A Dubious Honor
Who was the most informed political reporter in Tennessee during the election campaign? I came in tied for seventh in an informal poll. Of course, I also tied for last - along with such luminaries as the AP's Karin Miller, the Tennessean's Larry Daughtrey, WKRN Channel 2's Chris Bundgaard, and "nobody."
Oh well. At least it's nice to be mentioned.
Steaming hot commentary on journalism, Tennessee, politics, economics, the war and more...
- Name:Bill Hobbs
- Location:Nashville, Tennessee, United States
A Dubious Honor
I Sleep Well At Night...
...knowing George W. Bush is president at a time like this.
Today's Funny Page.
This interactive page is lots of fun.
Taxpayers Bill of Rights Praised
A Cato Institute scholar says Massachussets tax reformers should pursue a Taxpayers Bill of Rights similar to Colorado's, rather than trying to abolish the state's income tax outright. On Nov. 5, 45 percent of Massachusetts voters voted for a measure to abolish the state's income tax. November 25, 2002, Michael J. New, an adjunct scholar at the Cato Institute and a post-doctoral fellow at the Harvard-MIT data center, says the TABOR approach has a better chance of winning a referendum - and actually would do more to reduce government spending.
An approach similar to TABOR would likely enjoy more political success in Massachusetts than a proposal to abolish the state income tax. Reasonable people can disagree about the extent to which state services would have to be reduced if the income tax were abolished. However, such grandiose proposals are very easy for unions and other opponents to demonize and caricature. Conversely, a tight expenditure limit would not require drastic short-term budget cuts. Additionally, this approach has actually enjoyed some success in Massachusetts. In 1986 Massachusetts voters enacted an expenditure limit though it was too high to meaningfully constrain budgetary growth.
New also details the success of TABOR in Colorado:
When the state collects revenues above the limit set by TABOR, Colorado taxpayers are entitled to a rebate. Overall, between 1997 and 2002, Colorado has reduced taxes more than any other state, issuing annual tax rebates that have totaled more than $3.2 billion. These tax reductions have been a boon to Colorado's local economy. Between 1995 and 2000, for instance, Colorado ranked first among all states in gross state product growth and second in personal income growth. Furthermore, according to the National Association of State Budget Officers (NASBO), Colorado was one of only five states that did not run a deficit during fiscal 2002.
TABOR has also forced Colorado residents to see the costs inherent in government programs. In other states, residents often support higher government spending because they can see the benefits of a particular program, but remain blissfully unaware of the costs that they and other taxpayers will be forced to bear. However, in Colorado the annual tax rebates brings these tradeoffs clearly into focus. In every year from 1993 to 1999 there was a proposal on the ballot to either raise taxes or increase spending in excess of the TABOR limit. Knowing these initiatives would markedly reduce the size of their annual tax rebate, voters soundly defeated each of these measures.
For more stories related to TABOR, including a variety of looks at how the Colorado plan is working, and efforts to create a TABOR in Tennessee, go here, and here, and here, and here, and here. And this link will take you to a post with links multiple TABOR resources.
Lots of reading. Perhaps you should get started now. :-)
Say That Again
The New York Times buries this quote at the tail end of a long story about the Republican Party's rising popularity:
Wayne Denson, 75, a Democrat and retired optician from Kansas City, Mo., said: "I voted for him to start with but now that Bush got elected, I'd rather vote for Bush than Gore. Bush has got more intelligence."
Amen to that.
The crux of the story is that the Democrats' ratings are dropping - and many people, even many Democrats, don't want Gore to be the party's nominee in 2004.
In a measure of additional concern for Democrats, Al Gore, who is the best-known Democrat who might run for president in 2004, is viewed unfavorably today by a ratio of almost two to one, despite a weeklong bath of favorable publicity that accompanied his national tour promoting two new books about the American family. Nearly two-thirds of all respondents, including just over 50 percent of Democrats, said that Mr. Gore should step aside and allow someone else to run against Mr. Bush.
The sound you hear is the sound of Al Gore sliding into irrelevancy.
Islam-Religion of Peace® Update
Rich Hailey has a couple items today on the war. This one remarks about al Qaeda with a smirk: "For a bunch of guys who praise martyrdom for Allah it seems strange that so many of the leaders are captured alive...."
Also, Hailey remarks on the Nigerian Muslims who went on a killing spree after a newspaper columnist suggested the Prophet Mohammed might have chosen a wife from among the Miss World pageant contestants.
Now, for those of you who equate Islamic fundamentalism with Christian fundamentalism, let me ask you a question. We've had images of the Virgin Mary painted in cow feces; we've had books published saying Jesus was gay; we've had singers ripping up pictures of the Pope on national TV; we've seen devout Christians pilloried in our media time and again as helpless morons at best or dangerous fanatics at worst; we've seen sacrilege of almost every kind imaginable put forth as art. Anyone been burned alive for it? Didn't think so.
The Tennessean praises Frank Buck in an editorial we can agree with. We like Frank Buck too.
The degree of control [House Speaker Jimmy Naifeh] exercises over the House has the tendency to choke off honest debate and consensus building.
Bills deemed unpopular by the leadership are shuffled off to committees where they disappear. Important decisions are made behind closed doors. Committee votes are taken by voice vote, denying the public the ability to track their local legislators. Public records are kept off the Internet where they would be available to all.
Buck's ill-received remarks on Saturday were not a case of a young upstart trying to grab his 15 minutes of fame. This is a highly principled lawmaker who is amazingly void of personal ambition. He's also a 30-year veteran of the legislature who has been known to mumble under his breath that he doesn't need the aggravation of continued service. Yet the state needs him, and whether they know it or not, so do his fellow House Democrats. For the sake of state government, we hope they were listening.
I doubt Naifeh was.
The paper says Naifeh's love for Tennessee can't be questioned. I don't question it. I just think Jimmy Naifeh loves power more.
Incidentally, you don't think all that back-room smoke-filled-room dealing that is the hallmark of Naifeh's leadership style has any effect on the public's level of mistrust in their government, do you?
We Dodged a Bullet
What if Tennessee had adopted an income tax back in 1999, when Gov. Don Sundquist first proposed it? Today, Tennessee wouldn't be facing a minor revenue shortfall but a major fiscal crisis, in all likelihood.
Governors and state budget officers said the fiscal condition of the states was more dire than the condition of the national economy. The recession has reduced state revenues, especially personal income and capital gains taxes, said Raymond C. Scheppach, executive director of the National Governors Association, but the states' fiscal problems are also linked to long-term trends, like the increase in health costs and the growing importance of services in the economy.
The NGA's press release announcing the new November 2002 edition of its biannual Fiscal Survey of States, says states saw a much larger decrease in revenue from income taxes than they did from sales taxes.
In fiscal 2002 sales tax collections were 3.2 percent lower than originally budgeted, personal income tax collections missed states' targets by 12.8 percent...
In other words, if Tennessee had followed the path Gov. Sundquist and others had urged, Tennessee today would be facing a much-larger revenue shortfall. But we were told an income tax would protect us against major shortfalls during a sluggish economy. What happened? Simple: During this sluggish economy, consumer spending is the one sector of the economy that has remained strong.
According to the New York Times, Scheppach also fingers a primary cause of the budget gap in most states: "unaffordable and unsustainable" increases in spending on Medicaid (which, in Tennessee, is called TennCare).
Medicaid and other health costs like employee health benefits account for 30 percent of state spending and grew last year by 13 percent, the largest increase in a decade, the report said. At a time when revenues are declining, Mr. Scheppach said, such growth is unaffordable and unsustainable.
You can see the NGA's November 2002 Fiscal Survey of States here.
It includes some other rather interesting facts:
During a supposed time of fiscal crisis in Tennessee, state government added the equivalent of 1,097 full-time employees to the state payroll, going from 41,703 in fiscal year 2001 to 42,800 now.
The number of full-time equivalent positions in Tennessee state government rose 1.34% from fiscal 2001 to fiscal 2002, and 1.27% from fiscal 2002 to the current fiscal year. Nationally, among all 50 states, the number of full-time equivalent positions on government payrolls rose 0.4% from fiscal 2001 to fiscal 2002, and was reduced by 0.7% from fiscal 2002 to the current fiscal year. Other states trimmed their payrolls to deal with budget gaps; Tennessee's government continue to fatten itself.
26 states used across-the-board budget cuts to eliminate budget gaps in fiscal 2002. Tennessee was not one of them. Tennessee also did not use layoffs, furloughs, early retirement, reorganization of programs, privatization, or fee increases to help close its budget gap that year - measures that other states used one or more of. Could it be that the Sundquist administration was intent on letting the budget crisis fester in hopes of generating support for the income tax?
Tennessee increased general fund spending by 7.6% in fiscal 2002, compared to the year before, the fourth largest percentage increase among all 50 states. Only New Hampshire, Idaho and Hawaii increased spending at a faster rate. 15 states actually reduced spending.
Tennessee budgeted an increase in general fund spending by 4% in the current fiscal year, the 14th largest percentage increase among all 50 states. 17 states actually budgeted less spending.
The national average among all 50 states was 1.3 percent growth in spending in both fiscal years.
The evidence is clear: while revenues falling short of optimistic projections have contributed to the current budget gap, Tennessee spent itself into this position.
At least we didn't make it worse three years ago by adopting an income tax.
Here's Some Happy News...
The world is a safer place today, because of this.
The Return of Reaganomics
History proves that so-called "Reaganomics," more properly known as supply-side economics, has worked to foster economic growth every time it is tried. Actually, it should be called "JFKnomics," because it was President John F. Kennedy who, in the 1960s, used a combination of personal and corporate tax cuts to rejuvenate the sputtering economy.
The good news: The Bush administration appears to be embracing supply-side economics, and will push for more and faster tax cuts even at the expense of short-term increases to the national deficit. So says this story, though it is laden with anti-tax cut bias.
Earlier this month, [Bush] espoused one of the central premises of Reagan's supply-side economics: that tax cuts actually increase government revenue, by stimulating the economy. Asked about this year's deficit of $159 billion after a Cabinet meeting, Bush insisted that his big tax cut of last year was not responsible for the red ink. "The deficit would have been bigger without the tax-relief package," he said.
Indeed it would have. Even Alan Greenspan has said the tax rebates of last year helped prop up the economy, which leads to smaller deficits.
The administration is pushing to make permanent those aspects of its tax package which are set to expire. Its solution to the stumbling economy is in part a new package of tax cuts, perhaps to include a reduction in the corporate income tax rate. Treasury Secretary Paul O'Neill has even put together an internal group to mull major tax-code revisions. Contrast this behavior with that of former GOP presidential nominee Bob Dole. As a Senator Dole was once denounced by a member of his own party, Rep. Newt Gingrich, as a "tax collector for the welfare state" for suggesting increased revenue enhancements.
Congressional Democrats, for their part, are quick to blame tax cuts as a major reason for the current run of red ink. But few are willing to call directly for tax-cut repeal. And in the meantime, many in the party are busy promoting more spending on prescription drugs for the elderly and other social programs.
Bad news for Democrats: tax cuts not only work economically, they also work politically. Democrats oppose them at their political peril.
NYC to Taxpayers: Cough Up More
New York City's billionaire mayor wants taxpayers in NYC - and across the river in New Jersey - to pay more taxes. Others say he should cut the city's budget instead.
A billionaire media mogul and a political novice, the mayor has surprised many with the artfulness of his politics. But his budget moves have begun to draw catcalls. The Citizens Budget Commission, a business-backed watchdog, gave Bloomberg's first budget a grade of D. It noted that the city was "spending far beyond its means."
Many budget analysts also shook their heads when the mayor declared that the city workforce and budget were streamlined. "It was a very amateurish statement," said Steve Savas, a Baruch College professor, whose Privatization Research Institute analyzes state and city governments around the world. "Raising taxes and slashing services before you've even attempted to refashion the workforce is the wrong starting point."
The size of Bloomberg's proposed income tax levy on suburban commuters also has proven problematic. New Jersey Gov. James E. McGreevey (D) threatened to declare a cross-river tax war, and suggested the commuter tax could be DOA in Albany, where the state Legislature must give its approval.
Bloomberg allegedly is a Republican.
War Update: An Opportunity in Iran
A Second Iranian Revolution is brewing, and this time the revolutionaries are pro-American. Win that one, and we take a big step toward winning the War on Terror.
Frank Cagle says an opportunity has been lost and legislators who favor a state income tax remain in control of the Tennessee House of Representatives. With Naifeh wounded by the failure of the income tax and with many of his allies leaving the legislature to retirement or defeat, he appeared vulnerable. But never underestimate the ability of House members to disintegrate into disorganized rabble at the first sign of trouble. Sadly, he's right.
I'm not the only one who thinks Dr. Bill Fox's economic forecasts are wrong. The U.S. Government Accounting Office agrees with me.
"There's a dramatic and growing revenue concern for the states from e-commerce," said William F. Fox, a tax specialist and business professor at the University of Tennessee. His research puts the annual sales tax revenue lost through e-commerce at $10 billion, although a Government Accounting Office study in 2000 put it at only about one-third that amount.
Always remember: Dr. Fox's "study" claiming a huge current and future loss in tax revenue due to e-commerce was sponsored (i.e. bought and paid for) by the Institute for State Studies. The ISS is an arm of the National Governors Association. The NGA favors Congress allowing states to extend their sales tax to online purchases by customers in other states. Fox's "study" allowed the ISS and NGA to claim there was a "crisis," always a prerequisite before any group of politicians is able to ram a tax increase down taxpayers' throats in the guise of "tax reform" and "fairness."
For more on Internet commerce and sales taxes - and demonstrations of Fox's incompetence - go here and here and here and here and here.
But mostly, go here to read Colorado Gov. Bill Owens' excellent explanation of why taxing online purchases by remote customers is inherently unfair. It's in the latter part of the post.
Whom Do You Trust?
It's got a pro-income tax spin, but the rest of this column by David Kushma, editor of the editorial page of the Memphis Commercial Appeal, is pretty good.
Kushma reports on a recent report from the "Better Government Association," which he describes as "an independent watchdog group formed in 1923 to combat public corruption in Al Capone's Chicago long before Eliot Ness arrived." The report is a ranking of the 50 state governments on an "integrity index" based on honesty and accountability in state government. Tennessee ranks 44th. Arkansas ranked 31st and Mississippi 33rd, while ranking below Tennessee were Louisiana, Alabama, New Mexico, Vermont and South Dakota. But
Quoting from Kusmha's column:
"It begins to look like the state's for sale," said Terrance Norton, BGA's executive director and a former federal prosecutor. "Our form of government is sustained by public trust. If you don't believe your public officials are people of integrity, you've got problems."
The index ranks the states according to the effectiveness of their laws that fight corruption and promote government integrity. Those laws deal with such things as freedom of public information, protection of "whistleblowers" who expose government waste and corruption, campaign finance, conflict of interest, and rules covering gifts, trips and speaking fees for politicians.
Norton said the strength (or weakness) of such laws reflects a state's commitment to transparency of government processes, accountability for public officials, and strong, clear limits on what "public servants" can do in accepting campaign money and other favors. The BGA assigned each state a numerical grade on how close it came to meeting the best prevailing practices among state governments.
Kushma notes that the BGA's findings are "neither new nor startling"
After all, he says : Two years ago, another good-government group, the Washington-based Center for Public Integrity, surveyed conflicts of interest in state legislatures. In Tennessee, it found, a third of lawmakers sat on legislative committees that regulated their own professions or businesses.
A third received income from a government agency other than the legislature, even though the General Assembly often subsidizes those institutions. And 15 percent of lawmakers had financial ties to businesses or groups that lobby state government.
Such findings can - and do - cause voters and taxpayers to believe that the officials they elect are more concerned with promoting their own interests, or peddling their influence to the special-interest lobbyists who bankroll their campaigns, than with pursuing the common good. That's especially true when lawmakers of both parties conspire to limit electoral competition, and perpetuate their own tenure, through the gerrymandering of legislative districts.
As a result, citizens are going to look upon government as something they need to be protected from, rather than something that can improve their lives. That's hardly a recipe for progress.
Kushma asserts that some people oppose the income tax (which Kushma favors) even though it would benefit their own checkbook if the state adopted an income tax (a debatable assertion, but we'll do that another time), "based on the notion that, given their past performance, the politicians in Nashville can't be trusted to spend more tax dollars efficiently or even honestly."
On that point, Kushma is correct.
There is a way to solve that problem, if legislators want to.
They could pass a Taxpayers Bill of Rights amendment to the state constitution, similar to Colorado's, and put it on the ballot in the 2006 governor's race.
A smart Taxpayers Bill of Rights (TABOR) would have three essential components:
1. It would limit the rate of growth of state government spending from state tax revenues to the combined rate of inflation and population growth.
2. It would require surplus revenue above that growth cap be returned to the taxpayers via across-the-board tax rate reductions, unless the people approved in a referendum spending the surplus on a specific set of projects or programs proposed by the Legislature.
3. It would require tax rate increases and new taxes be voted on by the people.
Colorado's TABOR amendment - which ushered in a decade-long economic boom in that state - is considered the benchmark model of such a constitutional amendment.
Consider the words of Martin McBride, an Oak Ridge resident who is leading an effort to enact a local version of the Taxpayers Bill of Rights there. McBride emailed me just the other day.
Today’s citizen has typically seen many more political promises and experienced more tax increases than typical citizens have in the past. In my lifetime, I have been in three states where governors have broken solemn tax-related promises to their constituents. I have experienced a variety of tax increases---and heard all the assurances that “this would be the last major tax increase.”
I am an optimist in general, yet I find I have very little trust left to give my government in the tax arena. Many other citizens of my generation appear to feel the same. I see the advancing experience-level of American citizens is the single greatest reason why so many tax increases are being currently turned back across the country - good, old-fashioned lack of citizen trust in government.
Faced with declining citizen interest and trust, what options do our political systems really have in future tax decision-making? More promises probably will not work. About all that’s left are options that give folks a little bigger piece of the tax decision-making process, (a bigger piece of the action!) This line of thinking brings you to the conclusion that approaches like the TABOR - options which gives citizens a more-direct say-so in tax policy - are the coming thing in this country and are, in a sense, inevitable..
I think McBride is right.
I personally believe an income tax is more damaging to the economy than a sales tax, though a low, flat and constitutionally capped and TABOR-ized income tax would not do significant harm. I also believe Tennessee's constitution does not allow an income tax without the constitution being amended.
That said, I also believe this: if voters were given a chance to vote on a package that eliminates the state sales tax, the Hall income tax, the state's "death tax" on inheritances and estates, and the state's economically destructive franchise & excise taxes on business, replace it with a flat 4% income tax that applied on the first dollar of income for complete fairness, and include a TABOR amendment to cap the whole thing (and every other state tax to boot) - and guarantee future surpluses came back to the taxpayers - it might well pass.
I ran the numbers on such a package, incidentally, using data from the year 2000.
That year, the sales tax, franchise & excise taxes, Hall tax and inheritance/estate taxes brought the state $6.09 billion in revenue.
That same year, total personal income in Tennessee was $148.4 billion.
A flat 4% tax that year would have brought in essentially the same amount of revenue, $5.93 billion, a difference of just $160 million.
Under such a plan, the state would immediately switch from being an exporter of retail sales to retailers just across the border in lower-tax states, to being a retail magnet. And by wiping out the largest business tax, Tennessee would immediately become a business haven and an economic growth powerhouse. Increased economic growth would benefit workers with higher wages and more available jobs, while providing state government a surge in revenue. Meanwhile, the state's costs for various welfare services would drop as unemployment fell.
And in future years, the stronger economy would no doubt generate revenue surpluses, which TABOR would force the government to give back via tax rate reductions. Those reductions would begin to ratchet down Tennessee's income tax rate. Unless the people voted otherwise, the tax rate would never go up.
Such a system would force the Legislature to economize and prioritize, to cut the bureaucracy down to size and root out waste and duplication, to confront the entrenched special interests and tell them the party is over and their feeding trough is closed. It would force the Legislature to deal honestly and opening with the public as well, making them justify every dollar spent and every request to spend a surplus dollar.
And a TABOR-ized tax system would also clean up government, by lessening the power of lobbyists and special interests. Legislators would not be able to make promises to lobbyists and special-interest groups of lavish new spending in exchange for generous campaign donations, because TABOR would put surplus revenue off limits without approval by voters. Instead of courting the financial support of a few well-heeled lobbyists and PACs, legislators would have to convince a majority of voters that their proposals for new spending or new taxes or spending of surplus revenue made sense. Fewer and fewer legislative proposals would be tailored to curry favor with this well-funded special interest or that powerful lobbyist because the taxpayers would be the most powerful special interest, and ordinary citizens would be the most powerful lobbyists, which is as it should be.
Think that's pie in the sky? It's not. In fact, it's what has happened in Colorado.
The Rocky Mountain News once urged voters in that state to reject the TABOR amendment, when it was on the ballot in 1992, but on Nov. 7, 1999, the paper urged voters in Washington state to pass a similar measure there, saying that TABOR “actually strengthens the political process rather than destroys it."
"That's clearly what has happened in Colorado since the passage of TABOR," the paper continued. "Here, shifting responsibility for taxes from politicians to the public hasn't resulted in automatic rejection of every spending plan.
"But while Tabor hasn't straitjacketed government, it has accomplished a number of good things. It has heightened interest in elections and government policy; it has given public officials mandates they otherwise would have lacked; it has shrunk voters' sense of helplessness over the use of their hard-earned taxes; and last, but hardly least, it has strengthened the fiscal responsibility of state and local government."
A TABOR-ized tax system - whether it includes an income tax or not - would bring about what Mr. Kushma says he wants: a government the people can trust. A TABOR-ized tax system puts the ultimate political power in the hands of the people. TABOR trusts the people. You, on the other hand, want to get the people to trust their government again by having the very government they can't trust pass some more rules to toughen the rules that very government, ranked a dismal 44th in integrity, currently flouts.
Sorry, Mr. Kushma. Your goal is noble, but your approach is pure naiveté.
This Will Make You...
...feel good. Especially the ending.
An excerpt: The jihadists of militant Islam are reported to believe that as they toppled the Soviet colossus, so, in time, they can topple the American one. What they do not understand is that the Soviet state made war on civil society for most of its 70-year rule. Americans, meanwhile, have nurtured their churches, charities, and clubs. The Soviet Union fell because it was brittle as well as brutal. America, with its countless nodes of activity and authority, is somewhat more vulnerable than the USSR, but it is infinitely more robust. More robust than Al Qaeda realizes. More robust, even, than many Americans realize.
Larry Daughtrey is Usually Wrong
But this time he is so very right.
There are all sorts of little quirks in the machinery of the place. There are only half the welfare recipients that there were eight years ago, but the department's budget has doubled. The prison population is up 50%, and we spend $17,000 per inmate each year, more than the cost of four years at the University of Tennessee.
There's another nasty little secret: There's been a lot of rejoicing about how the new lottery will help more kids go to college, which is great. Their tuition, even with help from lottery scholarships, will pay only 40% of the true cost of their education. You've got to figure out how to pay the other 60% from tax money.
What Would Jesus Drive?
Have you heard of the group of silly preachers trying to convince you its a sin to drive an SUV by asking, rhetorically, "What Would Jesus Drive?"
Here is a brilliant answer from, as it turns out, a Nashville blogger who also happens to pastor a Nashville church.
It is impossible for me to live's Christ's life, nor can I meaningfully imagine Jesus leading my life . At best, I can hope to live a Christly life. But that makes the question not, WWJD, but "WWJHMD" - what would Jesus have me do? There is a particularity to my circumstances that Jesus never encountered, and to think that I can possibly say what he would do in my day, my place and my situation is arrogant, unless I use purely superficial situations.
Example: Last Monday night my wife and I went to Vanderbilt hospital be with a family whose five-month-old baby girl was literally her next breath away from death. The Gospels show that Jesus was responsive to that kind of tragedy, so far so good. But the breakdown occurs right there. Would Jesus have merely sat with the relatives (less mom and dad, who were with the baby in a medically restricted area) and simply prayed with them and offered purely moral support? Or would he have taken the girl by the hand and said to her, "Little girl, I say to you, get up!" (Mark 5:41).
I did the former, but I think Jesus would have done the latter.
IMO, for some clergy seriously to ask what Jesus would drive is to miss the entire point of Jesus' very life. Jesus wouldn't buy a car! He didn't even own a donkey; he had to borrow one to ride into Jerusalem. Jesus mostly walked from place to place. When necessary, he relied on transportation furnished by others - boats, for example. I have no problem imagining that Jesus would take a plane, train or automobile today. But if you offered to pick him up in a Ford Excursion, would he refuse? I think not!
Sensing is on the money with this one. I had planned to write an essay on the issue focusing on a logical argument regarding Jesus and SUVs. My point was going to be that environmental concerns are just one part of deciding what vehicle to drive, and that Jesus would also consider the safety of his passengers, and whether the SUV was the right vehicle for the task. But of course those are all tangential to the real issue, and I won't bother writing it now. Just read Sensing's piece.
It makes a ton more sense than this one-sided drivel.
UPDATE: Brock Yates has a good take on the Jesus/SUV debate:
Their contention is that if Jesus were touring Galilee today, he would have shucked his walking staff for a small, efficient, pollution-free automobile, as opposed to a giant sport utility vehicle (that might, on second thought, accommodate his 12 Disciples and be capable of navigating the more challenging sections of the Wilderness.)
Good point - one made equally well by the cartoonist for the Orlando Sentinel.
Memo to Bredesen: To Spend More, Tax Less
As Tennessee's state legislators prepare to return to Nashville for another season of taxing and spending (that is, after all, what government does), they would do well to read the report, Crisis in State Spending: A Guide for State Legislators, published in the past year by the American Legislative Exchange Council, the nation’s largest bipartisan, individual membership organization of state legislators.
In that report, two highly-accomplished economists explain why higher taxes ultimately harm a state's economic growth, and why reducing taxes (and reducing state spending) leads to higher economic growth.
Here's an excerpt from the report's introduction:
High taxes mean lower economic growth. High tax states grow slower than the low tax states.
U.S. examples abound. From 1964 to 1999, Tennessee grew approximately 20 percent faster than its northern neighbor Kentucky. Tennessee maintained low taxes, and indeed was one of nine states that had a falling tax burden over time. Kentucky’s tax burden, on the other hand, rose sharply.
You cannot find two states more similar than North and South Dakota. The tax burden fell in South Dakota, but rose considerably in its northern neighbor. The result? Economic growth was one fourth higher in South Dakota.
The two poorest states in the Union currently are Mississippi and West Virginia. In Mississippi, the tax burden fell slightly over time, while it rose sharply in West Virginia. Mississippi grew over 50 percent faster than the Mountaineer State, which probably will fall below Mississippi sometime in the next decade if it follows the suicidal fiscal policies of the past.
Colorado, with a falling tax burden, outdistanced neighboring Nebraska, Wyoming and New Mexico with rising taxes. New York’s tax burden increased more than that in neighboring Pennsylvania, New Jersey and Massachusetts, and it grew slower than any of them.
The reports also explores the effectiveness of various tax-and-expenditure limitation laws and constitutional provisions on the books in many states, from Tennessee's very weak spending cap to the very strong Taxpayers Bill of Rights amendment to the Colorado constitution, considered the benchmark.
During the recent Tennessee governor's race, the eventual winner, Democrat Phil Bredesen, criticized the Colorado plan, which losing Republican candidate Van Hilleary had held out as a model for Tennessee to emulate. The Bredesen campaign said such a Taxpayers Bill of Rights would lock Tennessee into staying at or near the bottom in education, etc..., as it would prevent much-needed state spending.
