Jay Costa's big-government agenda
By Lowman S. Henry
Published: Tuesday, May 28, 2013, 9:00 p.m.
In recent weeks Americans have seen the dark underbelly of big government: IRS targeting conservative groups; Department of Justice seizing journalists' phone records; White House stonewalling on Benghazi. It is not the best time to push a big-government agenda, but here in Pennsylvania that is exactly what state Senate Minority Leader Jay Costa is doing.
Speaking before the Pennsylvania Press Club, Costa proclaimed his caucus's highest priorities are raising taxes and expanding government programs. He wants to double down on the failed policies that have gotten us into serious fiscal difficulty.
The Democrat leader railed against Gov. Tom Corbett for rejection of the Medicare health care exchanges being set up as part of the Affordable Care Act, commonly referred to as ObamaCare. Pennsylvania would initially benefit from an infusion of federal cash, but according to The Heritage Foundation, within five to six years massive state tax dollars would be required to sustain the program.
Costa also pressed hard for lifting the cap on the state's oil franchise tax as a way of raising more revenue to fix roads and bridges. This would add more than 20 cents to the cost of a gallon of gasoline. There is bipartisan agreement that the state's aging roads and bridges need serious attention. But Costa proposes diverting even more state dollars into public transportation — in particular the Southeastern Pennsylvania Transit Agency and Port Authority of Allegheny County. Both are legendary patronage havens sporting some of the highest labor rates in the nation.
Costa framed both the health care exchanges and spending on highway infrastructure as jobs programs. Yes, they would create jobs. But they would be jobs created by the transfer of private wealth to the government sector, not jobs created as a result of a growing economy. Some say “jobs are jobs,” but siphoning money from the private sector on the scale proposed by Costa will result in further stifling economic recovery. That will hinder creation of private-sector jobs.
Costa also detailed Senate Democrats' opposition to privatization of the state store system. But a private system would create opportunity for thousands of small businesses and add real jobs in the private sector.
Costa also called for a moratorium on the phaseout of the capital stock and foreign franchise tax, an arcane tax levied on corporations in addition to corporate net income tax. Pennsylvania is the only state with both taxes. They contribute significantly to a poor overall state business climate.
The Senate Democrat agenda is geared more to winning next year's elections than to addressing the problems of Pennsylvanians. Costa says Corbett is putting the needs of corporations over health care for people. But the opposite is true. The governor opposes putting state taxpayers on the hook for funding an already failing federal health care monstrosity and pushes elimination of the capital stock and foreign franchise tax as a way to spur real, private-sector job creation.
So far polls indicate the Democrats' political gambit is working. But that is little solace to Pennsylvanians who, if the Costa agenda is enacted, won't be able to find work, will be saddled with a massive new state health care bureaucracy and will be paying more at the pump to fund a massive expansion of state government.
Lowman S. Henry is chairman and CEO of the Lincoln Institute and host of the weekly “Lincoln Radio Journal.”
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