Obama’s State of the Union: You’re just part of his “blueprint”

This originally was published in the Boulder Daily Camera on Saturday, January 28, 2012.

For refutations of the President’s flawed claims and statist economic plans, see the Cato Institute‘s website, blog, and YouTube channel.  Regarding Obama’s “Buffett tax” on millionaires, the Associated Press explains that the wealthiest Americans already “pay a lot more taxes than the middle class,” including secretaries

To understand Obama’s statist fervor, ask yourself: Are you a machine cog?  Surely not. But like many politicians, Obama disagrees, at least tacitly. How? Linguist George Lakoff explains how metaphors are key to understanding political discourse.  In his speech, the President expressed his desire to “lay out a blueprint for an economy.”  At least twice he’s mentioned starting a health care “system” from “scratch.” This speaks volumes.

“The economy” refers to people producing and exchanging goods and services. In a freed economy, government respects people’s right to trade voluntarily. But Obama sees the economy as a machine to be manufactured, or a cake to be baked.

Obama has the same conceit that better economists have warned about for centuries. Describing the “man of system,” Adam Smith wrote: “He seems to imagine that he can arrange … members of a great society with as much ease as the hand arranges … pieces upon a chess-board.” “Socialists look upon people as raw material to be formed into social combinations,” wrote French economist Frederic Bastiat in 1853. Or, as 1974 Nobel laureate F.A. Hayek wrote, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”

Prop. 103 supporters: You can still donate more of your own earnings to tax-funded schools

This article was printed in the Boulder Daily Camera on November 5, 2011.

To paraphrase Mark Twain: Don’t let funding schools interfere with funding students’ education. Boulder Senator Rollie Heath was behind the defeated Proposition 103, the proposed tax increase for Colorado’s tax-funded schools. “I just don’t know how far in education cuts we’ll have to do before people realize what we’re doing,” he told the Daily Sentinel after the election.

Heath implies that increasing school funding improves students’ education. Where’s the evidence?  As I documented in a recent Denver Post op-ed, national standardized test scores for 17-year-olds have been essentially flat since the early ’70s, while real-dollar per-pupil spending has doubled since then.

Increased spending didn’t increase test scores, but it increased teacher employment. Since the early ’70s student-to-teacher ratios decreased by almost a third. Employment in K-12 schools doubled, though student enrollment increased by just 10%.

Prop. 103 was really a Democratic Party fundraiser. Hiring more teachers sends more tax revenue to teachers unions. The unions almost exclusively support Democrat politicians, who when elected push for higher school taxes, and hence more money for unions that supported their campaign. These politicians also oppose school choice, and hence protect tax-funded schools as a monopolistic cartel.

Don’t fret if you supported Prop. 103. You’re still free to donate more of your earnings to tax-funded schools. You just can’t force others to do so.  But if you really care about quality education, you should support efficient schools that provide quality education at low cost, rather than letting politicians determine where your money goes.

* * *
Update:  Oddly, the website for the Boulder Valley School District does not make it easy for people to donate to the district itself or specific schools. But the District has received more than $2 million in annual donations. I did find the following:

• a donation page for Summit Middle School (Boulder County)
• CrayonsToCalculators.org
• Education Foundation of St. Vrain Valley

Prop. 103 results, Colorado election

As of 8 PM Tuesday it looks like Colorado Proposition 103 will not pass.  The Denver Post declared the measure “dead.” Channel 7 reports only 35% “yes” and 65% “no” with almost half of the precincts reporting. 9 News has similar results.

For why this is good news, see my article in the Denver Post: Colorado Proposition 103: More tax dollars for school helps unions & Dem. party, but not students.  For a version with more Colorado data and contributions from education policy analyst Ben DeGrow, see: Proposition 103: More Tax Dollars for Schools Makes No Sense.

In terms of cost to taxpayers, see this Summit Daily op-ed by economists Barry W. Poulson and John D. Merrifield : Prop 103: What Is The Cost To Colorado Taxpayers?, based on this analysis.

Note that Prop 103′s supporters raised more than $600,000 to promote it, while the opposition raised around $25,000. That’s a ratio of 24:1. (This doesn’t count Compass Colorado’s contributions.)

Thanks to this People’s Press Collective post for the Denver Post declaration and link to the funding info.

 

Colorado Proposition 103: A Democratic Party fund-raiser

The Denver Post has published my op-ed in opposition to Colorado Proposition 103. It begins:

Do you want government to throw even more of your tax dollars at Colorado teachers unions and their pet politicians, or do you actually want better education for children in Colorado?

