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May 30, 2008

Legislating by Judicial Fiat

The Tax Foundation published a background paper almost a year ago in which they discussed “appropriation by litigation,” and had the subtitle of “estimating the cost of judicial mandates for state and local education spending.” In the introduction, they write:

“Since 1977 courts in 27 states have held that spending on schools is constitutionally inequitable or inadequate. These decisions often lead to dramatic short-term increases in education spending as lawmakers comply with court mandates. In nine states lawmakers raised taxes by over $13 billion to meet these new spending obligations. Similar cases are currently pending in other states.

“Commentators have written many books, articles, and research papers concerning court involvement in the school finance controversy. But few studies have attempted a comprehensive, state-by-state measure of the long-term fiscal impact of court education mandates and none have presented a state-by-state estimate of the cost of legislation approved to comply with court education mandates.”

Virginia is not listed among those 27 states. However, the burden of those judicial decisions on taxpayers is significant. Nationwide, judges’ mandates have cost taxpayers $34.3 billion (in 2004 dollars), or an an average of $976 per student. The cost ranges from a high of $8.3 million in New Jersey, (6,648 per student) followed by New York at $10.6 million ($3,633 per student).

It’s one thing to bear the tax burdens imposed by elected federal, state and local legislators, but a totally different thing when imposed by unelected judges. For a pithy and well-reasoned argument against judicial activists, albeit those on the U.S. Supreme Court, turn to “Men in Black” by radio talk show host and constitutional lawyer Mark Levin.

May 29, 2008

More Propaganda With Our Tax Money

On March 1, we growled about tax money spent for a leftist art show at Arlington’s central library, primarily because of it’s focus on “social justice.” Now comes more taxpayer money being spent to preach “social justice,” but this time the vehicle is the Arlington Public Schools.

This evening, the Arlington School Board approved a so-called “exemplary project” for Ashlawn Elementary School. You can read all about it at the School Board’s Board Docs website (it’s agenda item E.3.).

ACTA’s president testified, and urged the School Board to reject the project. His comments included the following points, which are adapted from Discover the Networks’ Social Justice issue paper (Discover the Networks is a project of FrontPageMag.com):

  • The quest for social justice is perhaps the foremost stated objective of the modern Left.
  • The culmination of centuries of ideas and struggles became known as classical liberalism. And it was precisely in opposition to this liberalism that Karl Marx formed and detailed the popular concept of “social justice.”
  • The unbroken line from The Communist Manifesto to its contemporary adherents is the notion that economic inequality is the monstrous injustice of the capitalist system, which must be replaced by an ideal of “social justice” -- essentially a rejection of capitalism and economic freedom.

With virtually no discussion by the School Board, they approved the project 5-0. But a rejection of the project, or even a deferral for some serious reconsideration and scrubbing, would indeed have been a surprise for many Arlington taxpayers.

Oh, the annual cost for this little project? Initially, it will be $41,000 (page 11 of the report). 

May 28, 2008

"Reeling In" Our Tax Dollars

It’s good to live in the Congressional district of the most powerful member of the U.S. House of Representatives. According to CBS News last Friday:

“For the second year in a row, hard-hit fishermen and businesses will get cold, hard cash to make up for their losses.

“But it's not just to put food on the table and keep a roof overhead - this may be among the most generous aid packages ever to come from Congress. And you're paying for it.”

Salmon fishing has come on such hard times that the government has declared it a “disaster.” The lost salmon totals $22 million while other economic effects are estimated at $82 million. But enter the chief panjandrum of the House of Representatives, Nancy Pelosi (D). CBS News reports:

“But taxpayers are being forced to shell out $174 million. That's on top of $60 million given out last year.

“The salmon bail-out is so huge, it might not have survived debate in Congress. But it didn't have to, thanks to California's own Congresswoman Nancy Pelosi. She used her clout as Speaker of the House to insert the massive salmon relief into the Farm Bill as an earmark without a vote.

