A Tax-Cutting Democrat

...I have made economic development one of the cornerstones of my administration, and we have created close to 84,000 new jobs, balanced our budget, and we have the largest surplus in our state’s history—$500 million...

...Jennifer Rubin is an attorney in Virginia...

...Such spending increases include, according to Americans for Tax Reform, a 7.4 percent increase in teachers’ salaries, a 9.1 percent increase in other education spending, and a whopping 18.4 percent increase in health care assistance...

...Anti-tax advocates have complained that although Richardson did yeoman’s work in cutting rates, he more than made up for these cuts with tax increases on everything from cigarettes to fuel and a complicated, Dickensian, and later repealed surcharge on nursing home beds—all totaling a net tax increase of roughly $174 million through fiscal year 2006, according to the conservative Americans for Tax Reform...

...Of course, for Democrats (and many Republicans), that may be asking too much...

...At the midpoint of his first term, Richardson earned a “B” rating on the CATO Institute’s 2004 Fiscal Report Card on America’s Governors...

...As a result, high-skilled manufacturing work rose steadily in New Mexico, as did real wages—on average 2.4 percent a year between 2003 and 2006...

...CATO’s experts commented that Richardson’s “budget proposals have grown faster each year, and the general fund budgets he signed into law between fiscal 2004 and 2006 have grown in total by a whopping 23 percent—almost five percentage points faster than population and inflation...

...When asked about the importance of tax cuts, Richardson says: “Cutting taxes and creating tax credits can be essential to creating jobs and a strong economy...

...Most recently, at the winter meeting of the Democratic National Committee, Richardson reminded his audience that he “first passed a specific tax credit for creating good paying jobs” and was responsible for a host of other tax cuts and credits that helped “local companies that showed great promise for success and job creation...

...At the same time, I am proposing a fiscally responsible budget, leaving more than $560 million, or 10 percent of recurring appropriations, in reserve...

...Despite these accomplishments and his consistent pro-growth rhetoric, some observers paint a slightly less rosy picture of Richardson’s economic record...

...Not everyone is impressed, however...

...Which party is Richardson talking about...

...by Jennifer Rubin In July 2006 the Wall Street Journal touted New Mexico’s governor Bill Richardson as a man who “embraced tax cutting and benefited politically...

...ambassador and secretary of energy stands out as the only Democratic presidential candidate who has successfully enacted tax cuts and other pro-growth economic policies...

...The Journal quoted Richardson approvingly for advising his party that “we have to be the party of growth and the American dream, not the party of redistribution...

...Richardson’s spending increases averaged 7 percent per year until he appeared to abandon fiscal discipline altogether with a proposed 11 percent spending increase for 2007...

...His supporters say no and point to a 2007 agenda that includes a new working family tax credit, an acceleration of the income tax rate reductions, and a laundry list of new “targeted” tax cuts such as elimination of state income tax for active duty military personnel, tax cuts for investment management firms, tax credits for high tech investment and energy efficient offices and buildings, a onemonth tax holiday for purchase of energy efficient appliances, and an “advanced coal incentive...

...Richardson seems to relish his taxcutting image...

...As advertised, Richardson’s list of pro-growth measures did include a 10-percent tax credit on wages and benefits attached to each new job paying more than $40,000...

...To which Richardson responds that these tax cuts, like those in the past, have widespread economic benefit: “In New Mexico, we’ve used targeted tax cuts to create incentives for businesses to put people to work, to help middle class families, and cut the tax on food, among others...

...One of his first measures after he was elected governor in 2002 was to cut New Mexico’s top income tax rate from 8.2 percent to 4.9 percent over five years...

...Defending his spending levels, Richardson says, “My budget plan reflects my vision for the state: Investing in priorities like quality teachers in the classroom, access to health care, and putting money in the pockets of working families...

...Pete du Pont, former Republican governor of Delaware, acknowledges that Richardson is “on the right economic growth track...

...Richardson seems to have something for everyone: tax cuts for conservatives and substantial spending for liberals...

...Reacting to a four-star rating for his pro-growth policies from Inc...

...This was our way of declaring to the world that New Mexico is open for business,” Richardson told the Journal in 2005...

...Projects such as a $400 million commuter rail project, which Paul Gessing of the Rio Grande Foundation calls a “boondoggle” serving relatively few people at great cost, have also raised the ire of fiscal conservatives...

...The policies and initiatives that have worked here in my state can work across the nation,” he says...

...Has Richardson abandoned his progrowth and low-tax philosophy in lieu of traditional liberal tax-and-spend policies...

...Two years later, CATO explained the rating this way: “His income tax cuts were indeed substantial...

...In fact, by the end of his first term in 2006, CATO had dropped Richardson’s grade to a “C...

...magazine in October 2006, Richardson boasted in a press release: “New Mexico is a national leader in job growth, we have invested in better schools and improved access to health care and—most importantly for the business community—we have cut taxes year after year...

...Albuquerque, with an unemployment rate of just 4.9 percent, won first place on the 2006 Forbes Best Places for Business and Careers list...

...Americans for Tax Reform president Grover Norquist jokes that Richardson at least deserves “credit” for recognizing what few Democrats do: “Reduce the rates and then spend the money that comes in...

...The top marginal income tax rate has dropped a remarkable 35 percent as a result of Richardson’s actions and is still the largest income tax rate cut in the nation over the past few years...

...Indeed, the former U.N...

...Perhaps not surprisingly, Richardson argues that this additional spending went to needed infrastructure and education improvements, and that he maintained a prudent surplus to prevent future liabilities...

...The Democrats...

...Echoing what conservatives have been saying for decades, he explained: “After all, businesses move to states where taxes are falling, not rising...

...But du Pont adds that “the other essential ingredient to economic prosperity is to restrain the growth of government spending...

...Norquist complains that many of these tax cuts “are so directed as to become indistinguishable from subsidies and direct expenditures...

...In his 2007 state of the state address, Richardson continued to advertise his tax cutting credentials, declaring that New Mexico was a state “where tax rates go down, while salaries go up...