Back to Top

Center for Freedom and Prosperity (CF&P)

Subscribe to Center for Freedom and Prosperity (CF&P) feed
Updated: 1 hour 46 min ago

America’s “Wretched Hive of Scum and Villainy”: Part I

Sun, 10/11/2020 - 12:24pm

Earlier this year, I asked “Why are there so many bad and corrupt people in government?” and suggested two possible explanations.

  1. Shallow, insecure, and power-hungry people are drawn to politics because they want to control the lives of others.
  2. Good people run for political office, but then slowly but surely get corrupted because of “public choice” incentives.

I’m sure both answers apply to some extent. But let’s consider whether one answer is more accurate in more cases?

In an article for Quillette, Professor Crispin Sartwell of Dickinson College looks at this chicken-or-egg issue of whether people are corrupted by government or corrupt people gravitate to government.

“Power corrupts,” as the saying goes, and a corollary is that, other things being equal, the more power, the more corruption. …But perhaps the explanation runs the other way: It’s not only or not even primarily that power corrupts, but that corrupt people seek power, and the most effectively corrupt are likeliest to succeed in their quest. …That is, it is likely that a political career would attract moral corner-cutters. …There may be a certain percentage of people who seek power because they want to do good, or it may be that in the back of their minds, every political leader believes that he intends to do good. But to use power to do good, you’ll have to do whatever’s necessary to get that power. You’ll likely have to compromise whatever basic moral principles (“tell the truth,” for example) you came in with. …political power is a constant temptation to hypocrisy, or just flatly demands it. And when the public persona and the private reality come apart, a human being becomes a moral disaster, a mere deception. That is a fate common among politicians.

Professor Sartwell may not have a firm answer, but one obvious conclusion is that good people will be scarce in Washington.

And it’s not just the politicians we should worry about. The whole town seems to attract dodgy people.

In a 2018 study, Professor Ryan Murphy of Southern Methodist University found that Washington has far more psychopaths than any other part of the country.

Psychopathy, one of the “dark triad” of personality characteristics predicting antisocial behavior, is an important finding in psychology relevant for all social sciences. …While a very small percentage of individuals in any given state may actually be true psychopaths, the level of psychopathy present, on average, within an aggregate population (i.e., not simply the low percentages of psychopaths) is a distinct research question. …The most extreme data point is the District of Columbia, which received a standardized score of 3.48. …The presence of psychopaths in District of Columbia is consistent with the conjecture found in Murphy (2016) that psychopaths are likely to be effective in the political sphere. …The District of Columbia is measured to be far more psychopathic than any individual state in the country, a fact that can be readily explained…by the type of person who may be drawn a literal seat of power.

Moreover, we know that the crowd in D.C. figuratively screws taxpayers, but it appears they’re also busy screwing in other ways.

Residents in Washington, D.C. have the highest rates of sexually transmitted disease, compared to 50 states, according to a recent Center for Disease Control and Prevention report. Out of the four kinds of STDs that the CDC report identified – chlamydia, gonorrhea, primary and secondary syphilis and congenital syphilis – the district scored No.1 in the first three by a large margin… For every 100,000 D.C. residents, 1,083 cases of chlamydia were reported. Alaska came in second with only 772 cases. Similarly, the district had 480 cases of gonorrhea per 100,000 population, double the rate of Mississippi, which ranked second.

Since this report was based on data in 2016, it’s possible another state has overtaken D.C.

But given Washington’s big lead, that would take a lot of risky extracurricular activity.

This tweet caught my eye because it nicely captures how the “experienced” people in Washington often may be the worst of the worst.

Amateur politicians do unethical things that are against the rules.

Professional politicians do unethical things that they’ve written the rules to allow.

— Dan McLaughlin (@baseballcrank) March 6, 2019

And we’ll close with this quote, which comes down on the side of bad people naturally gravitating to government.

