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Accountability free trade & free markets general freedom local leaders media and media people nannyism national politics & policies porkbarrel politics responsibility tax policy too much government

Ballots & Books

The people of Roseburg, Oregon, aren’t paying enough in taxes. That’s the upshot of Kirk Johnson’s recent New York Times article, “Where Anti-​Tax Fervor Means ‘All Services Will Cease.’”

“For generations in America,” readers are informed, “small cities … declared their optimism and civic purpose with grand libraries that rose above the clutter of daily life and commerce.” 

And then, the unthinkable: “last fall, Douglas County residents voted down a ballot measure that would have added about $6 a month to the tax bill on a median-​priced home and saved the libraries from a funding crisis.”

How dare voters so vote? Didn’t they know the Times wanted those libraries fully funded? Where was the “optimism and civic purpose” of Roseburgians?

“We pay enough taxes,” said auto mechanic Zach Holly.

“The trust is gone from people who are paying the bills,” acknowledged an elected commissioner one county over.

Even Jerry Wyatt, who voted for the library tax, decried that, “There’s no end of waste” in government, adding, “We need less people on the county payroll.”

Meanwhile, the Times reporter explained that “few places” are confronting “the tangled implications … more vividly than in southwest Oregon.” It’s not merely “lights out, one by one, for the [library] system’s 11 branches.” There have also been “cuts to the sheriff’s budget … [ending] round-​the-​clock staffing.” 

“If a crime is reported after midnight there,” Johnson wrote, “best not hold your breath for a response.” 

This is “what happens when citizens push the logic of shrinking government to its extremes.” 

To the extreme, eh? Hmmm. Doesn’t seem bad at all. 

Douglas County voters made a free choice about libraries and taxes. 

Close the book on it.

This is Common Sense. I’m Paul Jacob.

 

* There have also been worthwhile innovations in county government due to the budget cuts. Nearby Curry County combined its juvenile justice department with its parks department to save scarce funds. Then, the parks department began using juvenile offenders to clean up the parks. By engaging teenagers in meaningful work, the policy pushed recidivism rates way down and now Curry County has one of the lowest rates of youths committing a second offense.


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Common Sense general freedom ideological culture initiative, referendum, and recall political challengers responsibility term limits too much government U.S. Constitution

Duck/​Rabbit, Maiden/​Crone, and Taxes

Revolution! Must we?

Can’t we reform at a reasonable pace?

Well, whether we change slowly or quickly, change must occur. Today’s in-​place policies are not stable.

But a better future itself must be stable. Or else it will not be better.

And a key to successful change is change in the hearts and minds of the people. The vast majority, East and West, need to shift mental gears and shift their ideological paradigms. (That is the term most famously used by Thomas Kuhn.)

Take yesterday’s story. I first heard about it from proponents of Oregon’s big business excise tax hike. They were saying that Oregon had the lowest business taxes in the union, and took that as a cue to raise taxes. I looked at it as a great political success, and one that had contributed mightily to Oregon’s remarkable economic resilience in these trying economic times.

The difference between the Higher Taxes reaction (which views low taxes as an opportunity only to raise them, and the consequences mainly as who gets the tax funds) and my reaction (which concentrates on the consequences of the expropriation, and looks to a longer period of time to gauge results) is a paradigm shift. To go from one to the other (preferably from the pro-​tax to the low tax position) requires a shift in vision.

It is like what happens when you refocus on the Duck/​Rabbit image, or the Maiden/​Crone. Give a person some time. Be patient. And hint that a shift in perspective is warranted to see both.

And that we might gain something from a paradigm shift.

This is Common Sense. I’m Paul Jacob.


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Accountability free trade & free markets property rights tax policy

Taxation to What End?

Oregonians have quite a few ballot measures this year.

And only one of them seems obviously nutty: Measure 97.

It would raise taxes on the very biggest of companies. The richest — that is, those with $25 million in sales.