“But what's really flipping out critics ... is how it works: Fishermen and business owners get to pick their "best" year, from 2002 to 2005, when they made the most money off salmon, and they get a check for that entire amount.”

But to really get you blood moving, look at the video, which accompanies the CBS story to see the smarmy look of Rep. Pelosi’s colleague, Mike Thompson, in this little caper of taxpayer thievery, as he justifies the need for the “emergency” aid.

May 27, 2008

Support Smokers in Opposing Tobacco Taxes

On March 21, 2008, I growled about a study by Kristina Rasmussen of the National Taxpayers Union, which noted that non-smokers get burned by by cigarette taxes, too. The NTU study identified:

“five reasons why non-smokers should oppose high tobacco taxes.”

In blogging at Government Bytes, Ms. Rasmussen offered kudos to South Carolina’s Gov. Mark Sanford (R) for vetoing a proposed 50-cent-per-pack tobacco tax increase. She included the following portion of the governor’s veto message:

“I am hereby vetoing . . . I do so because the revenue from this tax increase is dedicated to the start of additional spending on health care – for which there is no additional revenue as these programs grow. In that regard, the bill represents two tax increases – an immediate one with the bill’s passage, and a second over time to pay for these new programs.”

She then went on to note that the NTU study:

“found that taxpayers face a seven out of 10 chance of seeing another net annual tax hike within two years of a cigarette tax increase, in some cases due to increased spending burdens tied to the hike.” (emphasis added)

Wouldn’t it be great if more politicians were like Gov. Sanford in regards to taxes?

May 26, 2008

Memorial Day -- Honoring America's Fallen

Under the heading, “God Bless the Fallen -- Heros All: We Will Never Forget,” Reliapundit at The Astute Bloggers has three You Tube videos posted that honor our fallen heros. The include buglers at Arlington National Cemetary, taps by the Parris Island Marine Band, and an armed forces medley at a recent Memorial Day event on the Mall.

Then listen to Trace Adkins sing "Arlington," his Memorial Day tribute to members of the United States armed forces who now rest in peace in Arlington National Cemetary.

May 25, 2008

Question For Global Warming Alarmists

John Hinderaker at Power Line posted a remarkable graphic on Friday showing how temperature trends predicted by computer models disagree with actual observations. The graph was prepared by Dr. Fred Singer, an atmospheric physicist, professor emeritus of environmental sciences at the University of Virginia, and former director of the U.S. Weather Satellite Service. John notes that:

“Singer makes one point that cannot be repeated too often: the AGW theory depends entirely on computer models, but we know for sure that those computer models are wrong. They do not accurately explain either the Earth's climate history, or the present distribution of global temperatures.”

Hinderaker concludes:

“If you think about it, it is rather remarkable that Al Gore and his confederates have been able to stampede millions of voters, based on computer models that are indisputably contradicted by the facts.”

Rather amazing, we think, especially since all three presidential candidates believe in anthropogenic global warming (AGW). Not to mention, of course, that Virginia Sen. John Warner (R) is cosponsoring S. 2191 that would entangle the American economy with a so-called “cap-and-trade” monstrosity.

No wonder Nobel Laureate Al Gore has so far declined every offer to debate the science of global warming.

May 24, 2008

The Price of Fiscal Responsibility

In their weekly bulletin about government waste last week, Taxpayers for Common Sense (TCS) discuss how Congress has played “cynical games” with PAYGO, i.e., “pay-as-you-go,” budgeting. They note that:

“When the Democrats swept into power last year, they promised to restore fiscal responsibility in Congress.  Key to their plan was reestablishing the “pay-as-you-go" or PAYGO rules. This would mean that any new spending increase or tax cut would be offset equally by other spending cuts or tax increases. Both sides of the Hill and both parties have since been playing cynical games with this common sense budgetary principle by sidestepping the rules, which contributes to our nation’s record deficits and skyrocketing debt.

“The tricks and games to avoid PAYGO are numerous.  Lawmakers designate non-emergency spending as an emergency, shift cuts and spending with gimmicks to mask costs, simply agree to ignore the rules, or offer spending offsets to advance new spending, only to jettison it before the bill makes the trip up Pennsylvania Avenue to become law.”