But the ALEC report reveals an interesting statistic - one that the Hilleary campaign should have publicized. (Indeed, the Hilleary campaign in my estimation blew the campaign in part because it was too timid on the Taxpayers Bill of Rights and didn't make it a major campaign issue.)
Colorado's TABOR amendment was passed in 1992. While it has resulted in big tax cuts for the people of Colorado, it has also ushered in an economic boom in that state. Economic booms can produce more revenue for state government, even at lower tax rates.
That appears to have happened in Colorado, which restrained spending via its spending cap but still increased per-capita state spending by 139 percent from 1990 to 2000, the third-largest increase among all 50 states.
Tennessee, which pursued a strategy of increasing taxes and increasing government spending in the 1990s, and routinely exceeded its spending cap, but because higher taxes reduce economic growth, the state actually brought in less revenue than it might have under a lower-tax/higher growth strategy.
Tennessee increased per-capita spending by 76 percent from 1990-2000.
In 1990, Colorado's government spent $2,504 per capita and Tennessee spent $3,753 - 50 percent more per capita than Colorado. By the end of the decade, Tennessee was spending $6,593, and Colorado had increased per-capita spending to $5,992. Tennessee state government now spends just 10 percent more per capita than does the government of Colorado.
Even though Tennessee raised taxes repeatedly during the 1990s in order to spend more, Colorado was able to raise spending faster by taxing less.
If Tennessee's next governor doesn't change direction on tax policy and reduce taxes, Tennessee will always be stuck near the bottom. Mr. Bredesen, the evidence of the past decade could not be clearer: If you want to spend more money, first cut taxes.
(It's also a pretty good way to get re-elected in a landslide.)
Owens in 2008
It's a few months old, but I think you should read Colorado Gov. Bill Owens' speech to the Ronald Reagan Banquet at the 2002 Conservative Political Action Conference, held in Arlington, Va., last February. Owens laid out the roadmap for a small state to become an economic powerhouse with a highly educated workforce and high-paying technology jobs.
It's a path Tennessee should follow.
Here's a long excerpt. After you read it, you should read the whole speech. If I had to pick the best GOP candidate for President in 2008 right now, I'd pick Bill Owens.
In 1992, we passed the Taxpayers' Bill of Rights, a citizen initiative that constitutionally limits the growth of all Colorado governments. State, counties, cities, school districts, special districts, all of our governments are limited by the Taxpayers' Bill of Rights. And under this Bill of Rights, government spending cannot grow faster than the sum of inflation and population growth. Government at any level can only grow the combination of those two, and that is the maximum. If revenues exceed that maximum, we have to refund those revenues to the taxpayers.
And the only way that taxes can be increased in Colorado is through a direct statewide vote of the people.
With all due respect to Howard Jarvis, this is far better than Proposition 13 in California, because the Taxpayers' Bill of Rights means that, in Colorado, since 1992, our governments have not grown faster than the nongovernmental sector except by a direct vote and approval by the people.
I added two provisions to the Taxpayers' Bill of Rights.
First, that no government funds can be expended to support or oppose any initiated or referred measure. Many of you live in school districts where when the school district goes to the ballot, the school district funds that ballot campaign. You ought to try to put a stop to that, because it’s unfair. It is not right. It is not fair to put government dollars in these elections.
Second, I added a provision to the Taxpayers' Bill of Rights that says that we can raise taxes on only one election day a year, and that’s the general election day. This way, everybody knows about the election, not just those few who might benefit from that tax increase.
As you can imagine, the debate over the Taxpayers' Bill of Rights in 1992 was fierce. My predecessor, the Democratic governor, said that, if we pass the Taxpayers Bill of Rights, it would be akin to throwing a hand grenade into a schoolyard of children.
A Republican county sheriff put on his county sheriff uniform for the first time in many, many years, appeared in TV ads and said, if we pass the Taxpayers Bill of Rights, he would be forced to chain his prisoners to the railing of the State Capitol, in a tent.
Well, the voters ignored those visions. They passed the Bill of Rights in Colorado, and here is the result:
Today, according to the Corporation for Enterprise Development, a national group that ranks all 50 states in terms of our friendliness to the private sector, Colorado has the best business climate in the entire country.
We have the most technological workers per 1,000 of any state in the country, according to the American Electronics Association.
We have the best educated work force in the country, measured by college degrees per 1,000.
Both the Milken Institute and the Progressive Policy Institute say that Colorado has the third best ranking in the country in terms of being ready for the new economy.
We are first in per-capita income growth in the 1990s; fifth lowest poverty rate of all 50 States; third fastest growing in population.
Of most importance, the Tax Foundation says that we have the fourth lowest taxes per capita in the country.
All of this, I believe, is made possible because we have had the common sense in Colorado to limit the growth of government. That has allowed us to have the nongovernmental sector able to grow and prosper. And we are working hard to keep that economic engine growing.
We have been able to cut taxes by a billion dollars in the three years that I have been governor, which isn’t bad out of a $6 billion general fund state budget. And we have cut the income tax twice. We have cut the sales tax once. We have ended the marriage penalty in Colorado, something that we have also worked on nationally.
Owens also discussed the issue of taxing online purchases, and why such taxes would not be fair.
One more issue, and that is the taxation of the Internet. Some of you are very, very involved, as I am, in terms of opposing this. Let me just suggest that Ed Feulner at the Heritage Foundation was right when he said that perhaps the greatest business development since the creation of money is the Internet. And yet today, all across this country, there are mayors, there are legislators, there are some in Congress, and yes, there are some governors, who want to tax the Internet. Some will say it is a matter of fairness. If we pay a sales tax on Main Street, they will tell us, why shouldn’t we have to pay a sales tax when we buy items over the Internet?
Well, here is the difference. And as conservatives, it is important we understand this fundamental distinction, because this issue will be debated for the next few years in the United States. When I go on Main Street to buy something at Wal-Mart in Aurora, Colo., I am using the city street, I am protected by the city police force. If there is a fire and I need the help of the fire department, they are there. As I am going to that Wal-Mart or while I am in that Wal-Mart, if I drink water from the water faucet, I am using municipal water. I am in fact receiving city services when I go to that Wal-Mart and make that purchase.
When I buy something over the Internet from Lands End in Wisconsin, the only impact on any government in Colorado is the UPS truck that arrives at my door, bringing me that package. And UPS, I can assure you, more than pays its fair share in gas taxes for the use of that local or state road. There is no nexus between a service rendered and a service delivered for that Internet tax that some would want me to have to pay to Aurora and to Colorado.
Twenty states are now meeting regularly, setting up the system, so that if Congress ever overrules [California Rep.] Chris Cox and allows us to tax the Internet, there are states already ready to go forward with the compact to make this happen. Well, let me just tell you—and I bet Colorado is not the only state that will do this—but it is my goal, if that day ever happens, to have Colorado be the Switzerland of Internet taxation. I want us to be a tax haven so that these companies move to Colorado.
There's more to Owen's speech. Read it.
Louisiana May Tap Surplus to Cover Shortfall
Like many states, Louisiana faces a projected budget gap as projected spending is larger than projected revenue. The state's governor wants to tap the state's "rainy day" fund to fill the gap.
The good news is, Gov. Mike Foster is trying to avoid increasing taxes to fill the shortfall, and the Foster administration has already reduced planned spending this fiscal year by $75 million.
The Baton Rouge Advocate reports: A constitutional amendment passed by voters in 1998 created the Budget Stabilization Fund, commonly called the rainy-day fund, to be covered by budget surpluses in good years. The amendment set rules requiring that extra state money be put into the fund in good years and details how money could be spent during a budget crisis. The administration can spend up to one-third of the fund in a year - about $88 million of the $263 million currently in the fund. Foster needs two-thirds approval from the Legislature to tap the fund.
The governor blames the budget gap on several factors, including $50 million in costs imposed on the state by Hurricane Lili and Tropical Storm Isidore cost the government $50 million, and $3.4 million in costs from the outbreak of the West Nile Virus. Notably, he didn't do as Tennessee Gov. Don Sundquist did: blame the state's budget problems on taxpayers not paying enough taxes.
Foster is a lifelong Democrat who switched his party affiliation to Republican just before running for governor. He appears to be acting here as a conservative Republican.
But looks can deceive. The truth is, the Louisiana budget has grown by over $6 billion during Foster's two terms in office and Foster has steadfastly champion tax increases, and has called legislators who voted against his tax increase proposals "tooth fairies."
So while Foster looks to use the "rainy day" fund for this this budget gap, overall he's one alleged Republican who likes to put the bite on taxpayers.
Kentucky Gov. Proposes Tax Hikes
A Democratic chief executives admits to having an affair - and admits to lying about it. And he proposes tax increases. No, it's not Bill Clinton. It's Kentucky Gov. Paul Patton, who in September, Patton admitted an affair with businesswoman Tina Conner. Now he's back, and is proposing tax hikes to offset slowing revenue growth because of the sluggish economy in the Bluegrass State. Patton's a Democrat, so he's just being true to his party's tax-and-spend nature.
According to the Louisville Courier-Journal, Patton said Wednesday that the state must raise taxes, make substantial spending cuts - or both - to handle a revenue shortfall of a projected $144 million in the current fiscal year and a projected revenue shortfall of $365 million the next fiscal year.
In Kentucky, Democrats control the state House, Republicans control the state Senate. Patton "said he's already cut expenses enough, and in a written report hinted at raising taxes on businesses," reports the CJ. His report said the state must "substantially raise revenues or make draconian cuts."
Senate Majority Floor Leader Dan Kelly, a Republican, said Patton was implicitly asking for higher taxes, but the state can cut more spending without substantially affecting services.
"We really feel like there is a lot more work to be done to get spending under control before you turn around and ask the people of Kentucky to pay more revenue," Kelly told the CJ.
Kentucky is one state where the Republican leader appears to be standing up against higher taxes and looking to spending cuts to balance the budget.
On the Right Fiscal Track in North Carolina
Good news from North Carolina, where the projected budget gap is approaching $1 billion. Remember: a projected budget gap is merely the difference between projected future spending and projected revenue. Since no money has been collected or appropriated, it is merely a difference of opinion between what the bureacracy desires to spend and what the taxpayers have provided.
According to News 14, a television station in the Research Triangle area of North Carolina, "some lawmakers are trying to find new ways to save money," and a special legislative committee on government efficiency spent two hours looking at cost-cutting measures Thursday. "With a state budget shortfall projected at $1 billion or more, leaders of the House committee say they're going to need to find ways to help the state tighten its belt," the news program reported. Republicans took control of the state House in the November election. According to one legislator, the leadership in both parties have "said absolutely, we need to find more efficient ways to operate." State Rep. Wilma Sherrill, a Republican, says: "A lot of us have been talking about duplication of service and consolidation of services for years, and I'm excited that someone is finally talking about it. It is time that we get rid of the fat." The news report says some members of the House Government Efficiency Committee "want to take a closer look at the state personnel system, state grant programs, and zero-based budgeting."
All good things.
Incidentally, the story doesn't mention tax increases. They're on the right track in North Carolina.
It's The Same War
Despite what Al Gore says, there ARE links between Iraq and al Qaeda. Here is a story documenting how an al Qaeda subsidiary is attacking Kurds, who are American allies in Northern Iraq.
A former member of the al Qaeda-connected Islamist group Ansar al-Islam ("Soldiers of God") who, in the story, uses the pseudonym "Rebwar Kadr Said" to conceal his identity, says links between Kurdish Islamist groups to Afghanistan go back to the 1980s, when Abdullah Azzam, one of the founders of the Al Qaeda terrorist organization, held Mullah Krekar and a Palestinian man by the hand, and told his followers: "Take care of these two," meaning the groups each leader represented, Kurds and Palestinians.
"They dreamed of having a Taliban government in Afghanistan, a Taliban government in Kurdistan, and to join them through Iran," says Said.
Ansar al-Islam is the same terrorist organization that U.S. Intelligence determined was testing chemical weapons in Northern Iraq earlier this year, apparently with the blessing of Saddam.
War against Iraq is not a diversion from the war on Islamist terror. It is the same war.
Poindexter's Prying Project
Here's more on that creepy "Total Information Awareness" project underway inside the Defense Advanced Research Projects Agency (DARPA), the creator of the forerunner of the Internet.
From the WaPo: Pete Aldridge, the Defense Department undersecretary for acquisition, technology and logistics, held a news conference yesterday to officially outline the program. He used the opportunity to try to quell all the Orwellian comparisons. Aldridge said the system is just in an experimental stage right now, mostly using made-up data. Poindexter has said that private information about innocent people would be protected.
"You're looking for trends in transactions that are associated with some potential terrorist act," Aldridge said, as quoted by Newsday. "And you're trying to put those pieces together." The Associated Press quoted Aldridge as saying: "This is an important research project to determine the feasibility of using certain transactions and events to discover and respond to terrorists before they act." The system would scour passports, visas, driver's licenses, credit cards, rental cars, airline tickets, gun purchases, arrest records and other records. Aldridge also tried to soothe concerns over Poindexter's role, saying if the system is put to use by law enforcement and the government, Poindexter won't be involved anymore.
This is one part of the Homeland Security program that needs to be axed. Now. Poindexter shouldn't be involved, because the project itself should not exist.
Amen to This
I've got nothing to add to this excellent suggestion from James Robbins except this: Call your senators and congressman and tell them to make it so.
I have always admired the fact the Victoria Cross was originally manufactured from metal taken from Russian artillery pieces captured during the Crimean War, from which the decoration originated. In that spirit I would like to propose something similar - that all campaign medallions awarded for service during the War on Terror be cast from metal from the World Trade Center towers. Currently the salvaged beams are being cut up and sold for scrap in Asia. One long beam would supply enough metal for thousands of medals. And I think it would make the decorations that much more meaningful to the men and women who earn them, as well as let the survivors know that a small piece of the buildings in which their loved ones perished has been put to a noble use.
As the last steel beams are broken down and shipped to Asia for purposes mundane, would it be too much to ask that one or two be set aside for this purpose before the opportunity eludes us? And who can take the action necessary to encourage the Defense Department to authorize creation of the medals? Are any members of Congress at all concerned, apart from Senator Inouye? Could the commander in chief motivate this effort by Executive Order, and bring a sense of reverence to what could otherwise be a stuffy bureaucratic process? Surely too much is at stake to let this matter escape us. What veteran of this conflict, years hence, would not look with special thoughtfulness at such an award, knowing its hallowed provenance? And who would not bring it forth to show to generations now unborn, to let them feel its weight in their young hands, to tell the story of the fateful day, to renew the pride in service well performed, and to remember?
Today's Funny Page
I know, I know, the election is over. But this TV ad from the Club for Growth is still funny.
A Democrat Fiddles as South Carolina Burns
A newspaper editorial urges South Carolina Gov. Jim Hodges to either call the Legislature into session to deal with budget cuts, or order the state Budget and Control Board to make the cuts needed to close a $331 million budget gap in the current fiscal year.
"Thus far, Hodges has opted for the irresponsible choice: doing nothing," says the Greenville News in the scathing editorial.
By law, Hodges must do one or the other - either summon the Legislature into session or have the Budget and Control Board make the necessary 5-percent cut to the state budget, the paper notes. "Of the two options, calling the Legislature back to Columbia is preferable because state lawmakers can prioritize spending and safeguard vital services such as education, health care and law enforcement. The budget board, for its part, only can enact across-the-board cuts, which indiscriminately impact both crucial services and less important expenses. The budget board already has cut the state budget three times in the past two years, allowing the Legislature to escape the responsibility and accountability expected of lawmakers."
Hodges, a Democrat, appears ready to just dump the budget problem into the lap of Republican Gov.-elect Mark Sanford, who beat Hodges 53% to 47% in the November election. Sanford campaigned on a pledge to cut taxes and phase out the state's income tax, and received key endorsements based on his willingness to lead and tackle tough problems. During the campaign, Hodges refused to deal with the growing budget gap in order to avoid negative headlines that might hurt his re-election bid. He lost anyway, and deservedly so.
Now, he continues to play petulant politics rather than do his job.
GOP Does it Right in Arizona
Arizona Gov. Jane Hull is proposing spending cuts to close a budget gap in that state. "With revenue slipping below projections and some program costs rising, the state will see a projected shortfall of up to $500 million in the $6.2 billion budget for the 2002-2003 fiscal year that ends June 30," the Associated Press says. Part of Hull's $409 million answer to the budget gap included a small tax increase on Medicaid premiums, but the Republican-dominated Legislature didn't accept that proposal.
Knoxville News-Sentinel columnist George Korda assesses the legacy of Tennessee Gov. Don Sundquist, who spent the state into a huge budget crisis and leaves office with two thirds of Tennesseans giving him an unfavorable job approval rating.
Gov. Don Sundquist thinks Van Hilleary’s campaign ads criticizing Sundquist hurt Hilleary’s chances of being elected governor. Apparently Sundquist had the TV off when Phil Bredesen’s commercials aired calling for a change from "the last eight years." Sundquist also said he’d rather retire having done the best he could than just having been a caretaker.
The last four years was the best he could do?
There's other good stuff in Korda's column as well.
Blogging: Important to Me, You and Democracy
So says Rocky Mountain News columnist and editorial writer Linda Seebach.
Weblogs are "going to be as important a political force as talk radio," Seebach writes. Blogs are "the Reader's Digest on Internet time, instant, interactive, uncensored access to a dazzle of events and ideas." She cites several examples of how blogs have been used to ferret out the real truth of an evolving story - from the role several sites played in debunking a history of gun ownership in America to one site's gleeful take-down of political documentary filmmaker Michael Moore. Blogs "enforce a certain level of honesty," she says.
That, incidentally, is why this weblog exists. If you want it to continue to exist, please make a donation in the Amazon tip jar.
Income Tax No Guarantee of Revenue Growth
Check out what's happening what's happening in Missouri, a state the depends heavily on an income tax to finance state government. It puts the lie to those in Tennessee who said an income tax would prevent the state from facing revenue shortfalls.
From the Kansas City Star: "Missouri's budget deficit could grow to $300 million by next June, leaving Gov. Bob Holden with few ways to avoid painful reductions in government programs. The budget director, Linda Luebbering, said Tuesday that the state took in $102 million less than projected through Oct. 31. Individual income taxes, which had been projected to rise by 4 percent this year, continue to muddle along at last year's level."
Hmmm. They have an income tax, yet they still have a budget gap.
Notice the pro-Big-Goverment-spending bias in the first sentence of the Kansas City Star story. Painful cuts. Apparently, the KC Star doesn't leave its opinons on the editorial page anymore.
So, which will it be, Missouri? Spending restraint or higher taxes? Oh, sorry. It looks like higher taxes. Missouri Gov. Bob Holden "will pitch his plan to raise new money at a public hearing Thursday in Independence. The meeting, at 3 p.m. at the Truman Museum, is the first of four public hearings throughout the state that will emphasize the critical condition of Missouri's finances," says the Star.
Holden is a Democrat.
If a Democrat Can Do It...
Maryland has a budget gap. Maryland's outgoing Democrat governor is responding by cutting spending. Even better news: the income Republican governor wants to reduce spending even more.
From the Washington Times:
Gov. Parris N. Glendening introduced a plan yesterday to eliminate the state's estimated $498 million budget deficit by imposing spending cuts for most agencies but avoiding layoffs for state workers. Mr. Glendening said the plan, which spared K-12 education from cuts, would leave Gov.-elect Robert L. Ehrlich Jr. a balanced budged and $646.7 million in cash reserves when he takes office in January. The plan called for cutting $172 million in spending and taking $189 million from the state's $500 million revenue-stabilization fund — informally known as "the rainy-day fund."
"It's a start and it's just a start," said Paul Schurick, spokesman for the Ehrlich transition team. Mr. Schurick also said the plan needs to be examined closely because it appeared to rely mostly on one-time savings and does little to reduce next year's anticipated $1.5 billion budget shortfall. "The cost of state government has got to shrink," he said.
Why is it that some Democrats - like Maryland Gov. Paris Glendenning and Mississippi Gov. Ronnie Musgrove can hold the line on spending or even cut spending to handle revenue shortfalls, while Republican governors like Kenny Guinn in Nevada and Mike Huckabee in Arkansas feel that they must raise taxes first, rather than reduce spending? Did our guys learn by watching Tennessee Gov. Don Sundquist in action?
Perish the thought.
The good news for Maryland taxpayers is, Ehrlich isn't following the Sundquist model.
Kansas shortfall means... spending cuts!
Here's another update on how various states are dealing with budget gaps.
Kansas Gov. Bill Graves, a Republican, said Wednesday he will make spending cuts to address an expected $310 million shortfall in the current year's state budget. Kansas faces a projected budget gap - the difference between projected spending and projected revenue - of $1.1 billion in fiscal year 2004, which starts July 1, 2003, unless lawmakers reduce spending or raise taxes.
Graves is nearing the end of his term, but has decided to make the cuts instead of dumping the budget problems onto Kansas' next governor, Kathleen Sebelius. She's a Democrat, which means she talks out of both sides of her mouth when it comes to taxes.
From the Wichita Eagle: A spokeswoman for Sebelius said the governor-elect likely will not reverse Graves' cuts in the 2002-03 budget even if they include schools. Sebelius promised throughout her campaign that she would not cut school funding. "She will respect the decisions he makes in '03 and will not second-guess him," spokeswoman Nicole Corcoran-Basso said.
Translation: "We made promises to spend a lot of money we don't have, so thank God Bill Graves has the sense to be responsible and reduce spending to match revenues, because we Democrats hate having to do that sort of thing."
Tax Revenue Goes Up In Smoke
Last summer, lawmakers in Indiana raised the state's cigarette tax from 15 cents a pack to 50 cents, to help balance the state budget. Four months into the fiscal year, revenue from the cigarette tax is up - but not by as much as the state had hoped.
"The state is collecting more money in cigarette taxes compared to last year, but collections are down from where state budget makers thought they'd be when the legislature increased the tax," reports WISH-TV in Indianapolis.
"In the first four months we've been down about $17.8 million below what we expected, " said Budget Director Marilyn Schultz.
What's happening? The little guy is getting hurt by the tax increase, as usual. Indiana stores that sell cigarettes have lost business, while the state has raked in more money from some customers and driven others to avoid the higher tax by going out-of-state or online to buy their cigarettes.
"The state budget director says more people have stopped buying cigarettes in Indiana," reports WISH-TV in Indianapolis.
Why do state revenue forecasters tend to forget that when taxes are raised, taxpayers alter their behavior? The decline in cigarette purchases in Indiana after the cigarette tax was more than tripled was entirely predictable, except to Indiana revenue officials apparently.
Never Thought I'd Say This:
Sen. Dianne Feinstein is right.
As more is becoming known about the Total Information Awareness System, a Pentagon research project headed by former Iran-Contra figure John Poindexter, more people are becoming alarmed about the implications.
The Pentagon tried to allay those concerns Wednesday, stressing that it is only ``an experimental prototype'' and that Poindexter's involvement is limited to the research. But Sen. Dianne Feinstein, D-Calif., said she plans to introduce legislation to ensure that the project does not infringe on the privacy rights of Americans.
Read this from today's San Jose Mercury News for the whole story.
Oregonians Oppose Tax Hike
The new Democratic governor of Oregon wants voters to approve a $724 million temporary income tax hike in a referendum in January. Gov.-elect Ted Kulongoski, who only defeated Republican Kevin Mannix 49-47 because a Libertarian candidate sucked votes away from the Republican, says the tax increase is better than cutting more than $300 million from education, health care and other programs to deal with a budget shortfall.
Voters in Oregon in November overwhelmingly rejected a plan to create a statewide government-run healthcare program - a plan that would have doubled and tripled taxes on most Oregonians. Voters also defeated 18 out of 25 proposed tax increases for local schools on ballots across the state. “It’s very clear that people are not in the mood to depart with additional dollars,” said Oregon independent pollster Tim Hibbits.
A Hibbits poll for the Portland Oregonian and KATU television found only 37 percent of Oregon voters said they were likely to vote for the proposed tax increase. Hibbits said he doubted Kulongoski could change many voters' minds.
Opponents of the tax increase say voters don't want taxes raised during a troubled economy. "Taxpayers are really getting tired of being punished because the state can’t balance its budget,’’’ said Jason Williams, executive director of the Taxpayers Association of Oregon.
As you might expect, unions such as the AFL-CIO and education groups back tax increase.
The fact that nearly two-thirds of Oregonians are opposed to it is remarkable, given Oregon has long been one of the nation's most liberal states, and a bastion of tax-and-spend Democrats. If Oregon is in the midst of a tax revolt, anti-tax sentiment is a full-blown national trend.
Fries With That?
An excellent editorial in the East Valley Tribune, a paper in the Phoenix suburb of Mesa, alerted me to the incredible stupidity of a group called "Commercial Alert."
It seems the group wants UNICEF to cancel a fund-raiser involving the McDonalds hamburger chain, a fund-raiser designed to raise $5 million to help UNICEF fight global child malnutrition.
Commercial Alert's executive direct, Gary Ruskin, "and a bevy of physicians, professors and sundry activists" signed a letter to UNICEF asking them to cancel the project, reports the Tribune.
According to the organization's web site: “Commercial Alert's mission is to keep the commercial culture within its proper sphere, and to prevent it from exploiting children and subverting the higher values of family, community, environmental integrity and democracy.”
The paper comments, To Rushkin and his ilk, there is no such thing as "corporate citizenship." Just greed, which must be segregated from society's "higher values." Presumably if, in the process of keeping corporate America in its seamy corner, a few thousand children starve — well, so be it. At least we've protected our "higher values."
We see this “let them eat dirt” attitude all too often these days. We see it in the riot-torn streets outside World Trade Organization meetings and on Web sites demonizing genetic engineering of food crops.
And our response is this: We hope you, dear reader, will stop at McDonald's today in observance of World Children's Day. And whether you buy a Big Mac or a Happy Meal, we urge you to toss in an extra buck or two for UNICEF. And spare a scornful thought for those whose narrow, politically correct agenda moves them to disparage such a worthy partnership to save children's lives.
I'll eat to that.
Here's some fine counsel regarding what the Republicans and the Bush administration should push for now.
In a 2001 study on tax simplification, Congress' Joint Committee on Taxation found the tax code consisted of 1,395,000 words in 693 sections applicable to individuals, 1,501 sections applicable to businesses and 445 sections applicable to tax exempt organizations. A taxpayer filing a 1040 form could face a return of 79 lines with 144 pages of instructions, 11 schedules totaling 443 lines and 19 separate worksheets of embedded instructions.
The corporate tax code was even worse. And the cost to the economy, only for administering and complying with the rules - not including loses in efficiency from the distortions in the code - ranged from a low estimate of about $75 billion a year to a high of $300 billion.
The Tax Foundation, taking a mid-level assessment, noted early last year that compliance with federal tax laws requires the equivalent of 2.7 million full-time workers. That's more than the federal civilian payload, about double the military force and three times the number of police on the street.
As Aldona Robbins of the Institute of Policy Innovation noted, only by first tackling the structural problems with a tax system that continues to punish savings and investment can Republicans advance another primary agenda item - reform of Social Security.
The GOP has long held itself up as the party of ideas, especially on taxes. A failure by a GOP now in control of Congress and the White House to deal with the numerous deficiencies of the tax code would indicate it has no confidence in its tax ideas, so why should voters have confidence in what Republicans say about taxes?
Well, This is Lovely...
