A Republican dares to speak the truth on Minnesota taxes
December 5th, 2007,Yesterday the StarTribune published an opinion piece by a former Republican state legislator from Rochester, Dave Bishop. It reveals another crack in the facade of Republican unanimity on the “no new taxes” policy espoused by our governor, the Taxpayers League of Minnesota, and national leaders such as Grover Norquist. Some Republicans are waking up to the fact that a reduction in tax receipts can have seriously negative consequences - as it does, for example, when inflation eats away at our state gas tax and our transportation infrastructure deteriorates due to a lack of funding.
Starving our government of funding starves our society of needed services in education, transportation, and more. Yes, we need to limit government in order to limit the tax burden, but we also need to have government do what the private sector cannot or will not do. As Mr. Bishop writes, the “starve the beast” view of tax policy is an example of “extreme” conservatism; we might also call it radical.
Here are some excerpts from Mr. Bishop’s brave essay:
What has been the true tax policy of this small group of heavy hitters who call themselves True Conservatives instead of Republicans? To starve government services. To eliminate the effect of inflation on all funding for schools, for local government aid, and for roads and bridges. Their legislative lackeys have supported using inflation to pump up state tax income in budgets while at the same time refusing to use the same inflation standard for budgeting adjustments to state spending.
What have the Taxpayers League lobbyists told legislators to justify this schizophrenic tax policy? They have called it simply “bad tax policy” to budget for inflation in spending. Also they have marshaled the Republican members of the House of Representatives to oppose the indexing of the gas tax for inflation.
Does anyone in Minnesota not see what inflation has done to our gas tax? In 1988 (19 years ago) we raised it to 20 cents. As a Republican House member, I voted for it. Wisconsin also raised its gas tax that year to 20 cents, but added indexing to keep the purchasing power the same after adjusting for inflation. In 19 years, Wisconsin has had to add over 12 cents to its gas tax to keep up with inflation. Minnesota’s gas tax of 20 cents is really now worth less than 8 cents.
No wonder we have trouble with aging and broken roadways. No wonder we have so many bridges needing repair. No wonder we have counties and cities raising property taxes to pay for roads that used to be covered by gas tax local distributions….
And what has been the real result of this illogical and extreme tax policy? Galloping property taxes, excess levy referendums for school costs that can’t keep up with inflation. Also deteriorating roads, declining support for higher education — in fact, a total of declining quality of our life in Minnesota.
December 9th, 2007 at 10:21 pm
Yes, for those who insist on low taxes I recommend moving to Guatemala, which has the lowest tax-take as a percentage of GDP of any country in the hemisphere. Tax hawks will love living there!
Rational citizens, however, ought to favor pragmatic, not dogmatic, tax policies that aim to produce the highest standard of living possible.
Michael Blaine
http://www.rudelystamped.blogspot.com
December 12th, 2007 at 9:22 am
“If you rob Peter to pay Paul you can always count on Paul’s vote” seems to have been the mantra of the Democratic party back in the days when Republicans were fighting the increasing taxes that led to. Starving the beast by blocking taxes proved more effective than confronting the beast, because the issues were always fed by the emotional, “what about the children” crowd, who shamelessly manipulated the electorate.
Times have changed. But one thing is abundantly clear, to me at least. That is that a tax that is not 3rd-grade reading level simple cannot under any circumstance be called fair, no matter who ends up paying the lion’s share. The grassroots Republicans see that and work accordingly. I cannot speak to the ones remote from the voters (e.g., the professional politicians). But I don’t really trust much of the leadership in either party.
If this Republican dares to speak the truth, then I say that one honest conservative is worth a thousand lying limousine liberals. I hope his party is listening.
December 12th, 2007 at 9:32 am
Sorry about the “lying limousine liberals”, I just could not resist the alliteration. Truth is that a truly fair tax system would really clear the air of a lot of the smoke that gets generated when the topic of taxes comes up. Unfortunately, figures don’t lie, but how you generate those figure can make them do a pretty good job of obfuscating in favor of whatever position you want to take. For example, Bridgewater township just passed a resolution (11 Dec 2007) that will raise fees slightly at the Rice County landfill, said fees will be a direct pass-through to the users, so will (of course) hit the poor the hardest (everything hits the poor the hardest). This is nothing more than a tax in that it puts some of that revenue into the general fund. I totally supported this new tax. But to the extent that some of it must be earmarked for remediation, it is to that extent a fee. Either way, it uses economic forces to change behavior (sort of like carbon credits). And somehow that (in my eyes at least) makes it less onerous than a simple or hidden tax. A hidden benefit is that if the landfill is able to recycle at least 85% then the fee cannot be collected anymore.
December 12th, 2007 at 10:02 am
Bruce, I appreciate and respect your comments. I would respect the national Republican position on taxes more if they had actually reduced spending rather than increased it. As it is, an additional tax is placed on future generations when we borrow to make up the difference for lost revenue; that additional tax is the interest on the debt.
I would hope the Minn. legislature could raise the gas tax, since vehicles cause wear and tear and therefore increase road maintenance costs, and since they also add to air pollution, global warming, etc., which impose additional social costs. This is a “user fee” that needs to keep up with inflation.
Bridgewater sounds as though they did the right thing on the landfill fee.