Stephen Smith goes big on economic overhaul

As I have written here before, Stephen Smith is running an impressive campaign for the Democratic nomination for Governor of West Virginia.  He is smart, energetic and a tireless campaigner.

His “small ball” fundraising is working.  Smith’s campaign has reported raising nearly one-half million dollars so far, much of it through donations of $5, $10, $20, $50 and $100.  He has held dozens of town hall meetings and his team has organized volunteers throughout the state.

Smith’s theme of “West Virginia Can’t Wait” appeals to West Virginians who feel as though the state is caught in a “business as usual” political cycle that leaves too many people at the margins, while favoring elites.

That populist message is like those of Presidential candidates Elizabeth Warren, who has endorsed Smith, and Bernie Sanders.  Remember that Sanders won the 2016 Democratic Primary in West Virginia with 124,700 votes, compared with 86,914 for eventual nominee Hillary Clinton.

Now that Smith is starting to release his specific platform positions, it is also evident that Smith’s proposals are in line with the far left of the Democratic Party.

You can read the proposals here and decide for yourself, but here are a few points that stand out to me:

Smith wants to raise the corporate net income tax from the current 6.5 percent to 9 percent. That’s an increase of 38 percent.* His plan also includes reinstating the Business Franchise tax of .7 percent on companies with assets of more than $20 million.  The plan estimates that’s a business tax increase of $168 million.

Smith’s plan also includes creation of a Public Bank of West Virginia to provide “venture capital, forgivable loans, living stipends for arts and entrepreneurs, seed capital.”

Combine that idea with a long list of tax credits that Smith wants to create, and you have state government in the position of picking economic winners and losers on an even wider scale than it does now.

Smith is also proposing making West Virginia a strong union state. His “Workers Bill of Rights” includes instituting collective bargaining for public employees, preferences for union companies in state contracts, return of prevailing wage, elimination of the Right to Work law and passage of “the strongest laws in the country related to protecting the right to organize and strike.”

His plan includes another significant nod to unions.  The state would spend $10 million of taxpayer money to create “Workers Centers” where workers can get assistance organizing a union in their workplace and filing grievances against their employer.

Smith believes out-of-state corporations have taken advantage of the state.  He’s even proposing a 50-member Corporate Crime division in the State Police to “investigate and bring charges against corporate criminals,” a unit that he claims will “generate significant new revenue.”

He says his goal is to re-energize small business in West Virginia, and I have no doubt about his intent.  His pro-union, anti-corporation message will play well with his core supporters who believe West Virginia’s economy has never treated the state’s residents fairly.

However, his proposals are a much tougher sell for West Virginians who doubt the wisdom of government exerting even more control over the economy.

*(Editor’s note: An earlier version incorrectly stated that the increase was 42 percent instead of 38 percent.)

 





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