Most of this Seattle Times story about suspected terrorist James Ujaama's vision of the perfect Islamic state will make you either barf at his vision of a great society, or just shake your head in wonder that such people exist - or drop to your knees and pray a prayer of thanks to God that Ujaama and his friends aren't going to win.
Ujaama and Abu Hamza, seated at a small table next to each other, paint a picture of an ideal, worldwide Islamic state, beginning in Afghanistan, and urge Muslims to move there, build villages, attend military training camps and support the Taliban government.
And then there's this little snippet of info about Ujaama's pal Hamza, whom U.S. federal prosecutors have targeted for indictment on terrorism charges:
At one point in the video, Ujaama turns to Abu Hamza and adjusts the microphone for the cleric, who lost his hands while making a bomb in Bosnia...
No word on where, exactly, he lost his mind.
Lovely people. Brought to you by the Religion of Peace©.
Uber-liberal columnist (and, inexplicably, Vanderbilt University business management professor) Bruce Barry has lots of kind things to say about President George W. Bush in his Nashville Scene piece ... until the very end of his piece, where Barry offers the obligatory "Yes, But..."
Yes, Barry says, Bush has emerged as a good leader. But... he hasn't signed on to the liberal agenda. So he's not a good leader.
The late 2002 edition of George W. Bush is evidently more focused and polished than the early 2001 inauguration model. But authentic leadership transcends persistence and strategic gloss; it transforms the body politic through substantive social progress. Bush falls short here: We have a president who is eager to wage war, but unimpressed with civil liberties, indifferent to corporate corruption, unconcerned with millions who lack basic health insurance, unmoved by environmental degradation and unwilling to view education through anything more sophisticated than a lens of standardized testing. Honest liberals will grant that Bush has overachieved, yes, but such is the inevitable dividend of low expectations.
Liberals always have "low expectations" for an elected official of the opposite party who doesn't share their agenda.
At Least Some Republicans Are Opposing Tax Hikes
Several posts below detail how some Republicans are caving in and supporting higher taxes in states facing a gap between projected revenue and projected spending.
There's good news, too. The Milwaukee Business Journal is reporting that, despite the election of Democrat Jim Doyle as the next governor of Wisconsin, some are optimistic he will not resort to tax hikes to fill the gap. Doyle vowed during the campaign he would not raise taxes, but the state's business community is skeptical and fear the state's first Democrat governor in 16 years will try to raise taxes to cover a projected budget deficit approaching $3 billion.
"I don't think any of us understands the enormity of the budget deficit and the strong impetus to increase taxes," said Steve Sobiek, executive director of the 500-member Independent Business Association of Wisconsin. "We need something big and bold to improve the business community without a tax increase."
Sobiek suggests repealing Wisconsin's estate tax and allowing businesses to establish medical savings accounts for employees.
Jim Haney, president of Wisconsin Manufacturers & Commerce in Madison, says his membership is optimistic that taxes will not be raised because both Doyle and the Republican candidate ran on "no new taxes" platforms. "There seems to be a will not to look to taxes first to fix the deficit," Haney said.
The business community is hoping the Republicans, who took control of the state Senate and added to their majority in the state House in the Nov. 5 election, helps Doyle keep his pledge.
Meanwhile, in Minnesota, the election of a Republican governor has business leaders hoping Gov.-elect Tim Pawlenty "will reduce regulation, build coalitions to address tough issues and radically overhaul state government in an effort to uphold his promise to stave off tax increases," reports the Minneapolis-St. Paul Business Journal.
Pawlenty's no-tax-hike stance "means he will have to cut government and find new ways to fund projects to balance a projected $3 billion budget deficit rather than saddling businesses with added costs," the paper says.
But, so far, people believe he will do his best to keep his pledge. "This is about the most-friendly-to-business administration that we've seen in recent memory," said Lawrence Jacobs, a professor of political science with the University of Minnesota. Jacobs predicts Pawlenty will pursue an overhaul of state government that will shift many responsibilities to the private sector, a "thorough raking out."
In Minnesota, "state tax revenue is expected to grow 11 percent during the next two and a half years, while spending is expected to grow 11.6 percent," the paper reports.
Duane Benson, executive director of the Minneapolis-based Minnesota Business Partnership, says the new governor recognizes that the poor economy makes this a bad time to raise taxes. "What the governor-elect is doing is saying we don't have to raise taxes, and it's doable," he said. Benson says most business people could make up the difference in the state's projected revenue and projected spending through spending cuts.
Lucky Minnesotans. Not only did they get Norm Coleman in the U.S. Senate, they've got a governor who thinks the solution to a budget gap is to reduce the spending, not raise the taxes.
Election Day: A Fine Look Back
Politics has become the Democrats' religion, says columnist Mark Steyn in a gotta-read-it piece published in the Spectator.
Here's an excerpt: The do-what-you-gotta-do philosophy of the McAuliffe crowd is making the party look just plain ugly: at Republican concession speeches, the bromides about congratulating the Democratic victor and urging everyone to get behind him in the best interests of our state were listened to respectfully; at Kathleen Kennedy Townsend’s concession speech in Maryland and Gray Davis’s victory speech in California, the pro forma acknowledgments of their Republican opponents were greeted by boos. From the crowd. This was in keeping with what I think posterity will record as the ‘defining moment’ of the campaign — the grisly televised ‘memorial service’ for the late Senator Wellstone held in the solemn cloisters of the basketball arena at the University of Minnesota at which fist-pumping mourners hissed Republican senators, and deranged activists publicly demanded that these alleged GOP friends of Paul demonstrate their loyalty by renouncing their parties and campaigning for his posthumous victory. To those watching at home, it looked like hidden-camera footage from inside a particularly insane cult. It’s a commonplace, especially in Britain, to hear the ‘religious Right’ referred to as a bunch of weirdos who are an embarrassment to the Republican party. Well, the Minnesota memorial gave us the religious Left: they don’t believe in God, they believe in politics; the Democratic party is their church, Wellstone their latest martyr, and the campaign a crusade. They couldn’t have been any freakier if they’d been speaking in tongues.
Read the whole thing.
Today's Funny Page
Molly Ivins gets what she deserves in a fine piece of work by one ticked-off Texan.
Of Ivins, she writes: Oh. Good. Lord. You crazy bat. Our arrogance doesn't create terrorists. If that were true, I'd be killing people right now because Susan Sarandon's arrogance is frankly more than I can bear. Terrorists terrorize because they're psychopathic freaks who would rather kill successful people than help make their own countries successful.
Read the whole thing.
The Only Thing Certain is Uncertainty
Economist James K. Glassman examines the role uncertainty plays in the economy.
The argument is that investing is fraught with uncertainty, with real risks. The world of business is complicated and unpredictable, and, as Mitchell writes, "the attempt to develop accurate forecasts of earnings or market prices is a fool's errand." Successful investors figure out strategies, not to overcome risk, but to live with it.
Still, Wall Street and Main Street abound with people who think the key to picking winners is to scrutinize income statements more carefully or to build better financial models. But, "no matter how strenuous and ingenious, efforts to slay the uncertainty dragon have always resulted in disappointment, anger, sub-par returns and occasionally criminal behavior."
This is the essential nature of stock investing: It's a dark and risky place. But, as Mitchell puts it, "if investors are to earn a return above the risk-free rate, they have no choice but to invest in securities whose returns are not guaranteed." In fact, stocks have, for the past 76 years, earned a return that, in the average year, is 5 or 6 percentage points higher than the risk-free rate. You don't get returns like that without taking risk.
Stock investors, especially since the early 1990s, have seen high returns as an entitlement. And politicians - as well as some journalists - play into these false expectations, promoting the notion that the only reason people lose out in the market is that someone is cheating them, or not telling them enough about the inner workings of companies. But such concerns are really a distraction. The nature of business is deep uncertainty.
Mitchell is not merely saying that stocks lack a money-back guarantee. He is saying that, when it comes to specifics on how a company will perform, hardly anyone knows anything.
You certainly should read the whole thing.
Economy Update: Greenspan Says Its Growing
Federal Reserve Chairman Alan Greenspan says the economy is growing.
Greenspan said Tuesday that financial innovations have helped the United States and the world absorb various shocks from the loss of $8 trillion of wealth in the U.S. stock market to the terrorist attacks and a number of high-profile corporate bankruptcies. Greenspan cautioned governments to resist the temptation to over-regulate financial markets, saying new types of financial instruments have been a major reason the United States and the global economy have withstood the shocks of the past 2.5-years. "Despite the draining impact of a loss of $8 trillion of stock market wealth, a sharp contraction in capital investment and, of course, the tragic events of Sept. 11, 2001, our economy is still growing," Greenspan said in a speech to the Council on Foreign Relations.
Take That, Ted Rall
According to my traffic tracker, somebody clicked onto my site after running a Yahoo search on the phrase "theories about Wellstone's death" - and my parody of Ted Rall's ridiculous column, in which he speculated that President Bush had the senator killed, came up fourth. It also comes up sixth if you Google the four words ted rall paul wellstone.
War Update: Barbarians at the Gates
History holds important lessons for Western civilization in the War against Terror, says Brink Lindsey, a senior fellow at the Cato Institute.
That morning, complacency and triumphalism gave way to grief and rage — and fear. The solid ground of security and comfort vanished beneath us, and we stared down into an abysmal vulnerability. We saw, with sickening clarity, that it was flatly impossible to defend every possible target, to anticipate every possible act of random destruction. We were not unnerved, far from it: The trial of September 11 has instead stirred American resolve and fortitude. But a shadow had fallen over our lives, and most of us knew that it would not recede for a long, long time.
We face, now and for the foreseeable future, the threat of a new barbarism. The new barbarians, like those of old, consist of groups in which every member is a potential warrior. Like their predecessors, the new barbarians rely on their ability to outmaneuver their civilized adversaries, to concentrate deadly force at vulnerable spots. But unlike the old steppe nomads, the new barbarians seek neither booty nor conquest. Our new barbarian adversaries pursue a strategy of pure and perfect nihilism: They seek destruction for destruction's sake.
Glenn Reynolds' comments on Lindsey's essay are also worth reading.
If a Democrat Can Do It, Republicans Can Too
Here's an interesting story out of Mississippi exploring how tight budgets forced that state's Democrat governor to hold the line on spending. Are you listening, Republicans?
In fact, Musgrove, a Democrat, has behaved far more conservatively in many respects than Fordice did. Mississippi was spending $2 billion a year (the general fund budget) when Fordice arrived, $2.7 billion when he ran for re-election and $3.5 billion when he left office. Fordice signed off on nearly every penny of it. Three years into his term, Musgrove is still offering up a $3.5 billion budget.
Nevada May Gamble on Higher Taxes
Nevada's Republican Gov. Kenny Guinn asked a task force for recommendations on changing the state's tax stucture, and now he's got them.
No surprise: it recommends higher taxes. Government task forces dominated by government officials and special interests always do.
Reports the Las Vegas Sun:
The study, prepared by the Governor's Task Force on Tax Policy in Nevada and forwarded to Guinn on Friday, includes recommendations for new or increased business, property, entertainment and "sin" taxes to help eliminate projected state budget deficits. The general fund that supports public services such as eduction, prisons and welfare is projected to have a cumulative deficit of $4.56 billion by fiscal 2010.
Comment: the "projected" deficit is based on "projected" spending and a lack of "projected" government downsizing.
The report also looked at how much federal money Nevada gets, and finds it is below average. Other states get, on average, 20 percent of their funding from Uncle Sam. Nevada gets 14.5%.
This is a problem, according to one Task Force consultant, Las Vegas economic analyst Jeremy Aguero, who told the Sun that Nevada gets less in part because it has been undercounted by the U.S. Census, and some federal funding is tied to a state's population. But the real problem, he said, is that Nevada also has higher-than-average income levels and lower-than-average poverty levels, which also translate to less federal funding, he said.
"We get less federal funds than other states that have a higher percentage of people who need those services," Aguero said.
Yeah. Okay. Higher incomes and less poverty. That's a good thing, right? Not, apparently, to Aquero and the Nevada Governor's Task Force on Tax Policy.
Gov. Guinn is a Republican. He ought to toss the task force's recommendations in the trash can, declare there will be no tax increases, and point to Nevada's high incomes and low poverty as proof the state's traditional low-tax strategy is working. Sadly, he's going to gamble on higher taxes instead.
Florida's Low-Tax/Spend-More Conundrum
"Florida Republicans swept to historic majorities in this month's elections by attacking Democrats as big taxers, but the post-campaign reality of a dour economy is splitting the state's GOP leadership on taxes," reports the Miami Herald today.
The story continues on, saying that incoming House Speaker Johnnie Byrd is "warning fellow Republicans to stick to their anti-tax principles," while new Senate President Jim King, also allegedly a Republican, is "refusing to rule out a tax increase."
The GOP holds a 2-1 majority in the Florida legislature and Republican Gov. Jeb Bush just won a landslide reelection. But voters approved a constitutional limit on public school class sizes, and meeting that mandate "could cost up to $3 billion next year," says the Herald.
In a speech to fellow Republican lawmakers, Byrd (he's the anti-ax increase Republican) ridiculed the notion that a tight state budget or the class-size amendment justify raising taxes, and that pro-tax forces are out of step with the bedrock Republican principles that gave the GOP its majority, the Herald reports. Said Byrd: "If the principles that got us here are good enough to get us here, they're good enough to take us through the challenges that lay ahead. Now is no time to take our rudder out of the water, to stick our finger in the wind. This is the time to stay the course and lead this state based on Republican principles." The Herald says he got a standing ovation.
It seems to me if the people of Florida voted for both the class-size limit and for the legislature to be held by anti-tax Republicans, the voters' will is clear: reduce class sizes, but don't raise taxes to do it. In other words, prioritize, economize and cut the rest of government down in size. It's only hard to do if you lack the will to do it.
UPDATE: The Florida Times-Union of Jacksonville is reporting that King - the allegedly Republican state Senate leader who wants government to have more money even if it means a tax increase - is supporting expanding gambling in the state to enrich government coffers.
King, a Jacksonville Republican, said senators will take up a bill during the spring legislative session that would allow video lottery games - similar to slot machines - at greyhound tracks, horse tracks and jai alai frontons.
It's unclear whether the Senate will pass the bill or whether the House and Gov. Jeb Bush would go along. But King said it could help solve budget problems that worsened this month when voters approved a constitutional amendment requiring smaller school class sizes.
Those budget problems have led state leaders, including King and Bush, to say Florida might be forced to raise taxes or slash services.
"My feeling is if we could get up to $1 billion from allowing video lottery in pari-mutuel [racetrack and jai alai] facilities, I think there are a lot of us who would rather do that than come up with $1 billion in new taxes," said King.
The good news: King is at least looking for a way to avoid a general tax increase. The bad news: he isn't talking about reducing spending or streamlining government.
A Democratic project is going to cost "far more" than expected. Imagine that.
Productivity, which is now growing at a 5% pace, is probably the most significant number in the whole economic batch. It shows that the benefits of the technology revolution are still matriculating throughout the economy and that more output is being produced with fewer resources. This is a sure sign of future economic-growth potential. And to think American workers pulled this off despite terrorist bombings, war anxieties, corporate corruption, and accounting fraud. That's a job well done. - from economist Larry Kudlow, who writes frequently for National Review Online. I've added a link to his archives in my list of recommended sites.
The Empire Strikes Back Anyway
Earlier this month, Arkansas voters declined to pass a ballot question repealing the state sales tax on food and medicine. Opponents warrned it would gut state services like Medicare and higher education. Gov. Mike Huckabee campaigned against it, saying if it passed, Arkansans would have to make up the difference some other way.
Voters did what the government and the special interests wanted. They rejected the tax cut. Their reward? They're about to get hit with a tax increase.
"In Arkansas, GOP Gov. Mike Huckabee, also newly re-elected, stunned lawmakers last week when he proposed a sales tax increase that would generate $474 million for schools and more. Lawmakers can choose between the tax increase or budget cuts, he said," reports the Hartford Courant in a roundup of budget and tax information from a variety of states.
During the election, the paper says, Huckabee "didn't promise to hold the line on taxes and even warned voters against the initiative to eliminate the sales tax on food and medicine, saying residents would end up paying the difference. Still, he never said during the campaign that he would propose raising taxes to cover existing services."
The sad part is, Huckabee is a Republican. Apparently, he's been watching a certain governor of a certain state to the east of Arkansas, whose solution to a minor budget crisis was to spend more, tax more, and cut not at all.
UPDATE: The Benton Courier reports Huckabee is hoping to use part of the tax increase to out-Bredesen the soon-to-be-governor of Tennessee. Well, they didn't put it that way. But Huckabee clearly wants Arkansas to play the same big-time corporate subsidy game Tennessee Gov.-elect Phil Bredesen excelled at while mayor of Nashville. "Huckabee's proposed tax increase also would include nearly $40 million in additional revenue to establish what the administration calls a ''Superproject Fund'' to make the state more competitive in developing major industrial plants and economic projects," the Courier reports.
Tennessee Still on Toyota's List
As mentioned here last week, Texas thinks Toyota will pick a site in San Antonio for its sixth North American assembly plant, and Arkansas thinks Toyota will pick a site in the eastern edge of the state, just across the Mississippi River from Memphis. Tennessee officials say they think Jackson is still in the running.
The San Antonio Express-News says it's down to San Antonio and the Arkansas site - and that, because the assembly plant will build pick-up trucks, Texas has the best chance because Texas is the largest consumer market for pick-ups.
Toyota isn't saying - and probably won't for a for a few more months. Who knows. They might be waiting for Phil Bredesen to be sworn in as Tennessee's governor (on Jan. 18) so they can get the $750 million plant for free.
We'll keep you posted.
The Future Has Arrived
Remember the wrist-phone in the old Dick Tracy cartoons? It's here, sort of. Except it's a PDA.
Texas Taxes May Go Up In Smoke
Some Texas legislators want to raise the cigarette tax a dollar a pack to help the state solve a two-year budget gap of $12 billion. (Texas passes a 2-year budget, expected to total around $100 billion.)
The proposals bring Texas to the forefront of a national trend in which states are relying on so-called sin taxes to pay their bills. States are also trying to get more money from cigarette smokers and makers to help fill budget gaps that critics say include soaring tobacco-related health-care costs, reports the Austin American-Statesman.
The good news: some legislators are looking for ways to balance the budget without raising taxes.
Some of the Republican lawmakers who now control the Legislature for the first time since just after the Civil War say they won't begin their tenure by raising taxes. "Whether it's $1, 50 cents or whatever it is, I think it's dead on arrival," said state Rep. Talmadge Heflin, R-Houston, who is expected to be chairman of the House Appropriations Committee next year.
Al Gore Update
The Rocky Mountain News says a Bush-Gore rematch in 2006 would provide voters a stark contrast between two candidates, partly because of how George W. Bush has evolved since 2000, but mostly because of Gore's recent charge to the left. Noting Gore has used words like 'catastrophic,' 'immoral' and 'horrible' to describe Bush's economic, environmental and foreign policy, the RMN says: You've got to wonder what he thinks he gains by some of his almost hysterical rhetoric. He maintains, for example, that Bush's foreign policy is 'based on an openly proclaimed intention to dominate the world.' That's what it's based on? Pure imperial swagger? Gore seems to be banking on his ability to convince voters that Bush is not only misguided, but a bad man. And that's going to be one tough sell.
War Update: We're Gettin' Ready
...Another country welcomes us on the road to Iraq.
It Has Potential
This idea is a bad idea, says the Oak Ridger newspaper in Oak Ridge, Tenn. I don't agree. Sure, its crass. Sure it's hokey. Sure, it's prime material for a Saturday Night Live skit or endless jokes on Leno and Letterman. But for cash-strapped rural volunteer fire departments and small city police departments, this idea should not be rejected out of hand.
What is it?
Government Acquisitions LLC will provide police cruisers to law enforcement agencies for $1 per car as long as the vehicle can be emblazoned with ads. At first glimpse, it seems to be a good idea. After all, big cities, rural counties and small towns pressed for cash can obtain much-needed police cruisers. Bledsoe County already has signed up. It will get 10 new Ford Crown Victoria Police Interceptors for $1 each. Sheriff Bob Swafford is excited; he'll soon have vehicles without putting a dent in his budget or in the wallets of Bledsoe County taxpayers, reports the Oak Ridger.
On the other hand, Chattanooga won't take advantage of the offer. They just shelled out approximately $300,000 for 15 new police cruisers.
Warren Neel, Gov. Don Sundquist's chief income tax cheerleader, copes with rejection in an appallingly bad piece of writing for the Memphis Commercial-Appeal. Neel is Sundquist's Commissioner of Finance & Administration.
Here's a little piece of it:
Maybe there are no answers, but sometimes a parallel to one experience offers understanding of another. As horns honked outside the Capitol, as the talk shows clamored for market share and writers of little note twisted every message, I recalled the epic research by Elizabeth Kubler-Ross that outlines five stages a person moves through as the end of life approaches. I found it informative as I reflected on the state and the tax debate that has consumed the political arena for almost four years.
The first stage is denial and isolation. An individual, when told of a terminal illness, reacts: This cannot be true. Not me. Your test and diagnosis are wrong. Similarly, some suggest the financial problems of Tennessee just don't exist. This cannot be happening, particularly now, they say. We don't have a problem. And if we do, it is a slight problem caused by overspending and the economy.
... and this from the equally pathetic ending:
We have struggled through the five stages and now embark on a new political life in Tennessee. We are not sure where we are going because we arrived at this moment through rejection of a cure, not acceptance of a new life. And in so doing, we are faced with the prospect of being seduced by the rhetoric that promises to hold us firmly in the grasp of the past century, not the century our children face.
Yeah, whatever. Mr. Neel, here's what really happened: The state of Tennessee under Gov. Sundquist's leadership increased spending faster than the state constitution allows, by massively misusing a loophole intended for emergencies. This outstripped the revenue growth produced by the tax code - and yes, there was actual revenue growth. Instead of cutting spending, the governor proposed to increase spending - and demanded an unconstitutional income tax to pay for it.
Most of the major media repeated the administration's lies about the budget and revenue, and didn't challenge the revenue forecasts and the spin that came out of your office. But a few challenged the Official Version. I did. Most ignored it when you used selective data to make the revenue problem look worse than it was. Remember the time you said to focus on sales taxes from vehicle sales because they were down, but a few months later you said to ignore them because they were up? Nice try. Most of the media fell for it. I didn't. And remember the time you used a temporary dip in franchise and excise tax revenue - caused by a change in when corporations pay the tax - to make it look as if a giant new deficit hole had appeared? Once again, the media bought it and reported your press release almost verbatim. I didn't. And I was proven right, as those two press releases I wrote for the Tennessee Institute for Public Policy show.
Most of the media didn't bother digging into old revenue data, past budgets, or past editions of the state's Comprehensive Annual Financial Reports , to fact-check the administration's claims of a crisis. Some did. I did. I had worked in the state Legislature a long time ago, and I knew where to find the data and the truth.
Turns out, the administration was propagating a lie, and your office was helping.
A few courageous papers were willing to challenge the Official Version of the story. A little paper called In Review published my work right up until the founder ran out of money. The Nashville City Paper picked up the slack, publishing my fact-laden columns for more than a year, before canceling my column after I complained about not being paid on time. Today, the City Paper is just another liberal press release-regurgitator, but a year ago it had a backbone.
The end of my City Paper column was really just the beginning of better things. This web site, along with TaxFreeTennessee.com and TNTaxRevolt.org, increasingly used the Internet to challenge the Official Version with great effectiveness. A few courageous legislators stood up and said, loudly, that the Official Version was a lie, and that our constitution matters, and it does not give the legislature the authority to enact an income tax (so said three state Supreme Court rulings). And talk radio helped spread the facts that undermined your spin. The people, empowered by knowledge, rejected the lie. And that bugs you. Because the people - who are sovereign in our system - do not want the Bigger Government you were trying to force-sell them.
That's what happened. The people aren't in denial, Mr. Neel. They're in control. And you're soon to be out of a job. It's nice how life works things out for the best.
Neel, incidentally, is an economist. I found a poem dedicated to government economists like him. Here it is.
What Good is Winning...
...if you give away the victory?
Surrendering after a victory and consorting with the enemy to keep you under his thumb makes no sense. Sadly, however, that's what some Republicans in the Tennessee legislature appear ready to do.
Pro-income tax legislators had their lunch eaten in the November elections. 15 of the 45 who voted for the income tax aren't coming back. One died, one killed himself, five didn't run. One ran for state Senate and got beat. Seven were defeated in the primaries or the general election. Democrat House Speaker Jimmy Naifeh barely won re-election in his solidy Democrat district. Several candidates he endorsed got beat. And the incoming crop of 21 freshman legislators is, as a group, much more conservative and anti-income tax than the legislators they replaced.
And the GOP picked up three seats in the state House, moving them to within 5 of gaining the majority.
So what is the Republican "leader" in the House about to do? Lead a few Republicans to support the pro-income tax Naifeh as speaker, instead of helping Rep. Frank Buck, a good conservative anti-income tax Democrat, defeat Naifeh.
Here's Tom Humphrey in the Sunday Knoxville News-Sentinel: "If the 45 House Republicans were united, they would need to peel off only five Democrats for the 50-member majority needed to elect a new speaker. But the Republicans are not united. Indeed, House Republican Leader Steve McDaniel has declared he will support Naifeh's re-election. At the same time, McDaniel says he is appealing to Naifeh to reverse his long-standing policy of naming only Democrats to committee chairmanships. Unlike past years, Naifeh is declining to rule out the possibility.
Yeah. So he'll promise to appoint some Republicans to some committees, get re-elected speaker, and then renege - just like he reneged on various "promises" made to various legislators during the income tax fight.
You remember Naifeh's lies to other legislators during the climactic days of the Tennessee income tax battle, don't you? Here's what happened.
EXCERPT: No matter - the press barely had time to report on Sundquist's proposal (which he announced with all the emotional fervor of a limp dish rag) than the legislature yawned and ignored him. Last night, Jimmy Soprano made one last stab to keep his income tax alive by lying to Rep. Frank Buck - Naifeh promised to bring the income tax up for a vote but instead adjourned the House after realizing he didn't have the votes. But by Wednesday afternoon, Naifeh - his credibility in tatters - was reduced to admitting his income tax plan was dead. And Gov. Sundquist, according to Channel 4 news, was forced to promise he wouldn't pursue "tax reform" again for the rest of his term.
Why would McDaniel back Naifeh? McDaniel favors the income tax. Loudly.
The good news is, McDaniel is being challenged for the GOP leadership role by Rep. Bobby Wood of Chattanooga, who says he would be very supportive of Buck for speaker and, says Humphrey, "suspects most other Republicans would, too."
Well, this is fascinating... Teachers unions ain't gonna like it one bit.
EXCERPT: Increasingly, 21st century students from grade school to graduate school are taking web-based exams, often "smart tests" that adapt to the test-taker and provide results in minutes rather than months. It's not all multiple choice either: Artificial intelligence software can "read" and evaluate essays.
At the graduate level, web-based exams are becoming the norm. Now grade schoolers are trading pencil and paper for mouse and screen as states turn to high-tech testing. Among the states considering or implementing computerized testing are Pennsylvania, Oregon, Illinois, Virginia, Georgia, South Dakota and Idaho.
Students will be tested in the fall and again in the spring. They'll get their results as soon as they finish the exam, so they can review the answers while the questions are still fresh in their minds. Teachers will get a report on their students' performance within 24 hours. They can diagnose individual students' strengths and weaknesses, and adapt their teaching to cover what students need to learn. Principals will be able to evaluate teachers' success in teaching different areas of the curriculum.
