Trickle-Down Bureaucracy Is Destroying Vermont

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"Trickle-down economics" describes tax cuts for corporations, wealthy investors, and entrepreneurs intended to assist lower-income citizens by stimulating investment and economic growth. Also called "supply-side economics," the doctrine was championed by Nobel laureate Milton Friedman but denigrated by many — including economist John Kenneth Galbraith, who characterized it as "feeding the sparrows by giving oats to the horses."

Consider that in Vermont, the government has grown to be a mammoth corporation (the state's largest employer by far) and sucks up working Vermonters' wealth in a trickle-up bureaucratic behemoth. So much money is spent on reports, studies, and employment for state workers that Vermont's property tax rates are some of the highest in the nation. To the extent that any of the money does come back down, it is indeed a mere trickle.

Vermont demonstrates the government bloat that plagues many states, and the effects are becoming apparent. Vermont now has fewer than 700 conventional dairy farms — but the Vermont Department of Agriculture and the UVM Extension Service steadily increase employees, and salaries. This is quite typical of the virus-like quality of the Vermont bureaucracy — it grows, and citizens lose wealth or leave.

Vermont has nearly twice as many full-time state employees per 10,000 residents as New Hampshire, yet Vermonters are struggling much more than their thriving neighbors. There is no growth, and the governor has infamously offered $10,000 bribes to out-of-state earners to reside in Vermont. Perhaps the gargantuan proportions of Vermont's state government explain why Vermont's median income is $57,808 and New Hampshire's is $71,305.

The math is revealing. In a very thick and expensive "workforce report," it is revealed (Table 13) that "Comparing Fiscal Year 2013 to Fiscal Year 2017, both the number of classified employees and FTEs grew, with the number of employees increasing 4.9% (362) and FTE's increasing 5.0% (365.9)." Table 14 reflects that the agriculture department grew by 28% in those years; the Department of Health Access by more than 110%.

Granted, Vermont's VAAFM has taken on water quality and other issues. Yet still, as it increased employees, it steadily increased their wages — by 15.1% over the covered period (Table 40). Vermont's farmers are not so fortunate — "Net farm income ... decreased from 2014 through 2016 due to drops in commodity prices." And Vermonters on the whole saw only a 3.78% increase in median income over the same period, from $55,418 in 2013 to $57,513 in 2017. Yet fully 7.7% of Vermont employees report that they "disagree" with the statement that "The work I perform is meaningful and rewarding" (Table 61).

Meanwhile, Vermont has failed to properly fund its teacher and employee pensions and health care policies, to the tune of $4.5 billion. Admittedly, this number is based on unrealistic earnings projections of the funds it has set aside, so the actual number is certainly much larger — but the state has avoided calculating the actual figure.

Vermont's government has become an unwieldy, corrupt bureaucracy that funnels money from taxpayers' pockets through the Legislature (always eager to create new programs and jobs, regardless of taxpayers' plights). The camel's back is being broken straw by straw, and it is inevitable that this unsustainable, predatory abuse will implode. As the pension problem is ignored, how long until Vermont's credit rating is again downgraded, increasing borrowing costs in a disastrous cycle?

This is what trickles down in Vermont — government domination. Lifting that domination would be a new sort of trickle-down economics: not of raising all boats by rewarding wealthy individuals and companies, but improving all lives by unleashing the economic potential being stifled by government excess. History shows that government always grows bigger and bigger, until it becomes not servant, but master, and then it must be torn down and revamped.

Vermont is at that point. Where once it was profitable to own land for investment, most land ownership is now a liability in Vermont — no amount of capital appreciation will offset the intervening property taxes, and the taxes generally exceed the productive value of the land for farming or logging. The only growth industry in Vermont is...government employment.

This tumor must be surgically amputated. If Vermonters are to survive a forecasted national economic downturn, they must not be economically downtrodden in the good times by those sworn to serve them. Nationally, these are good times — just not for Vermont. Forbes rates Vermont 49th in growth prospects, 47th in business costs, 44th in economic climate, and 46th in regulatory environment. The Vermont bureaucracy dwarfs other businesses and does not wish to permit competition for its steady growth. It is in the business of enacting regulations.

And that business is in growth mode — 2020 promises new taxes at 29% on marijuana, a carbon tax (which hurts poor Vermonters most), a family leave mandate for employers, and a minimum wage (which Milton Friedman warns causes inflation). And reams of regulations for farmers, loggers, car-drivers... If legislating were productive, Vermont would be in boom times.

In Vermont, "that giant sucking sound" is not jobs moving to Mexico — it is jobs being concocted in Montpelier. Of course, Governor Scott shields illegal immigrants working in Vermont, and Vermont provides driver's licenses to them. The capital city also grants non-citizen residents the right to vote. It is no surprise that Vermont is #1 in the country for illegal northern border crossings.

Many fear-mongers predict global implosion in twelve years, from global warming. If Vermont does not change course, it will implode financially before then. Inflation and fiscal profligacy can destroy people's lives very quickly: the Vermont Legislature is warming to the task.

Many native Vermonters (especially those who work) are fleeing the state with the worst business climate and one of the highest welfare benefits for those who don't work, more concerned for "unauthorized entrants" than it is for citizens. Most Vermonters are starting to comprehend that when it comes to their state government, most of what it is enacting lately "is not meaningful or rewarding." It behaves more like a monopolist predator than a servant institution.

That is something Vermonters can no longer afford. They are fed up with being sparrows, eating the pickings left for them after the legislative horses have eaten all their oats. It's time to clean out the barn.

Originally published by American Thinker on October 25, 2019