Don Walton: Heineman battling on taxes, budget, Medicaid

2013-03-17T20:00:00Z 2013-03-18T08:16:57Z Don Walton: Heineman battling on taxes, budget, MedicaidBy DON WALTON / Column JournalStar.com

Dave Heineman was on his game last week at a Lincoln Chamber of Commerce luncheon.

The governor made his pitch for fundamental tax change that reduces or eliminates the state tax on personal and corporate income; his University of Nebraska budget proposal that, in effect, was designed to fund a two-year student tuition freeze; and his adamant opposition to Medicaid expansion.

Nothing new there, but it was a strong presentation of his views.

Interestingly, at this point, he might be losing the argument on all those issues.

Fundamental tax change has been delayed a year for a comprehensive legislative study; the Legislature's Appropriations Committee has balked on signing onto the substantial state funding increase that would be required to freeze tuition at the university (and the state colleges); Medicaid expansion looms as the great battle that lies ahead.

What surprised me -- and maybe it shouldn't have -- was that the governor's argument continued to include possible elimination of the state income tax rather than settling at this point for potential rate reductions.

It had seemed to me that total elimination of income taxes has been put to rest by the avalanche of opposition expressed by agricultural and business interests that would see their tax costs rise as a result of the accompanying repeal of an array of sales tax exemptions.

That solid wall of opposition scuttled Heineman's legislative tax proposals at least for this year and led to the proposed comprehensive tax reform study. 

Perhaps the governor still is making a case for possible elimination of the income tax, along with the alternative of a proposed reduction in rates, for tactical reasons. Why give up anything before the hardball negotiations and bargaining begins?

"Taxes are too high in our state," Heineman told an unusually large Chamber luncheon audience at the Country Club of Lincoln.

The fastest-growing states are those with no income tax or a very low income tax, the governor emphasized. 

When he listed Nebraska taxes that he believes are too high, Heineman named property, income and occupation taxes.

And that pretty much leaves the sales tax.

As for a possible 2014 Senate race, Heineman told the Chamber audience he's not ready to decide. 

Even though the governor appears to clearly sense he might not be either happy or content in the gridlock of Washington, something is keeping him from saying no. 

* * *

From a distance, it looks like the university budget is creating some intriguing drama.

Heineman, a fiscal conservative, has been unusually generous in his funding proposal, cooperating with university leadership to freeze tuition rates for two years to help the university spur growth.

The Legislature's Appropriations Committee, whose membership widely is considered to be more progressive in nature, tentatively has proposed a much smaller university appropriation. But it is subject to change. 

The university gets to make its case on Tuesday at what shapes up as an unusually important hearing before the committee.

* * *

Chuck Hagel got what must have been a very welcome sendoff from Joe Biden at a Pentagon ceremony last week marking his opening days as secretary of defense.

Hagel and Biden, a Republican and a Democrat, were buddies and foreign trip traveling companions when they were in the Senate.  Now, they get to work together at the highest level of the executive branch.

Pleased by all the support from a roomful of friends, associates and military brass, all of whom want and expect him to succeed, Hagel said the last time he had experienced such positive vibes was at his confirmation hearing before the Senate Armed Services Committee.

That, of course, was a good-humored reference to the antagonistic, and sometimes dismissive and even disrespectful, treatment he received from some Republican members of that committee.

When Hagel appears before the committee again next month, it will be instructive to see whether senators like John McCain, Lindsey Graham, James Inhofe and Ted Cruz, who were so critical of Hagel's nomination, will attempt to work with the new secretary of defense. 

Or not.

Finishing up:

* Comes now one of the best times of the year when premier sports coincide: March Madness begins this week and concludes on April 8 as major league baseball enters its second week. The opener, an odd MLB promotion designed to welcome Houston into the American League on March 31, matches the Rangers at the Astros, whose league change is going to fatten AL West team records.

* Mission accomplished: The enormous, but wonderful, 1,053-page biography centering on Winston Churchill's wartime leadership has been consumed before major league baseball begins.

* Deb Fischer shared the spotlight with Republican Senate luminaries at a media briefing following President Barack Obama's luncheon meeting with GOP senators last week.

* Lee Terry has introduced legislation in the House to proceed with construction of the Keystone XL pipeline by eliminating the need for presidential approval. Meanwhile, Fischer signed a letter urging Secretary of State John Kerry to approve the project.

* Without passing any judgment on religion or faith, you've got to hand it to the Vatican for great theater. Color, costumes, pomp, ceremony, even a marching band or two.

* OK, the Huskers once had a Prince and now they have a King. Go forth and recruit an Emperor now.

* Wednesday marks the beginning of spring; April, the first of seven outdoor months, arrives 11 days later. Here come the buds and blossoms, the greening, the reawakening and the rebirth, the long daylight days. Life is good.

Reach Don Walton at 402-473-7248 or dwalton@journalstar.com.

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