Q&A with U.S. Rep. Vicente Gonzalez
As congressman of the 15th District of Texas, it is my responsibility to listen and engage with South Texans. On Sept. 18, Juan Del Bosque, of Donna, sent a letter to The Monitor asking a series of questions. I would like to take this opportunity to answer his questions and assure him, and all who read The Monitor, that my team and I are doing our part to best represent all who live and work in South Texas.
Q: Why are interest rates for savings accounts and certificates of deposit so low?
A: There are many reasons, including the extent to which the financial institution is attempting to attract consumer deposits. Banks need more money to lend more money. When financial institutions need more capital to fill their lending objectives, they will often increase their interest rates to attract depositors.
Since the 2008 financial crisis, the Federal Reserve purchased financial instruments, such as Mortgage Backed Securities and Treasuries. This has increased the level of liquidity in capital markets, meaning that these purchases have made funds relatively easier for local financial institutions to access. That aid from the Federal Reserve has resulted in the opportunity for local banks, credit unions and national financial institutions to face no competitive pressure to increase its deposit base via increased interest rate offerings.
Q: Why are school superintendents paid so much?
A: The average school superintendent in Texas is paid $220,375. They are, in effect, the CEO of the school district, reporting to a local school board made of elected trustees. In Texas, the superintendant's salary is decided by the local school boards.
This issue is unfortunately out of my jurisdiction. However, this is an issue that perhaps could be brought up to local school boards across South Texas. Attend school board meetings and voice your concerns. Additionally, send a letter to your local school board.
Q: Why must we pay a tax to eat via a sales tax?
A: The sales tax in Texas is 6.25 percent. It goes to fund state and local projects, operations and programs throughout the state. Texas does not impose an income tax, and thus has a broader sweeping sales tax compared to other states. Cities, counties, special purpose districts and transit authorities can also impose local sales and use taxes of up to 2 percent, for a maximum combined tax rate of
8.25 percent. This issue is outside of my jurisdiction, but I invite you to visit Texas Comptroller Glenn Hegar's website, www.comptroller.texas.gov, for more information.
Q: Why is auto insurance so high?
A: In April, U.S. Rep. Gregory Meeks, D-New York, and I, along with other members of Congress, sent a letter to Treasury Secretary Steven Mnuchin urging him to appoint a director to the U.S. Treasury Department's Federal Insurance Office (FIO). This office is charged with monitoring all aspects of the insurance industry, including the extent to which traditionally underserved communities have access to affordable insurance products.
The letter followed the release of a ProPublic study that found racial disparities in the cost of automobile insurance in California, Illinois, Missouri and Texas showing that large insurers in those states charged residents of minority neighborhoods up to 30 percent more in premiums than to individuals living in areas with comparable accident costs. This made clear the need for a fully staffed FIO. Unaffordable auto insurance can often be a barrier to economic opportunity. High premiums can limit employment options, decrease household budgets and can lead cash-strapped families to make the unfortunate decision to drive without insurance.
In January, FIO announced it will continue to pursue data from the largest auto insurers to develop a more comprehensive affordability analysis. While an FIO director has yet to be named, I continue to implore Mnunchin and President Donald Trump to appoint one. In my next face-to-face meeting with President Trump, I plan to broach the issue.
Q: Why are major corporations given tax abatements?
A: Some state and local lawmakers believe that offering tax waivers and subsidies to corporations will attract certain strategic industries to locate their business in that local community. They hope it will increase economic activity and jobs. It is debatable, however, as to whether this practice constitutes good public policy or indeed accomplishes intended goals on a long term sustainable basis
Q: Why is it so difficult to organize and have other political parties?
A: The American political spectrum is far more diverse and fluid than simply Democrats and Republicans. We, as a society, began our American political identification in the hopes of diminishing a power that enforced taxation without representation. Political parties have emerged through the years, transformed, been absorbed, or disappeared altogether. I recognize that my constituents have different views and different values, but it is also my job, as congressman, to make sure that the legislation I author and support satisfies the needs and priorities of all those I represent. I work to make that balance possible every day that I serve as your federal representative.
Should you have additional questions, or wish to discuss more issues at greater length, please visit Gonzalez.House.Gov or contact our team at (202) 225-2531 or (956) 682-5545.