Over several years, the scores will show what "value" is added to each student's performance, claims Northwest Education Association, a Portland, Oregon non-profit that designed the tests. Smart tests show performance on a continuous scale, not just by grade level, making it easy to track progress over time.
In the private sector, Edison Schools, Inc. now managing 150 schools nationwide, tests second through 10th grade students every month in reading, language arts and math, using the quick turnaround on results to help teachers keep students on track. Vantage Learning customizes the test to meet various state standards.
Vince Matthews, principal of Edison Charter Academy in San Francisco credits the monthly assessments with his school's rise in test scores. Web-based assessment allows inexpensive scoring of different kinds of questions, a Rand study concluded. "For example, students may be asked to move or organize objects on the screen (e.g. on a history test put events in the order in which they occurred," the study says. Computers can read numbers written in answer to a math problem or read words in a fill-in-the-blank response. Students could observe and analyze a simulated lab experiment on screen. "Reliance on paper-and-pencil multiple-choice tests limits the kinds of skills that can be measured," Rand concluded. "Computer-based testing offers the opportunity to develop new types of questions, especially those that can assess complex problem-solving skills by requiring examinees to generate their own answers."
See the whole story for more details.
How He Did It
An anti-income tax conservative Republican defeated the incumbent pro-income tax Democrat, state Rep. Butch Lewis, in a state house district that has never before elected a Republican. And beat him 54-46, a near landslide - despite being outspent, despite being ignored by the local papers, and despite his oppenent being endorsed by such heavyweight political figures as House Speaker Jimmy Naifeh. This article by Sam Harper tells how he did it.
What Jeffords Giveth Away...
... Lott Taketh Back. Heh heh heh.
Big Brother is Pending
If you haven't heard of the "Information Awareness Office," a provision of the Homeland Security Bill making its way through Congress, you need to learn about it and fight it. You can learn about it by starting here.
My post of a few days ago is also a good place to start.
And remember... knowledge is power.
Tennessee's public universities want more money. They always want more money. They are one of the biggest special-interest groups backing creation of a state income tax. But this year's request is amazingly bold: They want a spending increase greater than the expected increase in state tax revenue. To meet their demand, the state would have to raise taxes.
The Nashville City Paper reports: The board of directors of Tennessee’s higher education systems Thursday approved the request for appropriations for the 2003-04 fiscal year of $1.5 billion, or $352 million more than the state legislature gave the colleges this year. State Treasurer Steve Adams, an ex-officio member of the Tennessee Higher Education Commission, tried to temper the enthusiasm of his fellow commissioners. “We haven’t had growth of $360 million in total state revenues in a long time,” he warned. (Which begs the question: if we haven't had revenue growth of $360 million, why has our governor been proposing billion-dollar spending increases every year? Oh, right. He wanted to spend the state into a crisis so the Legislature would pass an income tax.)
Remember: The state's public universities were one of the reasons the legislature agreed to a tax increase last July that will cost taxpayers at least a billion dollars a year every year from now on.
Are the university systems just setting a high-dollar request as a negotiating tactic in hopes the final result will be a few million more than it otherwise might have been? Or do they believe the new governor, Phil Bredesen, will find some tax to raise to give them what they demand?
One other question: Isn't a conflict of interest for the state treasurer to also serve on the board, even ex officio, of one of the biggest entities in the state that must compete in the Legislature for a share of state tax dollars?
Adams claims the state has not "had growth of $360 million in total state revenues in a long time."
1. Why, if we haven't had revenue growth of $360 million in a "long time," has our governor been proposing billion-dollar spending increases every year? Oh, right. He wanted to spend the state into a crisis so the Legislature would pass an income tax.
2. How does Mr. Adams define a "long time"? Tennessee last saw revenue growth above $350 million in fiscal year 2000. We've gone just two years with growth below $350 million. The jury remains out on this fiscal year, which is only one-third completed, but a recovering economy may well produce real revenue growth (excluding the tax increase) by $350 million.
Here's a chart showing revenue growth from 1992 through 2001.
Year - $ Revenue - $ Increase
1992 - 4,987,883,000 - --------
1993 - 5,645,879,000 - 657,996,000
1994 - 5,789,672,000 - 143,793,000
1995 - 6,149,459,000 - 359,787,000
1996 - 6,421,892,000 - 272,433,000
1997 - 6,787,680,000 - 365,788,000
1998 - 7,163,455,000 - 375,775,000
1999 - 7,413,808,000 - 250,353,000
2000 - 7,997,058,000 - 584,000,000
2001 - 8,112,402,000 - 115,344,000
Average revenue growth, 1992-2001: $347,252,000
Total revenue growth 1992-2001: $3,125,269,000
Percentage revenue growth, 1992-2001: 62%
Average annual percentage revenue growth: 6.89%
You can find the raw data online here in the state's 2001 Consolidated Annual Financial Report.
Bush at War
A new book from star Washington Post reporter Bob Woodward looks at the War on Terror from inside the Bush White House.
A story in the Post introduces the book, which touches as well on Iraq, North Korea and other matters of national security.
Speaking of the days immediately after the Sept. 11 attacks, Bush said he was "floored" to learn that 11 days after the attacks on the Pentagon and World Trade Center, the FBI had interviewed 417 people as part of its terrorist sweep and that agents had put 331 people on their watch list, which consists of potential terrorists who might be in the United States or traveling to the country. Bush said he decided to keep the number secret because of the trauma that remained from the attacks.
Regarding North Korea:
Describing his aspirations for an ambitious reordering of the world through preemptive and perhaps unilateral action, Bush turned first to Iraq but then to North Korea and its dictator Kim Jong Il. With the administration contemplating a response to North Korea's nuclear weapons program, Woodward reports that Bush shouted and waved his finger in the air as he vented about Kim.
"I loathe Kim Jong Il," Bush said. "I've got a visceral reaction to this guy, because he is starving his people. And I have seen intelligence of these prison camps - they're huge - that he uses to break up families, and to torture people."
Bush said during a February visit to the North Korean border that he had no intention of invading North Korea, but made it clear in the interview with Woodward he is not content with the status quo. "They tell me, we don't need to move too fast, because the financial burdens on people will be so immense if we try to -- if this guy were to topple," Bush said. But, he went on, "Either you believe in freedom and want to -- and worry about the human condition, or you don't."
Sounds like a good book about a great president.
War Updates: Airline Security, African Bases and More...
Copying elements of the Israeli approach to airline security is not a bad idea: El Al hasn't had a flight hijacked in decades. Nice to know we're starting to do it in this country.
UPDATE 11/17: El Al hasn't had a flight successfully hijacked in decades.
Here's more on the war, from the New York Times:
For the first time since American troops withdrew from Somalia after a bloody firefight in the streets of Mogadishu, the United States military is rebuilding its combat power in the Horn of Africa. The main goal this time is to put American forces in position to strike cells of Al Qaeda in Yemen or East Africa. But the Pentagon has also begun to use Djibouti to train its forces in desert warfare — skills that could be applied in Washington's campaign against terrorist groups or on the battlefields of Iraq.
And from the Sunday NYT column by Tom Friedman:
If you want to get a feel for how far ahead the U.S. military is from any of its allies, let alone its enemies, read the fascinating article in the November issue of The Atlantic Monthly by Mark Bowden about the U.S. air war over Afghanistan. There is one scene that really sums it up. It involves a U.S. F-15 jet fighter that is ordered to take out a Taliban truck caravan. The F-15's co-pilot bombardier is a woman. Mr. Bowden, who had access to the communications between pilots, describes how the bombardier locates the truck caravan, and with her laser guidance system directs a 500-pound bomb into the lead truck. As the caravan is vaporized, the F-15 pilot shouts down at the Taliban — as if they could hear him from 20,000 feet — "You have just been killed by a girl."
I was thinking about that scene as I watched the preparations for next week's NATO summit in Prague, which will expand the alliance from 19 to 26 countries, adding Latvia, Lithuania, Estonia, Bulgaria, Slovakia, Slovenia and Romania. I wonder how many lady F-15 pilots the Latvians have. Actually, I wonder how many Denmark or Spain have. I suspect the number is zero. And that is the main reason why I don't object anymore to NATO being expanded. Because, as we already saw in the Afghan war, most NATO countries have fallen so far behind the U.S. in their defense spending and modernizations, they really can't fight alongside of us anymore anyway. So what the heck, let's invite everybody in.
I imagine after this round of expansion that when you call NATO headquarters in Brussels, a recording will answer that will go something like this: "Hello. You have reached NATO. Dial 1 if you want help consolidating your democracy. Dial 2 if you need minesweeping. Dial 3 if you need anti-chemical warfare trucks. If you need to fight a real war, please stay on the line and an English-speaking operator will assist you."
Ouch. Truth hurts.
And from Robert Kaplan's essay in the November edition of The Atlantic Monthly:
The changes that may be about to unfold in the Middle East will clear Afghanistan from the front pages. In the late nineteenth century the Ottoman Empire, despite its weakness, tottered on. Its collapse had to wait for the cataclysm of World War I. Likewise, the Middle East is characterized by many weak regimes that will totter on until the next cataclysm—which the U.S. invasion of Iraq might well constitute. The real question is not whether the American military can topple Saddam's regime but whether the American public has the stomach for imperial involvement of a kind we have not known since the United States occupied Germany and Japan.
Read the whole thing.
New Tactic in the Budget Wars
I've been noticing a new tactic state officials facing revenue shortfalls are using to make their revenue forecasts look really bad: making multi-year forecasts.
This Associated Press story on Nebraska's budget crisis describes a $1.4 billion shortfall, but here's the catch - that's a four-year projection.
The Nebraska legislature's Appropriations Committee "was told Thursday that the state could be in the red in the next four years unless tax revenues increase. That means lawmakers would have to make $336 million in permanent cuts each year for the next four years to balance the budget."
Nevada's politicos are using the same tactic - projecting a two-year shortfall.
Of course, no one can predict the economy two and four years hence, but it is likely to be growing. basing revenue projections for the next four years on this year's sluggish economy is ridiculous. Unless you want to scare legislators into voting for higher taxes - and cow taxpayers into accepting it.
Tennessee Gov. Don Sundquist is probably wishing he'd thought of it.
California GOP Shows Some Backbone
Republican lawmakers in California have told Gov. Gray Davis he made his bed, now he has to lie in it.
Reporting from Sacramento, the Los Angeles Times says: Republican Assembly leaders on Friday denounced Gov. Gray Davis and Democratic legislators as reckless spendthrifts and vowed to oppose any new taxes in the scramble to address the state's newly projected $21.1 billion budget shortfall. Davis aides responded angrily, accusing the Republicans of shattering efforts to build bipartisan cooperation in the budget negotiations that begin next week among Davis and legislative leaders of both parties.
Even if every Democratic lawmaker votes for the 2003-04 budget that Davis must propose by Jan. 10, final passage next summer will require the support of at least six Republicans in the Assembly and two in the Senate.
Democrats blame the funding crisis on a national economic downturn and say the only solution is a mix of spending cuts and higher taxes. Republican legislators characterize the problem as a simple case of Democratic extravagance that can be fixed by cutting taxes and state spending.
The looming deficit is the result of "delay, wishful thinking and, frankly, the arrogance of our colleagues on the other side of the aisle," said. Republican Assembly Leader Dave Cox.
It's also the result of overspending. Gov. Davis is one of four governors - another being Gov. Don Sundquist of Tennessee - who recieved a grade of "F" in the Cato Institute's sixth biennial fiscal policy report card, A Fiscal Policy Report Card on America's Governors: 2002 released Sept. 20.
"Davis entered office as a rising star in the Democratic Party with an image as a fiscal moderate. However, in four years he has grown the state budget by nearly 40 percent and turned a $10 billion budget surplus into a $24 billion deficit," the Cato report says. "Davis has abandoned any pretense of fiscal conservatism and has had as economically destructive a first term as any governor."
Davis created his budget crisis. Let him fix it without raising taxes, the California GOP says. As Colorado Gov. Bill Owens has shown, that's a path to political success for Republicans. Working with Democrats to raise taxes is not.
Are you listening, Gov.-elect Phil Bredesen of Tennessee?
...the ratings for the TV show The West Wing are falling. (Ignore the Canadian writer's anti-Bush comments and slight anti-America attitude and, otherwise, it's a pretty good piece.)
Al Gore Wants You To ... Wait
David Frum wonders why Al Gore endorsed a single-payer healthcare system for the U.S. less than two weeks after voters in one of the nation's most liberal states rejected the idea there.
"There’s something rather brave about a politician picking up a bold idea like this barely two weeks it was crushingly rejected by the voters of Oregon, one of the country’s most liberal states. Brave – or tone-deaf," writes Frum.
Gore endorsed the notion that the U.S. should copy Canada's healthcare system. Frum writes, "No question, single-payer has many appealing virtues. It is amazingly hassle-free. No Canadian thinks about health insurance before switching jobs. The self-employed get the same treatment as the employees of the country’s biggest bans. There are few forms to fill out, no waiting for checks in the mail. If you are sick, you go to the doctor or hospital, flash your card, and get your medicine. Or rather – you wait for your medicine. And wait. And wait."
How long can you wait?
Canada’s leading free-market think-tank, the Fraser Institute, annual releases data on waiting times across Canada for various medical procedures. The Fraser Institute report, titled Waiting Your Turn, states: This grim portrait is the legacy of a medical system offering low expectations cloaked in lofty rhetoric. Indeed, under the current regime—first-dollar coverage with use limited by waiting, and crucial medical resources priced and allocated by governments—prospects for improvement are dim. Only substantial reform of that regime is likely to alleviate the medical system’s most curable disease—longer and longer waiting times for medical treatment. You can download it here.
Some data from the report on median wait times Canadians face under their single-payer system:
8 weeks for radiation treatment for breast cancer in Ontario
12 weeks for angioplasty in British Columbia
12 weeks for radiation treatment for prostate cancer in Quebec
20 weeks for cataract removal in Ontario
52 weeks for cataract removal in Saskatchewan
80 weeks for a tonsillectomy in Saskatchewan
Says Frum: "What do those waits mean? In the case of the patient waiting for an angioplasty, they mean three months of unnecessary pain – three months when the patient cannot work. 'Single payer' is an inaptly named system. In Canada, everybody pays for healthcare – the patient pays in pain, the employer pays in lost worker hours – but only the government’s costs are counted."
That's the kind of system Al Gore thinks would be good for you and your family. Aren't you more relieved than ever that he lost in 2000?
Governers Gather to Complain About Revenue
Today's Austin American Statesman reports on the gathering of the nation's governors and governors-elect - and how they aren't happy that tax revenue isn't flooding in as it did in the 1990s.
The 42 governors and 22 governors-elect are at the National Governors Association's Seminar for New Governors, being held this year at the Four Seasons Hotel in Austin.
Reports the Austin paper: Several years and a recession ago, the biggest problem for most governors was how to spend the surplus. Times were good. Cash was flowing. Governors were golden, and Americans picked their presidents from among them.
For the governors meeting in Austin this weekend, the recent past seems like ancient history. Many, if not all, are on the hot seat as states battle fiscal woes that will make it difficult for governors to shine.
A quote from Kentucky Gov. Paul Patton is quite telling about how too many governors view surplus tax revenue: "I've been governor during good economic times, and I've been governor now during bad economic times, and let me tell you, it is a whole lot more fun when you have a little money that you can increase state programs."
Please try to remember, Gov. Patton, that all thjat extra cash wasn't created by the state - it was earned by Kentuckians and then taken from them by the state. And if you hadn't spent all the extra cash back then, you wouldn't have such a huge budget to fund now - and a little 5% dip in tax revenue wouldn't be a very big problem.
A Flea on an Elephant's Butt
Today's Washington Post reports that a federal judge has ruled that the Department of Justices owes overtime pay to its lawyers who work more than 40 hours a week: In a ruling that could cost the Justice Department millions of dollars, a federal judge has ruled that lawyers at the department who routinely work more than 40 hours a week are entitled to overtime pay under the 1945 Federal Employees Pay Act.
The Instapundit, Glenn Reynolds, a University of Tennessee law professor, opines that "This decision may do more to rein in big-government excesses than any legislation we're likely to see in the next two years."
I doubt it.
According to the story: The ruling late Thursday by Judge Robert H. Hodges Jr. of the U.S. Court of Federal Claims came in a class action lawsuit filed in 1998 on behalf of more than 9,000 Justice Department lawyers, most of them assistant U.S. attorneys who try cases for the government around the country. The lawsuit sought more than $500 million in damages for uncompensated overtime work by the lawyers. The Justice Department has estimated that paying overtime could cost $40 million a year or more in additional expenses.
$40 million is a tiny flea on the elephantine DOJ's budget. The DOJ spent $23.1 billion in fiscal year 2002. The department, which has nearly 130,000 employees, includes the Federal Bureau of Investigation, the Immigration and Naturalization Service, the Drug Enforcement Administration, Bureau of Prisons, U.S. Attorneys, and U.S. Marshals Service.
$40 million a year is a rounding error in a $23.1 billion budget - an increase of just .17 of one percent. It won't do a darn thing to reign in excesses at the Department of Justice. In fact, it might do the opposite - by encouraging DOJ lawyers to work more now that they know they will get paid for it.
Why I am NOT a Libertarian
There are libertarians. And then there is the Libertarian Party. I consider myself a pragmatic libertarian Republican. I'm not, and never will be, a member of the Libertarian Party. This article from National Review, republished in today's New York Times, explains why.
Jackson's Half-Baked Election 'Analysis'
Jackson Baker flat makes stuff up for this Memphis Flyer piece on the election results.
Here's a gem:
The fact remains that - regardless of Saddam Hussein or Osama bin Laden or any other external menaces yet to be found - the nation’s economy is in the toilet, with rising unemployment, lowered productivity, and deficits once again mounting.
Baker seems to make fun of the notion that Saddam is a menace - quoting Democratic Congressman John Tanner as describing Saddam Hussein as a "two-bit tin-horn dictator with 20 million starving people" who "don't have any weapons to bother us with."
Tell that to the Kurds that Saddam gassed. Tell that to the victims of the Palestinian suicide bombers who Saddam funds. Tell them he's a "two-bit tin-horn." And tell the families of the tens of thousands of people who will die in the next September 11 that we had a chance to take out Saddam before he gave a nuke and some biotoxins to al Qaeda, but we didn't because people like John Tanner and Jackson Baker thought the economy was more important.
But let's let him slide on not caring a whit about national security. His piece isn't about national security because, as we've seen in recent months, Democrats have little to say about it. They'd rather talk about prescription drugs than about protecting a few hundred million people from being nuked by a madman.
Baker's pieces oozes with notion that the Republicans are out to crush the little guy economically, and only Democrats can save them. Consider what he claimed: "The nation's economy is in the toilet, with rising unemployment, lowered productivity and deficits once again mounting."
Here be the facts:
1. The nation's economy is growing, and has been for about a year now. Cumulatively, the U.S. economy is larger and stronger than it has ever been. Even the stock market is trending up.
2. Unemployment has come down sharply since March - in Tennessee it is down by more than a full point since March, and is now below 5%, which is the range economists used to call "full employment" because you will always have a small percentage of people in transition between jobs or chosing not to work.
3. Deficits are mounting only because the Democrats insist on tacking unrelated spending programs onto vital anti-terrorism and military appropriations legislation - and Republicans haven't worked hard enough to stop them. That'll change now that Tom Daschle isn't setting the agenda in the Senate anymore.
4. Productivity is rising. Alan Greenspan said so. The Fed lowered the target interest rate to 1.25% last week, which was fine in itself. But the action was made sweeter by the announcement that accompanied it: The Federal Reserve "continues to believe that an accommodative stance of monetary policy, coupled with still-robust underlying growth in productivity, is providing important ongoing support to economic activity," writes economist Lawrence Kudlow:"The crucial reference to productivity suggests that the old Alan Greenspan is back. In the late 1990s the Fed chairman consistently - and correctly - argued that rapid productivity gains were increasing the economy's potential to grow. Therefore, the Fed could afford to be more generous with the cash without being concerned about inflation. At the time, the country's productivity spike amounted to a supply-side tax cut that was helped along by more cash from the central bank."
Baker then looks at the Tennessee state legislative races and sees what he wants to see:
There is some evidence, indeed, that even the state income tax (which both proponents and opponents recognized to be redistributionist, to some degree) was never as unpopular among Tennesseans as the organized public protests indicated. Joe Hall of the Ingram Group mused on election night as he surveyed the results of legislative races: "One surprising thing about the election was that the income tax per se seemed to have little to do with the outcome, even in races where a Democrat was unseated."
Ahem. I'll plagiarize the next few paragraphs directly from TaxFreeTennessee.com's coverage of the election, published Nov. 6:
Of the 45 members of the Tennessee House of Representatives who voted for the Naifeh income tax bill, only 30 are returning to the House of Representatives in January. Two of the 15 who are not returning have died, and 5 did not seek re-election. One, Bobby Sands of (D-Columbia) ran for the State Senate, and was defeated by anti-tax Republican Bill Ketron.
Seven of the pro-tax legislators ran for re-election and were defeated. Republicans Ralph Cole and Zane Whitson were defeated in their primaries by Jerome Cochran and David Hawks. Cole still would not take no for an answer, and mounted a write-in campaign against Cochran in the general election, only to be rejected by the voters in the 4th District for the second time this year. In District 70, John White was defeated in the Democratic primary by former State Representative Calvin Moore. Moore, who had indicated a willingness to support the income tax when he served in the legislature before, was in turn defeated by Dr. Joe Hensley, who got the Republican nomination after a write-in campaign in the primary on an anti-tax platform. In the general election, voters also rejected pro-tax Republicans Ronnie Davis (Dist. 11) and Stancil Ford (Dist. 10), and pro-tax Democrats Doyle "Butch" Lewis, Jr. (Dist. 47) and Paul E. Phelan (Dist. 79) Of the 8 Republicans in the House who voted for the income tax, only three were returned by the voters...
Hmmm. No, the income tax issue didn't matter at all, did it?
Oh, and don't forget that anti-income tax crusader state Rep. Mae Beavers, a Republican, won a state Senate seat in a heavily Democratic district to replace the pro-income tax Sen. Bob Rochelle, who retired. Beavers' opponent Sherry Fisher claimed to be against the income tax but, in fact, lobbied for it back in '92. And she had the full backing of the state Democratic Party, which favors the income tax, and former vice president Al Gore campaigned for her.
Let's be clear. The income tax is why the GOP moved within 5 seats of taking control of the state House and defeated two key pro-income tax Democrats - Sherry Fisher and Bobby Sands - for state Senate seats in heavily Democrat districts. The legislature is now firmly in the hands of anti-income tax forces.
Jackson Baker didn't have a very good day on Nov. 5, did he?
UPDATE: Received a brief email from Jackson Baker: "Thanks for the worthy response. Enjoy your stuff (even when - which is not always - I disagree with it)."
Tax Reform Update: Montana
Montana Gov. Judy Martz, a Republican, is proposing a tax reform package that would cut the state's income tax by 10 percent, and institute a local-option sales tax that would be limited to items tourists tend to purchase.
According to the Billings Gazette, the tax would target prepared food, drinks, accommodations, rental cars, recreation fees, souvenirs and a few other goods and services.
"Projections are that out-of-state visitors would pay 56 percent of the tax and Montanans would pay 44 percent. Even if the state levied a 4 percent limited sales tax ... it still would rank last in tax collected from tourists on vacation, compared to nine other states in the region."
The money collected from that tax would offset the loss of revenue resulting from the third and final tax-reform proposal, which calls for cutting state income taxes by 10 percent, reducing income-tax rates and slashing the state’s effective capital gains rates, which are the highest in the region.
One little-discussed fact about the tax "reform" Gov. Sundquist proposed for Tennessee was that it would reduce Tennessee's revenue from sales taxes paid by out-of-state tourists by some $240 million - and made up that difference by taxing Tennesseans more.
Montana is moving in the other direction. The right direction.
Another Republican Goes Bad
We may have found Tennessee Gov. Don Sundquist's number one fan. He's Nevada Gov. Kenny Guinn, who is now pushing for a tax increase to fill a $700 million hole in the state budget. A "Governor's Task Force" in Nevada has recommended raising taxes to deal with the shortfall, but many Nevadans are not amused.
Money magazine ranked Nevada third-lowest in the nation for overall tax load. The state has no corporate income tax, no personal income tax and no inventory tax. As the Las Vegas paper describes it, "Nevada's tax structure allows businesses to hold on to more of their profits and gives residents more income for spending, saving and investing."
We'll ignore that the Review Journal described low taxes as government "giving" people more income, and focus on the future: Gov. Guinn - unlike his fellow Republican Gov. Bill Owens in Colorado but, sadly, very much like Sundquist - thinks the way you deal with sluggish revenue in a sluggish economy is to pile a big tax increase on that struggling economy to make it struggle a little more.
Guy Hobbs, chairman of the Governor's Task Force on Tax Policy, says there is an imbalance between the state's projected costs and the revenue coming in, and, as the paper paraphrased it, something has to be done for Nevada to continue providing services that have made the quality of life here among the best in the nation. Guy Hobbs just wants more money for the state to spend. Guy Hobbs is not related to me by blood or philosophy.
"The gap between them does exist and we're looking at a $700 million deficit in the next biennium. That's the immediacy of the problem,” he says. His task force's preferred solution: raise taxes by $4.6 billion over the next eight years.
But Jerry Barton owner of Las Vegas Mini Gran Prix Family Fun Center, "does not think the answer to Nevada's $700 million projected budget deficit over the next couple of years is to raise taxes," the paper says. Barton thinks the state "should do what any normal business or household does in tough economic times: start trimming expenses."
"Consumers can't afford new taxes when times are bad, and that's when they want to raise taxes," Barton said. "I run a business, I understand how things work, but I can't just arbitrarily raise my prices."
I don't know Jerry Barton. But he's the one who should be Nevada's governor.
A few weeks ago, the Tennessee Titans were 1-4 and headed to oblivion. If the season ended now, they'd host a first-round playoff game. The Oakland Raiders would travel to Tennessee, the San Diego Chargers would travel to New England to play the Patriots, and the Pittsburgh Steelers and Denver Broncos would have byes - with the Broncos the AFC's No. 1 seed.
Anatomy of a Future Government Boondoggle
The Tennessee Department of Transportation is running around the state hyping its $1.2 billion plan to put in a rail link from Bristol to Memphis. As the Knoxville News-Sentinel reports today, TDOT is "making the case for developing a Bristol-to-Memphis corridor that would compete with ever-expanding traffic along Interstates 40 and 81. If fully implemented, the new plan could initially move 350,000 commercial trucks off the roadways, as well as divert 115,000 automobile trips per year."
Let's do the math.
TDOT says it will reduce road usage by 115,000 car trips and 350,000 truck trips a year. That sounds like a lot, but it's not.
That's just 315 cars per day day. If you assume most car trips happen between 6 a.m. and midnight, that's just 17.5 fewer cars on the road between Bristol and Memphis - a stretch of 518 miles - in any given hour of the day. That means, in a given 70-mile stretch, in a given hour, you are likely as a motorist to encounter approximately 2.3 fewer cars.
