it as equal to the pregnant woman. If the woman dies, the penalties are harsher than if she does not.

The statute also says that only the person performing the abortion can be punished, but that “the woman whose miscarriage is caused or attempted shall not be liable to the penalties prescribed by this section.”

The court used that provision to invalidate the statute. According to a paper delivered in 2008 by Vermont Law School Professor Cheryl Hanna (Hanna writes more tersely than the court ruling, so she rather than it will be quoted here), “because the Legislature had failed to hold a woman liable for terminating a pregnancy, it had left her personal rights to here…since the Legislature had granted the woman a right to abort, it could not simultaneously deny her medical aid and expect to save her life. By granting her the right to abort, it must also grant her the right to safely

exercise it.”

To resuscitate the statute, Hanna said, the Legislature would probably “have to criminalize women along with providers in order for the law to be deemed reasonable.” It’s hard to imagine any Vermont Legislature taking that step.

This does not mean there is no reason whatever for abortion rights advocates to be concerned about the law still on the books. Beechman does not create a right to abortion under the Vermont Constitution, making it a slightly shakier protection than if it did.

Nor does it mean that laws creating “fetal rights” can not be used to prosecute women (and sometimes men). In one case cited in a document prepared by the National Advocates of Pregnant Women (an advocacy group, obviously, but its examples are backed up by news stories) a South Carolina woman who suffered a miscarriage was arrested and charged with homicide by child abuse.

But it does mean that the suggestion in Friday’s post that the Vermont statute could create a small political problem for Lt. Gov. Brian Dubie in this year’s governor’s race was probably overblown. Dubie may oppose abortion rights. But he’s not likely to veto a bill that the Legislature won’t pass because it won’t have to pass one to keep abortions legal in Vermont, no matter who’s on the U.S. Supreme Court some years hence.

A nuclear power plant (NOT Vermont Yankee)

In 13 months of existence, the News Guy has so far declined to deal with one of Vermont’s most important and most contentious issues: what to do about Vermont Yankee.

The subject has not been inadvertently overlooked; it has been deliberately avoided for two reasons.

The first is that the debate over re-licensing the nuclear power plant in Vernon for another 20 years has hardly been ignored by Vermont’s established news organizations. Sometimes it seems as though no one at the plant can sneeze without the Brattleboro Reformer, the Burlington Free Press and VPR recording how many co-workers said, “God Bless You,” and seeking comment from VY’s owner, the Louisiana-based Entergy Company.

Considering that one reason for the News Guy’s existence is to cover what others do not, not covering what others do made sense.

The second reason is that this dispute is both financially and scientifically complicated, and that one ought to know what one is talking about before talking about it.

That this precept is not universally followed renders it no less worthy.

Just how dangerous are those dry casks of nuclear waste stored at the plant site? How hard would it be to replace the power Yankee produces annually? Will that one-degree increase in the Connecticut River’s temperature degrade the river’s ecological integrity? Does the spinoff of Yankee to a new, highly leveraged, company mean Vermont taxpayers are likely to be stuck with the cost of shutting the plant down?

Because the policy here holds that knowing what you’re talking about involves more than just quoting the (often shrilly expressed) opinions on both sides of the debate, answering those questions and more would take more time than has been available. Hence the absence of Vermont Yankee coverage.

By now, though, enough of that information has been gathered to probe into some of the politics and economics (if not the nuclear physics) of the Vermont Yankee dispute. Besides, in recent days, the political aspect has moved center-stage, allowing the political observer to comment with more authority.

Actually, the tumult of the last few days has inspired some exceptions to one of the most obvious political facts of the Yankee debate – its tribalism. An outspoken Vermont Yankee supporter is likely to be…well, let’s just say a proper person (and, yes, we’re engaging in a little simplistic stereotyping here, just to make the point quickly). Possibly a Republican, but at any rate a pro-establishment sort, someone who admires – or at least is not bothered by – large corporations, the consumer culture, suburbia.

