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12/15/2004 Common Sense Will Help You Decide on TABOR By Chris Kliesmet There has been a great deal of analysis and reporting on the proposed Wisconsin Taxpayers' Bill of Rights, or TABOR. It seems that for every argument and statistic supporting TABOR there is another that discredits it. Lost in the debate over statistical minutiae is the true purpose of TABOR and the rather easy-to-understand problems it is designed to correct. It is time to put away the calculators, correct misleading reporting, and get back to evaluating the "big picture" armed with nothing more than common sense. Here are the key points to consider. --The Big Picture: TABOR is not a tax-limiting tool; it is a waste-limiting tool. TABOR is frequently, and erroneously, described as a tax-limiting tool. The sole function of TABOR is to create a "trigger point" that requires state and local taxing authorities to schedule public referenda to approve tax increases beyond that trigger point. TABOR is completely silent with regard to tax limits. State and local government can decide to raise taxes for any reason and in any amount desired. TABOR will have a limiting effect only to the extent that politicians are unable or unwilling to offer compelling reasons to voters to approve taxes increases above the trigger point. Common sense says if politicians cannot offer good reasons to spend money, then why spend it? --The Big Picture: TABOR does not limit local control, it increases it. Opponents of TABOR often attempt to mislead by stating TABOR is a "one size fits all" solution and another example of state interference in local governance. Actually, under TABOR the opposite effect occurs. As mentioned earlier, TABOR allows each community to set its own taxation level so there is no "one size fits all" problem. A key component of every serious TABOR proposal is the reduction or elimination of unfunded state mandates on local communities. Also, with TABOR in place, there is no need to keep the onerous educational spending limits and other state imposed rules that penalize local communities who decide to increase budgets for good reason or tap into their "rainy day funds." In terms of increasing local control, TABOR make sense because it takes unfettered and unilateral control over taxes away from the special interests and political elite and places it back in the hands of local voters. --The Big Picture: Wisconsin government charges high taxes and delivers poor results. Researchers and statisticians have crunched numbers in various ways that place Wisconsin anywhere from first to 15th in total tax burden. First, 10th, or 15th, this acceptance of poor to sub-mediocre performance is at the root of the problem. Recall this is a state that paid $685,000 for a Web site, found that it had 1,000 more cars and two dozen more airplanes than it needed, and sold a state gambling monopoly for pennies on the dollar. Part of the solution is that we must start demanding the best from government. People who are satisfied to simply be "out of last place" will never be confused with Vince Lombardi nor will they enjoy his legendary success. Rather than nit-pick dubious statistics it makes far more sense to focus on big picture developments like how people vote with their feet. Colorado had TABOR for a decade, increased population over 30 percent, and gained a congressional seat. Wisconsin fell behind in population and lost a congressional seat. While it is disingenuous to attribute the entire difference to TABOR, we still must ask: "What are we doing wrong?" The downward relative population spiral and lost congressional seat weakens our ability to bridge the federal funding gap we suffer compared to other states. We already are among the top education spenders in the nation yet still fail to attract leading corporations in search of high-caliber employees. What good does it do to have a great educational system that churns out graduates who move to other states? The Bloomberg Report lists Wisconsin as the worst tax-hell for retirees. Some public employee unions actively counsel their retirees to move out of state to avoid taxes and take their taxpayer-financed pensions with them. Wisconsin does not have the best meteorological or political climate. If we want to be competitive and retain high-caliber residents we have to be doing it better than the other states. What else can we offer to attract more jobs and people? More efficient spending and superior results from government come to mind. --The Big Picture: TABOR is needed because all other legislation has proven ineffective. Some opponents claim Wisconsin already has tough spending limits in place and that TABOR is overkill. Common sense tells us this is simply inconsistent with reality. We robbed the Tobacco Fund of a billion dollars and the Transportation Fund of half a billion, made various cuts in government, reduced shared revenue, issued of hundreds of millions of dollars in obligation bonds and yet we still have a $1.6 billion structural deficit. In the process we have created a "government class" of citizens in this state who have superior wages, benefits, and working conditions compared to the average worker. When the full extent of this mismanagement and system of apartheid is understood it will ignite a class warfare backlash that will make the grassroots actions in the Ament and Panzer episodes look like a walk in the park. --The Big Picture: We need a constitutional amendment because we cannot trust politicians. How many scandals, ethics violations, recalls, indictments, and convictions will it take to convince TABOR opponents that people need to retake control over government and their taxes? We have a two-party system best described as "tax and spend" and "tax and spend - light"; the primary concern appears to be gaining and maintaining political power. Common sense dictates that when trust and integrity is compromised additional checks and balances are called for. Finally, when looking to dry up the flow of wasteful spending it makes sense to place the dam as far upstream as possible. This creates an even playing field and prevents the common political antics of shifting taxes to areas outside the control and jurisdiction of legislation. Under a strong TABOR, everything is covered. --The Big Picture: We need a strong TABOR. A weak, "do nothing" TABOR is worse than no TABOR at all because it will fail to produce the proper results and lead some into a false sense of security. The main avenues of attack will be to exempt certain taxes and raise the level at which referenda are triggered. The tax and funding entities most often suggested for exemption are schools, health care, road building, and TIF districts. By exempting any major area you leave a loophole for politicians to play the shell game of shifting tax burden into exempt areas. Opponents argue that these critical areas must retain full funding. Under TABOR they will, however, it will be by the choice of the people, not the dictates of the special interests and political elite. Personal Income Growth (whose apt acronym is PIG) is being used as a "Trojan horse" by those looking to weaken TABOR. The ruse is to first suggest that PIG is an acceptable substitute for the Consumer Price Index because 70 to 75 percent of PIG historically tracks CPI. Once the "bait and switch" to PIG is made, TABOR opponents have already shown they will attempt to "bargain it up" to 90 to 95 percent of PIG. The problem is we already tax at this outrageous level. If PIG is adopted, nothing will change. On the other hand, CPI tracks what goods and services should cost, not what taxpayers have the ability to pay. Using PIG is like having your grocer first ask how much you have in your wallet to determine the price of a loaf of bread. It is the embodiment of the preamble to the Communist manifesto "From each according to his ability." At last report America was still listed as a capitalist democracy, not a communist autocracy. In summary, what we know is that Wisconsin is losing the competitive battle with other states for good people, good jobs, and a sound future. We have many liabilities in this struggle and one of them is high taxes. We can also document the inability of the current political system to solve the problem and can track it by monitoring the exodus of people, jobs, and income as compared to the rest of the nation. TABOR alone is not sufficient to solve all the problems we face, but it is a necessary first step. In taking a position on TABOR you can choose between dueling studies and statistics or simply trust your own common sense and instincts. The decision is yours. --Kliesmet is executive administrator of the CRG Network. |
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