Among the reasons given for this excise hike, which is estimated to be the biggest in the state’s history, are a whole bunch of “ooh, look at what we can do with all that loot!” enticements. Yes, and then there is the tried-​and-​untrue staple of the left, the “make large and out-​of-​state corporations pay their fair share in taxes” ploy.

Admittedly, trying to get out-​of-​state entities to pay for your benefits is classic. What “Let somebody else pay” lacks in nobility and morality it makes up for in avarice’s perennial appeal.

But the practical problem? A tax hike is just a bid on a future expropriation. Tax targets can, in effect, counter-​offer by moving, or threatening to move, out of taxing territory.

Imagine yourself a thief. Then imagine first announcing to your victims where, when and how much you intend to take.

Right now Oregon sports the tenth best business environment in the country and, maybe, the lowest business taxes*. Raise taxes to the “middle of the pack” and businesses begin to look at states with lower rates.

Objectionable? Doesn’t matter. Folks go into business to make profits, not pay taxes.

Against this reality? Measure 97’s many bigwig supporters: the progressive Democratic governor, Democratic legislators and big-​spending public employee unions eager to expand their bottom lines.

But by seeking to maximize near-​term tax rates, these greedy special interests risk losing revenue further off, after businesses flee the state.

This is Common Sense. I’m Paul Jacob.

 

* The Oregon Center for Public Policy ranks Oregon as tied with Connecticut for the lowest in the nation.


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Accountability nannyism national politics & policies tax policy

The Year of Translucency

Barack Obama promised transparency in government. He didn’t deliver.

But others stepped up to the plate.

It’s now possible to see through a lot of political, elitist, and bureaucratic bunk courtesy of fugitives like Snowden, convicts like Manning, and citizens using FOIA (Freedom of Information Act) procedures.

And we are learning more about Hillary Clinton with each info dump from Julian Assange’s Wikileaks and every court-​ordered disclosure thanks to lawsuits to enforce FOIA by organizations like Judicial Watch.

Some folks demand that Donald Trump release his tax returns. On the one hand, hooray for public demands for more information about candidates. But on the other hand, the richer you are, the longer and stranger your tax returns become. One shifts income around to avoid taxes — indeed, you take every “loophole” the law allows. As Justice Brandeis advised. Some folks may be shocked by Trump’s creative-​but-​legal accounting.

To avoid future confusion, we should demand simple tax returns from the rich. That would require jettisoning most of the tax code, simplifying the system. But ask your congressional representative why he or she will not support such a reform.

The reason we have an opaque and complicated tax code is … well, transparent. Under a simple tax system, there would be fewer favors to “trade” … and thus less power to accumulate, less oomph to parlay into pomp and splendor.

Which is why politicians rarely provide much transparency, and why it must often be wrested from them.

Merely by being merchants of opacity, our pols reveal, if inadvertently, the nature of our Too Big Government.

This is Common Sense. I’m Paul Jacob.


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folly free trade & free markets general freedom moral hazard too much government

When Parasites Collide

There are times I wish I were a tax accountant.

You know, just so I could better understand the news.

The European Commission has handed Apple, Inc., a $14.5 billion tax bill.

Owed to Ireland.

Apple, the tax commissioners said, had paid too little in taxes to Ireland, amounting to a mere 1 percent of the company’s European profits.

The Emerald Isle’s normal corporate tax rate is 12.5 percent.

On first read, this sounded like a tale of crony capitalism, with the EU’s tax authorities riding in, heroically, holding aloft the gonfalon of fair play, on the side of truth, justice, and an even playing field.

Well, the story gets complicated. The U.S. Treasury has protested the ruling as unfair. And Senator Chuck Schumer called it a “cheap money grab.”

The Wall Street Journal opinion page comes out on Apple’s side, too, but gives some specifics. Apple paid all the taxes it owed under Irish and EU law, but the ruling wasn’t about law, it was, we are told, about politics.

I can believe that.

So, as near as I can make out, what we have here are three sets of governmental interests, each intent on sucking the most out of a rich, innovative, and wildly successful multinational corporation.

It’s hard not to side with the target, Apple, and think of the other groups as mere parasites.

