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Los Angeles should bag the bag ban
Posted By:  - 11/12/10

Here we go again.

 

A little less than three months after California’s State Senate rejected an ill-advised plastic bag ban and paper bag tax out of a concern about the effect such a policy would have on jobs when unemployment is above 12%, Los Angeles County is set to pick up where the state’s politicians in Sacramento left off. On Tuesday, the Los Angeles County Board of Supervisors will consider a proposal that would ban plastic bags and require a fee on paper bags countywide.

 

But since the State Senate rejected the policy, Californians approved Proposition 26, a measure that requires a 2/3 supermajority vote in the state legislature or a local popular vote to raise certain fees. Los Angeles County and the bag ban’s proponents don’t seem to mind the new requirement; they argue that it does not apply simply because the grocers, not the government, gets to keep the fee. This appears to be an attempt to tiptoe around the vote requirement and, unfortunately, a disregard for the will of the voters who are fed up with stealth taxation through rising fees.

 

Plastic bag bans, taxes, and fees are only the latest fad in questionable public policy. Proponents claim that these will help reduce litter in the environment. But the fact of the matter is that as the price of a good increases or becomes less readily available, consumers either buy less of the good or, more likely, seek the good from another, cheaper source. Ironically, the less costly good may be of lower quality and more damaging to the environment. Bag bans and taxes in other metropolitan areas, such as Seattle and Washington, D.C. have not demonstrated much success.

 

Hopefully, Los Angeles County’s Board of Supervisors will come to their senses and reject this measure on Tuesday. If you live in Los Angeles County, you should can let the Board know by clicking here that disregarding popular opinion on requiring votes on fees to enact a questionable public policy is a terrible idea, and should be bagged.

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$572 Million Net Federal Spending in Taxpayer’s Tab
Posted By: Dan Barrett - 11/09/10

Tab Insert

The NTU Foundation’s Taxpayer’s Tab is back to its regular schedule and format, highlighting four newly scored Congressional bills.

Covering veterans educational benefits, the Most Expensive Bill of the Week would allow certain service members to transfer benefits to their dependents. The Least Expensive Bill of the Week would establish a comprehensive energy plan, including more domestic oil exploration, alternative technology development, and a natural gas vehicle demonstration project provision. The House version of the Prevention First Act was found to increase federal spending by $417 million in the first year.

Bills covered in the latest Taxpayer’s Tab include:

  • HR 3577, Education Assistance to Realign New Eligibilities for Dependents (EARNED) Act of 2009
  • HR 3505, American Energy Production and Price Reduction Act
  • HR 463/S 21, Prevention First Act
  • S 3078/HR 4757, health Insurance Rate Authority Act of 2010
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More Big Ethanol
Posted By:  - 11/08/10

In today's Examiner, Tim Carney argues that ending Big Ethanol's subsidies is an early test of their commitment to free markets and smaller government.  With the subsidies set to expire at the end of this year, you can never say never.  However, ethanol has hung around Washington for more than 30 years.  During the 1970s, ethanol was billed as the answer to America's energy crisis. During the 1980s, it was expected to save the family farm from financial ruin. During the 1990s, ethanol was touted for its environmental benefits.  Whatever problem Washington seems to be facing, ethanol seems to be the answer.  And, as Carney rightly points out, the industry has a lot of friends on Capitol Hill.  If Republicans can end subsidies to Big Ethanol, it would be an important accomplishment and demonstrate their commitment to reforming Washington.

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Election 2010: What a night
Posted By:  - 11/03/10

Oh what a night!

 

As of this morning, Republicans won 60 additional seats and control of the U.S. House of Representatives. Also, Republicans expanded the size of their caucus by six in the Senate. These two changes that will have serious implications for a host of economic policies at the national level, including energy production, taxes, entitlements, and the debt. My colleague Jordan Forbes will have more to say about the federal results soon.

 

But for all of the dramatic change at the federal level, what happened in Congress pales in comparison to the changes that voters made at the state level. Republicans picked up nine governorships, including several in the economically important Midwestern states, and won control of 18 state legislative bodies, including chambers in North Carolina and Alabama; today marks the first time since Reconstruction the GOP has controlled those chambers. The larger number of fiscal conservatives in state legislative chambers will have a significant impact on the next round of budget negotiations, when states will have to face no easy choices to balance the budget in the midst of uncertain economic times.

 

Voters also weighed in on hundreds of state and local ballot measures that affect tax and budget policies. There were several setbacks for taxpayers yesterday. It appears as though voters rejected efforts to reduce taxes income and property taxes in Colorado and sales taxes in Massachusetts. Additionally, California passed a measure that would allow the legislature to enact a budget with a simple majority vote, which will likely open the door to more tax hikes. Unfortunately, Californians also rejected an effort to repeal a costly cap-and-trade emissions program in the state. However, at the same time, Californians voted to require supermajority votes on fees and to prevent the state from raiding funds for local government.

