Public Policy and Governance – Page 333

State Workers Pay Taxes Too

During a discussion the other day, a SPEA staff member made a point that seems to be lost in the contending, highly ideological arguments about the standoff in Wisconsin. She noted that public employees are also taxpayers, and that the Governor’s insistence that he is acting in the “interests of the taxpayers” didn’t seem to include the interests of that particular subset of taxpayers.

Her observation has just been quantified and amplified by Robert Russell, a Wisconsin state economic analyst, who pointed out that state workers are not only taxpayers, but consumers.

According to Russell, if public employee salaries are cut through increased withholdings as Walker is proposing, by an amount large enough to fill the $137 million budget gap, the resulting drop in consumer spending will lead to: 1) a loss of over 1,200 nongovernment jobs; 2) a loss of about $100 million in business sales statewide; 3) a loss of nearly $35 million in personal incomes of nongovernment employee households; and 4) a loss of nearly $10 million in state tax revenues.

This is not about economics. (Indeed, Governor Walker seems blissfully ignorant of basic economics.) It’s about ideology, hubris, and political payback.

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Debt and Taxes

It doesn’t take long for my students to learn that “it depends” is almost always the right answer to policy questions. The world is complicated, and questions about how government should operate are rarely black or white.

In an excellent column about debt and taxes, Morton Marcus makes precisely that point. Debt incurred in order to make investments in the future is good; borrowing in order to shift costs properly paid for with current tax dollars–is bad. Borrowing to invest in education, transportation and communications will make life better for our children and grandchildren, and will increase their ability to pay that debt. Borrowing in order to avoid raising taxes to pay for the wars in Iraq and Afghanistan does not make life better for future generations; it merely saddles those generations with bills that we didn’t want to pay.

The issue isn’t whether debt is good or bad. It isn’t even whether it is too big. The issue is whether the borrowed dollars were used to make wise investments, or were used instead to allow current generations to say “charge it” to the future.

With debt, as with so much else, it depends.

Reaganism Triumphant

This morning, I made my usual mistake, and listened to the news.

The protests in Wisconsin–and to a lesser extent, Ohio–triggered by efforts to blame fiscal shortages on people who work for government. A story about a southern town that has stopped making pension payments to retired police officers and firefighters, because the town “ran out of money.” Various congresspersons of the Republican persuasion demanding ever-more draconian cuts in social programs we can no longer “afford” (while failing to explain why we can still afford all manner of military expenditures, including the Pentagon’s practice of sponsoring NASCAR races). You all know the drill–it’s drearily familiar.

So here’s my question: why, in all of these discussions, do we never hear anyone suggest raising taxes?

Now, I will grant that taxes can be a double-edged sword: depending upon who and what we tax, we can cause economic distortions. Tax policies can provide perverse incentives, or reduce incentives for behaviors we want to encourage. But that recognition hardly justifies taking taxes off the table, and that seems to be what we’ve done. Taxes have become a dirty word, rather than a revenue source.

The result is that we are strangling government’s ability to invest in the future of the country. When governors refuse federal dollars to built high-speed rail, they are not only refusing to create temporary construction jobs, they are ensuring that America will be less competitive for a generation. When they choose to “balance” budgets on the backs of pensioners and public servants, they are opting to weaken government’s ability to provide services and undermining the public’s trust in that government.

Ronald Reagan famously said that government is the problem, not the solution. Then he set in motion a political ideology that embraced a very selective version of Reagan’s Presidency and made that statement into a self-fulfilling prophecy.

Those who subscribe to “Reaganism” conveniently forget that even the Gipper raised taxes when necessary.

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Proof of Citizenship

Well, I see that our embarrassing legislators have given committee approval to the “let’s target brown folks” bill–aka “immigration enforcement.” Much like the widely criticized Arizona law after which it was modeled, the measure would allow police to stop people and demand proof that they are in the country legally if there is “probable cause” to question their immigration status. “Probable cause” includes failure to speak English, a provision that led a snarky friend of mine to suggest that people in southern Indiana should start carrying their birth certificates.

How would you prove that you are a citizen, or otherwise legally entitled to be in the United States, if you were stopped? Those of us with passports could start carrying them everywhere, I suppose. Or we could carry birth certificates. A driver’s license isn’t considered proof.

Since the sponsors of this bill insist it does not depend on profiling or skin color, we would all need to carry “official papers” of some sort in case we were stopped. And that is ironic, although I’m sure it is an irony that escapes our intrepid lawmakers.

When my oldest grandson was twelve or thirteen, my husband took him to New York’s Ellis Island. The museum of immigration had a wonderful interactive display, showcasing the history of those who came to America and the reasons they left their homelands. What made the deepest impression on our grandson was the number of people who left their original homes because they were required to have “papers” on them at all times, required to prove their right to walk the streets of the cities in which they lived. He found such a requirement incomprehensible.

I hope he has his papers. He tans easily.

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Downside of Democracy

Many years ago, during a discussion with a friend whose husband served in the Indiana House, she said something I’ve always remembered: “The problem with representative democracy is that it is representative.”

This session of the Indiana Legislature seems intent on proving the point.

If you’ve been following national news, you may be thinking that those we elected to the General Assembly couldn’t possibly be as crazy as, for example, the South Dakota lawmaker who sponsored a bill that would have made it legal to shoot abortion doctors (he withdrew it in the wake of the publicity), or the Arizona legislator who responded to the horrific shootings in Tucson by sponsoring a bill to allow concealed guns to be carried anywhere, or the Wisconsin Governor who is threatening to call out the National Guard if public workers protest his efforts to strip them of bargaining rights they’ve had since the 1950s.

But you’d be wrong.

Think an anti-bullying bill should be a slam-dunk? Think again. The Senate Committee killed it on a 3-5 vote. Opponents expressed an uncharacteristic concern for the First Amendment rights of schoolchildren…especially their right to express anti-gay sentiments.

Speaking of child safety, surely a bill to require all child care providers to meet health and safety requirements—staff criminal history checks, fire safety, drug testing and the like—should be a no-brainer? Wrong! Advance America’s Eric Miller brought in God’s folks to testify that the bill gave government “too much authority over Church ministries,” and the bill died without a committee vote.

Wisconsin isn’t the only state trying to strip public employees of bargaining rights—here in Indiana, a bill to abolish Indiana’s merit system has emerged from committee. And Mike Delph’s effort to have Indiana emulate Arizona by targeting people who “look like” they might be illegal immigrants is moving along nicely (never mind that Arizona’s convention bookings declined 36% in the wake of that state’s law, and never mind that immigration is an exclusively federal responsibility).

And of course, our “representative representatives” aren’t content with defeating the anti-bullying bill, and reviving the bill to amend the Indiana Constitution to ban same-sex marriage. Taking their war against gay Hoosiers up a notch, there’s an upcoming committee vote on a bill to prohibit state universities from providing domestic partner benefits.

The haters and the crazies are well represented in the Indiana General Assembly. The rest of us, not so much.

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