As for trucks, TDOT says moving a lot of freight off the roads and onto the rail corridor will reduce truck trips by 350,000 a year. That equals 863 fewer trucks on the road somewhere between Bristol and Memphis per day. If you've ever been on I-40 between Memphis and Nashville at 3 a.m., you know that trucks travel our roads 24 hours a day, so that's an average of 36 fewer trucks per hour. That means, in a given 70-mile stretch, in a given hour, you are likely as a motorist to see roughly five fewer trucks.
More to the point: If TDOT builds this rail project, and if it indeed removes 150,000 cars and 350,000 trucks from the road each year, then you, if you drive from Nashville to Memphis, will see 15 fewer trucks and 7 fewer cars. Traveling to Knoxville, you'll see 14 fewer trucks and 9 fewer cars. Chances are, you won't even notice the difference.
All that for $1.2 billion up front and millions of dollars in subsidies annually.
Ben Cunningham of TNTaxRevolt.org forwarded me the link to a paper by a Harvard University professor indicating the light rail rarely attracts as many riders as projected, and that light rail has never significantly reduced highway traffic. "Financially the record is pretty grim," Ben says.
New U.S. rail transit systems have generally performed poorly. Total transit ridership has generally shown only minimal improvements and, at times, declined. Financial performance has been disappointing in most cases, particularly when understood in the context of the additional system costs imposed through the reconfigurationn of bus networks to serve the new rail systems. Low-cost approaches to improving basic transit services can often be more effective than either rail or bus capital-based projects. - from the 1999 study, A Whole-System Approach to Evaluating Urban Transit Investments, by Jonathan Richmand, PhD., a fellow at the A. Alfred Taubman Center for State and Local Government at the John F. Kennedy School of Government at Harvard University, and a Fulbright Scholar at the Center for Transportation Studies at MIT.
Check out it.
Good News on the Economy
Unemployment is going down. "Tennessee's unemployment rate dropped for the first time in 15 months compared with the previous year, giving rise to optimism that the recession may have bottomed out," says today's Tennessean. "The state's 4.5% October jobless rate is the lowest since August 2001, and it's the first time since July 2000 that the monthly rate has been lower than the year before, according to figures the Tennessee Department of Labor and Workforce Development released yesterday."
As the economy revs up, the state will see a big boost in sales tax revenue.
Mo' Money, Please
Already, the special interests are lining up for more money in the next state budget. These people will never be satisified and never think they have enough. "Despite steep tuition increases to make up for a shortfall in state funding, Tennessee higher education is still about $100 million short of what it really needs to keep up with neighboring states, state officials said yesterday," The Tennessean is reporting today.
Where is it written that we must spend what other states spend on X, Y or Z?
Today's Funny Page
Not all Palestinian terrorists are alike.
Rocky Mountain High
The Denver Post isn't known as a conservative mouthpiece. A decade ago, when Colorado voters were about to vote on the Taxpayers Bill of Rights amendment to their state constitution, which would cap taxes and restrain the growth of government spending, the Post opposed the TABOR amendment.
Yet today, with Gov. Bill Owens proposing an actual cut in the state budget - not a reduction in growth but an actual cut - the Post editorialized in support of his budget.
"We don't see much in the governor's proposed budget to quarrel with," the Post said of the Owens budget for fiscal year 2002-03, which would spend less than the $13.8 billion the state legislature appropriated for the current fiscal year. "Hard times call for hard choices. On the whole, Owens has chosen wisely."
Contrast that with The Tennessean - or any of Tennessee's other major dailies - which, for the past three years, have seen only one solution to tight budgets: raising taxes.
Perhaps the Post is merely being realistic - after all, the TABOR law makes it difficult to raise taxes in Colorado, TABOR requires a voters to approve proposed tax hikes, which is unlikely during a still-sluggish economy. Or perhaps the Post is merely reflecting the reality of Gov. Owen's popularity. He spent his first term cutting taxes and cutting spending - and got reelected with 63 percent of the vote.
Either way, it's hard to argue with success.
UPDATE: The Rocky Mountain News also likes the budget plan:
Owens' latest proposal would maintain a 4 percent reserve fund, which administration officials believe could be tapped if tax collections don't pick up in the coming months - thus averting major state furloughs and layoffs. The question is whether lawmakers will keep their hands off the reserve and consent to actual cuts in some departments when as recently as six months ago they passed an oversized and irresponsible budget that threw the cost-cutting chores directly in the governor's lap.
One easy test of lawmakers' seriousness will be how they treat the governor's proposal to trim $11.5 million from tobacco education programs and research on ways to help people quit smoking. These are grant programs that clearly aren't as critical as a host of other state functions, such as funding the courts. Lawmakers who agree have only one option when faced with protests from the anti-tobacco lobby. Ignore them.
Here's how the Fort Collins Coloradoan is praising Owen's budget proposal:
Owens this week asked state departments to cut their budgets for the current fiscal year 6 percent. This comes on top of his line-item budget vetoes during the summer that hit local health and human services agencies hard and a 4 percent across-the-board cut in state spending. At times such as these, tough and sometimes unpopular choices must be made on what to fund. Owens showed his preferences for the 2003-04 fiscal year when he pitched his proposed state budget to the Legislature's Joint Budget Committee.
Owens' budget is less than this year's, the first time that has happened in years, although it does call for increasing the General Fund by 2.7 percent. The biggest funding increases would be for the departments of health and environment (15.9 percent) and corrections (7.5 percent). Funding of K-12 education would be up 5.3 percent. Owens, a former state treasurer, has a good grip on the state's financial condition and how to manipulate its $13 billion budget.
UPDATE: Here are the specifics of Owens' budget cuts in Colorado and an op-ed piece looking at the Colorado budget process.
Humbled in Humboldt
A reader passed along the link to this story in the little Humboldt Chronicle regarding Cris Crider, a 28-year-old Republican who defeated Democratic state Rep. Paul Phelan, a 10-year incumbent, in the heavily Democratic district 79, which includes all of Gibson Co. and south Carroll Co.
It's a long story. Here are the key facts:
Phelan outspent Crider $160,000 to $15,000. Phelan voted for the income tax. Phelan "went negative" in his ads. Phelan was endorsed by House Speaker Jimmy Naifeh. And by former Gov. Ned Ray McWherter and Congressman John Tanner, two wildly popular West Tennessee Democrats.
Crider is against the income tax. Crider stayed positive. Crider worked hard.
And Crider won, by a substantial 54% to 46%.
Crider had this to say about the income tax and the state budget:
"Being a financial planner, I have the ability to take a good look at the state budget. No government can be one hundred percent efficient, but Tennessee's budget can stand some improvements. Our spending has increased faster than eighty percent of other states. And because we have to balance our budget, our revenues are also increasing."
A caller to the Phil Valentine radio show yesterday claimed his daughter was one of the Middle Tennessee State University students who participated in polling Tennesseans to find out their attitudes regarding the income tax and other political issues. He said his daughter was not given a list of people to call, but was told to just call family and friends. If that's true, the poll - which appeared to show rising support for a state income tax - is not scientific.
I sent an email to Dr. Ken Blake, Associate Professor & Director of Graduate Studies at the College of Mass Communication at MTSU and asked if that caller was telling the truth, and also asked for the actual poll questions.
Here is Dr. Blake's response, in its entirety:
Thank you for your interest. You will find the poll's questionnaire at http://www.mtsu.edu/mtpoll under the "Data & Codebook" links. The poll's research reports and raw data are available as well.
As in all installments of the Middle Tennessee Poll, we purchased a random digit dialing sample from Marketing Systems Group (http://www.m-s-g.com/). The sample consisted of randomly generated telephone numbers covering all valid area codes and exchanges across the state. In keeping with standard polling practice, the numbers were generated in frequencies proportionate to each area's population so that densely populated areas would not be underrepresented and sparsely populated areas would not be overrepresented. Calling for the poll took place in our polling lab in the Business/Aerospace Building on campus under the supervision of a field director. Each caller used one of the lab's computer terminals networked to a server running Sawtooth Software's WinCATI 4.1 computer-assisted telephone interviewing system (www.sawtooth.com). The system begins each interview attempt by choosing a number at random from the sample database, printing that number on the interviewer's screen, and instructing the interviewer to dial the number. Once a residential household is reached, the interviewer uses a simple, standard process for selecting a person within the household to interview.
Students most certainly are not told to simply call people whom they know. As you noted, results of a poll conducted in such a fashion would have little chance of accurately reflecting the outcomes of both the governor's race and the lottery referendum - as our poll did.
The caller to Phil Valentine's show appears to be lying. As for the poll itself, anyone out there with expertise in polling is welcome to examine the MTSU poll's questions and data and comment.
One key question with any poll is, is it a "push" poll. Are the questions designed to "push" opinion in a certain direction?
The Battle of Tora! Tora! Tora! is Over!
It's over Over There on the Left Coast as the Forces of Political Correctness have given in and permitted a Pearl Harbor Day special event involving a showing of the classic movie Tora! Tora! Tora! at a local historic theater to proceed.
The Los Angeles Daily News reported it this way: They had survived bombs at Pearl Harbor and torpedoes across the Pacific -- but say they were nearly sunk by political correctness in the city of Los Angeles. City officials who had barred veterans of Pearl Harbor from commemorating the attack on Dec. 7 by attending a showing of the 1970 film "Tora! Tora! Tora!" at a city-owned movie theater did an about-face Wednesday. Councilwoman Janice Hahn, who Tuesday said "I wanted to be very sensitive to the Japanese-American community," changed her mind Wednesday in the face of outrage from veterans' groups and called for "disciplinary action" against theater officials for discriminating against veterans.
Never mind that it was Hahn who initially had the movie event canceled - allowing the theater to be booked for a holiday party for her brother, L.A. Mayor James Hahn, and his staff. Mayor Hahn's staff is now backtracking too - claiming they never booked the theater. But it's on the booking schedule.
Whatever. They finally did the right thing.
The San Pedro Daily Breeze story is here.
My previous coverage of the story is here, here and here.
Feel free to email Janice Hahn and tell her thanks for doing the right thing, even if she did have to be pressured into it by two days of bad publicity.
Siegelman: My Voters Are Stupid
The Birmingham News has some choice words for Alabama Gov. Don Siegelman, who either did or didn't win a close battle for re-election:
So it wasn't just Republicans who question the wisdom of those who voted for Don Siegelman for governor on Nov. 5. Now Siegelman himself, in a feeble attempt to justify a statewide recount of the ballots, argues that his supporters may have been confused by the simple act of marking next to his name with a pencil.
A Democrat says his supporters tend to be less intelligent than people who support the Republicans. Hilarious.
Are You Paying Attention, Mr. Bredesen?
The Denver Post is reporting that Colorado Gov. Bill Owens sees the state's budget crunch as an "opportunity to act on his long-stated desire to shrink government, eliminating waste and making it more efficient."
Says Owens: "In any organization as large as state government, with a $13 billion budget, there undoubtedly are programs that over the years have lost their value. A budget shortfall forces managers to evaluate everything they do and establish priorities."
Well, yes. Except in Tennessee, where revenue shortfalls led Gov. Sundquist to propose spending a lot more. Three years in a row. Exacerbating the budget 'crisis'.
Yesterday, Owens ordered most Colorado state agencies to slash their budgets 6 percent this fiscal year, to make up for an expected $550 million decline in tax revenues this year. And for the next fiscal year, Owens has proposed a budget that spends less than the $13.8 billion originally appropriated for fiscal year 2001-02.
The Post says: This virtually ensures that Colorado government will be smaller for years to come. While other states hit by declining revenue are looking toward a day when they can add back what they are being forced to cut, the method by which Colorado's government operates means it can't go on a spending spree once good times return. By law, spending increases in Colorado are limited to 6 percent from one year to the next. And Owens' cuts make it likely that the state's budget will operate from a lower base in the future.
Can't we go back four years and trade them Sundquist for Owens?
More importantly, who does Tennessee Gov.-elect Phil Bredesen look to as a role model. Owens? Or Sundquist?
U.S. stocks rallied across the board Thursday morning, ignited by a pair of better-than-expected reports on retail sales and employment.. See CNN/Money for all the details.
This would seem to be major news out of China. How come it's buried on CNN.com?
In addition to anointing new leaders, [the Politburo's Standing Committee] approved an amendment that inscribes into the party's constitution Jiang Zemin's theory of the "Three Represents." The doctrine aims to preserve the party's monopoly on political power by broadening its base to include capitalists, who were historically denounced by Communists as class enemies. - Knight Ridder newswire.
Tax Sneak Attack
TechCentralStation examines the argument that states are "losing" tax revenue to online retail.
EXCERPT: 31 states along with anti-Internet business trade groups like the National Retail Federation ... have long contended that state governments are losing out on tax revenues and that Internet-only businesses whose customers primarily purchase from out of state to avoid paying sales taxes have an unfair advantage over bricks and mortar retail stores who must impose sales taxes on their walk-in customers. There is one glaringly obvious problem with the argument: How can you lose money that you've never had to begin with? It's like saying: "Damn, I lost 56 million bucks on the lottery last night" and you never even bought a lotto ticket. For tax collectors in Utah to address their budget problems by taxing Missourians shopping online (who, as Missourians, have no representation whatsoever in Utah's legislative process) is silly.
Utah isn't $411 million in the hole because it wasn't getting its fair share of tax revenues from families in West Jordan buying Veggie Tales books off Amazon.com; Utah is $411 million in the red because they spend too much money.
It should be obvious that the National Governors Association waited until after the November 2002 election to try and push for an Internet taxation scheme. If the committee had met on October 12, 2002 instead, many voters would've thrown the bums out this month.
Amen to that.
Incidentally, the Sundquist administration made Tennessee a signatory to the NGA's Streamlined Sales Tax Project, which commits Tennessee to taxing online sales in the near future.
Soon-to-be-ex-Gov. Don Sundquist analyzes the election in a speech to the the local chapter of the Society of Professional Journalists yesterday. He claims, weirdly, that "BredeSundquist won" the election.
Here's a handy translation of the rest of the guv's speech, based on the reporting of it in The Tennessean.
"Waaaah! Waaaah! Waaaah!"
And here's the best news in the story:
Sundquist was limited to two terms.
Switch, Zell Miller!
U.S. Sen. Zell Miller of Georgia is a Democrat, but don't hold that against him. He's written a great piece in the Wall Street Journal.
Here's an excerpt:
Why in Heaven's name can't our party be for real tax cuts? In the middle of a recession, the Democrats once had a president who passed a massive tax-cut package. His name was John F. Kennedy. Today, in the middle of a recession, we should be a party advocating for more tax cuts, not less. But we aren't.
America is the most tax-averse country on earth. Our own revolution started with people tossing tea off boats in Boston Harbor . . . because of high taxes! Being a party that opposes tax cuts is not good politics, anywhere, any time. Like it or not, that's what we've become.
Instead of arguing that Mr. Bush's tax cut goes too far, we Democrats should be arguing that it doesn't go far enough. Middle-class families need more tax relief now as America faces an economic threat we haven't seen since the 1930s -- the threat of deflation.
The Federal Reserve has already cut interest rates to the lowest levels in 40 years, and there's not much more it can do. This country needs a massive economic stimulus now, before we head down the road of falling prices, falling wages and falling home values. There is a way out and it works. Let's cut taxes for individuals and business even more, right now.
Also worth reading: Pete DuPont's OpinionJournal.com piece exploring what it means for the Democrats if they pick left-winger Nancy Pelosi as their next House Minority Leader: The Democratic Party is not without good ideas, but repealing the Bush tax cuts and adopting the French foreign policy - talk nicely and never threaten a terrorist - are not among them.
Also, check out InstaPundit's look at U.S. Rep. Harold Ford's op-ed explaining why Ford, a Memphis Democrat, should get the job instead of Pelosi. "The Democrats could do worse. In fact, they almost certainly will," says Instapundit.
Also, back in May, the Atlanta Journal-Constitution had this story about Zell Miller, and how Georgia Republicans think he's great, but Democrats wish he'd switch parties.
Nation Tilting GOP?
Today's New York Times has a story reporting on Karl Rove's contention that the nation is no longer split down the middle on politics but is actually tilting toward the Republicans in a meaningful way.
"Things are moving in a new direction," Mr. Rove said in his first extended public remarks since the elections last week. "It's not just that Republicans picked up three seats in the Senate or six or seven or eight seats in the House. It's something else more fundamental, but we'll only know what it is in another two years or four years."
Safire: You are a Suspect
Columnist William Safire worries about the power that will be centralized by the Homeland Security Act in the "Information Awareness Office," a part of what Safire calls "the otherwise excellent Defense Advanced Research Projects Agency, which spawned the Internet and stealth aircraft technology." Safire asserts that, unless the Homeland Security Act is amended, "Every purchase you make with a credit card, every magazine subscription you buy and medical prescription you fill, every Web site you visit and e-mail you send or receive, every academic grade you receive, every bank deposit you make, every trip you book and every event you attend — all these transactions and communications will go into what the Defense Department describes as 'a virtual, centralized grand database.'" He further charges that the government's "computerized dossier on your private life" will also hold all manner of other information, from passport applicationsa and driver's license to bridge toll records, judicial and divorce records, even "complaints from nosy neighbors to the F.B.I.." It will be, he says, "a supersnoop's dream: 'Total Information Awareness' about every U.S. citizen." Safire warns that this seemingly Orwellian scenario "is what will happen to your personal freedom in the next few weeks if John Poindexter gets the unprecedented power he seeks."
And then he reminds us who John Poindexter is.
This Is How 'Republicans' Lose
New York Mayor Michael R. Bloomberg, allegedly a Republican, "called yesterday for a sizable new income tax on commuters who work, but don't live, in New York City," reports the New York Times. "The mayor, who is faced with a $5 billion to $6 billion deficit next year, is seeking not only to raise taxes, but to fundamentally reorganize them," the NYT says, adding that "several officials and policy analysts said it could be a bargaining gambit, designed to get legislators to approve a smaller commuter tax. Some noted that the proposal, by holding out the prospect of smaller income taxes for city residents, could give the City Council the political cover to approve a large property tax increase."
In his inaugural address as mayor of New York last Jan. 1, Bloomberg discussed the city's budget and said, "We cannot raise taxes. We will find another way."
Now he wants to raise taxes.
Bloomberg ran as a Republican, but he's governing like a Democrat. NY voters probably won't make the distinction at the polls.
Greenspan: Make Tax Cuts Permanent
In a major victory for the already-on-a-roll Bush administration, Federal Reserve Board Chairman Alan Greenspan, today said he favored making last year's tax cuts permanent, lending a powerful voice to a high priority of President Bush and the new Republican-majority Congress. "It would probably be unwise to unwind the long-term tax cut, because it is already built into the system," Mr. Greenspan told members of the Congressional Joint Economic Committee.
Spin Cycle: Whitewashing the GOP Win
A survey of voters says the GOP won its historic election gains by carrying majorities of men and whites, marginally increasing its support among Hispanics and benefiting from a slightly lower turnout by African-Americans, according to this report from Knight Ridder Newspapers.
Democratic pollster Stan Greenberg's survey "offered the first demographic analysis of the Nov. 5 voting," the story says.
"This small but dramatic shift was produced by historic events, by a president who took the stage and played his part boldly, by tactics and by money," said Greenberg, "And it was produced by the Democrats, who barely took the stage, failed to tell voters what this election was about and failed to offer bold critiques or alternatives, particularly on the economy."
Notice, please, the story is based on a poll by a Democratic pollster, and it paints the GOP as a party that attracts mostly white men.
Here's a question: Why ask voters who they voted for? We have the actual election results. Nationwide, Republicans got 53 percent of the vote (in elections for federal offices). By contrast, the poll found that 50% of voters said they voted for Republicans, 46% voted for Democrats.
That's what professional pollsters call a "margin of error."
Tora! Tora! Tora! Update
The LA Examiner drops rhetorical bombs all over the decision by Los Angeles officials to cancel a Pearl Harbor Day film event featuring the movie Tora! Tora! Tora! out of fears of offending Japanese-Americans.
In what may be remembered as the single most offensive decision by LA's Hahn siblings, the city has killed a Pearl Harbor Day event in San Pedro to avoid offending Japanese-Americans. As the Daily Breeze reports in this thorough story, LA veterans planned a showing of the 1970 WWII film "Tora! Tora! Tora!" at San Pedro's historic Warner Grand Theater. The Dec. 7 showing would also raise money for the Fort MacArthur Military Museum in San Pedro. The movie, produced jointly by Japanese and U.S. filmmakers, is a historically accurate account of the Pearl Harbor attack and the events leading up to it. LA Councilwoman Janice Hahn says, "I wanted to be very sensitive to the Japanese-American community. Dec. 7 is a tough day, especially for the second and third generations of Japanese-Americans. Why do we want to do something that makes it more difficult?" Sure, Janice, let's just forget about World War II and those annoying old veterans. Worse yet, the veterans are being kicked out of the theater that night so Janice's brother, Mayor James Hahn, can throw a party for himself.
The piece goes on to explain that the movie is considered a very balanced treatment of the Dec. 7, 1941 attack, and that, "many LA Japanese-Americans acted in the film as extras, and their relatives were looking forward to the special screening."
Tora! Tora! Tora! is one of my favorite movies of all time. As the LA Examiner piece notes, star Jason Robards survived the Pearl Harbor attack and received the Navy Cross. You can buy it on DVD here:
Terrorists casing U.S. oil ports and refineries in Philadelphia; Corpus Christi, Texas; and Valdez, Alaska.
The threat to oil ports was outlined in a classified intelligence report sent to senior U.S. officials last week. Surveillance of potential targets is one of the only indicators that reveal to intelligence officials that terrorists are planning attacks, reports the Washington Times'' Bill Gertz.
John Allen Muhammad and John Lee Malvo may have "ties to a growing sect of militant American Muslims committed to waging holy war against the United States," reports the Washington Times.
EXCERPTS: Law-enforcement authorities yesterday said investigators want to know whether the suspects — now awaiting separate murder trials in Virginia — were involved with Jamaat al-Fuqra, a militant Muslim group with documented ties to international terrorism that has been linked to 13 slayings and 17 firebombings in the United States and Canada.
The al-Fuqra network, through an offshoot group known as the Muslims of America, has established a patchwork of more than two dozen communes from New York to California, including a sizable retreat in Red House, Va., 30 miles south of Lynchburg, where as many as 200 people live in trailers in a guarded community.
FBI agents assigned to the sniper investigation task force were in Red House last week, seeking information on whether Mr. Muhammad and Mr. Malvo had ties to that community or whether they had used the site as a hide-out during a 23-day killing spree in Virginia, Maryland and the District that left 10 persons dead and three others wounded.
Al-Fuqra communes have been established to follow the teachings of Sheik Mubarik Ali Shah Gilani, a Pakistani cleric who founded the tax-exempt Muslims of America sect in 1980. Sheik Gilani left the United States for Lahore, Pakistan, in 1993, shortly after the first attack by Muslim terrorists on the World Trade Center.
There's an Al-Fuqra connection to Richard "Shoe Bomber" Reid, and a link fom Sheik Gilani to murdered Wall Street Journal reporter Danny Pearl.
It truly is a different kind of war.
See also this related story.
Naifeh Gets Nervous
The political future of the pro-income tax speaker of the Tennessee House is looking less secure.
Or maybe not. Vanderbilt Divinity School is a rather liberal divinity school, after all.
UPDATE: It's 7:37 p.m. When I first posted this item, the headline on the story on the Tennessean's website read "Divinity student sentenced to 24 years for promoting prostitution" - but now it identifies the convicted person merely as a "Hong Kong national." A Google search also reveals that the story, when first posted, lead with the description of the pimp as "A student at Vanderbilt University Divinity School...," but now the story merely refers to him as "a former religion student" at Vanderbilt.
Weird. Was someone at VU offended at the notion that their Divinity School is turning out pimps?
Nashville's NewChannel5 is reporting that a company at the center of the federal-state investigation of insider contracts handed out by the Sundquist administration "is already trying to work its way into Phil Bredesen's good graces" by hiring a "Bredesen insider" former state legislator who helped get Bredesen elected governor.
Education Networks of America was founded by two longtime friends of Gov. Don Sundquist - a friendship that was rewarded with two exclusive state contracts worth $180 million to connect Tennessee schools to the Internet. NewChannel5's Phil Williams has reported that "Internal ENA memos boast of the company working at the 'highest levels of government' to get even more contracts. And now they have hired former state Rep. Dana Moore, a "Bredesen insider" who will serve as ENA's state government liaison.
It's something to watch.
How the GOP Conquered Georgia
The Republican Party in Georgia ended the political career of a Democratic governor who was being hyped by the press as a possible 2004 Democratic presidential nominee, and also in the November elections defeated a senator, statehouse speaker, state-senate majority leader - and won two of the four congressional seats the state legislature had drawn explicitly for Democrats
Here's how it happened:
EXCERPT: Rural voters who believed in God, owned guns, loved their children even before birth, and didn't want their children in pup tents with homosexual scoutmasters still were voting Democratic as recently as 2000. Those voters who saw the Republican party as being on their side in the culture wars still didn't trust the individual GOP candidates who had all invariably come from Atlanta (one of the few Republican metropolises in the nation).
But in Sonny Perdue, Georgians who had always voted Democrat saw a kindred spirit — but one who had overcome bitterness from Reconstruction and made the leap from the party of Nancy Pelosi to the party of George W. Bush. And Perdue and Chambliss were not entrenched insiders from Atlanta — they were from south and central Georgia and acted like it.
Mailings, grassroots work, and campaign ads from the state party and the campaigns drove home the point to rural voters: If you support President Bush, vote for Republicans.
Republicans have known for years that God-fearing, gun-toting folks were voting for Democrats. This year they did something about it with campaigns that stressed defense and social issues and an unprecedented get-out-the-vote effort coordinated by Reed. And now that these voters have seen that the Republican party is the conservative party, they may never go back.
Georgia Democrats look east and see that South Carolina has become a one-party state. They look south and see Jeb Bush clobber his Democratic opponent becoming the first Republican governor to win reelection in Florida. Alabama, too, is drifting steadily towards the Republican party.
Meanwhile, Tennessee elected a Democrat governor and retained a Democratic legislature. But that may be an abberation on the road to a solidly Republican Tennessee. Yes, Democrats picked up one Congressional seat. But Lincoln Davis won it by posing as a conservative - and won it unimpressively against an underfunded, little-known challenger in a district the Democratic legislature redrew specifically to help Davis win.
And Republicans gained three seats in the state house, moving the GOP within striking distance of taking over the House in '04. The state Senate also is within reach of the GOP. That would complicate the second half of Bredesen's first term, and perhaps pave the way for a Republican to defeat him in 2006.
Right to Work = Better Economy
At least that's what they're learning in Oklahoma, says an editorial in today's Daily Oklahoman
EXCERPT: New and expanding manufacturers and processors invested more than $209 million in the state in the quarter that ended Sept. 30, about one year after the right-to-work vote. This investment came during troubled economic times and yet the amount invested was up by nearly 400 percent over the third quarter of 2001.
Included in the figures were six new companies that announced the creation of 645 jobs over the next three years and eight existing companies that pledged to increase employment by 421 jobs during the same time period.
Last year, right to work was posited as part of the answer to the problem of losing new manufacturing plants and distribution centers to Southern states that don't compel the payment of union dues. It was never sold as a panacea. Oklahoma was losing the opportunity to attract firms that in many cases chose Texas or Arkansas.
Right to work is working. The proof is in the figures cited above and evidence from other states that adopted open shops years ago. Oklahoma now has an aura of acceptance for business investment. Before, it had the stigma of compulsory unionism.