P.S. If you like mocking the political class, you can read about how the buffoons in DC spend their time screwing us and wasting our money. We also have some examples of what people in MontanaLouisianaNevada, and Wyoming think about big-spending politicians. This little girl has a succinct message for our political masters, here are a couple of good images capturing the relationship between politicians and taxpayers, and here is a somewhat off-color Little Johnny joke. Speaking of risqué humor, here’s a portrayal of a politician and lobbyist interacting. Returning to G-rated material, you can read about the blind rabbit who finds a politician. And everyone enjoys political satire, as can be found in these excerpts from the always popular Dave Barry. Let’s not forgot to include this joke by doctors about the crowd in Washington. And last but not least, here’s the motivational motto of the average politician.

———
Image credit: Martin Jacobsen | CC BY-SA 3.0.

Whitewashing East Germany’s Stalinist Dictatorship

Sat, 10/10/2020 - 12:22pm

In my lifetime, perhaps the greatest moment for human liberty took place 31 years ago when the corrupt socialist dictatorship of East Germany lost the will and ability to maintain the Berlin Wall.

Almost overnight, there was hope for the long-suffering people of the so-called German Democratic Republic.

In a spontaneous celebration that still brings tears to my eyes, they joined together with the free people of West Germany to tear down the ugly symbol of Marxist tyranny and oppression.

Even better, the fall of the Berlin Wall was a precursor to the total collapse of the Soviet Empire, thus liberating hundreds of millions of people from the horrific brutality of communism.

But not everybody is happy that the communism wound up on the ash heap of history. In a column for Jacobin, Loren Balhorn wistfully remembers East Germany’s Stalinst regime.

On October 3, 1990, the German Democratic Republic (GDR), formerly one of the most enthusiastic members of the Warsaw Pact, …ceased to exist…the uprisings of 1989–1990 across Eastern Europe saw the consolidation of a neoliberal order as the supposed price to pay for basic civil liberties and nominal freedom of movement. Communist parties that had ruled for decades fell into disarray, hastily rebranding themselves as social democrats or dissolving entirely. The fall of the Soviet bloc also demoralized large sections of the Left on the other side of the Iron Curtain, prompting the collapse of the international communist movement. …The specter of dictatorship and economic stagnation that is used to (one-sidedly) characterize life in the Eastern Bloc continues to be cited as incontrovertible “proof” that capitalism is the only workable — and indeed desirable — socioeconomic system. Moreover, socialism’s collapse in 1989 demonstrated that, when presented with the choice, most workers opt for the material abundance of capitalism and liberal democracy over whatever a socialist system has to offer. …whatever gains workers had made under socialism evidently were not enough to retain their loyalty when the moment of decision came. …But did it have to be this way?

After posing the rhetorical question whether it had “to be this way?”, Balhorn provides a very twisted answer

For many who survived fascism and wanted a new, better Germany, the GDR appeared as the natural choice. A number of prominent leftist intellectuals and artists, like renowned playwright Bertolt Brecht, composer Hanns Eisler, philosopher Ernst Bloch, and legal theorist Wolfgang Abendroth, opted to move East and lend their services to the cause. …Beyond these famous examples, it should not be forgotten that over five hundred thousand Germans chose to migrate not West but East in the first decade of the GDR’s existence. …The Wall…gave the GDR the chance to build a society that was broadly characterized by modest prosperity and social equality between classes and genders. Workers were guaranteed employment, housing, and all-day childcare, while basic foodstuffs and other goods were heavily subsidized. Though wages were only half of what they were in the West, adjusted for prices in relation to earnings, GDR workers’ actual purchasing power was more or less the same. …class distinctions in the GDR were in fact dramatically reduced, both in material as well as cultural terms.

In other words, Balhorn wants readers to believe that equal levels of misery and deprivation in former communist nations are something to celebrate.

I can’t resist pointing out that his assertion about levels of purchasing power being “more of less the same” in West Germany and East Germany is utter nonsense.

Here’s the data from a column I wrote last year.

Simply stated, both parts of Germany started out from a very low level after the destruction of World War II.

But then West Germany, triggered by the free-market reforms of leaders such as Ludwig Erhard, became a rich nation while East Germany lagged far behind.

Here’s one final excerpt which must set a record for romanticizing a Marxist dictatorship.