“PAYGO has been abused by both parties so much that it runs the risk of becoming a tired joke.”

In summary, TCS concludes:

“PAYGO can be one of the best and most effective tools that lawmakers have on their fiscal responsibility tool belt.  Unfortunately, they don’t use it the way it was intended.  The only way PAYGO is effective is when both sides commit to implement it, and make the tough spending decisions it calls for.”

The entire bulletin, which TCS calls “The Wastebasket,” is worth a read because TCS outlines some of the “tricks and games” played by the Congressional panjandrums.

May 23, 2008

Socialists and “Planet Savers”

You may have seen the show trial this week of the oil company executives before the House Judiciary Committee. If you watch Fox News, you may have even seen California’s Rep. Maxine Waters (D) threaten to nationalize the oil industry, according to the video clip at Gateway Pundit.

Enough background, though. One reason for the climbing gasoline prices is that the oil companies are not able to drill for oil in large tracts of America, e.g., the Arctic National Wildlife Refuge (ANWR). As George Will wrote for Newsweek earlier this year:

“ANWR's 10.4 billion barrels of oil have become hostage to the planet's saviors (e.g., John McCain, Hillary Clinton, Barack Obama), who block drilling in even a tiny patch of ANWR. You could fit Massachusetts, New Jersey, Rhode Island, Connecticut and Delaware into ANWR's frozen desolation; the "footprint" of the drilling operation would be one sixth the size of Washington's Dulles airport.” (emphasis added)

For a picture of just where in Alaska, ANWR is, Mark Perry has a nice map of ANWR and Alaska as well as a picture of just how desolate ANWR is at his blogsite, Carpe Diem. Take a look, and you are likely to agree with Will, who concluded that:

“Energy policy has become a mare's nest of environmental and national-security fallacies. Energetic rethinking is in order.”

Are most members of Congress capable of the "energetic rethinking" needed, however?

May 21, 2008

Just Who Does Congress Represent?

If the voting to override the President’s veto of the farm bill (H.R. 2419) is any indication, most members of Congress care little about America’s taxpayers. According to the Chicago Tribune:

“President George W. Bush vetoed the long-embattled 2007 farm bill on Wednesday, saying it provides subsidies for farmers at a time of record crop prices, increases farm spending by $20 billion and uses "budget gimmicks to hide much of that increase." But within hours, in a show of bipartisan defiance, the House overwhelmingly overrode his veto.”

On Monday, we growled about an earmark for Plum Creek Timber that was put into the farm bill, and noted that the National Taxpayers Union had described the bill as “bloated.” Well, that wasn’t the only pork in the bill, as noted by Jeff Patch at Cato@Liberty, who wrote that earmarks totaled almost $1 billion, adding:

“Fourteen senators (nine Democrats and five Republicans) and one House Democrat inserted 26 earmarks, according to the conference report. Three earmarks appear to be multi-member earmarks.

“The earmarks represent only one-third of one percent of the bill’s expected cost ($289 billion). Legislators will soon issue laudatory press releases patting themselves on the back for rewarding their districts and deflecting criticism by pointing out the “low” cost of earmarks. That’s not the point. The sneaky way the earmarks were inserted and the inefficiency of the federal government doling out money for local projects (also an affront to federalism) helps explain why the public has lost faith in Congress.”

Vermont Sen. Patrick Leahy (D) trotted out the familiar rhetoric of the tax and spend crowd, e.g., “If President Bush is allowed to have his way, this veto would be a setback for farmers, for hard-pressed Americans trying to keep food on the table, for our promising organic farming sector, and for efforts to clean up Lake Champlain.” (emphasis added) The complete text of President Bush’s veto message is here, but included this:

“It continues subsidies for the wealthy and increases farm bill spending by more than $20 billion, while using budget gimmicks to hide much of the increase.”