Proposition 103 is about throwing money. Sponsored by Rep. Rollie Heath, D-Boulder, and endorsed by Colorado’s largest teachers union, the initiative would increase income tax rates by 8 percent and sales tax rates by 3.4 percent — both for five years.

But decades of increasing school funding has not increased student test scores. It has created jobs for teachers and revenue for their unions that almost exclusively support Democratic politicians. These politicians sustain tax-funded schools as a monopolistic cartel that squashes competition and limits choice for parents and taxpayers.

Read the rest of the article at the Denver Post: Proposition 103 is about more money for the teachers union.

Thanks to Ben Degrow for pointing me to data sources, and to Ari Armstrong for suggesting key revisions.

For some of the references in the article, see this post: Colorado Proposition 103: More tax dollars for schools does not improve kids’ education.

 

 

Colorado Proposition 103: More tax dollars for schools does not improve kids’ education

If passed, Colorado Proposition 103 (ballot text) would increase state sales and incomes taxes for the alleged purpose of sending the additional revenue to government-run schools.  But it’s doubtful that throwing more tax dollars at government schools actually improves education for kids.

Consider per-pupil spending, as documented by the National Center for Education Statistics. It shows that, in constant dollars, per-pupil spending has doubled between 1973 and 2008.

[Graph source: Another Government Bailout, downsizinggovernment.org]

What has happened to standardized test scores during that time? NationsReportCard.gov has this data. This page shows results of the National Assessment of Educational Progress (NAEP) in math for 17-year-olds.  The finding? “At age 17, the average score in mathematics in 2008 was not significantly different from the scores in 2004 and 1973.”

How about reading?

Debt ceiling & reducing deficit without raising taxes

The Daily Camera asks: Lawmakers in Washington continue to be divided about raising the $14.3 trillion debt ceiling, which faces a deadline of Aug. 2, the day the Treasury Department says it will lose borrowing authority. Meanwhile budget talks regarding possible tax increases and debt reduction continue. What do you think?

My response:

Debt ceiling? What debt ceiling?  ”In the last 10 years, Congress has raised the debt ceiling 10 times,” notes economist Veronique de Rugy.

The real problem is excessive government spending that has created the huge debt. Spending has increased more than 60% in the past ten years.  ”43 cents of every dollar spent is borrowed,” de Rugy estimates.  According to USDebtClock.org, the federal debt exceeds $46,000 per U.S. citizen.

This spending is unsustainable and hazardous. The Congressional Budget Office warns of ” lower income growth” and risk of a “sudden fiscal crisis” that requires “spending cuts or tax increases more drastic and painful than those that would have been necessary had the adjustments come sooner.”  Taxation and government borrowing crowds out investment in private capital. This diverts “resources that could be used more productively. … U.S. companies are less likely to build new plants, conduct research, and hire people,” de Rugy explains.

As a remedy, Reason magazine suggests a “19 Percent Solution,” which refers to typical levels of tax revenue relative to GDP. The plan would balance the budget without raising taxes by reducing spending by less than 4% annually for ten years.

Since entitlement programs drive much of federal spending, these cuts will be unlikely so long as people see the programs as moral. But as forced charity, these entitlement programs are immoral. Charity can be virtuous, but there’s no virtue in being forced to donate to a charity, or empowering politicians to force others to do so.

This was originally published in the Boulder Daily Camera on July 16 2011.

Tax breaks are not tax subsidies

Too often I’ve heard people refer to tax breaks or tax exemptions as “subsidies.” Freeman Editor  Sheldon Richman does a great job explaining the difference.  Some excerpts:

A subsidy is a cash grant from the government. … government intervention enables people to obtain money they were not entitled to; the flip side is that someone else is deprived of money he is entitled to, or that he would have had legitimate access to.

In contrast, when someone is given any kind of “tax break,” he keeps money he is entitled to. … if a person retains some of his own money because of a government action, we should not condemn this as a subsidy.

Subsidies should be opposed. Opportunities to keep one’s own money should not.

Needless to say, government can create great mischief by determining who can and cannot keep his own money. If mortgage interest is tax-deductible but rent is not, government encourages home buying. It is not the government’s function to decide the best way to live and then to use the tax system to manipulate people into living that way. …

No one should be begrudged the opportunity to keep his own money. In the face of a discriminatory tax cut, we should point out that it ought to apply to everyone (who pays taxes), and not just a narrow group of taxpayers. Efforts to widen exceptions may not succeed, since that would defeat the politicians’ purpose, which after all is to manipulate private behavior. But at least we can pound home the point that it’s better for people to spend their own money for their own objectives.

