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By directing tens of millions of dollars to environment research grants and millions more in tax incentives for renewable energy companies, Thompson estimated her administration could create some 30,000 new jobs in the solar and wind industries. Thompson isn't announcing any new spending on the environmental economic development initiatives, though she calls them "sweeping"; the state is far too strapped for that. Instead, as House Speaker Pat Bauer conspicuously withholds his public support, Thompson's sticking by her proposal to spend down the state's budget surplus on a suspension of the state's sales tax on gasoline—a move that would cost the state $120 million annually. And make the state more dependent on oil.
We'll need those green jobs.
Thompson's proposal has emerged from a campaign that has been relatively issues-light, or, in this case, issues-confused. And this week, she continued to blast House Bill 1001, the legislation that bipartisan majorities in both the House and Senate passed last winter to cap property tax bills. "I think that 1001 was the best compromise that Speaker Bauer could have gotten," she said Wednesday. "It was important to get signed into law some kind of tax relief for homeowners. But as a member of Congress, I never one voted to raise taxes, and I'm bothered by the fact that it does raise the sales tax, and that impacts families that can least afford to pay. It falls way short of the overall tax reform of our structure that is needed. And local governments and local schools are hurting as a result."
She told the Greene County Daily World that the bill was "another example of Gov. Daniels pushing state problems onto local governments."
"I want to completely reform the tax structure, which will also include funding streams for local as well as state programs. We need reform of the overall tax structure," she said.
Last winter she and her Democratic primary opponent Jim Schellinger took a pass as the Governor and General Assembly worked to overhaul Indiana's taxing structure, ultimately instituting Daniels-proposed property tax caps. Thompson said at the time that Daniels's "property tax plan is nothing more than a well-orchestrated shell game designed to shift the blame and the burden of collecting taxes to local government—not to reduce property taxes or government spending." Not only did she misstate Daniels's proposals—which are fundamentally come down to shifting taxing authority away from local government, even eliminating facets of it—but she offered no alternative proposal of her own.
Complete reform, of course, is something of a Thompson euphemism for no reform at all.
Asked what she meant by the phrase, Thompson told HPI simply, "I think that the overall tax structure needs to be reformed. I think our tax structure is designed for a nineteenth century economy and we're in the twenty-first century. I think you have way too many funding streams for some programs, it's too complex, and I think we should be more strategic with our tax policy."
Her platform doesn't invoke the phrase "property taxes," and its only hints at tax reform are a series of modest tax incentive proposals. She would offer incentives—itself a vague term—"to businesses that provide health care coverage to their employees, [improve] efficiency by acquiring new technology . . .
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[or reduce] their impact on the environment." And she would offer more tax deductions for individuals to offset the cost of healthcare and continuing education.
Thompson often points to her MBA and Ph.D. in business, saying in her convention video that after graduating from Indiana University, she thought to herself, "I think I understand economics better than a lot of politicians." But Thompson's tax policy—the one of "complete reform"—ends, depressingly, right there, with standard Democratic boilerplate.
The green jobs proposal is about as modest. It draws on the campaign's seemingly contrived economic development plan that proposes to divide the state into three sections, "[categorizing] the state's 92 counties into three different economic tiers based on a variety of factors and then allocate different tax incentives as a way to create jobs all across the state, focusing on areas in greatest need of economic revitalization." It shuttles state incentives not to where companies want to build, but to counties that satisfy a need-based formula including unemployment rate, median household income, population growth and assessed property value per capita. Thompson announced that if "green" companies—what a green job is, she admits, she hasn't defined—decided to build in counties with the requisite tier designation, they could receive additional tax breaks.
Thompson's other proposals include reducing school testing requirements, but not by modifying the state's I-STEP testing. Instead, according to campaign manager Travis Lowe, Thompson will exercise "regional and national leadership" to reform the federal No Child Left Behind law—a hollow proposal far more concerned with politics than policy. Others are as gauzy as her pledge to "work to encourage Indiana businesses to hire returning [military] service personnel."
A government reform initiative calls for a "sweeping" overhaul of campaign finance in Indiana, proposing that the political campaign contributions of limited liability companies to be capped at $5,000 annually. Last quarter, Governor Daniels's campaign took in $115,442.33 from LLCs, compared to the $31,970 Thompson's campaign received. Thompson's plan makes no mention of contributions from labor unions, despite—or perhaps because of—the $700,000 she received from a single source, the Service Employees International Union, last quarter.
At the green jobs press conference, Thompson continued to emphasize her reliance on incentives. "These are not just goals," she said. "This is a clear plan of action."
Thompson communications director Jeff Harris said the state "needs to be smarter about how we spend tax dollars. If we can reprioritize some of the existing assets, both of these proposals focus on helping individual working families and their bottom lines."
But none of this smacks of the kind of big ideas needed to truly transform Indiana's economy. Half of the 21st Century Research & Technology Fund will be diverted to fund the green proposal, sapping eighteen million dollars primarily from the state's burgeoning life sciences industry.
All of this to pay for a gas tax suspension universally panned as hyper populist, gimmicky, and economically empty? Even Thompson's occasionally meaningful proposals have a way of being stained by the meaningless political ones. Gas tanks aren't the only things running on empty this summer.
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