 

But taxpayers did score several important victories. Despite rejecting a broad reduction in the sales tax, Massachusetts approved a cut in the sales tax on alcoholic beverages. Washington voters resoundingly rejected an effort to enact a new state income tax and approved a measure rolling back a tax on soda, candy, and bottled water. Washingtonians also voted for a measure to require a supermajority in the legislature for any tax increase. Missourians voted overwhelmingly to require votes on local earnings taxes. Meanwhile, Indiana approved a measure to enshrine caps on property tax increases in the state’s constitution.

 

Elsewhere, Arizona and Oklahoma approved measures that projected the right to choose a health care plan from the individual insurance mandate in Obamacare. Several states, including Oklahoma, South Carolina, and Virginia approved measures to increase the size of their rainy day funds to weather bad economic times. Other states also approved measures that would provide property tax exemptions, impose term limits, and improve government accountability.

 

Of course, these are just a sample of the hundreds of measures that NTU is analyzing for its report showing how taxpayers fared at the ballot box yesterday. Stay tuned.

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Can California afford to Live like Ed Begley Jr.? Nope
Posted By:  - 11/02/10

The reality television show “Living with Ed” documents actor and environmentalist Ed Begley Jr.’s adventures and challenges in living a low-carbon emission, or so-called “green” lifestyle outside of Los Angeles. In each episode, we watch as Ed tries to grow his own drought-resistant crops or get good mileage out of his electric car. Though we may chuckle as Ed endeavors to practice what he preaches, his reality could become the reality for all of California unless Proposition 23 passes.

Proposition 23 on the statewide ballot would suspend AB 32, a 2006 law that requires a 30% reduction in carbon emissions by 2020, until unemployment falls to 5.5 percent for four consecutive quarters. AB 32 achieves the emissions reductions through new taxes and regulations on cars, trucks, appliances, and farming. Additionally, AB 32 mandates electricity from renewable sources like wind and solar power.

The bill’s supporters said it would create jobs, so-called “green jobs,” in California, but a study a the Pacific Research Institute, a San Francisco-based think tank, predicts 150,000 lost jobs by 2012 and another 1.3 million by 2020. Additionally, a Sacramento State University study shows that AB 32 will actually increase a family’s cost of living nearly $4,000, boost the regulatory burden on an average small business by nearly $50,000. All of this to create a “green” lifestyle for all of California.

These figures are not idle speculation. European countries that have tried programs like AB 32 have actually experienced job losses. Gabriel Calzada, a Spanish economist and lead author of a study detailing the economic costs of Spain’s green experiment, found that the Spanish economy lost a net 2.2 jobs for every “green job” the mandates created. And most of the green jobs (9 out of 10) created from renewable energy mandates were temporary because they were installation jobs. As a result of the mandates, Spanish companies like Acerinox, a steel maker, exported manufacturing jobs to South Africa and Kentucky. California companies will likely do the same.

California simply cannot afford this. The American Legislative Exchange Council already ranks California 46th out of 50 on its Economic Outlook Rank. The state ranks so poorly due to its high state and local tax burden, its income tax progressivity, size of its public workforce, and public employee compensation. For example, the state boasts one of the highest marginal income tax rates on high-income earners, currently at 10.55 percent, and the highest marginal corporate income tax rate in the West, at 8.84 percent. However, all of this translates into a weaker economic output. Adding to the tax burden by allowing AB 32 to take effect would only exacerbate the state’s bad economic problems.

No other state has tried to follow California’ lead in creating it’s own cap and trade program, and for good reason. Even under the best economic conditions, the impacts of AB 32 on the state would be terribly harmful. But at a time when the state’s unemployment rate is in excess of 12 percent and the state is broke by $20 billion, allowing AB 32 to take affect would be downright devastating to Californians. Though we may laugh and envy some aspects of Ed Bagley’s lifestyle, California simply cannot afford it.

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NTU Joins with Liberal Group to Identify $600 Billion in Waste
Posted By: Andrew Moylan - 10/28/10

Today, NTU joined with the liberal group U.S. PIRG to release a report called "Toward Common Ground: Bridging the Political Divide to Reduce Spending." This report debuts a list of $600 billion worth of specific federal spending reductions. With all the talk about debt and deficits, we saw an opportunity to put together a true left-right coalition in order to begin the conversation about the difficult choices we’ll have to make as a nation. We thought it would be useful to reach across the ideological divide to identify specific items that we could cut from the federal budget without reducing the quality of government services or neglecting the government's basic commitments.

The U.S. PIRG and NTU study identifies 30 specific, actionable items to cut in federal spending, including:    

  • $62 billion in savings by eliminating wasteful subsidies to farmers and large corporations.
  • $354 billion in savings from reforming inefficient contract and acquisition procedures.
  • $77 billion in savings by improving execution of existing government programs as well as eliminating unneeded programs.
  • $108 billion in savings from ending low-priority or unnecessary weapons systems, along with rightsizing other programs.

