By Hallie Richwine

This month's Public Forum at Western New Mexico University's Miller Library tackled the topic of "Poverty and Decline of the Middle Class and the New Tax Law." The program was presented by Miller Library, Grant County Democratic Party, WNMU Young Democrats, and MEChA.

The forum opened with moderator Lynda Aiman-Smith introducing the panelists and explaining how to engage with them. Note cards were given to the public to write down questions they wanted to ask the speakers.

The panel itself comprised Michael Morones, CPA at the Morones and Knuttinen, LLC firm, Francis Reyes, Assistant Professor of Economics at WNMU, and Cynthia Hall, representing the office of New Mexico Senator Martin Heinrich.

Reyes introduced herself first. This is her third year teaching economics at the university and she encourages her students to learn not just the theory of economics but how it affects their daily lives. Reyes reminded the public that the most common answer an economist gives is, "it depends," because the field depends on so many factors to predict and explain behavior. Reyes explained the middle class is a large group, those households making from $20,000 per year to $100,000. Any discussion on how the disposable income in the middle class is increasing over time may be true, however a closer look shows unequal distribution. Through time income distribution is showing an increase in earners at the lower end of the class, but it is also increasing at the upper end, which shows the separation of the class. As for the tax bill and if it will benefit the middle class, time will tell, she said.

Next Hall spoke. As a representative of Senator Heinrich's office, she explained his perspective of the tax plan and how it affects middle class families. Heinrich is a ranking member of the joint economic committee and has access to reports on health, education, and economic development. He believes the problems working families face have been ignored by the current administration. For instance, repealing the Affordable Care Act will drive up the cost of healthcare, increasing the cost of premiums and therefore the uninsured population. It also affects charitable giving, threatening non-profit agencies. Heinrich believes Congress should be focusing on different goals like increasing wages and investing in children and early learning opportunities.

Morones followed Hall and offered a practical standpoint. A former councilor and mayor, he has a unique perspective as a professional and as an individual that has dealt with public policy. "As a CPA I've always found my responsibility to my client is that they pay the legal minimum. No matter what the tax law is, I'm not doing my job if they have to pay more than they have to."

Morones explained that the tax rate has been at different levels during different times. At the point of the highest taxation Americans were paying 90%, and during the Kennedy Administration the country saw a decline to 70%. Since that time for the most part taxes have been lowered. From the public side, "we do have a lot of obligations to the community, meeting the needs and wants of the citizens. The tremendous development through the great public works movement of the 1950s would not have been possible without higher taxation and could be why infrastructure has suffered." Morones reminded the attendees that the tax law is still so new that the IRS has yet to give their perception and courts have not determined case law. There is potential for some individuals to see incentives in adding jobs to their rosters, but "we still need a robust economy and a desire to add to the workforce."

Aiman-Smith posed a question to Morones, "How do corporations usually spend the money they save?"

Morones said first is the need to define what a corporation is - it could be anything from a "mom and pop" shop to a corporation selling insurance or cars. These tax savings aren't going to create the ability to hire more staff per se. Maybe the business owners can take home a little more so they can consume a little more, which may create work elsewhere. For large corporations, it may become attractive to operate out of America, only time will tell.

"It goes with the good faith of the corporation, with so many choices, they could give raises or create jobs. Without knowing the good faith, it is easiest to assume they will mostly benefit the stakeholders in the company itself and possibly not the employees," Reyes said.

Aiman-Smith posed another question, this time to Reyes, "Won't globalization increase?"

Reyes explained that if globalization increases it causes more displaced workers. If jobs move there are more challenges of poverty, inequality, and unemployment.

"It has been my experience that as soon as corporations saw decreases in taxes they decreased the compensation of the highest executive or did stock buybacks," Aiman-Smith said.

Hall was asked the senator's opinion on deficit growth. "The office is concerned with how to balance the possibility of growing jobs, wages, and increasing infrastructure," Hall said. Heinrich wants to highlight making good investments, using a fact-based approach, whether it pertains to individual investment like early childhood programs or infrastructure that benefits all citizens.

A question from the crowd was what the median income in the United States was compared to Grant County. Aiman-Smith said according to the 2016 statistics, in the US overall the median income was $59,000; however in Grant County it was $38,000.

Morones was asked how many people in Grant County use a professional tax preparer. He said his office alone does nearly two thousand tax returns a year.

Aiman-Smith asked another question on behalf of the audience, "Some wealthy consider they pay the most taxes, shouldn't they have a bigger say?"

Reyes said to remember this is not a perfect progressive tax system, there is not vertical equity, and Morones added that "we need to remember we live in a republic. This is a representative democracy and none of us has direct input."

Aiman-Smith read the next question, "Some speakers equate increased stock market with booming economy. Where is that money going?"

Morones said stock market growth is appreciation for many, especially those who hold stocks. Pensions should grow. Reyes added that the level of confidence of corporations on the stock market increases as well, causing ripple effects from investments.

Aiman-Smith had a question for Hall, "Someone said Heinrich supported healthcare for all, will he continue now even though it is difficult?"

Hall said Heinrich believes every American has the right to health care. He will continue to highlight the positive effects of the Affordable Care Act and the effects of preventative care versus Emergency Room visits.

Hall ended the forum by informing the public that Heinrich has been very vocal about the current administration's lack of action to the opioid crisis and natural disasters. There is a fear that this will contribute to the decline of the United States' ability to govern itself, similar to what happened in Puerto Rico.

Public Forums happen on the third Thursday of the month at Miller Library. Future topics include: gerrymandering, violence against women, and local candidate debates.