…the women and men who lived and worked in the GDR spent four decades building a society they understood as such and registered a number of remarkable achievements. …we can look to many of its achievements in education, housing, childcare, and labor relations as evidence that society does not have to be organized around the interests of the wealthy and that the free market is not the only way to organize an economy. It is possible to ensure that everyone has a place to live, health care, enough food to eat, and access to education — something that no capitalist society can claim today.

This is – at best – moral blindness.

noted back in 2017 that there were some economists who used to write about the supposed superior performance of communist nations. But there were merely guilty of naively believing data from communist nations (and also guilty of not actually understanding economics).

I don’t think any of them would be dumb enough to praise East Germany today.

So Loren Balhorn definitely qualifies as a dupe and apologist.

P.S. You won’t be surprised to learn that the nations with the most pro-market reforms are the ones that have most prospered since the collapse of communism.

P.P.S. There’s a grocery store in Texas that played a role in the collapse of the Soviet Union.

———
Image credit: US Dept of Defense | CC by 2.0.

The Renewable Fuel Mandate is a Failed Policy

Fri, 10/09/2020 - 12:47pm

Originally published by Inside Sources on October 8, 2020.

One of the many political dysfunctions plaguing the nation is the fact that failed policies rarely come to a quick and decisive end.

Case in point: It has long been clear that the Renewable Fuel Standard (RFS) has not and will not achieve its objectives, yet both parties participate in its perpetuation and even expansion.

recent paper published by my organization, the Center for Freedom and Prosperity, reviews the record of the RFS and summarizes: “In the 15 years of its existence, the RFS has failed to advance its stated purposes while leading to adverse consequences for consumers, refiners, and the environment.”

Drafters of the mandate expected biofuel to develop along a predictable path, but technology doesn’t necessarily follow the route most convenient for politicians.

Instead of transitioning from corn starch ethanol to more advanced biofuels as hoped, increases in the mandate over the years are met with even greater reliance on corn, causing problems for just about everyone except corn farmers.

Economically, consumers suffer because competition for corn drives up prices for foods losing acreage to corn and for livestock that use corn for feed.

It has also squeezed small refiners unable to blend their own biofuel and who are reliant on the secondary trading market, dysfunctional owing to its nature as a product of government instead of real economic demand, to meet statutory quotas.

Of a particular irony is the environmental record of the mandate. The presumption that renewable energy equals environmental improvement has proven false, at least in this case corn ethanol. As mentioned, corn constitutes the bulk of biofuel produced in the U.S., and its production has proven to have many adverse consequences.

The total life-cycle emissions of corn ethanol exceed gasoline, so it does nothing to advance carbon reduction goals. The heavy use of nitrogen-rich fertilizers to grow corn also create “dead zones” in the Gulf of Mexico where sea life often dies due to a lack of oxygen.

Toxic algal blooms in the Great Lakes are similarly made worse.

It’s no surprise, then, that surveys of environmentalists show a majority oppose the corn ethanol mandate. Yet despite what appears to be a broad, cross-ideological coalition opposed to the RFS, it has thus far avoided serious reforms.

Despite benefits to farmers like approving year-round sale of E15, gasoline with up to 15 percent ethanol, and denying a slew of waivers for small refiners hurting from the mandate, ethanol backers say Trump has done too little.

Joe Biden has taken up their cause by pledging to double down on ethanol. His rhetoric tellingly focuses on “rural America and our nation’s farmers,” in a tacit admission that the modern RFS is little more than a special interest carve-out rather than a defensible energy policy.

Incidentally, Biden will wipe out demand for ethanol by subsidizing electric vehicles as part of his $2 trillion climate plan.

A large part of the explanation for the mandate’s staying power is the influence of farm-state legislators. A closely divided electorate puts a premium on every seat as potentially decisive in the balance of power, giving that constituency tremendous influence. But while the politics are complicated, the policy questions themselves are not.

The evidence is clear that for consumers and the nation the RFS is a bad deal.

———
Image credit: Beeki | Pixabay License.

Education Bureaucrat: Choice for Me, Equal Mediocrity for Thee

Fri, 10/09/2020 - 12:09pm

Writing about the failed government education monopoly back in 2013, I paraphrased Winston Churchill and observed that, “never has so much been spent so recklessly with such meager results.”