So organic farming is now a special interest, too, which must be subsidized by American taxpayers. What’s next? By the way, the vote tally to override the President’s veto was 316-108. Democrats voted 216-14 to override while Republicans voted 100-94. Arlington’s Rep. Jim Moran (D) voted to override the veto.

HT: Dominic Rupprecht, blogging at the National Taxpayers Union.

May 20, 2008

Virginia's Transportation Politics

After scanning Gov. Tim Kaine’s (D) so-called transportation plan last week, we growled that it looked more like a plan to raise taxes rather than a plan to lessen traffic congestion.On Sunday, May 18, Tim Craig of the Washington Post trumpeted that Gov. Kaine:

“is giving House and Senate Republicans an ultimatum in the fight over transportation money: Work with me to make a deal, or face political repercussions from voters in next year's election.

“In blunt talk demonstrating his dual policy and political goals, the governor says he is convinced that he cannot lose when the General Assembly returns for a special session June 23 to consider his $1.1 billion tax proposal.”

Suggesting there might be more politics than policy in the governor’s approach, Craig notes, “Kaine clearly relishes the political game, as evidenced by his active role in Sen. Barack Obama’s presidential campaign and his efforts last year to flip the Senate into Democratic control.”

The Washington Times editorializes today that “Virginia's political leaders have missed the obvious solution.” And what is that solution? According to the Washington Times:

"Rather than raise taxes, the state should reapportion its laughable transportation funding allocation away from politically influential but underpopulated parts of the state. That is, instead of grabbing more taxpayer dollars to build a bigger total pie, it should simply serve Northern Virginia and Hampton Roads the slices each has already earned.

“This year, the commonwealth's total transportation outlays neared $4.8 billion. But the state is on track to invest only $600 million in congestion relief for Northern Virginia and just over $250 million in Hampton Roads . . . Only part of the state's transportation dollars are apportioned by population density. In a state as traffic-clogged as Virginia, density is the proper yardstick. Together, Hampton Roads and Northern Virginia comprise nearly 60 percent of the state's population. But density is just one of the formulas for only certain types of spending by the Virginia Department of Transportation.”

Let’s see! If the allocation of transportation money was more fair and equitable, Northern Virginia and Hampton Roads would get over $2 billion rather than less than $1 billion? And that’s without a tax increase.

For the record, the Arlington County Civic Federation’s 2008 legislative package (requires Adobe) requested:

“the General Assembly to study the fairness and equitableness of the many formulas used in distributing general and non-general fund budget appropriations to assure they are fair and equitable.”

A cursory scan of planning documents at the General Assembly’s JLARC website disclosed no plan for such a study. Growls says, "No study, no taxes!"

May 19, 2008

Plum Deal or Prune Job

Sen. Max Baucus (D-MN) happily announced that Congress passed what the National Taxpayers Union has called the “bloated farm bill” in a letter to President Bush urging him to veto the bill. What you may not know is just how bloated the bill is.

David Freddoso, reporting for National Review Online provides this example of “a plum deal for Plum Creek Timber.” Last Monday, he wrote:

“But this year’s farm bill contains a special-interest provision you’ve probably never heard of — the Qualified Forestry Bonds program. This provides federally funded tax-credit bonds for forest purchases that meet the following four criteria:

  1. The forest must be adjacent to U.S. Forest Service Land;
  2. Half of the parcel must be turned over to the U.S. Forest Service;
  3. It must include at least 40,000 total acres; and
  4. It must be subject to a “native fish habitat conservation plan approved by the United States Fish and Wildlife Service.

