`Forgotten'

March 6th, 2014
By

State Sen. David Ige on Thursday shot back at Gov. Neil Abercrombie after the governor blamed him for not advancing the governor's tax relief proposal for seniors.

Ige, who is challenging Abercrombie in the Democratic primary, suggested that Abercrombie might be trying to obscure the fact that he wanted to tax pension income in 2011.

From Ige:

The governor may not be following the legislative process closely, as he suggests asking me via a print interview today why I did not support a particular bill. In fact, the bill did not make it through the legislative process to my committee, the Senate Committee on Ways and Means. I did not hear the bill he mentions.

I do acknowledge that in 2011, the governor did--and I quote from his interview today--‘…not concede until that last hammer comes down on that last day and minute and second of the Legislature….’, to push through his bill to tax retiree pensions of $37,500 or more. Under my leadership, the committee on Ways and Means killed this bill that would have taxed the retiree pensions.

It appears to me that the governor may believe we have forgotten his fight to tax retiree pensions.

12 Responses to “`Forgotten'”

  1. Ella:

    Why would we ever re-elect the current Governor, whose first reaction was to balance the severe budget deficits left by the GOP administration, on the backs of retirees and their pensions? Why would we ever believe his election year BS to the contrary?

    Recently, I listened to the current Governor speak. It was a very interesting speech as it was a collection of sound bytes which were strung together and sounded like speech but were kind of gibberish. Is that related to why the Governor, as a former legislator, is making the fundamental mistake of blaming David Ige for his bill dying, before it even made it through the legislative process to Ige's committee?

    It is pretty fundamental that Ige's Ways and Means (money) Committee is LAST, and that, FIRST, bills have to make it through their subject matter committees. The Governor's bill failed while still before the subject matter committees, so never got to Ige's committee and Ige had nothing to do with his bill dying. It was pretty disingenuous of the Gov to blame his opponent when it is demonstrably obvious and documentable that Ige had nothing to do with it.

    Has the Gov forgotten the legislative process?? Regardless of what the Gov has forgotten, I don't think anyone will ever forget the chilling move Abercrombie made, immediately after being sworn in, to go after one of our most vulnerable populations, our seniors on fixed incomes, and Abercrombie's unthinkable initiative to tax retirees' pensions. I voted for the guy--not that we had much choice ! Still, I was horrified and felt so betrayed! Sadly, that was just the beginning.


  2. Guy:

    Seems like the senator is the one who doesn't remember what bad shape the state was in 2010 when the governor took office. The state was in deep in the hole and everyone was still ignoring ballooning unfunded liabilities. It was refreshing to see a governor consider all options no matter what political fallout he might be subjected to. The senator keeps crying that he wants some of the credit for balancing the budget and passing bills to help address unfunded liabilities, but it's funny that all of that only started happening after Abercrombie took office. Ige wants to take credit for the good but wants us all to forget he was asleep at the wheel of Ways & Means, letting things get so out of hand in the first place.


  3. nonpolitic:

    @Guy: I think you may want to check your facts. David Ige wasn't the Ways and Means Chair back in 2010. Donna Mercado Kim was. Also, in order for any "balancing of the budget and passing of bills to help address unfunded liabilities" can occur, the bills have to pass through both the Ways and Means committee in the Senate, and the Finance committee in the House, regardless of what the governor wants. So essentially, both Ige and Abercrombie can take credit (along with a booming economy) for the economic recovery, although I would offer that, regardless of whether either was in office back in 2011, the economic recovery would have happened with or without them. Bottom line, Abercrombie was willing to tax retirees at the time (and clearly, as history has played out, it wasn't necessary) and Ige did not.


  4. OILPAN:

    @nonpolitic: Ok, so prior to 2010 what serious legislative initiatives did Sen. Ige propose to focus on and address the already out of control unfunded liability? You point out that he was not the Chair of Ways and Means, but he was a sitting state senator with the power to introduce bills to address serious issues facing the state. Can it be truly stated that he was a leader on the unfunded liability issue? The focus and call to action came from the Abercrombie administration and legislation was enacted during the Abercrombie administration. Yes, the legislature must pass bills from the executive branch which requires both sides to work cooperatively. Fortunately, both parties labored together and the legislature agreed with and did pass the initiatives from the Gov.


  5. Especially Incognito:

    Blame lingle. Saying an audit was "shoddy".