This more-recent data from Mark Perry shows that inflation-adjusted spending has ballooned in recent decades, driven in part by teacher expenses but even more so by the cost of bureaucrats.

Robby Soave recently wrote about the hypocrisy of one of those non-teaching bureaucrats.

In a must-read article for Reason, he notes that the lavishly compensated superintendent of government schools in a suburb of Washington, DC, has decided that one of his kids will get a better education at a private school.

Alexandria City Public Schools (ACPS) Superintendent Gregory Hutchings has always been proud to call himself a parent of two children who attend public school. …But now, Hutchings has pulled one of his kids from ACPS—which remains all-virtual, to the frustration of many parents—and instead enrolled the child in a private Catholic high school currently following a hybrid model: some distance learning, and some in-person education. …It’s hard to blame Hutchings for trying to do right by his own child. But he is in a position to do right by thousands of other kids who don’t have the same opportunity.

Mr. Hutchings is a hypocrite, but that’s hardly a surprise.

So was Barack Obama. And Obama’s Secretary of Education. Lots of other leftists also have opposed school choice while allowing their kids to benefit from superior private schools, including Elizabeth Warren.

Why are they hypocrites? Because they put the self-interest of teacher unions before the educational interests of other people’s children.

But let’s return to Mr. Hutchings, because not only is he a hypocrite, he’s also a believer in equal levels of mediocrity.

Hutchings previously expressed concerns about parents seeking alternative educational arrangements. In a July 23 virtual conversation with parents and teachers detailing the district’s fall plans, Hutchings fretted that in-person learning pods would cause some students to get ahead of their Zoom-based public school counterparts. …Hutchings described pod-based learners as “privileged.” “If you’re able to put your child in a learning pod, your kids are getting ahead,” he said. “The other students don’t get that same access.” Students enrolled in pod-based learning, private tutoring, or private schooling that involves in-person instruction are indeed better off than those languishing in virtual education. But that’s a failure of public schools, which have largely chosen to privilege the demands of unions over the needs of children.

This is truly reprehensible.

In the past, I’ve criticized President George W. Bush “No Child Left Behind” scheme because it involved more centralization and more wasted money.

Hutchings is even worse. His policy should be called “No Child Gets Ahead.” And he’s not alone. My home county of Fairfax has the same disgusting attitude.

All things considered, Mr. Hutchings deserves membership in the Bureaucrat Hall of Fame.

P.S. It goes without saying, but I’ll say it anyhow, that the record spending increases for government schools have not been matched by improvements in educational outcomes. Heck, the chart shows that there haven’t been any improvements.

P.P.S. Getting rid of the Department of Education would be a good idea, but keep in mind that the battle for school choice is largely won and lost on the state and local level.

P.P.P.S. School choice doesn’t automatically mean every child will be an educational success, but evidence from SwedenChileCanada, and the Netherlands shows superior results when competition replaces government education monopolies.

———
Image credit: Ken Gallager | CC BY-SA 4.0.

How Can the New York Times Write about the Failure of Venezuela and not Mention Socialism?

Thu, 10/08/2020 - 12:00pm

Every so often, I’ll grouse about media sloppiness/media bias, most often from the Washington Post or New York Times, but also from other outlets (ReutersTimeABC, the Associated Press, etc).

Let’s add to the collection today by perusing an interesting – but frustrating – article in the New York Times about Venezuela’s near-decimated oil industry.

Authored by Sheyla Urdaneta, Anatoly Kurmanaev and Isayen Herrera, it provides a thorough description of how the energy sector in oil-rich Venezuela has collapsed.

For the first time in a century, there are no rigs searching for oil in Venezuela. Wells that once tapped the world’s largest crude reserves are abandoned… Refineries that once processed oil for export are rusting hulks… Fuel shortages have brought the country to a standstill. At gas stations, lines go on for miles. …The country that a decade ago was the largest producer in Latin America, earning about $90 billion a year from oil exports, is expected to net about $2.3 billion by this year’s end… More than five million Venezuelans, or one in six residents, have fled the country since 2015, creating one of the world’s greatest refugee crises, according to the United Nations. The country now has the highest poverty rate in Latin America, overtaking Haiti.