But find a populist Vermonter (left or right) who rails against corporate dominance, gas-guzzling vehicles, and consumerism, and who has some counter-cultural sympathies, it’s a probable twelve-to-seven that he or she wants Vermont Yankee shut down yesterday.

On neither side of the divide is anyone likely to change his or her mind because of anything as trivial as evidence.

Which, when you think about it, is a pretty foolish foundation on which to conduct an important discussion.

Herewith, then, the first of three conclusions about the Vermont Yankee debate: It is entirely possible to be a reasonable, thoughtful, intelligent, well-meaning, public-spirited person and be in favor of relicensing VY for anther 20 years.

Or to be against it.

And that’s because of the second of three conclusions about the Vermont Yankee debate: Everyone living in Vermont now or who gets born or moves into it over the next 20 years can live healthy, prosperous (and electrically-powered) lives if the plant shuts down in 2012 or earlier.

Or if it continues to operate for another 20 years.

Which is not to say that the choice is not consequential, merely that it is not cataclysmic. Without Vermont Yankee, electricity might cost more, and Vermonters in effect might have to burn more coal, producing more greenhouse gas. (“In effect,” because Vermonters wouldn’t themselves burn the coal; it would be burned for them to provide some of the power now produced by Yankee).

If the plant continues to operate, it will continue to produce some radiation pollution. Then there is the danger, minimal but potentially catastrophic, of leakage from those storage casks. (But that danger already exists, from the gunk already there. Whether another 20 years worth substantively enhances the danger is one of those scientific questions this site is not yet competent to answer).

These are the kinds of choices societies have to make these days, and, as stated above, are matters on which decent and reasonable people can disagree. In an ideal world – or even a reasonable one – they would disagree civilly and rationally.

A challenge rendered more difficult by passions on both sides, but especially these days by the conduct of the plant’s owners, whereupon we come to the Third conclusion about the Vermont Yank debate: Entergy officials may be competent managers of an efficient and safe power plant. But when it comes to dealing with the public, they…well, to clean up the line Lyndon Johnson (unfairly) used about Gerald Ford, they can’t find their collective behind with both hands.

A reality evident even before this latest debacle about the underground pipes and lying to the authorities. There was the collapsing water tower in 2007, the inadequate studies about the safety of the waste storage, the failure to follow the Public Service Board’s order requiring it to monitor radiation levels in the spent fuel containers, its procrastination in making a price offer to the utility distributing companies.

Then consider the company’s new advertising campaign, the one highlighting the fact that 650 people work at the plant.

As they do. But half of them live in Massachusetts. And if they were all Vermonters? They would comprise some three tenths of one percent of all the jobs in the state. The people of Vermont don’t rely on Yankee to provide jobs. They rely on it to provide clean, reliable, inexpensive electricity. Sometimes, marketing “experts” can be too cute for their own good.

Then of course we come to the latest fiasco. ‘Oh, we do have radioactive material in underground pipes after all, even though we said we didn’t; even though we said it under oath.’ (But using words perhaps designed to avoid to perjury. “I don’t believe there is active piping service today carrying radionuclides under ground,” said Entergy Vice President Jay Thayer. It’s all but impossible to prove that a person did not “believe” what he said he did at any moment).

It’s as though nobody ever told these guys that the best – actually, the only – way to appear to be transparent is to…(hold your breath here for the shock)…be transparent. It’s a public process. You can never be sure of not getting caught if you say something false. Ergo, say nothing false.

In all likelihood, then, most Vermonters now view Vermont Yankee as a company from which they would not buy a used car, were it in the car business, because: (a) they wouldn’t trust it not to have rolled back the odometer; and (b) they wouldn’t be sure it knew how to roll back the odometer without rolling it forward by mistake.

That explains why even a whole lot of pro-corporate establishment types are turning against Yankee relicensing. See Sunday’s Free Press editorial. See also the angry statements from top officials of Gov. Jim Douglas’s Administration, clearly expressing the governor’s views. If anyone has the right to be angry at Yankee, it is Douglas. He’s supported it all the way. Now it has sandbagged him.

To render this judgment, one needs no scientific expertise, and the company has only itself to blame.