Most of Vermonts Legislature and many in its media and the general intelligentsia do not really believe our state faces a serious crisis regarding our tax burden or economy; lets look at the facts.
As leader of Vermont Tax Revolt found at www.VermontTaxRevolt.org this recently formed grassroots organization is composed of nonpartisan-seeking citizens who are concerned not only with Vermonts weighty tax burdens, but with what we see as ominous signs of worse things to come. As our web site voluminously lists, lets look at some of those more troubling danger signals should give pause and reflection to all Vermonters.
Vermont is in a demographic free-fall: Vermonts share of people aged 25 to 29 is the lowest in the nation while its share of people aged 50 to 54 is the highest in the country; Vermont has the lowest birthrate in the nation; Vermonts young people leave our state at 4 times the national average; and lastly, because of an anomaly of birth cycles, in approximately 2012, our school population will actually begin to increase just as our aging population and their income tax dollars begin to retire, causing what the Ethan Allen Institutes Off The Rails report terms our coming train wreck. Between 2000 and 2006, Vermont lost 11,000 quality private sector jobs and found 20,000 new jobs; 65% of which came from either government (4,000) or from the education and health services field (9,000) and these mostly in the field of social assistance. This is an unsustainable tread: our taxpaying businesses shrink, leaving our remaining private sector businesses and home owners to support a growing government and non-profit sector. In addition to these two major demographic and economic challenges, the Vermont Tax Revolt organization has identified at least $3.5 billion of unfunded liabilities and expenses facing Vermont taxpayers, all of which are identified on its web site.
This October witnessed the first of almost 80 million baby boomers that will file for retirement in the coming years. In addition to the projected $50 trillion deficit facing Medicare and Social Security, these retirees will be cashing in their IRA's and 401k's. This demographic tsunami will result in an enormous amount of claims on the goods and services of this nation, and if output in the form of the goods and services that these retirees demand doesn't at least keep pace with this demand - shortages and inflation will occur. Imports may seem like a viable option, but if we're not producing the wealth to pay for them, we'll just be adding to our deficit spending.
Drilling down to Vermont's economic and demographic crisis, Senator Shumlin is on record as stating that "Vermonters do not have the additional earning capacity to raise [even] $250 - $350 million." In order for Vermont to keep pace with the claims on its economy, entitlements and transportation infrastructure needs, it must abandoned its preoccupation with its culture of distribution and redistribution of wealth and embrace a culture of producing real wealth, not just financial claims on it. Over time, tax revenues are determined by economic and productivity growth.
With our young sons and daughters fleeing Vermont at 4 times the national average, with quality private sector job growth almost nonexistent along with the general lack of affordability for the average, working middle-class family and Vermont taxpayers facing at least $3.5 billion of unfunded liabilities and expenses, the facts just dont validate denial of the obvious any longer.
Winston Churchill said it best: The multitudes remained plunged in ignorance of the simplest economic facts, and their leaders, seeking their votes, did not dare to undeceive them.
Folks, its time to awaken this sleeping giant.
Tom Licata leads Vermonts citizen-led grassroots organization, found at www.VermontTaxRevolt.org. He lives in Burlington.