Read the whole article: Tax “Breaks” Aren’t Subsidies in The Freeman, published by  The Foundation for Economic Education

Questioning your “compassionate” politics

My <a href="http://www.huffingtonpost.com/brian-t-schwartz/questioning-your-compassi_b_574030.html”>first article/post for the Huffington Post appeared today. It begins:

“You oppose Medicaid and government-run schools? You’re heartless and lack compassion.”  If you have ever made this accusation, even tacitly, I invite you to reconsider the government policies you support.

Why does being compassionate mean supporting government-run schools and health plans? This makes little sense if you view these programs as government-run charities. Would you agree to perpetually donate a portion of your monthly income to the same charity -  regardless of its effectiveness?  If the charity is doing a lousy job, wouldn’t you want the freedom to find a better one?

Read the whole article: <a id="title_permalink" title="Permalink" href="http://www.huffingtonpost.com/brian-t-schwartz/questioning-your-compassi_b_574030.html”>Questioning Your “Compassionate” Politics. (Update, the Denver Daily News also published the article.)

Thanks to Ari Armstrong, Paul Hsieh, Dave Kopel, and my wife for their comments. Thanks to Jessica Corry for putting me in touch with HuffPo.  I acknowledge many others in links within the article.  One person I did not link was Michael Cloud, whose book Secrets of Libertarian Persuasion was quite helpful, especially for this sentence, which is basically his:

If you support mandatory charity, what do you authorize government to do to those who peacefully refuse to cooperate?

I also recommend Cloud’s CDs on this topic. Great material, and not much overlap with the book.

Peter Saint Andre also inspired some of my ideas for this article. Many years ago I read his essay, On the Road to Voluntary Government Financing.

RTD’s “FasTracks” on the wrong track

The Daily Camera (Boulder) asked its Editorial Advisory Board members their views of different sales tax schemes for funding RTD’s “FasTracks.” My reply was published on Saturday, February 13:

Adaptable commuter transit routes, reducing traffic congestion with demand-sensitive road pricing, and minimizing both free-riders and forced funding. These goals should guide transportation policy. Taxing everyone to fund static commuter rail puts FasTracks on the wrong track.

RTD’s low-ball cost estimate is not surprising. In “16 Ways RTD Deceived Voters About FasTracks” economist Randal O’Toole notes that Southwest and Southeast light-rail lines costs 28% and 59% more than original estimates, respectively.

The controversy should not stop here, however. O’Toole shows how RTD has sold FasTracks with false advertising.

If FasTracks reduces traffic congestion, it would be negligible and short-lived given increasing vehicle traffic. It won’t reduce pollution, either. Denver’s light-rail trains emit more carbon dioxide per passenger mile than SUVs. “FasTracks adds almost six times as much nitrogen oxides into the air as all the cars it takes off the road,” O’Toole concludes.

The proposed Northwest rail corridor between Longmont, Boulder and Denver compares poorly to bus rapid transit. O’Toole summarizes RTD’s investment study: “Bus rapid transit was ten times more cost-effective at relieving congestion than commuter rail: it cost less than 60 percent as much to build, cost half as much to operate, and provided almost six times as much congestion relief.”

Bus rapid transit is just one alternative O’Toole discusses in his on-line “Mobility Plan for Denver” and new book Gridlock. Adding express toll lanes, coordinating traffic signals, and lifting restrictions on private transit services can also reduce traffic congestion and increase our mobility.

Colorado HB 1193: stop this Internet sales tax

Contact your Colorado state senator about opposing this bill.  From Vincent Carroll in the Denver Post:

HB 1193 requires out-of-state online retailers to collect sales tax from Colorado customers if those businesses have a relationship with a local “affiliate.” …

Democratic lawmakers are sleepwalking toward approval of a bill that could have the state dunning tens of thousands of Coloradans for unpaid sales tax on Internet purchases with retailers such as Amazon. Now won’t that be a popular election-year gift to voters?

…  For any on the fence, let me offer a short list of the bill’s deficiencies.

* It is almost certain to put Coloradans out of work.

* It won’t produce nearly the promised $4.7 million in tax revenue for the next fiscal year.

* It could result in the state harassing citizens for often paltry sums that most didn’t even know they officially owed – and which almost no one actually pays.

Carroll writes that “[f]our House Democrats did break ranks to oppose House Bill 1193, which survived by just a single vote in its journey to the Senate.”  Read the whole article: Amazon buyers, beware: State has it in for you.

Also see this post from ReveNews: Overstock Threatens to Terminate Colorado Affiliates Over Pending Legislation.

And don’t forget to contact your Colorado state senator!