After all, my non-accountant’s spidey sense suspects that Schumer objects because the U.S. government isn’t going to get any of that $13 billion.

Preferring an “expensive money grab,” I suppose.

This is Common Sense. I’m Paul Jacob.  


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folly free trade & free markets general freedom moral hazard national politics & policies tax policy too much government

Whose Side Are They On?

Excuse me if I drive over familiar roadways. But we are witnessing one of the great revolutions in human cooperation.

And our governments and politicians are working mightily to block traffic.

I refer, of course, to Uber and Lyft and the like.

The innovation that these companies bring to market? Enabling everyday drivers to leverage their personal investment in a capital good — a car or SUV — to make extra bucks (or even a living) while efficiently serving people who want rides.

Ride-​hailing apps on smart-​phones provide more security and consumer guidance than the old taxi services ever bothered to even try. The elaborate online rating system, where drivers rate riders and vice versa, provides a new market in information that outstrips government “regulation” as a consumer defense system.

And consumers get better rides, cheaper.

The Uberization of ride sharing competes directly with taxis, of course, and that’s a problem … for taxi companies. And the politicians who have regulated them for years. This regulation never was about consumer protection, but politicians just feathered their own nests with campaign contributions through crony capitalism, helping some taxi services at the expense of others.

And customers.

The latest idiocy hails from Massachusetts, which has enacted a 20¢ per trip tax on all ride-​sharing apps, with 5¢ of each charge slated for subsidizing the old, established taxi services.

Taxachusetts’s Republican governor, Charlie Baker, has been sucked in to the government racket, choosing to support old cronies rather than customers.

Still, it could have been worse. The advocates of the tax had initially demanded Uber be banned.

This is Common Sense. I’m Paul Jacob.


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Illustration based on original cc photo by GörlitzPhotography on Flickr

 

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folly general freedom national politics & policies tax policy too much government

Procrastinators’ Weekend

Usually, April 15 is the deadline date, in these United States, to file taxes or apply for an extension. This year it is April 18.

Why? Many of us think of the Fifteenth of April as Tax Day. It seems strange and arbitrary when it is jiggered with. And kind of annoying.

But a postponement of taxes could be a postponement we might all appreciate as a tiny (ever so slight) reprieve.

So, again, why this year’s three-​day extra leeway?

First off, it is regularly postponed when the day falls on a Saturday or Sunday.

Could it be that the “Nothing Gets Done on Friday” Rule has been acknowledged by the fine folks at the Internal Revenue Service?

No.

People in Maine and Massachusetts celebrate Patriots Day on April 18, so their tax day is set another day later, April 19.

Which begs the question. Why the 18th in the first place?

Well, because of Emancipation Day, usually celebrated in Washington, DC, on April 16.

Because the 16th settles on a Saturday this year, and because the day is a traditional day off for federal workers, the holiday shifts a day in advance, to this Friday, the 15th. So, Emancipation Day — commemorating the signing of the Emancipation Act by President Abraham Lincoln — trumps Tax Filing Day.

Apt, since it might seem cruel to Americans to have Tax Day, marking the subservience of a whole population to its government, fall on something called Emancipation Day.

After all, consider: holding them on the same day? Hmmm. Might get people thinking.

Bigwigs in DC don’t want that.

This is Common Sense. I’m Paul Jacob.


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folly ideological culture moral hazard national politics & policies tax policy

Rebranding the Odious?

Being a clever person is hard work. Many of the truly clever things about everyday life have already been said. New and innovative cleverness? A rare thing indeed.

But if you are in the business of being clever, that puts you in a pickle, if “being relevant” and “worth our attention” is part of your cachet.

Take Alain de Botton, a very clever man who has written at least one brilliant book … and several not-​so-​brilliant ones. He has tackled Proust, Epicureanism, and is now deeply into religion.

Well, maybe not so deeply.

He wants politicians to follow the lead of religious leaders, who, he asserts, are masters of rebranding. (I had thought that was for marketing specialists.)

