RHODE ISLAND faces a $360 million budget deficit, and cost-shifting gimmicks will no longer suffice. The Campaign for Rhode Island’s Priorities, comprising over 40 leading Rhode Island organizations and thousands of individuals, has two goals — to ensure sufficient state funding for the crucial public services and programs that help Rhode Islanders work, learn and stay well — and achieving this goal with a fair and equitable revenue structure.

A recent Journal editorial tried to trivialize the campaign’s efforts (“R.I.’s slow learners,” March 16) and at the same time over-simplified the state’s fiscal crisis. Worse, The Journal ignored budget issues crucial to our state’s future success and perpetuated several myths.

The editorial states that “If state the government raises taxes relentlessly, people will not just stay and pay.” But the Journal neglects to mention that over the past decade income taxes have been reduced in Rhode Island. Between 1997 and 2002 income taxes were cut in this state by 10 percent. Recently, we have seen even more major tax cuts — in income and capital-gains taxes — creating a windfall for our wealthiest families.

While Rhode Island’s wealthiest have clearly benefited, middle- and low-income Rhode Islanders have seen their smaller income-tax breaks negated because of deep cuts to services and programs and a rise in property taxes. If the 1996 income-tax rate were applied in 2008, an additional $110 million would be available to support needed programs and provide property-tax relief.

Also, abusive corporate-tax loopholes, such as one that lets large, multi-state corporations hide income by “leasing” logos and other “intangibles” to shell companies, mean that we lose as much as $60 million annually. Meanwhile, the combination of tax cuts to the wealthy and reduced federal aid for health care and education because of the federal budget deficit presided over by President Bush has severely compromised the state’s ability to raise needed revenue for basic services and programs.

The impact of these tax breaks has been the erosion of Rhode Island’s safety net for those most in need — such as the 857 young people 18 to 21 years old who stand to lose housing, health care, and case-management services; or the working, taxpaying parents of 3,800 children who will no longer qualify for otherwise unaffordable child care.

The proposed cuts will have consequences for our entire community. Cutting child care could force many parents out of the workforce, with negative impacts for small businesses and our entire economy. Forcing hundreds of foster youth to be completely on their own at their 18th birthday could mean an increase in our homeless and prison populations.

The proposed budget cuts do not represent Rhode Island’s values or priorities. The Campaign for Rhode Island’s Priorities believes that a serious examination of both revenue and program expenditures is needed, and that we must develop a system that is fair and sustainable over time.

Policy-makers must bring the same level of scrutiny to the state’s Tax Expenditure Budget that they bring to the state’s direct-spending programs. The Tax Expenditure Budget outlines the loss in state revenues that results from tax credits. Rhode Islanders deserve to know whether tax subsidies are working to create promised jobs and economic activity. The General Assembly should hold hearings to review the cost and outcomes of all the tax credits, deductions, exemptions and preferential rates that cost the state millions of dollars in foregone revenue each year.

Governor Carcieri needs to speak honestly about how tax cuts have impeded our ability to serve the public, instead of proposing such short-term fixes as selling state land and using one-time money from legal settlements. Instead of these short-term fixes, we need longer-term solutions, including:

• Reversing the phaseout of the capital-gains tax originally cut to match Massachusetts, which has already reinstated its tax of 5.3 percent because of the need for revenue. Our proposal would put Rhode Island’s capital-gains tax at 5 percent.

• Close corporate tax loopholes that let major corporations that operate in Rhode Island shift income to avoid paying nearly $60 million in state taxes.

• Freezing the state’s alternative “flat tax” — an income-tax cut that this year will benefit only the wealthiest 2,866 taxpayers; when fully implemented, it will still only benefit about 14,000 people, but at a cost to the state of at least $70 million.

• Seriously consider an expansion of the sales tax to include certain luxury services and products to reflect the shift in our economy from goods to services. If we expand the sales tax, we then have the option to phase in a reduction from the current 7 percent, with the goal to make this important revenue stream more equitable across the board.

Taxes are not driving wealthy individuals away from Rhode Island. But growing inequities in education, health care and income — and the erosion of programs and services that create a quality of life Rhode Islanders can be proud of — will.

It’s time that we tackle the tough dilemma of our state’s budget deficit by being truthful.

For more information on the Campaign for Rhode Island’s Priorities, readers can visit the campaign’s Web site at PrioritiesRI.org.

Karen Malcolm is the executive director of Ocean State Action, the coordinating organization of the Campaign for Rhode Island’s Priorities, which represents unions and welfare advocates.