We're not making the case that new plant announcements or expansions are solely due to right to work. The state's tax incentives for business investments play a major role. But these incentives were in place years before the right-to-work vote and Oklahoma continued to lose plants to Texas and elsewhere despite offering comparable or better incentives.
Tennessee is a right-to-work state.
The Second Battle of Tora! Tora! Tora!
The city of San Pedro, Calif., is now backtracking on its decision to prevent a Dec. 7 special-event showing of the World War II movie Tora! Tora! Tora!, and Janice Hahn, the city councilperson who initially blocked the movie event now says she didn't block it.
The San Pedro Daily Breeze reports today:
An uproar over a quashed plan to show “Tora! Tora! Tora!” at a San Pedro theater has prompted Los Angeles city officials to try to line up an alternative venue. Veterans were stunned when they were told it would be insensitive to the Japanese-American community to go forward with a planned Dec. 7 showing of the 1970 Academy Award-winning film on the 61st anniversary of Japan’s attack on Pearl Harbor.
Here's yesterday's story, which reported that Hahn "concluded that the event would have been insensitive to the Japanese-American community," after which the theater - managed by the Los Angeles Department of Cultural Affairs - canceled the event and scheduled a "community holiday party" sponsored by Los Angeles Mayor James Hahn, Janice Hahn's brother.
You can email Janice Hahn at firstname.lastname@example.org, and tell her to apologize for her insensitivity to World War II veterans.
The movie 'Tora! Tora! Tora!' is considered a classic - and praised for its balance and fair treatment of the Japanese. You can buy it on DVD here:
NEA Under the Microscope
Do you know of any cases where the Tenessee Education Association illegally participated in political activity? If you, you can help the Landmark Legal Foundation, a public interest law firm, in its ongoing effort to force the National Education Association - with which the TEA is affiliated - to comply with tax laws regarding non-profits.
Landmark released a press release today noting that it has begun monitoring the activities of NEA-affiliated state teachers unions in all 50 states for that purpose.
Landmark Legal Foundation announced today that it has included the political activities and expenditures of every National Education Association (NEA) state affiliate in its ongoing efforts to monitor the union’s compliance with federal tax, election and labor reporting laws. The announcement signals a major expansion of Landmark’s five-year old NEA Accountability Project.
“It seems that NEA’s state affiliates have no more respect for federal law than their national union,” explained Landmark President Mark R. Levin. “In state after state throughout this last election cycle, NEA affiliates appear to have loaned union employees to run and work in campaigns, used tax-exempt, members’ dues to post political advertising on websites in support of specific candidates, hold candidate rallies, and hand out campaign literature and signs. Only a handful of affiliates appear to have made any effort to segregate their political expenditures from their general revenue.”
Landmark’s initial findings about the state unions’ activities were gathered from numerous sources including union-produced campaign materials, websites, news coverage and from NEA members around the country who were concerned that their dues were being used to fund political activities without their consent. Landmark has previously filed numerous comprehensive complaints with the Internal Revenue Service (IRS), the U.S. Department of Labor and the Federal Election Commission (FEC) documenting violations of federal tax, election and labor laws by the national teachers’ union going back to 1994.
“We will be watching very closely when the state affiliates file their income tax forms next year,” Levin said. “Incredibly, despite spending millions of dollars on political activities, the national union reports zero dollars from tax-exempt members’ dues spent on political campaigns since 1994. If the NEA state affiliates attempt to conceal their political expenditures from the IRS, and fail to pay income taxes on those expenditures, Landmark will file complaints against them as well.”
Cracking down on such illegal activity by the teachers' unions is a necessary step in rescuing public education from the liberal education establishment that has perpetrated its decline and even now stands in the way of sensible reform. If you know of or any illegal or possibly illegal political activity by the TEA or TEA members in Tennessee campaigns - especially if you can document it - contact Landmark via email at email@example.com
A Good Example For Phil to Follow
If Tennessee Gov.-elect Phil Bredesen is looking for a role model, he can't do better than Owens. Colorado Gov. Bill Owens is dealing with a bit of a revenue shortfall this year, just as Tennessee Gov. Don Sundquist did last year. But the two governors have taken radically different approaches to dealing with such problems. In Tennessee Sundquist proposed massive spending increases and demanded a huge tax increase to pay for it. In Colorado... well, we'll let the Denver Post explain how a good governor manages in bad times:
Gov. Bill Owens ordered most state agencies Tuesday to cut another 6 percent from their current-year budgets to help make up a projected $550 million budget shortfall. Owens also called on the legislature, the courts and attorney general's office to match the reductions in the current 2002-2003 budget. His order, which largely spares prisons and Medicaid, comes on top of 4 percent across-the-board decreases he mandated in May to balance the budget.
In addition to the new 6 percent agency cuts, which he said would save $143 million in the current fiscal year, Owens proposed a budget savings of nearly $134 million by shifting the pay date for state employees from the last day of the month to the first. That change also could prevent 2,300 layoffs, Owens said.
Owens announced the new cuts at a presentation of his proposed $13.1 billion budget for the 2003-04 fiscal year to the legislature's Joint Budget Committee. "I believe it offers a responsible and realistic spending plan in what will continue to be a challenging economic environment," Owens told lawmakers on the six-member committee.
It is the first time in at least a dozen years that a governor proposed a budget smaller than the one in the previous year. The 2002-2003 current state budget, with the new cuts, amounts to $13.2 billion.
Each month during the Sundquist administration, the latest revenue data was released and used to trumpet the need for an income tax. Compare that to how Owens announced Colorado's current shortfall in a Sept. 30 press release:
Based on the September revenue forecast prepared by the Office of State Planning and Budgeting, an additional $330 million in reductions will be required in the current fiscal year to ensure a balanced budget.
"A year ago, and many times throughout the year, I warned the Joint Budget Committee members that state revenue was declining. These warnings were largely unheeded. The legislature sent me a budget that increased spending by 7 percent when revenue was down 13 percent. As recently as June, some legislators were claiming the budget was balanced and that my actions to reduce spending were not needed. If I had not taken action earlier this year to cut the state budget by $220 million, the situation now would be even more pressing," Owens said.
Sundquist spent like crazy. Then, times got tough so he panicked and grabbed for higher taxes. Owens governs in such a way that Colorado lives within its means. Owens recently received the top rating for fiscal management among all governors (Sundquist got an "F") and National Review recently called him America's "best governor."
All those budget cuts have turned the people of Colorado against Owens, right? Wrong. Owens is one of the most popular governors in America, and just won re-election in a landslide, capturing 63 percent of the vote.
UPDATE: Here is the Rocky Mountain News coverage of the same story.
Call You Travel Agent
Sez here the Democrats are going to hold their 2004 convention in either Boston, Detroit or New York. Meanwhile, the Republicans are picking from New York, Tampa-St. Petersburg, Florida; and New Orleans. Call your travel agent and tell them which of those cities you want to avoid in the summer of '04.
UPDATE: It's Boston for the Democrats.
The More Things Change...
Hmmm. Today's hot issue is states wanting to levy a sales tax on online purchases. The first two things I ever posted on my blog, almost one one year ago, were on the same topic.
Here's part of one Nov. 30, 2001 essay, titled The Myth of the Level Playing Field:
The Bond Buyer article, “Analysts Downplay E-Commerce's Threat to State, Local Taxes,” notes that some analysts have predicted e-commerce would wreak havoc on state and local budgets. Last month, economists at the University of Tennessee issued yet another report predicting state and local governments across the nation will forego billions of dollars in revenues if online transactions continue to be mostly untaxed. But so far, those large revenue losses predicted by UT and other organizations "have not come to pass.”
"I haven't heard one state treasurer say that Internet sales are a basis for a downturn," said David Hitchcock, a director at Standard & Poor's, saying states with slumping sales tax revenues have no reason to believe online sales are the reason why. And Claire G. Cohen, vice chairman of Fitch, says, "It would appear that e-commerce is not as widely threatening at this point as some people thought it would be."
The old essay also cites a Cato Institute study that exposes the hypocrisy in the arguments of those who favor allowing states to collude on a multi-state online sales tax system.
Read the whole thing. And then methodically read all of my archives for the past year. Or not.
Good News on the Economic Front
Economist Lawrence Kudlow says the stage is set for enactment of better economic policies, thanks to the elections. Coming soon: bigger, faster tax cuts and more to put the economy on a high-growth path.
EXCERPT: This past week delivered another positive for the economy in the form of a strong mid-term election mandate for the White House. In January, President Bush is expected to include across-the-board tax cuts in his 2003 budget. His recipe may include tax cuts on dividends, business write-offs for the purchase of new equipment, higher limits for supersaver accounts, investment losses, and gains, and faster implementation of last year's personal tax cuts.
Inside the White House it is expected that economist Glenn Hubbard will be given new responsibilities to shepherd along such a big-bang economic growth package. In the Senate, Don Nickles of Oklahoma will likely become the chairman of the Senate Budget Committee, where he can lead a massive budget reconciliation act. And over at the Federal Reserve, the recent decision to link productivity with monetary policy strongly suggests that Dallas Fed president Robert McTeer is being groomed to succeed Greenspan in 2004 when his term ends — or perhaps sooner should the chairman decide to take early retirement.
McTeer is an apostle of the high-tech new economy, where spillovers from technological innovation continue to revolutionize the old economy. He will pair wonderfully with Hubbard in the White House. A McTeer-Hubbard combination will generate a pro-growth policy mix that can dominate the economic landscape for years to come.
...There are big changes in store for the economy. President George W. Bush will use a fresh new voter mandate to take full command of the economy with far-reaching reforms that will dominate the fiscal scene for years to come. The voters have given him their trust, and he will not wait long to put powerful growth measures back into action.
Amen to that. With the GOP now firmly in charge, they can finally take all the steps necessary to once and for all bury the Clinton recession (yes, it started under Clinton) under a mountain of economic growth.
UPDATE: A reader sent me the link to an article at City-Journal.org by a conservative and Wall Street Journal ethics columnist Harry Stein, who meticulously documents - at length - how he was smeared by the Fort Worth Star-Telegram in May 2002 after a speech at the Federal Reserve Bank of Dallas to the National Center for Policy Analysis. The smear, Stein says, was not really aimed at him but at planting a "land mine" in McTeer's public record so liberals will have a way to block him if he's ever nominated for a higher office - like chairman of the Federal Reserve.
It is truly a sickening feeling being slandered in this way, the outrage mixing with a profound sense of helplessness. Yet rereading the article, I finally grasped something else: I was not really the main target here. Bob McTeer was," writes Stein.
A quick visit to the Internet shows why. Well liked and well respected, with a squeaky-clean reputation, he is a favorite of conservatives, and has been described as “the leader of the free enterprise fed.” “Alone among FOMC members,” notes Lawrence Kudlow in a March 2002 column, “McTeer uses real-time financial and commodity advice to guide his policy views. . . . [I]t remains unlikely that Alan Greenspan will serve out his full term as Fed chairman through 2004. To promote non-inflationary growth and monetary reform, why not Bob McTeer?”
And, sure enough, there it all was near the top of the Star-Telegram story: “Bob McTeer, president of the Federal Reserve Bank of Dallas, quickly apologized to his colleagues, but the flap has reached officials in Washington, D.C., where McTeer, popular for his folksy manner and steadfast belief in free markets, has been considered a possible successor to Fed chairman Alan Greenspan.”
UPDATE: WSJ editor Roberty Bartley says McTeer was the victim of a political-correctness hazing over the Stein speech. Bartley praises McTeer's work with the Federal Reserve, saying, "the half-point reduction in the federal-funds rate certainly vindicates the September dissents by Governor Edward Gramlich and Dallas Fed President Robert McTeer Jr. (Given what happened in 2000, Mr. McTeer's two 1999 dissents against tightening also look pretty good.)"
You can purchase Stein's excellent book, How I Accidentally Joined the Vast Right-Wing Conspiracy (and Found Inner Peace), by clicking the picture below:
A Crime Story...
... that'll make you smile.
Of Revenue Shortfalls, Taxes and Budget Cuts
Over in Oklahoma, tax revenue is not coming in as fast as the guvmint hoped it would. So, they're proposing a big new tax, right? Wrong. They're cutting spending. ... Meanwhile, Idaho is dealing with a lean budget ... but a growing revenue surplus as state tax collections have exceeded expectations for the fourth straight month this fiscal year. ... But out in Nevada, they're talking tax increases to fill a hole in the state budget.
Toyota to Texas?
Tennessee was said to be on the short list, but this report says the company will builds its next new plant in San Antonio, Texas. Or possibly Arkansas. "A site in eastern Arkansas that is just minutes from Memphis, Tenn., is in the running for the new $650 million truck plant that Toyota plans to build in the United States, and company officials have invited the Arkansas governor to visit Japan," reports the Associated Press. But USA Today said it appears San Antonio will win the plant.
From the "If You Can't Beat 'Em" Department
U.S. Sen. John Edwards of North Carolina wants to be president. So... he has a plan.
U.S. Sen. John Edwards today will call for significant cuts in the size of the federal government and for placing a priority on tax cuts that benefit the middle class over those that will help the wealthy. The speech comes as Democrats try to regroup after last week's election debacle and the party's 2004 White House aspirants search for a message that will set themselves apart from a popular war-time president and one another."
But Edwards can't escape his party's use of class warfare. He proposes to cancel the part of the Bush tax cuts that go to familes making $200,000 a year or more. Canceling that part of the tax cut won't help people who make less, of course. But, hey, if a Democrat wants to cut taxes - any taxes - that's real news. And the Republicans should shake his hand, welcome him aboard and offer to increase the size of his tax cut. Because there is no such thing as a bad tax cut.
An Attack of Political Correctness
It was going to be a night to remember, reports the San Pedro Daily Breeze. There would be "ushers dressed in World War II military uniforms, vintage cars pulling up to the curb, Pearl Harbor survivors and a recently restored 1940s military searchlight ... on hand Dec. 7 to greet the crowds at a special anniversary showing of 'Tora! Tora! Tora!' at San Pedro’s historic Warner Grand Theatre."
The paper goes on to note that the 1970 film — which was a joint American and Japanese production — "is considered one of the most accurate depictions of events leading up to the 1941 Japanese bombing of Pearl Harbor." The special event was intended to raise funds for the Fort MacArthur Military Museum in San Pedro.
But now the show is off. Because this dumb woman stepped in. She's Janice Hahn, a member of the Los Angeles City Council.
"Veterans and museum members say it’s simply a case of political correctness run amok," reports the Daily Breeze. "Hahn concluded that the event would have been insensitive to the Japanese-American community."
And so the theater - managed by the Los Angeles Department of Cultural Affairs - was made to cancel museum's reservation and schedule something else instead. They scheduled a "community holiday party" sponsored by Los Angeles Mayor James Hahn. He's Janice Hahn's brother.
You can email Janice Hahn at firstname.lastname@example.org.
For more on the movie 'Tora! Tora! Tora!' click this link to Amazon.com, and read the reviews that praise the movie for its balance and its fair treatment of the Japanese.
Better yet, just to irritate Janice Hahn, you can buy the DVD here:
The Tennessean Should Do This, Too
Here's a great idea for The Tennessean to copy. Though, one suspects, most of their stories would have to be labeled NRE or NRU.
Internet Sales Tax Vote
A group of states that wants to tax all online sales - not just sales by merchants that have a presence in their state - is set to vote today on a proposal to streamline sales tax collection and automate it, to make online sales taxation easier, reports today's Washington Post. The WaPo calls the states "revenue hungry." As if government is ever not hungry for more cash to spend.
The Supreme Court's 1992 Quill decision currently disallows states from enforcing their sales taxes on merchants that sell into the state but do not have a physical presence or "nexus" there. However, the court left the door open to Congress requiring such a tax. The states voting for the "Streamlined Sales Tax Project" proposal hope that, if enough states sign on to the agreement, Congress will rewrite the law and mandate such taxation across state lines.
The WaPo reports that, "Currently, 45 states and the District of Columbia levy sales taxes, with rates varying from state to state - and often from town to town. Under the Streamlined Sales Tax Project proposal, states would be required to establish uniform definitions for taxable goods and services, and maintain a single statewide tax rate for each type of product."
In other words, get ready for a hidden sales tax increase if this thing becomes law. Why? Simple. As states move to make their sales taxes uniform across all jurisdictions within the state, all items will be taxed at the rate in the highest-taxed jurisdiction. In Tennessee, the local option sales tax varies from city to city and county to county. Do you think "revenue hungry" tax collectors will implement a scheme that lowers taxes in some cities to create uniformity? Or is it more likely they'll raise tax rates where necessary to create uniformity?
Incidentally, Gov. Don Sundquist long ago made Tennessee a member of the Streamlined Sales Tax Project.
The WaPo notes that critics say the proposal would require a vast database of people's purchases, exposing them to potential privacy invasions. The story also examines whether the next Congress, with its Republican majority, will welcome the tax-raising proposal with open arms. My hope is that Republicans and Libertarians will join forces to kill this proposal for reasons of both keeping taxes low and protecting consumers' privacy.
For a full exploration of Internet sales taxation policy, click here or scroll down to read A Legion of Errors. Also, click here or scroll down to read a previous update on the Internet sales tax issue.
UPDATE: The member states of the Streamlined Sales Tax Project have adopted their plan.
Find out if your state has signed on to the Streamlined Sales Tax Project by clicking here. In Tennessee, Gov. Sundquist signed a version of the model act written by the National Conference of State Legislatures into law on May 30, 2001. The bill was sponsored by state Sen. Jerry Cooper and state Rep. Matt Kisber, two Democrats. Kisber, who voted for the proposed state income tax and then did not seek re-election, is rumored to be in line for a post - perhaps Finance Commissioner - in the incoming administration of Gov.-elect Phil Bredesen.
That model act was passed in Tennessee while most people were paying attention to the ongoing income tax debate - hence, it got little or no press coverage. But by passing that act, Gov. Sundquist set the state for higher taxes across Tennessee in any city or county where the local option sales tax is below the capped maximum of 2.75 percent. That's another part of the sorry Sundquist legacy.
Right People, Right Time
Some good news from the Christian Science Monitor:
The GOP's unexpected surge in midterm elections last week rippled beyond the US Congress to state legislatures across the land. For the first time since 1954, more Republicans than Democrats have statehouse seats nationwide. The GOP will control the legislature in 21 states, up from 17 before last Tuesday's vote. Democrats control 17 legislatures, down from 18. Eleven states will have split control, and Nebraska's legislature is unicameral. The shift, while far less noticed than Republican reclaiming of US Senate, is significant in several ways. Local lawmakers make decisions that ripple into everyday lives – from education to taxes and economic development. Politically, GOP gains in legislatures could be a harbinger of long term strength.
The story notes that the GOP gains the upper hand in state legislatures at a time when state budgets will need trimming in response to the economy and revenue shortfalls. (And overspending in the late 1990s, I must add.) Good! Reducing government spending is good training for these legislators, some of whom will move up to Congress some day.
State legislative seats are measures of a national party's basic strength down to the grass roots," says Jack Pitney, a political scientist at Claremont McKenna College in Claremont, Calif. "Presidential and Congressional returns may bounce around in response to national events, but if you are looking for the plate tectonics of American politics, look to the statehouses. Right now, the geology favors Republicans."
Tennessee is one of the states where Republicans made gains in the legislature. The GOP gained three seats in the House, bringing it to within 5 seats of taking control of the House in 2004 - when President Bush's presence on the ballot should generate record GOP turnout.
Update: Internet Sales Taxes
Devereaux Cannon, editor of the TaxFreeTennessee.com site, sends the following letter in response to my essay, "A Legion of Errors," below.
In your column on the City Paper's Bredesen interview, you wrote:
"That means they have to be spending, on average, approximately $1,800 per person (or $7,200 per family of four) per year over the Internet, an absurdly high number. On the other hand, if the Census data is correct, and the average American resident spent $120 online in 2001, and we extrapolate that number to Tennessee, then the state lost just $40.3 million in sales taxes due to online shopping in 2001 - nowhere near the $300 million-plus scare tactic that is being tossed around. And that's only if you accept the notion that all of those sales would have been taxable if they took place in Tennessee, which is dubious at best."
Another point to consider is that a number of the purchases made on the internet ARE taxable and taxed by Tennessee. A case in point, I bought a new freezer from Sears, Roebuck & Co. a few months ago. I bought it on-line. Guess what? I had to pay Tennessee sales tax. Every purchase I have ever made on-line from an establishment that has a retail presence in Tennessee has generated sales tax income for the State.
And speaking of those 50 computers for every car, it seems to me that a hefty number of those computers are Dell machines, a name the governor-elect might know. Aren't all of those Dell machines bought on-line, even if shipped here from Texas, subject to Tennessee sales tax?
UPDATE: Did a little historical research. Turns out, Bredesen tried to give away most of local-option sales tax revenue that Dell generates for the city of Nashville. He tried to tack it on to the $166 million package of tax breaks, free land and other subsidies he gave Dell to convince the computer maker to build its plant in Nashville (even though it was already planning on coming to the Nashville suburbs without any incentives). So much for consistency - then he was trying to give away sales tax dollars generated by online sales, now he complains the state doesn't get enough money from the same.
The fact of Bredesen's attempt to give Dell the sales tax revenue is buried deep in this story from Site Selection magazine.
Excerpt: Early on, local area economic development officials also had to rethink how to structure the Dell incentive package. Initially, they considered letting Dell collect up to 75 percent of sales taxes, which would have given the company some $1 million annually.
Even without that - which would have amounted to another $40 million in free money for the multi-billion-dollar computer maker over the 40 years of the incentives deal - Site Selection magazine named it the Incentives Deal of the Month in August 1999.
Impacting Politics Via the Net
"The first-ever survey of mayors and city council members of the National League of Cities about their use of the Internet shows that local officials have embraced the Internet as part of their official lives and most now use email to communicate with constituents. In contrast to Congressional representatives, who have felt swamped by email and who often dismiss emails as not very meaningful, local officials find them useful. And local officials do not feel overwhelmed by the volume of incoming email." - From Digital Town Hall: How local officials use the Internet and the civic benefits they cite from dealing with constituents online, a report from the Pew Internet & American Life project.
You can read it online or download it in a PDF file.
Here's More Proof...
...that Nashville's economy sucks.
...that Nashville's public schools are on the right track.
... that Iraq doesn't have nerve gas or plan to use it in a war with the U.S.
... that electing Republicans was a bad idea.
... that Palestinians want peace.
... that Cuba is a worker's paradise and a land of freedom.
... that Saddam has a mandate.
... that I bought my new computer a tad too soon. But then, technology changes so fast that's always true.
... that there's really no danger of a terrorist "dirty bomb."
... that government spending can only go one direction: up.
... that bad memories fade over time.
Bring Back Bonfire
I'm not an Aggie (a student or alumnus of Texas A&M University) but "Bonfire" was a great tradition and they should bring it back, as some students are trying to do. The bonfire has traditionally has been lighted on the eve of A&M's football game against their archrivel, the University of Texas Longhorns, but the 90-year-old tradition was ended by A&M administrators after the bonfire stack collapsed in 1989 while under construction, killing 12 people. Now, I'm not for people being crushed by falling logs, but it seems distinctly un-Texan to just give up and end a great tradition rather than learn from the mistakes and make bring back Bonfire better - and safer - than before. I don't think the soldiers who freed Texas gave up after the Alamo because some people died. No. They chased down Santa Ana, defeated him, and won Texas' independence.
I admit, Bonfire isn't as important as Texas winning its independence. But since when do Texans run from adversity?
A Legion of Errors
There are numerous errors of fact and apparent omissions of proper questioning in this story in today's Nashville City Paper regarding Internet sales and the state sales tax.
Below, the story, with comments of correction added in italics.
Bredesen looks for fixes to Internet, parks woes
By Skip Cauthorn
Governor-elect Phil Bredesen said recently that he’s concerned about the state’s dependence on the sales tax — 9.75 percent on the dollar in some areas — in light of dollars leaking out of the state from Internet sales. Those sales aren’t taxed if items are purchased from out-of-state locations.
“There is an Internet and mail order problem,” said Bredesen. “It’s been growing.”
Many say Tennessee’s reliance on the sales tax as its primary revenue source makes the growth in Internet sales problematic. Economists told the General Assembly last session that the state is losing roughly $300 million per year in sales taxes, and that this number is growing.
The data is based on faulty academics and pro-income tax spin - and the $300 million figure is ludicrous. The state sales tax rate at the time that figure was announced was 6 cents per dollar of spending. For the state to lose $300 million because of online sales, tthe people of Tennessee would have to be spending $5 billion a year online. Tennessee has approximately 5.6 million people, so that's $892 per person, or almost $4,000 per family of four.
If Tennesseans were shopping online at that rate, and if Tennesseans were shopping online at the national average, then U.S. consumers would be spending $240.8 billion a year online. Consider that the fourth quarter of the year is typically the best quarter for online shopping. Forrester Research predicts that this year U.S. consumers will spend about $20 billion online during the fourth quarter, a record. Fact is, U.S. consumers aren't spending anywhere near $240.8 billion online. "Total e-commerce sales last year were estimated at $32.6 billion, an increase of 19.3 percent from 2000," reports the Silicon Valley/San Jose Business Journal, citing U.S. Census data. There are 270 million people in the United States, give or take a few million undocumented illegals the INS hasn't bothered to track down and kick out yet. Let's do a little math. $32,600,000,000 divided by 270,000,000 people works out to $120 spent online per person in all of the year 2001. Not anywhere close to the $892-per-Tennessean figure that Gov.-elect Bredesen - he of supposedly superior intellect and business acumen - has swallowed like a 2-year-old accepting the existence of the Easter Bunny.
Chances are, Tennesseans aren't shopping online at a rate equal to or above the national average. According to the Progressive Policy Institute, a moderate Democrat think tank in Washington DC, only about 60% of U.S. households are wired.
The most wired city in Tennessee is Nashville, according to Nielsen//NetRatings, as reported in mid-2001. Only 53.2 percent of the homes in Nashville had Internet access - slightly more than half. Tennessee as a whole is less wired. A report from the Tennessee Regulatory Authority in June 2000 said this:
Overall, the TRA’s analysis found that Tennessee’s digital divide is even more widespread than the national divide - with only 37.5 percent of Tennesseans owning personal computers, as compared to 42.1 percent nationally. The report further shows that even fewer Tennesseans are connected to the Internet, despite the fact that computer ownership statewide has doubled since 1994.
It also said this: Tennesseans are less likely to own computers and to be connected to the Internet than the national average.
And this: Computer penetration in Tennessee’s urban areas exceeds rural areas in every income category, and only one-third of the state’s rural residents own computers.
The TRA also said 37 percent of Tennesseans own or have access to a computer, compared to 48 percent nationally. Data from the National Telecommunications and Information Administration backs up the general picture of Tennessee's population being less "on-line" that the national average.
But per capita income in Tennessee $26,988) is well below the national average ($30,472) - ranking 34th among the states in 2001 - making it highly unlikely Tennesseans spend online at the same rate as consumers do nationally.
So, being generous, let's imagine that half of all Tennesseans are now shopping online. That means they have to be spending, on average, approximately $1,800 per person (or $7,200 per family of four) per year over the Internet, an absurdly high number. On the other hand, if the Census data is correct, and the average American resident spent $120 online in 2001, and we extrapolate that number to Tennessee, then the state lost just $40.3 million in sales taxes due to online shopping in 2001 - nowehere near the $300 million-plus scare tactic that is being tossed around. And that's only if you accept the notion that all of those sales would have been taxable if they took place in Tennessee, which is dubious at best.
