Sunday, June 19, 2005

Waging war on the poor with GET increase (Issue in Hawaii)

The transit tax will punish the poor. Plain and simple. Yet, supporters of the 12.5 percent increase in the General Excise Tax (GET) continually try to make a traffic issue out of a funding problem. It will take 3 billion dollars to fund a rail transit, and the proposed raise in GET will only fund an infinitesimal fraction of the total costs. [1] Opposition to the transit tax is not just against the ambiguity in the state plans on how it wants to relieve Oahu’s traffic congestion. The people wholeheartedly oppose the raise on the basis that this is the most regressive tax increase in history of this state for a proposal its proponents hope will bring benefits in a “30- to 50-year time frame.” [2]

This is how the GET destroys the poor. It works in a pyramid fashion taxing every transaction involved in the sale of a good. The tax is applied from wholesaler to retailer than from the retailer to the consumer, who pays for it all. This multiplication takes place on not only food and medical supplies, but also on housing and rental prices. Food, health and shelter are three areas where the poor make day-to-day, paycheck-to-paycheck decisions. A family of four can expect an estimated increase of $450 in annual living expenses on top of everything else the state is raising. [3]

Democrats and double-crossing Republicans have waged a war on the poor in the name of traffic relief.

They have also failed to do their homework – the very reason we sent them to office in the first place. Alternatives, such as toll roads and tunnels, are working in other states and countries around the world at the expense of private investors. [4] In addition, people can afford access to these alternatives, and they are paying for them in cities like San Francisco and Sydney. [5] What that means for the rest of us poor folk is that there would be less people on the existing infrastructure right away instead of 30 to 50 years in the future.

At the same time, the use of rail is on the decline [6]. The same has been true of our bus monopoly. No one is willing to give up her or his private transportation for an inferior good called public mass transit. Anyone who studied economics would have learned that once an individual reaches an income threshold, he or she buys more of a normal good, which in this case, is the convenience of one’s vehicle.

The only way then for the state to make mass transit succeed is to keep poor people poor and make everybody else above the poverty line poor as well. The GET will do that and worse, and perhaps, that is the state’s plan all along.


[2] Here's how to derail transit plans this time around by Karl Kim
[3] Council advances tax hike for transit
[4] Congestion Relief Toll Tunnels
[5] Orange County Toll Roads: A Model for California
[6] Myth #3 — “Rail transit will reduce the numbers of cars on the road.”


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