‘Your initial reaction might be, “What’s so bad about that?” The government does far more damaging things than forest-land preservation, after all. But this farm-bill provision offers a lesson on how things are sometimes done in Washington. Only one parcel of land in the entire United States meets the criteria set for the Qualified Forestry Bonds program.” (emphasis added)

Who owns that parcel of land? The answer: “Plum Creek Timber Company, the single largest private landowner in the United States,” which “began its corporate life in 1987 as Burlington Resources, spinning off of Burlington Northern to manage the railroad giant’s timber and mineral resources — some of which date back to the original railroad land grants of the Lincoln administration.” The following paragraph from Freddoso’s column is worth noting although it won’t be a surprise:

“Plum Creek spent some $220,000 lobbying Congress in the first quarter of this year. Its PAC has spread $400,000 in campaign contributions between the parties in the last decade. PCL Employees have given $16,600 this cycle to Sen. Max Baucus (D., Mont.), chairman of the Senate Finance committee and the author of the bond provision. Baucus, whose staff did not answer inquiries, was enthusiastic enough about the forestry bonds that he put them into the Farm Bill (H.R. 2419), though they have nothing to do with agriculture. The bonds also didn’t have anything to do with energy when Baucus put them in last year’s energy bill.”

Thank you David Freddoso, and a HT to Coyote Blog for alerting the public about the  NRO column. Express yourself about this outrageous abuse of taxpayers by using the following link to write to:

Sen. Max Baucus

May 18, 2008

1) Estonia’s Flatulence Tax; 2) Stimulus Checks

Thanks to The Astute Bloggers (via The Midnight Sun and the Russian news service Novosti), we learn that:

“Estonian farmers have received tax notices for methane emissions from their cattle, the country's opposition party, the People's Union of Estonia, said on Thursday.”

Estonia follows the lead of New Zealand, where according to Novosti:

“authorities in New Zealand proposed introducing a flatulence tax saying that New Zealand cattle are responsible for 90% of the country's methane emissions and 43% of greenhouse gas emissions.”

Back to the U.S., a cartoonist has discovered how the federal government gets the money to pay for those fiscal stimulus rebate checks it send taxpayers (HT: Club for Growth).



May 17, 2008

Things They Do With Your Taxes

Citizens Against Government Waste (CAGW) named U.S. Senator Charles Schumer (D-NY) as the May 2008 Porker of the Month. According to this CAGW press release, he attempted:

“to use the tax code to earmark a $2 billion subsidy for a commuter rail between Manhattan and the JFK airport.  Sen. Schumer wants to take advantage of the New York Liberty Zone (NYLZ) tax credits, which were intended to stimulate the redevelopment of downtown Manhattan after 9/11, for a rail project that has been under consideration since well before 2001.”

CAGW went on to say:

“On May 1, Sen. Schumer said on the Senate floor that the project “is not an earmark, this is not a specific project.”  However, the Senate Finance Committee report published November 13, 2007 determined that the project is a “limited tax benefit,” or earmark.  There are constitutional questions as well.  A Congressional Research Service (CRS) memo dated April 30, 2008, says the earmark “could raise concerns under the [Constitution’s] Uniformity Clause because it explicitly provides a tax benefit based on a geographical classification.”  The Uniformity Clause says that ‘all Duties, Imposts and Excises shall be uniform throughout the United States.’”

If you’re upset over Sen. Schumer’s attempts to manipulate the tax code, take a look at  the 2008 Pig Book, which they released earlier this year. Then contact your Congress Critters!

May 16, 2008

Dr. Coburn’s Washington “Waste " Reports

U.S. Senator Tom Coburn, M.D. (R-OK) publishes “the pork report,” which tracks “how Washington politicians, bureaucrats and lobbyists are spending your taxes.” Below are just a few examples of such waste:

  • May 16, 2008. “Rhode Island Senators earmark half a million dollars to transform a “derelict building” into an International Yacht Restoration School and Museum of Yachting.”
  • May 15, 2008. “Under federal law, 10% of federal surface transportation funds are being spent on non-road projects, such as streetscapes and non-motorized trails.”
  • May 14, 2008. “Louisiana will spend $1.3 million in Federal Highway Administration grants to design a hurricane museum.”
  • May 12, 2008. “ Federally funded bike path will link casino to Nevada communities; “When we are done, it will probably be a national treasure,” says county Parks and Recreation director”
  • May 1, 2008. “Iowa misspent federal election funds to hire entertainers to perform at a ‘celebration of voting’”

Those are just a few examples. Most days seem to have at least a half-dozen examples. And each blurb is supported by the underlying news reporting on the wasteful spending.