At this point in reporting the story, I'd have asked Bredesen if he was aware of a study showing that Internet sales are having a negligible impact on state sales tax collections - specifically, this one from 1998, just four years ago (and in the middle of the ecommerce boom), which pointed out the following:
"An estimate of the sales and use tax not collected in 1998 from the increase in remote sales due to the Internet is less than $170 million, or only one-tenth of one percent of total state and local government sales and use tax collections. An estimated 80 percent of current ecommerce is business-to-business sales that are either not subject to sales and use taxes or are effectively subject to use tax payments by in-state business purchasers. An estimated 63 percent of current ecommerce business-to-consumer sales are intangible services, such as travel and financial services, or exempt products, such as groceries and prescription drugs, which generally are not subject to state and local sales and use taxes." - from a report by Robert J. Cline and Thomas S. Neubig, Ernst & Young Economics Consulting and Quantitative Analysis.
Incidentally, the report that purports to show Tennessee is losing more than $300 million in sales taxes due to e-commerce was commissioned by the Salt Lake City-based Institute for State Studies, a public policy group connected with the National Governors' Association, both of which have endorsed taxing online sales. And do you know who wrote the report? University of Tennessee economist Dr. Bill Fox, a longtime cheerleader for higher taxes in general and a state income tax for Tennessee in particular.
The City Paper continues:
However, states are basically waiting on action by Congress, which currently has a ban on taxing the Internet across state lines.
Not true. Congress did not ban Internet sales taxes. The Commerce Clause of the United States Constitution bans them, a position upheld by the U.S. Supreme Court in the 1992 Quill decision. Basically, the court said that states can not levy their sales taxes on merchants in other states that don't have a physical presence in the state that wants to levy the tax.
Many opponents of such a tax say the Internet’s burgeoning growth must be allowed to mature and that taxation could possibly harm the relatively new market.
I'd agree with that.
“[Congress] is going to have to deal with this,” said Bredesen. “For every car bought in state there are 50 computers bought from out of state.”
I'd have asked the governor-elect his source for that stat. If he couldn't provide one, I'd have excluded the claim from my story -r quoted it and then reported that Bredesen couldn't say where the data came from. My guess is, the claim is just as dubious as the "more than $300 million a year in lost revenue" malarkey.
Sadly, the City Paper is falling well short of its goal of providing a well-written and balanced alternative to the liberal Tennessean.
Here's the Memphis Commercial-Appeal on the Tennessee General Assembly's next big fight: creating and implementing a state lottery.
Says the CA: State sponsorship of the lottery also will require transparent administration, with complete financial disclosure of operating revenues and costs. And the state must run the lottery in such a way that its players fully understand that their chances of winning anything are extremely slim. Advertising for the lottery should be limited and truthful, avoiding the ticket-to-easy-street come-ons that have characterized some of the lottery industry's more tawdry marketing campaigns in other states. Lottery administrators also must recognize and address the social costs of gambling in the form of addiction, bankruptcy and crime - costs that too many Memphis families have had to pay since the inception of casino gambling across the Mississippi state line a decade ago.
Too bad nobody thought to put all that in the constitutional amendment.
I especially love the part about marketing the lottery "in such a way that its players fully understand that their chances of winning anything are extremely slim. Advertising for the lottery should be limited and truthful, avoiding the ticket-to-easy-street come-ons that have characterized some of the lottery industry's more tawdry marketing campaigns in other states."
The Commercial Appeal doesn't get it. The lottery creators' goal is to maximize revenue, even at the expense of the poor. Otherwise, its power to raise money to fund those scholarships, would be greatly limited.
Lincoln Davis Hangs On
The Knoxville News Sentinel has an interesting story about state Sen. Lincoln Davis, just elected to Congress in the 4th District of Tennessee. Davis hasn't resigned his state Senate seat yet, and there's a bit of political intrigue as to the timing of he departure.
Davis will be sworn in as a congressman Jan. 7. After he resigns his state Senate seat, the county commission in Davis' home county will appoint an interim senator, and then there will be a special election. Former state Rep. Mark Goins, a Republican who wants the seat, says he believes Davis needs to resign his Senate seat before he is sworn in as a congressman.
The KNS story: Reports in Nashville are that Davis will try to stay long enough to help re-elect John Wilder as Senate majority leader, which in effect would make him lieutenant governor. Wilder has presided in the position by virtue of a coalition of Democrats and Republicans since the mid-1980s.
The First Amendment a "Technicality" at UT?
Glenn Reynolds has the latest on the burgeoning brouhaha at the University of Tennessee over the administration's response to a fraternity party in which five fratboys donned blackface. The Black Law Students Association at UT is upset - and wants the administration do something even if it "technically" violates the First Amendment.
UPDATE: More good stuff from Instapundit on the UT free speech debacle. Just follow Glenn's links.
South Knox Bubba - with whom I disagree on gubernatorial candidates but wholeheartedly agree with on the right choice of a college football team for which to root - sends a nice compliment my way:
Bill Hobbs has some great pro-quality blogging on the election, and something tells me he will be all over Bredesen like white on rice if he even hints at going back on his word regarding the state income tax.
Yes, Bubba, I will. But, honestly, I don't think Bredesen will go back on his word. I think he actually meant that he won't propose an income tax for the next four years. Although I remain convinced Bredesen believes an income tax is a good idea and he secretly wishes the state had one, he also wants to get-relected in 2006. Plus, a third of the pro-income tax votes in the state House are either retired, defeated or dead, and most of them were replaced by anti-income tax candidates. The state Senate is also decidedly more anti-income tax, with the election of Rep. Mae Beavers to replace retired income tax architect Sen. Bob Rochelle, and the election of Bill Ketron over pro-income tax Rep. Bobby Sands to an open Senate seat.
My guess is, Bredesen will be able to competently manage the state for four years, aided by renewed revenue growth as the economy improves. Even the teacher pay equalization is not a serious threat, in my book - the state could equalize its contribution to teacher pay for very little money - unless Bredesen caves in to the Tennessee Education Association and goes for an equalization plan that goes far beyond addressing the court's concerns and seeks to not only raise rural teacher pay to match urban pay, but to raise teacher pay statewide to the southeastern average. The latter has nothing to do with satisfying the requirements of the Tennessee constitution, but it nonetheless is being pushed as a "solution" to the plan. It's not. It's a naked money-grab.
Democrats traditionally are in the pocket of, beholden to, and unable to resist the pressure tactics of, teachers' unions. Bredesen, I think, will be different.
Of course, I could be horribly mistaken.
The national Democratic Party never defined the Democratic agenda. Other than being sort of whiney as we got drug into the Iraq war, we never really defined our position on the economy, we never said what we would do differently. We have no message this year other than we're not Bush," Mr. Harpootlian said. "Well, guess what? Eighty percent of the people like Bush."
Well-said by Dick Harpootlian, the chairman of the South Carolina Democratic Party.
Watch Out, East Tennessee
Frank Cagle, late of the Van Hilleary for Governor campaign, laments that East Tennessee may well have screwed itself by voting for Democrat Phil Bredesen for governor.
Income Tax Haunts New Legislature?
The Tennessean seems to be coming around on the issue of whether the income tax impacted the election. Last week, the paper asserted that raising taxes little impact because most of the people who voted for "higher taxes" were not defeated. But the paper was intentionally blurring the facts by including in their count legislators who voted for the sales tax increase in order to kill off the income tax for the session.
The proposal for a state income tax may be dead, but its ghost continues to divide members of the state House sharply and may result in a serious challenge to Rep. Jimmy Naifeh's bid for a seventh term as speaker of the House," the paper reports today. "Much of the post-election buzz on Capitol Hill has been about whether a coalition of dissident Democrats and Republicans will form to try to unseat Naifeh, who has lost some vital members of his inner circle and had less than a landslide victory in his bid to return to the House, where he has served since 1974. In a contest with retired Air Force Col. Antonio Lopez from Naifeh's hometown of Covington, Naifeh received 53% of the vote to 47% for Lopez, who tried to make the vote a referendum on the state income tax."
His likely challenger is Democrat Rep. Frank Buck who has been critical of Naifeh. Buck told The Tennessean: ''There has been too much emphasis on taxation and not enough on reorganization and streamlining the government."
The Tennessean notes that the 99-member House will have 21 new faces in the new session: Says the paper: More than a dozen of them will replace some of Naifeh's most trusted allies, including those who died in office, were defeated or did not run for re-election. They include 14 members who voted with Naifeh for a state income tax.
Make no mistake about it. Opponents of the proposed state income tax won the election.
Stupid is as stupid does.
Just As I Thought
The funeral rally for the late Sen. Paul Wellstone helped his rival beat his replacement on the ballot - and hurt the Democrats nationally too. While the memorial service that morphed into a shrill, crass partisan get-out-the-vote rally caused a backlash among voters nationally, Democrat pollster Mark Penn "believes national security was ultimately a bigger issue," reports Time. "His poll shows a stunning 65% of voters thought Democrats weren?t supportive enough of the President's war on terror."
Amen that that.
War Update: The 20th Hijacker
Here's some good news about the prosecution of admitted al Qaeda member and suspected would-be 20th hijacker Zacharias Moussaoui.
Reports the NYT: The White House is weighing a proposal to abandon the Justice Department's prosecution of Zacarias Moussaoui in a federal court, remove him from the United States and place him before a military tribunal in Guantánamo Bay, Cuba, administration officials say.
Good idea. The way I see it, the moment the guy admitted to being a part of the al Qaeda terrorist network, he should've been put on a plane to Guantanamo for a speed military tribunal, followed by a swift execution. As a member of al Qaeda, he is a terrorist, a sworn enemy of the United States and an enemy combatant. Whether or not he was part of the September 11 plot specifically matters not. He deserves what all members of al Qaeda deserve, from bin Laden on down.
Bring 'em On
Frank Rich's column in today's New York Times on the election results is lots of fun - until the last paragraph, which has it exactly backwors. There is not "vast opposition" to where President Bush is taking the country. There is majority support virtually nationwide. Republicans outpolled Democrats by a an average of 53% to 47% nationwide - within 2 points of a landslide.
An excerpt of Rich's column: With Mr. Gephardt leaving his leadership position, many Democratic politicians are calling for Mr. McAuliffe's head. Everyone wants "new faces" — not an easy task for a party whose 11th-hour new faces in this campaign were Frank Lautenberg and Walter Mondale and whose favorite form of ingenue, "new" Kennedys (Andrew Cuomo and Kathleen Kennedy Townsend), went belly-up in the friendly confines of New York and Maryland. The bench is so sparse that Gary Hart's name was tossed around this week. Next up, no doubt: Eugene McCarthy, George McGovern, Jimmy Carter and Mike Dukakis.
Shooting Down an Anti-Gun 'History'
If you're a believer in the Second Amendment right to bear arms, check this out: A book on guns and early Americans has been proven a fraud, and here's what I find most fascinating: The professional historians loved and praised the bogus offering — largely, it seems, because they thought it helped the cause of gun control — while initially scorning a software engineer who exposed its fallacies.
Ben Cunningham over at TNTaxRevolt.org alerted me to this story from the Daily News Tribune, a newspaper in the western suburbs of Boston, pointing out just how popular the initiative to repeal the state's income tax really was. Even though it failed 55-45, "A majority of voters in nearly two-thirds of the state's 351 cities and towns voted in favor of the initiative," the newspaper reports. The initiative, called Question 1 fared the worst, in "university towns" such as Amherst, Cambridge, Boston and Williamstown.
The Democrats in time came not to seem like the party of the little guy but the party that taxed the little guy so Danny Rostenkowski could go on a junket. To make it worse, the modern Democratic Party, which got its current philosophies during the Depression, is no longer dealing with a nation full of people who see themselves as the little guy. - Peggy Noonan, "They Got What They Wanted," Wall Street Journal, Nov. 8, 2002
Conventional wisdom has it that Fritz Mondale was poised to capture the sympathy vote after replacing Sen. Paul Wellstone on the Minnesota ballot, but the Democratic Party gave away the advantage with that awful "memorial service" that turned into a full-blown political rally complete with booing members of the other party who had merely come there to pay their respects to a man who they personally liked despite being at odds ideologically. The conventional thinking goes that the completely crass, classless and tasteless political rally energized Republican voters and disenchanted independents who are the swing vote in Minnesota, sending many away from Wellstone's replacement - and some of them wound up perhaps even voting for Norm Coleman as a rebuke to the Democratic Party. And hey, if that's the case, great - Norm Coleman will be an excellent senator.
But I wonder if that's really the whole reason Mondale emerged with an 8-point lead in the first poll and, five days later, lost to Coleman by 3 points. I doubt it.
I 'm struck by the baggage Mondale brought to the race - and the bad memories he must have evoked. Wellstone, however liberal, was not tied to an era of economic gloom the way Mondale is inextricably linked to the disastrous economic policies of the Carter administration. Remember 1978-81? Here's how Grolier's encyclopedia describes it:
On assuming office in 1977, President Carter inherited an economy that was slowly emerging from a recession. He had severely criticized former President Ford for his failures to control inflation and relieve unemployment, but after four years of the Carter presidency, both inflation and unemployment were considerably worse than at the time of his inauguration. The annual inflation rate rose from 4.8% in 1976 to 6.8% in 1977, 9% in 1978, 11% in 1979, and hovered around 12% at the time of the 1980 election campaign. Although Carter had pledged to eliminate federal deficits, the deficit for the fiscal year 1979 totaled $27.7 billion, and that for 1980 was nearly $59 billion. With approximately 8 million people out of work, the unemployment rate had leveled off to a nationwide average of about 7.7% by the time of the election campaign, but it was considerably higher in some industrial states.
When Mondale's face was on TV, did voters subconsciously see him as representing a return to such economic malaise and stagflation? Or perhaps they looked at Mondale and remembered the Iranian hostage crisis during the Carter/Mondale years, and how America was impotent to respond to Islamic terrorists.
The Carter/Mondale administration's failed economics and failed foriegn policy combined to set the stage for Ronald Reagan to attract millions of "Reagan Democrats" and independents to his side in the 1980 election. Did Mondale's 2002 reprise on the political stage - at a time of economic uuncertainty and war with Islamic terror - do the same for Coleman and for Republicans across the nation?
Wellstone's vote against the Iraq war resolution was one man voting based on his principles. But Mondale's statement that he, too, would have voted the same way shows that Mondale hadn't learned anything from the Iranian hostage crisis. Did voters see him and think that?
Wellstone represented a return to 1960s idealism; Mondale represented a return to 1970s failure. Coleman, on the other hand, represented the future, in which America is not impotent in the face of Middle East terror nor beset by a terribly troubled economy. I wonder if Mondale's face on TV - in Minnesota and across the nation thanks to wall-to-wall cable new network coverage of the Minnesota race after Wellstone's death - didn't cause revulsion among "Reagan Democrats" and independents across the nation on Election Day, just as they rebelled against Carter/Mondale liberalism 22 years ago.
If so, then Mondale can slip back into retirement knowing his legacy is secure.
Do You Know What Time It Is?
This is hilarious You'll need to have Flash and audio.
A Fool and His Words Are Soon Parsed
This is one of the funniest and well-done take-downs I've read in a long long time. Rachel Lucas makes Democratic National Committee chairman Terry McAulliffe look like a complete fool, using McAulliffe's own words ... and the lowly hyperlink. A delicious dish of crow for the head of the Democratic National Committee.
Voters Speak Out Against Taxes
The Washington Post says voters sent a "resounding 'No' to their elected officials by overwhelmingly rejecting a referendum that would ahve increased their gas tax to build more roads and mass transit. "Northern Virginia's political and business establishment struggled yesterday to understand the disconnect," says the WaPo."Elected officials, executives, tax opponents and voters themselves said the messages coming out of a rare regionwide election include deep mistrust in state government, a hardening opposition to new taxes, and a growing sentiment that sprawling development can be blamed for some of the region's ills."
What's so hard to understand? People are sick to death of being taxed and taxed and taxed to pay for yet another politician's dreams.
Meanwhile, up in Massachusetts, voters' antitax sentiments are "seen altering agendas," says the Boston Globe. "The unexpectedly strong showing Tuesday of Question 1 to eliminate the state income tax and the election of Mitt Romney have underscored a potent antitax sentiment in the state that could significantly strengthen the new governor's hand as he confronts the Legislature over the looming budget deficit," the Globe says. "With 45 percent of voters approving the state income tax measure - more than even supporters had predicted - many political observers now say the sentiment gives Romney valuable public support in the absence of veto power against the Democratic-controlled Legislature.
"Romney, who opposed the measure, already has begun to recite its narrow defeat as a mandate. 'The response to Question 1, with so many people saying they wanted to see an elimination of the income tax was, if you will, underlining the fact that people do not want to see taxes go up in Massachusetts, and they'd like to see them come down,' Romney said Wednesday. 'That's one of the things that I think brought such support to Kerry Healey and my campaign.'
A Massachusetts Democratic political consultant said: "In everybody's polling, taxes were one of the top worries. The Democrats failed to address those pocketbook issues, and Mitt Romney was just hammering home the tax issue."
Anti-tax sentiment is alive and well.
A prediction: if Tennessee Gov.-elect Phil Bredesen tries to raise taxes - any taxes - during the next four years, he's a one-termer.
War Update: Robots Hunt al Qaeda
Al Qaeda pledged a global battle without borders, and it's getting one. The Predator attack shows that U.S. counter-terror intelligence has improved. Satellites, UAVs and other cutting-edge technologies extend U.S. military presence in ways bin Laden failed to anticipate. Hellfire's laser-light can illuminate a terrorist's darkest corner.
Every American, in Al Qaeda's war doctrine, is a permissible target. Al Qaeda's own decentralized organization is part of its offensive and defensive strategy. Individual Al Qaeda members - its suicidal terrorists - are indeed its military weapons. Bin Laden praised his "asymmetric" warriors of 9-11 for their "unstoppable" dedication.But now a fearful symmetry appears. CIA's robots are more relentless than bin Laden's most committed zealots.
GOP Win Good for Healthcare Biz
Today's Tennessean looks at how the election results impact the for-profit healthcare industry that is headquartered largely in Nashville. "Decisions in Washington have a huge impact in Nashville," home to such as American Healthways and HCA Inc., the nation's largest hospital company. Tom Cigarran, chairman and chief executive officer of American Healthways, a disease management company, says history took a right turn with the Tuesday election results. The Clinton administration's reluctance to allow for-profit health-care companies to make a profit was frustrating, he said. "The industry was told, 'That's like making money off sick people'," He expects a friendlier attitude after January. "The people in charge understand for the first time in years that if you want first-rate things, it's OK to make a profit."
True Then. True Now
Now that he's almost finished his second term as governor, it's time to look back fondly on how the administration of Gov. Don Sundquist was so accurately slammed by the editor of the Nashville Business Journal for lacking credibility in his relentless drive for an income tax. That must be the same financial crisis Sundquist has been warning us about, the one that has left the state with a $300 million-plus surplus. I keep waiting for my personal checking account to experience a similar crisis, wrote then-NBJ editor Bill Lewis. (Lewis now reports on the healthcare industry for The Tennessean).
He continued: In June, overall tax collections were $696 million, 19 percent more than last year. For August through June, collections were almost $7 billion, almost a 9 percent increase over the previous year. Despite these facts, reported by its own tax collectors, the Sundquist administration has chosen to throw its credibility to the wind. In the face of historic economic growth, Sundquist's top economic advisers say tax collections are running almost $31 million below "revised" estimate. Strictly speaking, they're telling the truth. Tax collections can be up 9 percent and still be below the "revised" estimate.
All you have to do is make up a ridiculously high "revised" estimate. Then you can claim that tax collections are below estimates and the state faces a crisis. The only ingredients needed to cook the numbers are a governor intent on a tax increase and a few willing accomplices, including legislative leaders who secretly want an income tax but don't have the spine to say so publicly. Truth is the first victim in this exercise. Taxpayers will be the second.
Indeed they were.
(Free registration is required to see the article online from the July 31, 2000 Nashville Business Journal.)
Sundquist's Greatest Hits...
Remember when the Sundquist administration had to halt the release of its annual economic report when it realized it was using "flawed" data? This will jog your memory... (Free registration is required to see the article online from the May 18, 1998 Nashville Business Journal.)
Three Years Ago in Sundquist History
As his governorship thankfully passes into history, let's not forget this bit of history from Gov. Don Sundquist's record. (Free registration is required to see the article online from the Nov. 15, 1999 Nashville Business Journal.)
The Party Line
Donald Sensing is a Nashville blogger - and also full-time pastor of Trinity United Methodist Church in Franklin, Tenn. - and his blog is well worth your time. He's got a disheartening prognostication on Trent Lott's being re-handed the reins of power.
Writes Sensing: In a cable news interview just concluded, Trent Lott, soon to be Senate majority leader, promised to blow it. I was waiting for him to utter the fatal phrase, and he did: "Certainly we are going to try to work across party lines."
Translation: we are still going to let the Democrats bluster, snivel, whine and threaten their way to dominating the legislative agenda even though they are a minority because we Republicans imagine our selves to be cooperative and considerate.
Good News From The Left Coast
While Tennesseans were busy electing a serial tax-raiser and spree spender as their next governor, the people of the state of Washington were voting to limit their taxes - and even reduce them.
"Amid a lingering recession and growing state budget problems, voters yesterday showed a strong anti-tax bent with an accompanying distrust of government," reported the Seattle Times. "They overwhelmingly rejected a $4.5 million campaign by the state's business and political elite to increase the gas tax, and backed the latest tax-cutting measure by the state's most prominent anti-politician."
They also rejected a legislative plan to rewrite the state's unemployment-insurance laws, which opponents had painted as a tax increase on small businesses. And returns showed they were on their way to reducing the Legislature's power over pensions for police and firefighters.
• Referendum 51, which Gov. Gary Locke proposed and lawmakers placed on the ballot to raise billions in gas taxes for a transportation plan, was crushed despite spending dramatically more than the opposition did.
• Referendum 53, the unemployment-tax measure that was defeated, meant that voters backed home builders and small businesses against the Legislature, the governor, Boeing and other businesses that would have benefited from the legislative plan.
Referendum 51 was defeated with 63% voting no. This Seattle Times story says it was defeated by a "strange and novel alliance" of anti-tax conservatives who oppose higher taxes and liberal environmentalists who thought the transportation projects would increase urban sprawl.
Initiative 776, the plan to cut the state's car tab tax to $30, also passed handily.
Don't you Tennesseans wish you had the chance to vote on tax increases? Your Governor-elect, Phil Bredesen, doesn't.
Republicans Won. Now What?
Here's an excellent idea from Instapundit on what the Republican Party should do now to capitalize on their Election Day successes.
Taxachusetts' Missed Opportunity
Here's a pre-election day open letter to the people of Massachusetts about the chance they just narrowly missed to vastly expand their liberty.
Excerpt: Question 1 on your November 5th ballot will ask if you want to end the state income tax. Clear your eyes, take a deep breath, and read it again: END the income tax. Not raise it. Not lower it. But killing the contemptible thing once and for all. You, dear people of Massachusetts, have a real choice in this election.
The next time someone uses the phrase "no-brainer," think of this ballot question. Would you like to keep an additional $3,000 of your income each year? Would you like the state economy to be more attractive to business? Would you like to see more jobs created? Would you like to put a major dent in government waste and corruption? Do you want to help put an end to the state monopoly on education? Voting "Yes" will do that.
Seven other states today have no income tax. Kids attend public schools in those states with the usual results. Regarding the elderly, as a group, they are the most prosperous people in our society. If they feared states without an income tax they wouldn't flock to the sunshine state in such droves. It's no accident that Nevada, Florida, and Texas lead the nation as entrepreneurial hot spots — and have no state income tax.
If we don't end the income tax now, the day will soon arrive when there won't be an income tax to end. The government will simply take the next logical step and confiscate every cent you and I earn and pay us an allowance based on how cooperative we are, or how needy, or who we know. "Allowance" is an appropriate term — we're all children to the state. If you think this projection is unrealistic, think again. Much of what it does today was envisioned only in the worst nightmares of our Founders.
Massachusetts, know this with absolute certainty: voters in every state with an income tax are positively green with envy over your opportunity. To get rid of this oppressive measure, this attack on decency, all you have to do is vote "Yes" on question 1 on election day.
You don't have to spend a winter at Valley Forge freezing and starving to death. You don't have to march barefoot in a sleet storm at four in the morning to surprise mercenaries at Trenton on the day after Christmas.
You just have to vote "Yes" on question 1.
Not enough of them did.
Was I Right?
I went back and re-read a column I wrote 15 months ago about Phil Bredesen and the income tax, a column that waswrongly interpreted as a near-endorsement of Democrat Bredesen over Republican Van Hilleary in the Tennessee governor's race.
It was nothing of the kind. It was a warning to conservatives that Bredesen had the rhetoric right on the income tax - and it could propel him to a victory they didn't want.
I wrote: Bredesen said the state’s heavy dependence on the sales tax inevitably causes revenue growth that rises and falls more or less in sync with economic growth and economic slowdowns. When revenue growth slows, he said, "It's fair to ask the governor of our state to manage through the process" and "tighten up."
That diagnosis was right on target, and easily understandable by the average voter. At the time, Hilleary was saying he was against the income tax unless voters approved one in a constitutional convention - which made it possible for some to suggest, wrongly, that Hilleary secretly supported just such a constitutional amendment. While Hilleary discussed constitutional intricacies, Bredesen was saying, in effect, "the guvmint's gotta live with what it's got."
His track record of serial tax-raising and spending, notwithstanding.
But that was then. This is now. Bredesen is our next governor.
Incidentally, out on the campaign trail he said he opposed Hilleary's plan to roll back the 1-cent sales tax increase the Legislature passed last July. But 15 months ago, I reported in my column, Bredesen told the newsletter Tennessee Politics that the no-new-taxes budget the General Assembly passed July 12, 2001, was sufficient and the legislature should pass another one in 2002. They didn't. They passed a tax increase that will cost Tennessee taxpayers $933 billion this fiscal year and more than $ billion next year... and the year after that, ad nauseum. Bredesen favors the government keeping every dime and spending it.
That's Bredesen consistency for you. He's says he's not for tax increases, but he'll be glad to spend them. If, two years from now, Naifeh & Co. pass an income tax to deal with equalizing teacher pay "for the children," I guarantee you Phil Bredesen will either sign it or allow it to become law without his signature.
CNN: Republican Win a "Coup D'etat"
CNN confers illegitimacy on the GOP's big election day wins, likening it to a subversive "coup" against the government. Says CNN: ... for the first time in U.S. history the president's party gained seats in the House during the administration's first midterm elections" and "the same Republican coup d'etat was accomplished in the Senate."
The Massachusetts ballot initiative to repeal the state income tax lost 55-45, a suprisingly strong showing in liberal Taxachusetts. The Boston Globe covers the story and looks at the future of taxation in the state:
Surprising even supporters, voters came close to passing a proposal to eliminate the state income tax, sending a strong signal to Beacon Hill about distaste for future tax increases as a way to solve the budget crisis. Sponsors of Question 1, led by Libertarian gubernatorial candidate Carla Howell, had hoped for 40 percent in order to assemble a critical mass of public opinion that might dissuade the Legislature from passing a tax increase at the end of the year. "It goes to show that you can't trust polls," Howell said late last night shortly after conceding her loss in the governor's race. "It also demonstrates that the reporting of how big government must solve everyone's problems is clearly not representative of what all the people believe."