But here’s what shocked me. The article never once mentions socialism. Or statism. Or leftist economic policy.

Instead, there is one allusion to “mismanagement” and one sentence that refers to government policy.

…years of gross mismanagement… Hugo Chávez, appeared on the national stage in the 1990s promising a revolution that would put Venezuela’s oil to work for its poor majority, he captivated the nation. …Mr. Chávez commandeered the country’s respected state oil company for his radical development program. He fired nearly 20,000 oil professionals, nationalized foreign-owned oil assets and allowed allies to plunder the oil revenues.

Almost 1800 words in the article, yet virtually no discussion of how maybe, just maybe, Venezuela’s hard shift to the left (as illustrated by the chart, economic freedom has steadily declined this century) may have contributed to the collapse of the country’s major industry.

This is journalistic malpractice. Sort of like writing about 2020 and not mentioning coronavirus or writing about 1944 and not mentioning World War II.

For those of you who do care about facts, it’s worth knowing that Venezuela has the world’s lowest level of economic liberty according to Economic Freedom of the World and second-to-lowest level of economic liberty according to the Index of Economic Freedom.

In a column for USA Today, Daniel di Martino writes about the awful consequences of his nation’s drift to socialism.

All my life, I lived under socialism in Venezuela until I left and came to the United States as a student in 2016. Because the regime in charge imposed price controls and nationalized the most important private industries, production plummeted. No wonder I had to wait hours in lines to buy simple products such as toothpaste or flour. …My family and I suffered from blackouts and lack of water. The regime nationalized electricity in 2007 in an effort to make electricity “free.” Unsurprisingly, this resulted in underinvestment in the electrical grid. By 2016, my home lost power roughly once a week. …The real reason my family went without water and electricity was the socialist economy instituted by dictators Hugo Chavez and Nicolas Maduro. The welfare programs, many minimum-wage hikes and nationalizations implemented by their regimes resulted in a colossal government deficit that the central bank covered by simply printing more money — leading to rampant inflation. …I watched what was once one of the richest countries in Latin America gradually fall apart under the weight of big government.

And he issues a warning about what could happen to the United States.

…neither Medicare for All nor a wealth tax alone would turn the United States into Venezuela overnight. No single radical proposal would do that. However, if all or most of these measures are implemented, they could have the same catastrophic consequences for the American people that they had for Venezuela.

The good news, so to speak, is that it would take many decades of bad policy to turn the U.S. into an economic basket case. There’s even a somewhat famous quote from Adam Smith (“there is a great deal of ruin in a nation“) about the ability of a country to survive and withstand lots of bad public policy.

But that doesn’t mean it would be a good idea to see how quickly the U.S. could become Venezuela. As I pointed out when writing about Argentina, it’s possible for a rich country to tax, spend, and regulate itself into economic crisis.

P.S. If you like gallows humor, you can find Venezuela-themed jokes hereherehereherehere, and here.

P.P.S. I speculated about the looming collapse of Venezuela in both 2018 and 2019. Sadly, it looks like the regime will last at least until 2021.

America’s Best and Worst Governors

Wed, 10/07/2020 - 12:57pm

According to the Fraser Institute’s calculations of overall economic freedom, Delaware apparently has the worst politicians and New Hampshire has the best ones.

According to comprehensive estimates of economic liberty in Freedom in the 50 States, New York’s politicians seem to be the worst and Florida’s are the best.

But what if we focus just on fiscal policy?

Earlier this year, I wrote three columns that illustrated different ways – income taxessales taxes, and government spending burden – of measuring the quality of state fiscal policy.

Today, let’s look at a comprehensive assessment of the nation’s governors, courtesy of Chris Edwards. Here’s his core methodology.

…this year’s 15th biennial fiscal report card on the governors…examines state budget actions since 2018. It uses statistical data to grade the governors on their tax and spending records—governors who have restrained taxes and spending receive higher grades, while those who have substantially increased taxes and spending receive lower grades. …Scores ranging from 0 to 100 were calculated for each governor on the basis of seven tax and spending variables. Scores closer to 100 indicate governors who favored smaller-government policies.