The question that needs to be asked is why taxpayers have allowed some of their Congress Crritters to remain in their sinecures. Enough is enough! We repeat the quote by Edward Langley that we used in Wednesday’s growls, “What this country needs are more unemployed politicians.”

May 14, 2008

How Does He Know?

An AP story yesterday reported that Democrats in the U.S. House of Representatives:

“are proposing a tax surcharge on millionaires to pay for a big increase in education benefits for veterans of the war in Iraq, lawmakers said Tuesday.”

According to Rep. Mike Ross (D-Ark), the so-called “leader of the (House) Blue Dog group:"

"What we're talking about is a one-half percent income tax surcharge on incomes above $1 million . . . So someone who earns $2 million a year would pay $5,000. ... They're not going to miss it."

How does he know? As Jeff Dircksen, blogging at Government Bytes, asks, “Why not take more?” Dircksen then suggests, “I'm sure that they didn't have any plans for the money...they probably were planning to burn in a big bonfire in the back yard. So, you're probably doing them a favor after all.”

We concur in the great quote of Edward Langley, who said:

“What this country needs are more unemployed politicians.”

Thanks Jeff! 

May 12, 2008

Simple, Statewide, and Sustainable

Those are the three words that Virginia Gov. Tim Kaine (D) uses to describe his plan to raise taxes. Or, is it a transportation plan? Whatever. In this press release today, he calls it a transportation plan, but it sure looks like a plan to raise taxes.

He says he’s interested in “safety first,” and would pay for this highway maintenance with:

“Increases (in) the existing statewide motor vehicles sales tax from 3% to 4%"

“Increases (in) the statewide annual vehicle registration fee by $10”

Both tax increases would be used for maintenance. In addition, both taxes had been approved by the 2007 Virginia General Assembly in the now infamous HB  3202, which was overturned by the Virginia Supreme Court in February.

He then proposes increasing the retail sales tax by 1% in Hampton Roads and Northern Virginia, which would go to the Northern Virginia Transportation Authority and to seven regional projects in Hampton Roads. Interestingly, he proposes abolishing the Hampton Roads Transportation Authority and the current local option income tax in both regions.

Finally, the governor proposes establishing a “transportation change fund” that “will increase investment in transit, rail, and innovative solutions to reduce traffic congestion like teleworking and ridesharing,” specifying that 3/4 of the transportation change fund “will be dedicated to transit and rail projects.” The money for this “fund” would come from a statewide grantor’s tax (i.e., from the sale of your home) of 25 cents. Not to worry though because the General Assembly had previously approved a 40 cent grantor’s tax in the regional HB 3202 package.

More detailed information is available at the governor’s website, e.g., PowerPoint presentations, spreadsheets, both a video and an audio of the governor’s presentation, and a schedule of his townhall meetings in which he’ll be trying to sell you on his plan. This spreadsheet (requires Adobe) summarizes Governor Kaine's plan to raise our taxes.

We’ll growl a lot more about the governor's plan to raise taxes between now and June 23 which is when the governor has called a special session of the General Assembly to address transportation.

May 10, 2008

Taxpayers’ Money for Another Boondoggle

In conjunction with Citizens Against Government Waste, the National Taxpayers Union issued a letter to U.S. Senators earlier this week, urging them:

“to oppose efforts to pass the San Joaquin River Restoration Settlement Act either as a stand-alone bill (S. 27) or as part of a larger omnibus package. This activist-imposed arrangement is a clear waste of taxpayer dollars and should be rejected by the Senate.”

In their letter, the two organizations wrote:

“Special interests are pushing S. 27 as a way to "settle" their two-decade-old lawsuit against the federal government (specifically, the U.S. Bureau of Reclamation) to restore the salmon population to the historical outlines of San Joaquin River. Even though the targeted segment of riverbed has been dry for 75 years (thanks in part to a dam California voters approved in 1933), these same activists are prepared to spend considerable taxpayer resources in an attempt to bring back a minimum of 500 salmon to the area.