While we're under no illusions that every group or individual on the left and right will agree with our list, we think that it can serve as something of a consensus document from which Congress and the President's Fiscal Commission can work. Simply stated, we can't continue to kick the can down the road on reducing the size of the federal government.  In order to head off a debt crisis like that facing Greece today, we need to begin scaling back our unsustainable spending habits.  This list can help to do that without starting a political food fight.

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An Alternative to Ethanol
Posted By:  - 10/21/10

In case you're looking for an alternative to ethanol, Investors.com points out that you could purchase a Chevy Volt.  However, they don't seem completely sold on it: "So it's not an all-electric car, but rather a pricey $41,000 hybrid that requires a taxpayer-funded $7,500 subsidy to get car shoppers to look at it."

 

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More on Big Ethanol
Posted By:  - 10/20/10

A little more on Big Ethanol.  This week Gregg Easterbrook has a piece on Reuters.com that touches all of the bases:  subsidies, environmental benefits, and taxes.  Give it a read.

I could not agree more.

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Public Presidential Campaign Financing Covered in NTUF Taxpayer’s Tab
Posted By: Dan Barrett - 10/14/10

Tab Insert

Springing forth from the successful BillTally Quarterly Report in Issue 14 of The Taxpayer’s Tab last week, NTU Foundation brings you brand new cost estimates in the traditional weekly format -- that's four bills introduced in the 111th Congress that would increase or decrease federal spending.

The most expensive bill of the week is a collaborative effort between pro-choice and pro-life caucuses in the House, to prevent unintended pregnancies and attempt to reduce the need for abortions. If enacted, the $3.9 billion first year cost would go towards state grants and programs supporting education and women’s health.

This week’s Taxpayer’s Tab details the following bills:

  • HR 3312, Preventing Unintended Pregnancies, Reducing the Need for Abortion, and Supporting Parents Act
  • S 3452, Valles Caldera National Preserve management Act
  • HR 775/S 535, Military Surviving Spouses Equity Act
  • HR 6061/S 3681, Presidential Funding Act

To supplement the large number of Military Surviving Spouses Equity Act cosponsors, the following is a breakdown by party and chamber.

  • House – 352 Congressmen in Support
    • 222 Democrats (87 percent of all Democrat Representatives)
    • 130 Republicans (73 percent of all Republican Representatives)
  • Senate – 60 Senators in Support
    • 40 Democrats (68 percent of all Senate Democrats)
    • 17 Republicans (41 percent of GOP Senators)
    • 2 Independents (100 percent of Independent Senators)*
    • 

* Senators Lieberman and Sanders caucus with the Senate Democrats.

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Got questions about ballot measures? NTU's Ballot Guide has answers
Posted By:  - 10/14/10

Voters face many important decisions in the upcoming elections, which are now less than three weeks away. But many of these critical decisions will not involve choosing between the names of candidates. Instead, voters will have to choose between letters and numbers identifiying hundreds of state and local ballot measures, many of which could have an especially profound impact on tax, spending, and other fiscal policies for years to come and regardless of which political party triumphs in the state houses. To help taxpayers better understand these measures, NTU has produced and made available on our website "The 2010 Ballot Guide: The Taxpayers Perspective."

Our Guide is more than just a list of measures. The Guide is an analysis of these measures on the state and local ballots across the country, providing evaluations of how these measures grow the size of government and increase the tax burden on hard-working families. Unfortunately, there are many such measures on the ballot according to the Guide. However, many other measures on the ballot will give taxpayers opportunities to exercise a greater degree of control over government tax, spending, and regulatory powers.

Here are some highlights from the pages of the Guide:

  • In Washington State, Initiative 1098 would impose a state-level income tax there for the first time, beginning on individuals with incomes above $200,000 but later possibly extending to other groups at the Legislature’s discretion.  This would knock Washington off the list of just nine states without a broad-based income tax. On the other hand, Initiative 1053 would require two-thirds of the Legislature or a majority of voters to raise taxes in the future, while Initative 1107 would roll back taxes on candy, bottled water, and soft drinks.
  • In California, Proposition 23 on the statewide ballot would suspend the California Global Warming Act, and all of its mandates until unemployment eases. Taxpayer advocates in the state argue that this measure would prevent substantial hikes in energy costs on struggling consumers. Meanwhile, Proposition 25 would do away with a two-thirds legislative vote requirement to pass a budget but Proposition 26 would extend a two-thirds vote stricture on increases in many fees.
  • Voters in Massachusetts will consider a measure that would reduce the state’s sales tax from 6.25 percent to 3 percent, as well as one repealing in most cases the sales tax on alcoholic beverages.
  • Proposition A on the Missouri statewide ballot would take away the authority for cities to levy an earnings tax, require voter approval for the continuation of earnings taxes where they currently exist, and provide for their eventual phase-out.
  • At the local level, voters in California's San Diego County, as well as voters in Illinois' DuPage County, will vote on measures that would either require voter approval for increases in public safety pension benefit formulas or call upon the state to undertake serious pension reforms immediately.

We hope you find the Guide useful in evaluating the choices awaiting you at the polls. Be sure to check back with NTU after the election for our report on how taxpayers fared.

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