Recognizing that the word “tax” is an odious one — few people really like paying their taxes — de Botton says that politicians should follow what “religions do” and “rebrand ‘tax’ as ‘charity.’”

Charity, he notes, is a “much more appealing word.”

Well, yeah. That’s because charity is a word for love. It is all about deep concern, sympathy, etc., and “acts of charity” are expressions of love and concern.

And the only way that acts of charity can be determined to be expressions of concern is that they are voluntary. Taxes, on the other hand, are not voluntary. They are taken by force (try not paying them — force will find you).

Forcing people to “be charitable” will automatically scuttle that very purpose.

Trying to rescue politics from the stench of compulsion should not be done with rebranding, but by limiting government.

The less government, the less force.

And more scope for charity.

This is Common Sense. I’m Paul Jacob.


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Common Sense Needs Your Help!

Also, please consider showing your appreciation by dropping something in our tip jar  (this link will take you to the Citizens in Charge donation page… and your contribution will go to the support of the Common Sense website). Maintaining this site takes time and money. Your help in spreading the message of common sense and liberty is very much appreciated!

 

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folly ideological culture moral hazard national politics & policies tax policy too much government

The B. S. Theory

Bernie Sanders is worse than merely wrong about the rich not paying their fair share of taxes.

It’s we, the much-​lauded “Ninety-​nine Percenters,” who don’t pay enough!

At least, when we figure taxes paid against direct subsidies/​services rendered: taxes minus transfers. And, according to the Congressional Budget Office, only the top quintile of income earners — including the much-​abhorred One Percenters — pay appreciably more in taxes than they receive in “benefits.”

In a republic, you would expect the masses to pay taxes, receiving only indirect benefits, like a broadly defined “security” and “the rule of law.”

The calculation of who is and is not a net tax-payer or net tax-consumer has to be difficult. I certainly haven’t vetted the studies carefully. But previous accountings also show that the super-​rich pay the bulk of income taxes in America.

How to put the system aright?

Don’t tax us more!

Bernie’s preference, to tax a whole lot more as well as to provide more subsidies and “benefits,” will only make a bigger mess.

Unfortunately, doing the right thing (cutting back on the giveaways at all levels) is politically … tricky.

But there’s something missing in all this: the indirect hazards of the “benefits” … the opportunity costs involved when we get hooked on hand-​outs. The most trapped people in America are those who pay the least and take the most. The dollar-​value of their received transfer payments measure neither their dependency nor their consequent lack of upward mobility.

How could we figure real harms and helps embedded in the current system, when some “benefits” are, in fact, detriments?

This is Common Sense. I’m Paul Jacob.


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crime and punishment folly free trade & free markets general freedom tax policy

Gold Leaf

The experiment in legalized marijuana begun by citizens in the states of Washington and Colorado has, from the beginning, faced a huge obstacle: marijuana is still illegal, federally. State nullification of federal law is not merely “problematic,” it’s hard to “get away with.”

Take Colorado’s experience. The Centennial State, which has made the swiftest and most extensive progress regarding marijuana retail sales, has come up to an inevitable problem with the federal government.

Over banking.

Interesting Reason reporting tells us that “Marijuana-​related businesses in Colorado are so profitable that the government doesn’t know what to do with all of the tax revenue they’re generating. But business owners face a more immediate problem: Where to stash their own profits when banks won’t take it.”

Congress has been very active making banking less and less private and less and less free for decades now, in part because of the War on Drugs. Existing banks refused to take new cannabis clients.

So a new credit union was formed, to handle the cash.

And now, NBC News tells us, our central bank, the Federal Reserve (dubbed by NBC “the guardian of the U.S. banking system”), said “that it doesn’t intend to accept a penny connected to the sale of pot because the drug remains illegal under federal law.” Which makes modern banking difficult, even for a credit union, apparently.

What are “weed” businesses to do … other than what they are doing, hiring security guards for all the cash?

Maybe Bitcoin will step in. Or old gold-​warehouse banking, as was not unheard of even in the 19th century.

Or, maybe, the federal government will cease its over-reach?

This is Common Sense. I’m Paul Jacob.


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