the State-related and State System Universities are starting to descend
on Harrisburg to protest the proposed cuts in education by the state's
new Republican Governor, Tom Corbett. Governor Corbett is proposing cuts
of over 50% to the state's universities and hundreds of millions of
dollars to its public schools.
The students will be protesting and lobbying because they know that they
will be paying the initial bill for the austerity cuts, with society paying
the rest on the installment plan. They know that these cuts will end the
college careers for some in a time when everybody, including President
Obama, is telling them that their economic futures depend on getting an
education. Even those who are able to stay in school will pay a heavy
bill for Corbett's proposed education cuts. That is because these cuts
will cause many students to take longer to get their degrees and they
will have to work more hours while taking classes which hurts their
learning. But we should note that those who will pay an even higher
price are those who attend the public schools in Pennsylvania. Not only
will their parents have to succumb to a higher local tax rates, cuts to
the public schools will make it even more difficult for them to prepare
for the future whether or not that future involves college.
Though the upcoming college student activism in and of itself is good,
if all the students lobby Harrisburg for is increased funding, they will
only be asking the State to rob Peter to pay Paul. That is, with the
fixed state income that will result from no new taxes, there is no other
place for the State to go to increase funding for colleges, public
schools or welfare. Without an increase in the State's revenues,
State-related university students will be pitted against the State
System students, and both will be competing for funds that the public
school students need and so on. And as long as there is this division,
not only will the students be less effective at lobbying, they will have
overlooked a foundational reason for the budget cuts. That reason is
Pennsylvania's tax structure.
Now Governor Corbett has pledged no new taxes for its residents and I
agree with that pledge. He is now considering fees on gas companies that
drill in Pennsylvania but those fees are for local municipalities.
Other than that, there is a slight of hand in Governor Corbett's pledge
not to raise taxes. That slight of hand can be discovered when one reads
that 70% of "C Corporations" doing business in Pennsylvania do not pay
Corporate Net Income tax. While many of these companies may have
legitimate reasons for not paying taxes such as operating at a loss, it
is not true for all. One highly questionable way by which some of these
corporations evade taxes is to use the laws from other states as
loopholes. For example, some corporations establish shell companies in
states where there are no corporate net income taxes. These companies
neither produce a product nor have any employees. The corporations then
transfer to these companies the necessary trademarks for their products.
The production companies of the corporations would then pay fees for
using the trademarks and the balance sheet for the the companies' net
income would be $0.00 hiding the profits of their corporations. These
corporations keep all of the profits while small "S" corporations must
then compete with these bigger corporations being handicapped with a
sense of social responsibility. In Pennsylvania, this loophole is called the Delaware Loophole.
Unless loopholes, like the Delaware Loophole, are addressed, the real
battle that will take place is not one between citizens in need and
their neglectful representatives; but one that pits one group of those
in need vs another. Will the State reward more money to the
State-related institutions while deducting more from the State-System
institutions or will both of these groups lose out to
Public Education? In any event, the group that is most likely win
the biggest loser contest will be the most vulnerable: those who rely on the
Welfare System and, in the end, society.
Beyond that, all citizens from each state that plans to implement
austerity measures must not just look at what it will cost us today, we
must look beyond the horizon. For what will be our future be when we
continue to spend less to prepare our young people for it? And what kind
of role models will be left for our young people when the most powerful
in our country achieve that power by finding legal ways to cheat those
in need and avoid their social responsibilities?
Those who pay to spare themselves from being socially responsible are
smart people, they know the answers to the above questions. They know
because they know what to expect of their corporation's own future
should they fail to invest in the future. And yet, they will show no
restraint in telling us that to require them to contribute to society by
paying taxes will spell certain economic doom for us all. And they use
those media members and politicians who are on their payrolls to ignite
our fears and channel our responses.
If we could think of society and corporations as being married, with the
way corporations are currently contributing to maintain society, we
could expect society to ask corporations if they were seeing someone
else. And we could hear corporations answer in the affirmative. Society
would then ask "where do I stand?" Corporations would then say coldly,
"For now, I only want you for your body." And it is this codependent
relationship that society has with corporations that is at the heart of
the budget crisis. Thus, it is this rapport that activists must focus on
when confronting their representatives. That is because our
representatives are the chief enablers, or should we say enforcers, of this relationship. For these
student activists to take any other approach is to simply, as was stated
before, to ask the state to rob Peter to pay Paul.