“While it is unclear exactly how much money will have to be expended to meet the settlement prescriptions outlined in S. 27, there is no doubt that federal taxpayers will be on the hook for a significant sum. The Congressional Budget Office (CBO) estimates that implementing a similar House bill could cost federal taxpayers $500 million (and California taxpayers another $250 million). Other parties have estimated the real governmental cost of the agreement to be up to $1.1 billion.”

The left-wing Natural Resources Defense Council hailed the legislation in this press release. In addition, WashingtonWatch.com released summaries of two related bills (HR 24 and  HR 4074), which provide links to further information, including that the cost has escalated from $3.29 per family to $11.20 per family (i.e., over $1 billion). Finally, a group calling itself “Revive the San Joaquin released this summary of legal action.

NTU called the project a boondoggle, adding:

“Surely, there are more pressing demands, such as shoring up entitlement funds or reducing tax burdens, than buying 500 salmon.”

If you agree with NTU, and we do, write Arlington’s representatives in the U.S. Congress:

    •    Senator John Warner
    •    Senator Jim Webb
    •    Representative Jim Moran

May 09, 2008

Clarifying The Gas Tax Debate

The Tax Foundation writes in a news release yesterday that “(f)uel taxes have recently become a hot topic in the presidential campaign and in the media,” adding that “(e)veryone has an angle on this issue:”

“The purpose of the gas tax is simple: to raise revenue for building and maintaining roads and related infrastructure. This approach conforms to what economists call the "benefit principle" of taxation, which stipulates that consumers of government services should pay in proportion to the benefit they obtain from those services. It follows that the revenue raised from a tax that adheres to the benefit principle should be used solely to provide the good or service on which the tax is levied. Therefore, if gas taxes are paid by the individuals who benefit most from roads (drivers) and if the revenue is used solely for road building and maintenance, then the tax is a good one.

“However, there is also the question of whether gas taxes should be used to decrease fuel consumption in order to protect the environment and reduce pollution. Pigouvian taxes, named after Arthur C. Pigou, a renowned English economist from the early 20th century, are taxes that attempt to make up for undesirable side effects of certain industries—what economists call "negative externalities." Pigouvian taxes are controversial and often difficult to calculate; they complicate the gas tax debate considerably.”

They then go one to identify various Tax Foundation publications and blog posts, which can clarify the issues related to the gas tax. Don’t be swayed by the political rhetoric. Rather, arm yourself with facts.

May 07, 2008

How Much Do Arlington Schools Really Spend?

In a press release last September, the Arlington Public Schools announced the results of the 2007 customer satisfaction survey. They seemed most proud of the answer to the question of “whether or not (taxpayers) tax dollars are being well spent:”

“60 percent of the community think that their tax dollars are well spent compared to 48 percent in 2004. On the same question, 83 percent of APS parents surveyed in 2002, 2004 and 2007 responded that their tax dollars are well spent by the school system.”

Unfortunately, no effort was made to probe whether taxpayers were satisfied with the actual dollars being spent, but only to the much more general “their tax dollars,” which by the way was $17,958, according to the FY2007 report of the Washington Area Boards of Education (WABE).

But now comes research that strongly suggests that 60% number of satisfied Arlington County taxpayers would be significantly lower if taxpayers knew just how much the Arlington Public Schools spend per student. According to a survey conducted by researchers at the University of Chicago and Brown University (here is the press release, and here is the the complete article (requires Adobe), including the methodology):

“Do Americans have an accurate grasp of how much is currently being spent on public education? Not according to a recent analysis of national survey results by University of Chicago’s William Howell and Brown University’s Martin R. West published in the summer issue of Education Next. The average respondent surveyed in 2007 thought per pupil spending in their district was just $4,231 dollars, even though the actual average spending per pupil among districts was $10,377 in 2005 (the most recent year for which data are available). [emphasis added]

“Howell and West also found Americans think that teachers earn far less than is actually the case. On average, the public underestimated average teacher salaries in their own state by $14,370. The average estimate among survey respondents was $33,054, while average teacher salary nationally in 2005 was actually $47,602.