Only four governors got the highest grade (and that’s using a curve!), led by Chris Sununu of New Hampshire.

Those of you who follow politics may be interested in knowing that Kristi Noem (R-SD) and Ron DeSantis (R-FL), both potential presidential candidates in 2024, got “B” grades. So good, but not great.

Now let’s look at the most profligate chief executives.

The worst of the worst is Jay Inslee of Washington. So however bad Biden’s agenda is for the country, let’s be happy that Governor Inslee didn’t win the Democratic presidential nomination.

I’m not surprised by the other “F” governors. Though I am surprised that Gov. Pritzker isn’t in last place, given his efforts to get rid of the the Illinois flat tax.

For what it’s worth, the best-ranked Democrat (a “B” grade) is Steve Sisolak of Nevada. I assume this means he hasn’t tried to ruin the state’s zero-income-tax status. The worst-ranked Republican (a “D” grade) is Bill Lee of Tennessee and his bad score is because of huge increases in the state spending burden.

Last but not least, Chris identifies a systemic problem impacting almost all states. Simply stated, government spending has been growing too rapidly, more than double what would be needed to keep pace with inflation.

General fund spending grew at an annual average rate of 4.1 percent between 2010 and 2020, including increases of 5.5 percent in 2019 and 5.8 percent in 2020.

Here’s the accompanying chart.

In the study, Chris says states should use “rainy day funds” to avoid boom-and-bust budgeting (in other words, set aside some revenue when the economy is growing so it’s not necessary to make big adjustments when there’s a recession).

That’s definitely a prudent approach, and the study points out that some blue-leaning states like California follow that policy, while others (most notably, Illinois) recklessly spent surplus revenue.

My two cents is that a spending cap is the best long-run solution, and Colorado’s TABOR is easily the best fiscal rule among the 50 states.

P.S. Governor Sununu of New Hampshire needs to continue getting good scores to atone for his father’s terrible role, as Chief of Staff for George H.W. Bush, in pushing through the failed 1990 tax increase.

The Most Important Ballot Initiative of 2020

Tue, 10/06/2020 - 12:27pm

On election day, most people focus on the big-ticket partisan battles, such as this year’s contest between Trump and Biden.

Let’s not forget, though, that there are sometimes very important referendum battles at the state (or even local) level.

This year, the most important referendum will be in Illinois, where hypocritical Governor J.B. Pritzker wants voters to approve an initiative to replace the state’s flat tax with a discriminatory progressive tax.

I’ve already explained that the flat tax is the only thing saving Illinois from going further and faster in the wrong direction. Let’s add some additional evidence, starting with excerpts from this editorial in the Wall Street Journal.

The last state to adopt a progressive income tax was Connecticut in 1996, and we know how that turned out. Now Democrats in Illinois want to follow Connecticut down the elevator shaft with a referendum replacing the state’s flat 4.95% income tax with progressive rates… Public unions have long wanted to enact a progressive tax to pay for increased spending and pensions, and they think the political moment has finally arrived. Democratic Gov. J.B. Pritzker says a progressive tax will hit only the wealthy… Don’t believe it. There aren’t enough wealthy in the state to pay for his spending promises, so eventually Democrats will come after the middle class. …Illinois has no fiscal room to fail. Since 2015 Illinois’s GDP has grown a mere 1% annually, about half as fast as the U.S. and slower than Ohio (1.4%), Indiana (1.7%), Wisconsin (1.7%) and Michigan (2.1%). About 11% of Illinois residents have left since 2001, the second biggest state exodus after New York. Taxpayer flight has been accelerating as income and property taxes have risen. …A progressive tax would be a gift to Florida and Texas.

The head of the Illinois Chamber of Commerce, Todd Maisch, also worries that other states will benefit if voters make the wrong choice. Here are excerpts from his column in the Chicago Sun-Times.

