From the Executive Director

from NewsLink, Vol. 1, No. 3, Spring 1997

The New York Times reported recently that the nation's governors are calling for state tax cuts of $4.4 billion next year, the largest reduction in more than 20 years. The Gray Old Lady also reported that governors are seeking to keep spending at bay.

While Massachusetts may not be following suit, other states are putting their tax-cutting machines into high gear. Earlier this year, BHI evaluated a proposed reduction in the state of Iowa's income tax rate. Our report played a major role in informing the Iowa tax cut debate. As he signed landmark tax-cutting legislation, Iowa Governor Terry Branstad said, "Today, we take the most significant step this state has ever taken in improving our overall competitiveness, creating quality jobs and easing the burden on Iowa taxpayers." We were glad we could help.

Thanks to the dynamic of American federalism, states are in a better position to respond to the needs of local economies than is Washington. This is one reason why a groundswell of support for devolution emerged in the early 1990s. And that's why interstate competition will continue to be a factor.

 

True reform will come only when we are able to bring about profound changes in the lives of the poor. This is where local private charities, working according to the family advocate approach, can play a critical role in moving former recipients into responsible, independent lives. The compassion tax credit is the way to empower these charities.

The states are now proving their meddle beyond tax policy with welfare reform. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 has generated a flood of analysis and activity at the state level. This was expected. We are all reading about caseload reductions and disappearing welfare recipients. It would be wrong to assume, however, that the poverty crisis in this country today will be solved simply by pushing welfare recipients into low-paying jobs. True reform will come only when we are able to bring about profound changes in the lives of the poor. This is where local private charities, working according to the family advocate approach, can play a critical role in moving former recipients into responsible, independent lives. The compassion tax credit is the way to empower these charities. In February, I traveled to Phoenix to testify before the state legislature as Arizona debated charitable tax credits. In April, Arizona, with the journeyman work of state representative Mark Anderson, adopted a charitable tax credit. Arizonaês taxpayers will be able to subtract from their tax liability up to $200 in contributions made to eligible human-services organizations that help the working poor. In April, the Wall Street Journal published our article written at the time of the Presidents' Summit for America's Future. In "America's Volunteers Deserve a Tax Break," we argued that tax credits are a sure way to increase volunteerism at the community level. Go to the Wall Street Journal reprint

On June 24, the Beacon Hill Institute and the David R. Macdonald Foundation will host Father Robert A. Sirico, President of the Acton Institute for the Study of Religion and Liberty, at a luncheon meeting of the Renewal Alliance in Washington, DC. Father Sirico is a leading spokesperson on behalf of the moral basis of the market economy and of how it operates for the benefit of all of society. If you would like to attend the luncheon, please call BHI at (617) 573-8750.

It's useful for us to flex our intellectual muscles from time to time. This June, the estimable University of Richmond School of Law publication, Perspectives on Law and the Public Interest, is publishing our article, "Rethinking Welfare Reform in the Age of Devolution." Perspectives is an online electronic journal that is indexed in Lexus-Nexus. We invite you to check it out at http://www.urich.edu/~perspec/issue3/welfare.htm.

NewsLink is the quarterly newsletter of the Beacon Hill Institute for Public Policy Research at Suffolk University. © 1996-2001. All rights reserved.

 

Updated on 9/9/02 4:54 PM