"It's certainly sobering for the Legislature that with a $2 billion estimated deficit, this puts even more pressure on them to meet the defecit with budget cuts rather than a combination of cuts and taxes," said Tufts University political scientist Jeffrey M. Berry. "I would guess it comes back on the ballot in a little bit."
Here are links to other major news media outside of Massachusetts covering the income tax repeal initiative:
The Washington Times buries it in a round-up story, as does CBSNews.com. The Associated Press notes the story in a round-up that also notes anti-tax sentiment beat a universal healthcare initiative in Oregon.
If you see other coverage outside of Massachusetts, please email me the link at bhhobbs-at-comcast.net.
To people coming here from Instapundit - WELCOME!
Incidentally, the tip jar is over there ----> (scroll up) and it's kind of empty. :-(
The Tennessean attempts to blur the impact of the income tax on state legislative races by looking at how "backers of taxes" fared last night, tossing votes for the sales tax increase into the mix to make it appear as if the income tax was less of a factor than it really was.
Says the paper: If members of the state House of Representatives who voted for new taxes earlier this year feared a voter backlash, it didn't materialize for most of them Tuesday night. Across the state, 38 incumbents who voted for either an income tax or a sales tax increase faced opposition. Four had clearly lost late Tuesday night. The rest won re-election.
Okay. Here's the point: Some anti-income tax legislators voted for the sales tax increase in order to get the budget passed and bring the legislative session to an end without an income tax.
TaxFreeTennessee.com has this roundup of what happened to legislators who voted for the income tax:
Of the 45 members of the Tennessee House of Representatives who voted for the Naifeh income tax bill, only 30 are returning to the House of Representatives in January.
Two of the 15 who are not returning have died, and 5 did not seek re-election. One, Bobby Sands of (D-Columbia) ran for the State Senate, and was defeated by anti-tax Republican Bill Ketron.
Seven of the pro-tax legislators ran for re-election and were defeated. Republicans Ralph Cole and Zane Whitson were defeated in their primaries by Jerome Cochran and David Hawks. Cole still would not take no for an answer, and mounted a write-in campaign against Cochran in the general election, only to be rejected by the voters in the 4th District for the second time this year. In District 70, John White was defeated in the Democratic primary by former State Representative Calvin Moore. Moore, who had indicated a willingness to support the income tax when he served in the legislature before, was in turn defeated by Dr. Joe Hensley, who got the Republican nomination after a write-in campaign in the primary on an anti-tax platform.
In the general election, voters also rejected pro-tax Republicans Ronnie Davis (Dist. 11) and Stancil Ford (Dist. 10), and pro-tax Democrats Dotle "Butch" Lewis, Jr. (Dist. 47) and Paul E. Phelan (Dist. 79).
Of the 8 Republicans in the House who voted for the income tax, only three were returned by the voters: Steve McDanial, Robert Patton and Raymond Walker. This significantly increases the likelihood that Steve McDaniel will not be re-elected to his position as House Republican Leader.
There is also speculation that Representative Frank Buck (D-Dowelltown) may challenge Jimmy Naifeh (D-Covington) for the position of Speaker of the House. Naifeh's position as speaker could be jeopardized by the loss of ten pro-tax Democrats in his caucus. Buck, also a Demcorat, may find his challenge to Naifeh strengthened by an alliance of anti-income tax Democrats with the newly strenghtened anti-tax Republican caucus.
Go to TaxFreeTennessee.com for a chart listing details.
The Massachusetts ballot initiative to repeal the state income tax lost 55-45. Losing by any margin is bad, but for an anti-tax referendum to be that close to winning in Taxachusetts is, well, nothing short of stunning. This is Massachusetts, which makes this an earthquake of about 7.9 on the political Richter scale. Over at Instapundit, Glenn Reynolds says, "I noticed that CNN was covering the failure of the medical-marijuana referendum in Arizona, but didn't mention this one at all. all me crazy, but I think that a 45% vote to abolish the freakin' income tax - and in Massachussetts of all places - is a bigger deal."
You're not crazy, Glenn. It is a bigger deal. But it's one the mainstream press will do their best to ignore. My hunch, however, is the newly elected Republican governor, Mitt Romney, won't ignore it.
I Didn't Know That
A quote from CNN: CNN also projected victories for: Incumbent Republicans Ted Stevens in Alaska, Mitch McConnell in Kentucky, John Warner in Virginia, Thad Cochran in Mississippi, Pat Roberts in Kansas, Jeff Sessions in Alabama, James Inhofe in Oklahoma, Michael Enzi of Wyoming, Chuck Hagel in Nebraska, Pete Domenici in New Mexico, Larry Craig in Idaho, Lamar Alexander in Tennessee and Susan Collins in Maine.
Poor Bob Clement. Hard to beat an entrenched and powerful incumbent.
Good News/Bad News
The good news is, a Republican won the gubernatorial race in Georgia, defeating the incumbent Democrat. The bad news is, the incumbent was a tax-cutter. ... Roy Barnes' campaign website says "Governor Roy Barnes has also protected Georgia homeowners from backdoor tax increases - assessments on homes going up while the millage rate remained the same - by passing the Property Taxpayer's Bill of Rights." And Georgia's economy and taxpayers were better off for it. ...
But here's the good news about the winner, Sonny Perdue. He supports even strong measures to restrain taxes and spending. According to his campaign website, "Sonny Perdue supports a constitutional amendment that requires the use of surplus revenue for tax cuts or to pay down the debt. A 2/3 supermajority in both houses of the General Assembly would be required to use surpluses for any other purpose." That's similar to the Taxpayers Bill of Rights in the Colorado constitution. That's a good thing. ...
Here's the kind of headline we like to see:
N.Va. Voters Reject Tax Hike. The WaPo story says, "Northern Virginia voters soundly defeated a regional transportation tax yesterday that opponents said would have funded suburban sprawl and forced families to pay more to governments they already distrust."
Any time voters get a chance to vote down Big Government tax-and-spend schemes, it's a good thing. ...
...but so do anti-income tax candidates
The income tax issue didn't push Van Hilleary over the top in the governor's race, but it helped several anti-income tax candidates win races down the ballot. Democrat Phil Bredesen apparently convinced enough voters he was "against" the income tax even though he also said he is keeping the tax as an "option" to be considered four years from now and that he believes it would be good for the state's economy. Spending $3 million of his own money to help buy the win certainly didn't hurt. But the income tax clearly hurt some candidates running for office in Tennessee.
In State House District 47, incumbent Doyle "Butch" Lewis, D-Manchester, lost his seat to Tullahoma businessman Judd Matheny, a Republican, in District 47. Lewis voted for the income tax.
In State House District 79, Republican Chris Crider of Milan defeated incumbent Democrat State Rep. Paul Phelan of Trenton. Phelan voted for the income tax.
And, he didn't win, but retired Air Force Colonel Antonio Lopez came close to knocking off House Speaker Jimmy Naifeh, the Democrat who was the principal backer of a state income tax during the last legislative session, in House District 81. Naifeh won by an unimpressive 53 percent to 47 percent against a political novice who had to mount a write-in campaign just to get on the ballot. Perhaps Naifeh has learned his lesson and will, finally, drop the notion of passing an income tax.
Also, in District 93, with 68% of the votes counted, long-time incumbent Rep. Mike Kernell, D-Memphis, who voted for the income tax, was running barely ahead of Republican John Pellicciotti.
In the State Senate races, Republican Bill Ketron of Murfreesboro, who is opposed to the income tax, appeared on the verge of defeating state Rep. Bobby Sands of Columbia, who voted for the income tax.
And Republican state Rep. Mae Beavers of Mt. Juliet was elected to the State Senate District 17 seat, defeating Sherry Fisher, the Carthage Democrat hand-picked by pro-income Democrats to succeed retiring state Sen. Bob Rochelle. Fisher lobbied on behalf of the income tax in the early 1990s.
And, don't forget, the leader of the anti-income tax brigades, state Sen. Marsha Blackburn, was overwhelmingly elected to Congress.
The Massachusetts ballot initiative to repeal the state income tax lost 55-45. Losing by any margin is bad, but for an anti-tax referendum to be that close to winning in Taxachusetts is, well, nothing short of stunning. This is Massachusetts, which makes this an earthquake of about 7.9 on the political Richter scale. Betcha the liberal press buries the story. But if I were the newly elected Republican governor, Mitt Romney, I'd be gettin' to work on cutting Massachusetts' taxes oh, about an hour after I was sworn in as governor.
Racial Profiling in the Sniper Case
U.S. News' John Leo savages the sniper investigators for improper racial profiling.
An exceprt: Police came across the sniper suspects at least 11 times during the long manhunt but let them go every time. The Washington, D.C., police chief acknowledged that race was a factor in this amazing failure. "Everybody was looking for a white car with white people," he told the Washington Post. Writing on his Web site, Andrew Sullivan said this was racial profiling. If a white killer had been let go 11 times because cops were looking for a black man, he asked, "Wouldn't this be the basis for uproar? Wouldn't the cops involved be fired? Wouldn't there be a massive investigation?" Yes, and the press would have erupted in high dudgeon.
Why were police looking for a white man? The usual response is that, statistically, most serial killers are white. But that excuse would never be accepted if police announced they were looking for black suspects simply because statistics on black crime are high. Besides, statistical evidence about the high percentage of white snipers and serial killers is quite shaky. Whites are about three quarters of the population but account for just over half of sniper killings, says James Alan Fox, a criminologist at Northeastern University, reporting on statistics for 1976-2000. Eric Hickey, a criminal-psychology professor at California State University-Fresno, says there are plenty of minority serial killers. Blacks account for about 12 percent of the U.S. population and 22 percent of serial killers.
Even after John Muhammad and John Lee Malvo were identified, the New York Times said authorities were exploring their possible connection to "skinhead militias." (This was deleted after the early editions of October 24, perhaps when some alert Times editor figured out that black men are not likely to join skinhead groups.)
You get the feeling that if the Muslim Marauder, a/k/a John Allen Muhammad, hadn't handed investigators multiple keys to the case, the cops and the press would still be looking for a white guy in a white van. And people will still be dying in DC.
Can't Resist It
What good's a blog if you can't post pictures of your kids?
Bennett Alexander Hobbs.
Age: 9 weeks. Too young to vote - but one look at his middle name and you know who his parents and his grandparents are for in the Tennessee Senate race.
Say It Isn't So
This part is true: "Many bloggers currently spend hours each day reading news and writing views. For almost all of them the work is pro bono, a Latin phrase that means Ramen noodles for dinner. I wish the rest of this was true
UT Blackface Update
Instapundit has more on the controversy over the University of Tennessee taking punitive action against a fraternity because five members of of the frat showed up a party in blackface.
"Suggesting that the University needs to create a "speech code" - of the sort that were stylish ten years ago and that have repeatedly been found unconstitutional - is absurd," writes Glenn Reynolds, who happens to be a law professor at UT's law school. "I'm very unhappy that the University's first instinct here was to respond in a punitive fashion. It has always been a point of pride to me that the University of Tennessee has been largely free of PC absurdities. It's doubly embarrassing to me that this stuff is appearing just as the rest of the world seems to be waking up to how wrong such behavior is."
He also links to and excerpts comments from UCLA law professor and First Amendment scholar Eugene Volokh regarding the same controversy. The lowdown: While the frat boys were boorish and perhaps even racist, UT looks like they don't understand the right of free speech.
She's a Member of the VRWC
Just found a great blog. Trust me. The writer, a self-described member of the VRWC*, says this of herself: Rachel is a 30-year-old gun-totin' capitalist oppressor of the first order and an expert on hating Al Gore. Oh, and don't mess with Texas, because that's where Rachel lives.
* Vast Right Wing Conspiracy
Regular readers of this blog know I have long advocated adoption of a Taxpayer's Bill of Rights provision in the Tennessee constitution similar to the TABOR amendment in the Colorado constitution as a way to restrain the growth of government spending and taxation. The Rocky Mountain News recently published this list of tax reductions Coloradans have enjoyed in recent years thanks to their TABOR amendment. Including permanent reductions in Colorado's income tax and a variety of other permant cuts and temporary reductions and rebates, the average couple in Colorado has kept $874 more of their money, according to the Colorado Governor's Office of State Planning and Budget
Incidentally, Colorado's budget is balanced, the state is fiscally stable, and the state's economy has benefited from TABOR's restraint on the growth of government spending and taxation. Tennessee Republican gubernatorial candidate Van Hilleary favors addition of a TABOR to Tennessee's constitution; tax-and-spend liberal Democrat Phil Bredesen does not.
Surprise: Politicians Lie
Voters in the state of Washington are considering a ballot initiative to raise their taxes to pay for a bunch of road projects. But the politicians are lying about which projects. A big one - replacing the Alaskan Way Viaduct through Seattle, "gets lots of attention in campaign fliers" now arriving in voters' mailboxes urging a 'yes' vote on Referendum 51, the $7.8 billion statewide transportation package on next week's ballot, reports the Seattle Times. "Here's what the campaign literature doesn't say: There's no money in Referendum 51 to actually build a viaduct replacement."
Good News From the Left Coast
This story from the Seattle Times should make you smile. If Hunter loses his re-election bid Tuesday to the Chelan County Commission, there won't be a Democrat left in county government for the first time in 50 years.
Looking for work or a second income? Check this out. And feel free to email me at bhhobbs-at-comcast.net for additional details.
Making the case for Question 1
Boston Globe columnist Jeff Jacoby makes a persuasive case for Question 1, the Massachusetts ballot initiative that would repeal the state's income tax. Question 1 - backed by Libertarian gubernatorial candidate Carla Howell but opposed by Democrat Shannon O'Brien and even by Republican Mitt Romney - probably won't pass. But it may get above 40 percent, which will qualify as a political earthquake in liberal tax-and-spend Massachusetts. Betcha if that happens, the liberal tax-and-spend news media won't cover it that way.
Here's Jacoby: Enacting Question 1 would not wipe out state government. It would cut a $23 billion budget to $14 billion, or roughly where it was in 1993 - not exactly the Dark Ages. In so doing, it would administer a badly needed rebuke to a Legislature that routinely treats the public with contempt and thinks the best answer to every question is new taxes. It would occasion a far-reaching debate on the state's real priorities: $14 billion will buy a lot, but it won't buy everything. It will remove $9 billion from the clammy grip of the bureaucracy and plow it back into the Bay State economy - with spectacular results.
Romney, O'Brien, and the rest of the establishment make the PBS argument: If state government doesn't do it, who will? The answer is that we will - and we will generally do it more efficiently, more intelligently, and more flexibly than the state.
And this is where Carla Howell is wrong. Small government isn't beautiful. What is beautiful is what small government makes possible: a flourishing civil society.
Shrink state government and a hive of creative private activity will take its place. Individuals and organizations will form what Edmund Burke called the ''little platoons'' of a free society - the voluntary associations that have been the wellspring of so much that is useful and humane in American life. From feeding the poor to paying for medicine to promoting the arts, countless functions that the government does badly, private societies can do well. Question 1 would give them the chance to blossom and grow, and Massachusetts would become for all of us a happier, healthier place.
Amen to that.
The good news here in Tennessee is, voters today have a chance to elect as governor - Van Hilleary - who won't let the state adopt an income tax. We don't have to go down the Massachusetts road only to regret it and face an uphil battle to repeal the income tax later.
ELECTION NIGHT UPDATE: With 57% of the votes counted, the Massachusetts ballot initiative to repeal the state income tax was losing 53-47. Losing by any margin is bad, but for an anti-tax referendum to be that close to winning in Taxachusetts is, well, nothing short of stunning. UPDATE: With 78% of the vote counted, the margin remains about the same - 55-46. This is Massachusetts, which makes this an earthquake of about 7.9 on the political Richter scale. Betcha the liberal press buries the story. But if I were Mitt Romney, I'd be gettin' to work on cutting Massachusetts' taxes oh, about an hour after I was sworn in as governor.
Disintermediation Bites Back
Darwin magazine suggests that Orbitz, the online airfare merchant owned by a consortium of airlines, is sowing the seeds of its own destruction.
An excerpt: "Orbitz is a shining example of two of the consequences that Internet gurus used to make good money blathering on about. The website has eliminated one expensive middleman (the travel agents), and has another (reservations systems) in its crosshairs. And it has made an incomprehensible pricing system transparent (if not comprehensible) with the end result of reducing airline fares, which have become the commodity that they always looked like they should have been." But therein lies the problem: "What the gurus didn't tell us was that the benefits of shooting the middleman could easily be washed out by the empowerment of the customer once a product had been reduced to a commodity."
The Internet is having this kind of impact on all sorts of industries. It occurs to me that politicians are a middleman, of sorts. As the Internet provides voters with more and more direct access to government information, making once-incomprehensible government more transparent - will the Net not also undermine politics and entrenched government? Your thoughts and comments please ... I may even publish them. Email them to me at bhhobbs-at-comcast.net
12 Reasons Why You Should Vote Democrat
The following was forwarded to me by Chuck Muth, editor of Chuck Muth's News & Views, a daily email newsletter you should subscribe to. It was written by Bob Batts, a subscriber to that newsletter.
Vote Democrat if:
You believe the government should have the power to force an employer to pay their employees more than they are worth. (minimum wage)
You believe that it is unfair to the poor that the top 50% of wage earners in this country pay 96% of the income taxes.
You believe that pouring millions of our tax dollars into the Federal Dept. of Education will benefit local schools.
You believe all our problems would be solved if everybody worked for local, state or federal government unions.
You believe undocumented workers (illegal aliens) should be allowed to vote in this country.
You believe your health care provider should be controlled and rationed by government.
You believe that Ted Kennedy, Tom Daschle and Barbara Streisand are more intelligent than the rest of us.
You believe that Jimmy Carter and Bill Clinton successfully negotiated lasting peace agreements with North Korea and between Israel and the Palestinians.
You believe the only thing Bill Clinton did wrong was have sex with a woman less than half his age while he was married.
You believe the U.S. Supreme Court stole the presidential election for the Republicans, but it is perfectly okay for New Jersey to violate it's own election law in order to insure a Democrat senate victory (Torricelli/Lautenberg).
You believe the government should be responsible for looking after your elderly parents, the health care and education of your children and to provide you income during your retirement.
And last but not least -
You believe it is proper for the government to take 15% of your income for Social Security, all your working life, but if you die too soon your family gets practically nothing in return ($270 death benefit).
Today's election ballots in Colorado and Massachusetts include referenda on replacing bilingual education with English-immersion programs in the public schools.
Reports the AP: The first skirmishes were fought in California and Arizona. Now the battle over bilingual education shifts eastward to Colorado and Massachusetts, where voters will decide November 5 how best to teach English to students who don't speak it. In each state, a contentious ballot item asks voters to do what Californians did in 1998 and Arizonans in 2000 -- replace bilingual education with an intensive English-immersion program aimed at getting them into regular classrooms after one year. Supporters of the ballot proposals say bilingual education, however well-intentioned, traps foreign-born students in classrooms where they learn neither how to write in their native language very well nor in English.
And, um... they're right.
UPDATE 11/5/02: Today's Christian Science Monitor has a good story on the English-immersion debate.
ELECTION NIGHT UPDATE: The English-immersion initiative was approved overwhelmingly by voters in Massachusetts. That's good news. Unfortunately, a similar initiative is going down to defeat in Colorado, "thus ensuring that non-English-speaking children will remain poor and socially marginalized," writes Donald Sensing.
Are All Serial Killers White?
Some in the press seemed to think so as they served up "profiles" of the possible sniper being a white male, probably a right-wing gun nut, before the Beltway Sniper suspects were caught ... and turned out to be black. Turns out, black serial killers are as common as white serial killers, once you factor in differences in each race's percentages of the population, according to Atlanta Journal-Constitution columnist Cynthia Tucker.
Says Tucker: If convicted, Malvo and Muhammad would not be the first black serial killers. While there have been few studies of serial killers by race or gender, criminologists believe that black serial killers exist in rough proportion to the number of blacks in the population: about 13 percent.
Then there's this from The Tennessean: Tony Garrett Mitchell, whom police say wanted to be famous in a world with few black serial killers, pleaded guilty this afternoon to murder charges and was sentenced to two consecutive life sentences without possibility of parole. Mitchell, 23, of Columbia, pleaded guilty to first-degree murder charges in the slayings of Diana Pulse, 18, and Pam Tate Gordon, 39, in July. Bodies of both women were found dumped in rural Mt. Pleasant, police said.
Hmmm. Guess he should've waited and read Instapundit.
A Message - And Warning - From Camp Hilleary
The following email arrived moments ago from Jim Burnett, chief of staff of the Van Hilleary for Governor campaign:
I wanted to write a quick note to let everyone know how much Van and Meredith appreciate your efforts. So many people have worked so hard to get us to this point. The momentum in this race is clearly behind Van. Feedback from across the state is very positive and everything points to a victory for Van on Tuesday.
However, on a darker note, I feel compelled to let you know about some very disturbing activity.
A Tennessee Republican Party staff member was just covered from head to toe with white paint by a passing motorist. Her offense? She dared to put up a Van Hilleary for Governor sign.
Earlier today a supporter's truck was vandalized. His offense? He chose to display a Hilleary for Governor sign in the back of the truck.
This weekend, our campaign manager's wife was intentionally tripped and thrown to the ground. Her offense? She participated in the Race for the Cure to raise money for breast cancer - wearing a Van Hilleary for Governor t-shirt.
Last week, a supporter's farm was vandalized. His offense? He dared to invite Van Hilleary to tour his dairy farm.
I do not know who is behind this, but in all of the campaigns I've been involved with, I have never seen such brazen and irresponsible behavior. Please be careful. Work in teams. Call the police immediately if you feel threatened. But, please, let's not be intimidated into letting up in our efforts for one minute. Van Hilleary offers Tennessee the "Fresh Start" our State so desperately needs. Working together, we have an opportunity to do something really good for our friends and families.
There is an old adage: You can tell a lot about a person by the company they keep. Van is very proud to be associated with each and everyone of you.
- Jim Burnett
Political Ads On Your Cell Phone?
Red Herring has a fascinating story on how short-messaging services are being used in political campaign marketing. SMS is the technology that allows someone to send a short text message to that little screen on your cell phone. Red Herring also looks at the legal ramifications, noting that "each state has a law regarding how close to polling places votes can be solicited on election day," and SMS campaign ads might arrive on voters' cell phones, pagers or Blackberries while they are in the voting booth. The director of research for George Washington University's Institute for Politics, Democracy, and the Internet says regulators should "take steps to make sure it doesn't happen," but others say it would be hard to regulate. Last August, the Federal Election Commission exempted SMS communications from campaign disclosure regulations. Political ads delivered by SMS do not have to carry a disclaimer revealing who paid for them, allowing the entire 160-character SMS message to carry advertising. SMS ads are already in use in some campaigns in which New Media Communications, a marketing firm that serves conservative political campaigns, is doing media and Internet work.
FYI: New Media Communications designed Lamar Alexander's Senate campaign website - although the story indicates the Alexander campaign didn't use SMS to carry advertising.
I must admit, I had to laugh when I read a quote in the story from the George Washington University prof suggesting that the government needs to step in and make sure no one gets a political ad on their cell phone screen while in the voting booth. I'm no technology expert, but stopping such advertising from reaching cellphone-clutching voters in the voting booth would seem to be a technical impossibility - and rather pointless to boot.
Voters in Colorado get to vote on proposed tax increases. Here's an example:
Adams County residents will also decide a variety of ballot issues: The county is asking that it be allowed to keep excess revenue under the Taxpayer's Bill of Rights, or TABOR amendment, for funding services, projects and operations. Residents will decide whether to increase their property taxes to raise $5.8 million annually to pay for three new library branches, renovation and expansion of another three branches, and expanded materials and technology. - from the Denver Post, Oct. 31, 2002.
Also in the same story:
Federal Heights is asking for a 1 percent sales tax increase that would raise $1.55 million for public works projects, maintenance and services. Adams County School District 1 is asking voters to override TABOR. Adams County School District 14 wants voters to approve a property tax increase to raise up to $2.5 million annually to go toward music, athletics and art programs and computer upgrades. Adams County School District 50 wants a tax increase of $5.95 million annually to fund programs to improve reading, writing and math as well as hire and retain teachers.
Politicians asking the people's permission to tax more and spend more. And having to convince voters their request makes sense. Imagine that.
By the way, Van Hilleary wants to write a similar Taxpayer's Bill of Rights provision into Tennessee's constitution. Tax-and-spend Democrat Phil Bredesen is opposed to it - even though it helped Colorado enjoy fiscal stability and avoid serious fiscal problems during the recession - and fostered a decade of rapid economic growth. But, then, Bredesen is a "competent manager" who thinks the income tax would be good for Tennessee's economy.
He's Had His Phil
Instapundit is tired of Phil Bredesen's phone calls.
The Freedom of Imagination
This Yale Law Review article on the constitutionality of copyright law, and the freedom of imagination, is well worth your time if you're interested in that sort of thing.
Copyright's tensions with the First Amendment, long suppressed in the case law, have become increasingly apparent. This Article first shows the insufficiency of all the standard claims purportedly explaining why copyright law —- the country's most systematic, sweeping set of speech regulations —- is not unconstitutional under the First Amendment. It then argues for a new evaluation of copyright's constitutionality, based on the principle that individuals cannot be punished for what they imagine or for communicating their imagination to others. This freedom of imagination, the Article suggests, best captures the protection of art and entertainment, as well as other core First Amendment protections. Measured in light of the freedom of imagination, copyright's central prohibition of piracy is fully constitutional, but its prohibition of unauthorized derivative works is not.
Thanks to Instapundit for the link.
Tomorrow is vital for the future of Tennessee. If Phil Bredesen is elected governor, you can say goodbye to any chance for meaninful education reform and meaningful spending reform. Bredesen is in the pocket of the Tennessee Education Association - all liberal Democrats are. The TEA is the main roadblock to serious education reform. As for spending, Bredesen is opposed to any form of constitutional provision, like Colorado's Taxpayers Bill of Rights, which restricts the growth of government and returns revenue surpluses to the people that paid them. Van Hilleary is in favor of such controls. Bredesen favors higher taxes - that's his unambiguous track record as an elected official - and he favors government spending over individual spending. Hilleary is opposed to higher taxes. Bredesen believes the income tax would be good for Tennessee's economy, but he's politically astute enough to say he's against it ... for the first four years. Hilleary believes the income tax would be bad for Tennessee and that it is unconstitutional. That stance puts him at odds with some of the grand poohbahs of his party. He doesn't let politics get in the way of principle. You can trust him.
So get your butt to the polls on Tuesday and vote.
UT Violates First Amendment Freedoms
A fraternity at the University of Tennessee-Knoxville had a party in which five white fratboys attended in blackface. The university kicked the frat off campus and banned them. Oops. That's a violation of the frat's constitutional rights. I don't condone the frat's actions, which were racially insensitive and rather boorish. But the First Amendment protects even racially insensitive, boorish speech. This excellent essay explains why.
Uh, administrators, sorry to distress you even further, but the First Amendment gives people the right to be uncivil, unharmonious, and not terribly respectful of racial harmony. What's more, it means that when you sanction people, you are violating the Constitution, and can be and should be sued and held financially liable.
The funny thing is that this very issue - people's right to wear blackface - has come up before, and has actually led to a U.S. Court of Appeals decision, Iota Xi v. George Mason University (4th Cir., some time in the early 1990s) that made perfectly clear that public universities may not punish students for wearing blackface. But even without the Iota Xi decision, the right First Amendment result would be obvious.
The author is a UCLA law professor. The story has a link to the relevant Knoxville News-Sentinel story.