While far from certain, it is becoming increasingly more likely that the Democratic Party will ride to victory in this fall’s federal midterm election.
The balance of the House of Representatives is now leaning blue according to most polling projections and some even believe that the Senate may be in reach.
The question for Long Islanders and New Yorkers in preparation for this should be, upon victory, “What should we demand from our legislators?”
Within the Democratic Party there are a number of debates on issues such as what type of healthcare legislation our representatives should support, what sort of trade policy to promote, and how aggressively the party should target President Trump as scrutiny from Special Counsel Mueller increases.
However, while all of these issues deserve deliberation, one issue that should unite Democrats, Independents and Republicans at home is a need to get back the disproportionate share of taxes we all pay to the federal government.
According to a 2017 report prepared by the New York State Comptroller’s office in Federal Fiscal Year 2016, New York generated nearly $41 billion more in taxes paid to the federal government than it received through federal spending.
Described on an individual basis, our state contributed $12,914 per capita in tax revenue to the federal budget, despite only receiving $10,844 in per capita federal spending.
This means that for each dollar a New Yorker gives to Washington D.C., we only receive 84 cents in return.
The number is far below the national average where, due to deficits, the rate of return is $1.18 for each dollar given to Washington D.C.
The total places New York as the 47th ranked state.
Worse yet, our deficit will only grow going forward due to the stripping of State and Local Tax Deductions in the Tax Cuts and Jobs Act of 2017.
The effect of this change will further disadvantage states like New York whose residents benefitted more from SALT deductions due to our relatively high state and local taxes in addition to deductions on items like their home mortgage interest.
In response, we need a specific plan to get back our fair share of taxes and bring this growing deficit under control.
The eliminations of the various deductions from last year’s tax legislation were passed with clear knowledge, if not intent, for constituencies in some states to benefit and others to lose.
With foresight, we can right a wrong and even reverse a status quo that had left us in a disadvantageous position.
This will mean reinstalling these deductions, but also seeking out other advantages for New York and other states similarly situated.
Representatives should consider increasing the value of these deductions, adding more deductions that could benefit states with higher costs of living, or even withholding spending to those states who hold especially large spending to receipt deficits with the federal government.
Forming a coalition for such a proposal should be natural, as numerous states would similarly benefit.
Those states include New Jersey, Connecticut, Massachusetts, Illinois and California, all of whom together will have elected a significant percentage of the federal representatives in what may be a newly empowered Democratic Party.
Of course, for any actual change to go into effect we would likely need to wait until a Democrat was actually in the White House.
Still, planning for that future should not wait.
Even if only symbolic in the near term, if the Democrats make sufficient legislative gains in the fall, it is highly likely that they will move to pass tax legislation through Congress just as Republican Congresses sent legislation that would never be signed to President Obama concerning the repeal of the Affordable Care Act, also known as Obamacare.
This means that we need to be ready to plant our flag.
The ability of our representatives to put New York’s interests front and center will be essential in framing the terms of the debate on what could be a new reality that would benefit all New Yorkers in just a few years.
Such a focus should be welcome by all and, therefore, should be taken on by our representatives with the upmost purpose.