“Almost 96 percent of the public underestimate either per-pupil spending in their districts or teacher salaries in their states.”

After attending a joint worksession between the County and School Boards last month, we growled that County Board members seemed more concerned about how “green” the schools were rather than about their cost.

The conclusion of the study’s authors is rather thought-provoking:

“In sum, Americans think that far less is being spent on the nation’s public schools than is actually the case. The vast majority of the public thinks we spend amounts that can only be described as minuscule, and almost 96 percent of the public underestimate either per-pupil spending in their districts or teacher salaries in their states.

“Important questions about the public’s understanding of school spending remain. Why are their estimates so low? Is this phenomenon unique to education, or would we find the same thing if people were asked about the salaries of other public servants, say, postal workers or police officers? And crucially, does the public’s understanding of school finance shape their policy preferences, or do the public’s policy preferences shape their understanding of school finance?

At this point, though, one matter seems certain: whatever motivates people’s concerns about school finance, it is not sound information about what is actually being spent.” [emphasis added]

May 02, 2008

A Local Windfall Profits Scheme

Yesterday evening, the Arlington School Board formally adopted its own budget for FY 2009 (item F-1 from yesterday’s agenda). While some politicians on Capitol Hill whine about oil company profits and the need to tax excess profits, the approved School Board budget was enriched by Arlington County’s own form of excess profits (aka the Revenue Sharing Agreement, which we growled about on April 29).

The budget proposed by the Superintendent called for a “county transfer” of $348.7 million. However, thanks to the Revenue Sharing Agreement, the School Board’s budget received a “windfall” of $4.1 million. The approved transfer is now $352.8 million,which results from $1.3 million in “additional local revenue from the prior year” and $2.8 million from re-estimated FY 2009 revenue. Some of the “windfall” will offset reduced revenue from the state, including $0.5 million less in state sales tax.

How will the School Board budget grow. Among a number of items, the operating fund grows by 5.3% from the FY 2008 appropriated budget. Staffing will increase by 39.9 full-time equivalent (FTE) positions over the Superintendent’s budget. A third item worth noting in the staff report for agenda item F-1 is the almost 21% increase in debt service resulting from the School Board’s “aggressive” capital spending, increasing from $27.7 million to $33.4 million.

Unfortunately, the School Board cannot see, or chooses to ignore, the annual windfalls from its Revenue Sharing Agreement with the Arlington County Board. Instead, the two boards blather on about an increased ability to plan school spending from the present scheme.

May 01, 2008

Questioning Higher Taxes, More Government

Richard Rahn, senior fellow at the Cato Institue, asks in his column in today’s Washington Times:

“Have you ever wondered why so many people see higher taxes and more government as the solution to every problem, despite the empirical evidence that more government reduces economic efficiency and growth and diminishes our liberties?”

Rahn takes on this editorial in the April 24, 2008 New York Times, and commented that the editorial was:

“(O)ne of its classic inane editorials in favor of higher taxes on labor and capital, which contained this gem of a sentence: "Memo to McCain: 401(k) savers get no benefit from a low capital-gains [tax] rate."

“Everyone who has ever taken basic economics should know a lower tax rate on an investment (i.e., the capital-gains tax) will lead a higher rate of return, and hence the investment will be worth more. Other things being equal, lower capital gains tax rates will lead to higher stock prices, and all who hold stocks will benefit, whether or not they pay a particular tax on that stock. Though this concept is not difficult for most people to understand, it seems beyond the knowledge and reasoning ability of those who write editorials for the New York Times.”

He then provides example after example “of what those who advocate higher taxes on capital and labor either do not understand or willfully choose to ignore.” The column is worth reading if you need to arm yourself with “talking points” to combat the inanities of "tax-and-spenders" that you may come into contact with.