The rest of the nation’s states are cheering on Illinois’ efforts to enact a progressive income tax. That’s because they know it will be one more self-inflicted blow to our state’s economy, certain to drive dollars, jobs and families into their waiting arms. …The reality is that this proposal is intended to do just one thing: Make it easier to raise taxes on all Illinoisans. …the spenders in Springfield are coming for you too, sooner or later. Proponents of the progressive tax know something they don’t want to tell you. Taxing millionaires will in no way meet their appetite for state spending. There simply isn’t enough money at the higher income levels to satisfy their demands. Tax rates will go up and tax brackets will reach lower and lower incomes. …Other states already are benefiting from the outmigration of Illinoisans and their money. Illinois passing the progressive tax is exactly what they are hoping for.

Amen. We already have lots of evidence showing that taxpayers move from high-tax states to low-tax states. And Illinois already has been bleeding taxable income to other states, so it’s very likely that a progressive tax would dramatically worsen the state’s position.

Illinois voters can and should learn from what’s happened elsewhere.

For instance, Orphe Divounguy of the Illinois Policy Institute shares evidence from California about the adverse impact of class-warfare taxation.

Illinois Gov. J.B. Pritzker finds himself in the same place as then-California Gov. Jerry Brown was in back in 2012 – trying to convince voters that a progressive state income tax hike will fix state finances in crisis. Brown claimed the burden of those tax hikes would only harm those earning $250,000 or more – the top 3% of earners. That’s exactly what Pritzker promises with his “fair tax” proposal. Brown was wrong. …Here are the main findings of the new study… The negative economic effects of the tax hike wiped out nearly half of the expected additional tax revenue. Among top-bracket California taxpayers, outward migration and behavioral responses by stayers together eroded 45% of the additional tax revenues from the tax hike… The “temporary” income tax hike, which has now been extended through 2030, made it about 40% more likely wealthy residents would move out of California, primarily to states without income taxes.

Illinois voters also should learn from the painful experiences of taxpayers in Connecticut and New Jersey.

The Wall Street Journal editorialized this morning about their negative experiences.

Illinois is the nation’s leading fiscal basket case, with runaway pension liabilities and public-union control of Springfield. But it has had one saving grace: a flat-rate income tax that makes it harder for the political class to raise taxes. Now that last barrier to decline is in jeopardy on the November ballot. …the pattern of other blue states is instructive. Democratic governors have often lowballed voters with modest rates when introducing a new tax, only to ratchet up the levels in each administration. …New Jersey first taxed individual income in 1976 amid a national revenue slump, with a top rate of 2.5%. …Democratic Gov. James Florio raised the tax to 7%… A decade later Democrats raised the top rate to 8.97%, and last year Gov. Murphy added the 10.75% rate… Or take Connecticut… For decades its lack of an income tax lured New York workers and businesses, but Gov. Lowell Weicker introduced the tax in 1991…and the original 1.5% rate has since been raised five times to today’s 6.99%.

And here’s the chart that every taxpayer should memorize before they vote next month.

And never forget that ever-increasing tax rates on high earners inevitably are accompanied by ever-increasing tax rates on everyone else – exactly as predicted by the Sixth Theorem of Government.

So if middle-class Illinois voters approve the so-called Fair Tax initiative, they’ll have nobody to blame but themselves when their tax rates also climb.

P.S. If voters in very-blue Illinois reject Pritzker’s class-warfare tax referendum, I wonder if that will discourage Democrats in Washington from embracing Biden’s class warfare agenda next year (assuming he wins the election)?

P.P.S. There’s a debate whether ballot initiatives and other forms of “direct democracy” are a good idea. Professor Garett Jones of George Mason University persuasively argues we’ll get better governance with less democracy. On the other hand, Switzerland is a very successful, very well-governed nation where voters directly decide all sorts of major policy issues.

Pages

Donate to Tea Party Manatee





Follow us on social media

About

If you have Constitutional values, believe in fiscal restraint, limited government, and a free market economy - then join us or just come and listen to one of our excellent speakers. We meet every Tuesday from 6-8 pm at Mixon Fruit Farms in the Honeybell Hall, 2525 27th St. East, Bradenton, Florida. Map it

Tea Party Manatee welcomes all constitution loving Americans.

Our core values are:

  • Defend the Constitution
  • Fiscal Responsibility
  • Limited Government
  • Free Markets
  • God and Country

Read more