  6. nonpolitic:

    @Oilpan: I think you miss my point. Prior to becoming the Ways and Means chair, I believe Mr. Ige was the chair of various other committees in charge of technology, education, and health. Basically, he was in charge of other subject matter. As for being a leader on the unfunded liability issue, he can claim that he shepherded the bill through the Ways and Means committee since he was the chair at the time of its passage. If you recall, the state didn't really have the funds to deal with prefunding the unfunded liability during the Lingle (or the Cayetano) administration to do anything about it. As I recall though, the legislature did periodically lower pension and health benefits (prospectively) for public employees while Mr. Ige was in office, but not while Abercrombie was governor. I believe they (the legislature - I couldn't tell you how Mr. Ige voted on these issues) stopped providing free health benefits for retiree spouses, started a sliding scale for copayment of retiree health benefits based on the years worked, and changed the retirement system back to a contributory system (made employees pay for part of their retirement benefits). These downward benefit adjustments take years, if not decades, to manifest any real savings to the state (although actuarial estimates did get adjusted downward). Mind you, Mr. Abercrombie has, in my view, one of the best Finance directors to be in that position for decades. But essentially, the point I was trying to make was that without a booming economy, neither could have accomplished lessening the unfunded liabilities of the state.


  7. Guy:

    nonpolitic, agree with you on Mr. Young. He's an outstanding Finance Director. Seems to me he should stay Finance Director, Ige should stay WAM chair, and the governor should stay governor.


  8. Kolea:

    In my view, the Governor's original plan to tax pensions exhibited both crude policy and crude politics. The Governor raised the plan in the context of desperately trying to raise revenue from every conceivable source, in order to balance the budget. So THAT put pensioners on guard. His bill featured an unusual income trigger mechanism, once an income threshold was reached, ALL pension income would be subject to a tax, not just that portion over the threshold.

    Contrast that with Rep. Isaac Choy's proposal. Like the Governor and successive Tax Review Commission reports over the years, Choy believed pension revenue should be taxed like other income. But, Choy also recognized workers had planned their retirements based upon the understanding the pensions would not be taxed. (I would go further: pensions of most workers are part of a wage and benefit package agreed to through collective bargaining. A pension is "deferred earnings." Had employees known the pension would be taxed, they would likely have demanded either a boost in pay or another benefit be increased. This is certainly true for state workers, who, along with federal employees, including military, are the bulk of our pensioners).

    So rather than disrupt the retirement plans of so many, Choy proposed a tax only on a small percentage of high-income pensions. Over a couple of decades, inflation would slowly cause more and more pension income to be taxed.

    This was a very gradualist approach and made sense. If one were patient. But the Governor was less concern about a long-term rational tax policy and more concerned about raising lots of money in a short time. His impatience was on full display when, asked how he would "counter" the opposition of the AARP to his pension tax, said, "I am not going to 'counter' them. I am going to ROLL OVER them!"

    Big, crude mistake. People over the age of 60 make up, believe it or not, almost 2/3 of the voters in the upcoming election. Can you say, "Ooops"?

    To try to fix his sour relations with seniors, this year Abercrombie proposed a bill to exempt their pensions from taxation. In an effort to top the Governor's bid, Senator David Ige saw that bid and raised by offering a constitutional amendment to forever exempt pension income from taxation. In my view, another crude, over-reaction, over-correction. I think Isaac Choy had the most sensible approach and I hope the two candidates will stop trying to out pander each other long enough to gravitate towards his position. Ige is generally a calm, reasonable man. Maybe it was is campaign advisors who caused this uncharacteristic leap?


  9. zzzzzz:

    "His bill featured an unusual income trigger mechanism, once an income threshold was reached, ALL pension income would be subject to a tax, not just that portion over the threshold."

    And he apparently didn't understand his own plan, based on his excoriating Barbara Marumoto for pointing out this trigger mechanism.


  10. Kolea:

    Zzzzzz,

    Your remark about Neil's dispute with Barbara Marumoto jarred my memory and set me a-Googling.

    I found this commentary by Dave Shapiro (miss you Dave!):

    http://blog.volcanicash.net/2011/05/24/time-for-the-governor-to-show-if-hes-got-game/

    Among the lengthy comments were longwinded essays by me, one of which supported Marumoto in that "dustup." Since it was early in Abercrombie's administration , we also discussed whether he could reverse the mistaken trajectory he was on by the time of the 2014 election. I found that discussion interesting, now that we are approaching the election.


  11. Especially Incognito:

    As always.


  12. Especially Incognito:

    Hawaii needs an audit. You hear this IRS.


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