Tag: tax policy

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too much government

Distill This

hammer, hand sanitizer

This story started out lousy and then swerved into neutral. But there are still problems under the hood.

At the very end of 2020 (good riddance, 2020!), U.S. distilleries were suddenly faced with a ludicrous FDA tax of $14,000 for using their facilities to make alcohol-​based hand sanitizer.

These adaptive distilleries — about 835 of them — have long used alcohol to make booze, of course. But early last year, lockdowns began to massively reduce demand for alcoholic beverages in certain venues. It made sense to begin producing hand sanitizer in order to meet the massively new pandemic-​induced demand for sanitizer.

Win-​win, until, in the last days of 2020, FDA decided that such flexible pivoting deserved what amounts to a penalty. Bureaucrats decided that producing hand sanitizer changed how the 835 distilleries should be classified. Entities so classified — as “over-​the-​counter drug monograph facilities” — are supposed to pay the $14,000 fee.

Media coverage and the outcry by already-​walloped distilleries has, however, led the Department of Health and Human Services to rescind the penalty. HHS has told FDA to stand down. The fee has been cancelled.

So everybody is happy now, the way you’re happy when the sledgehammer swinging down doesn’t bash you in the head after all.

Aaron Bergh of Calwise Spirits wonders whether distilleries will still get hit with such a fee in 2021. What the government giveth, it can taketh. For now, though, like everyone else, he’s just darn relieved.

Happy New Year, folks.

This is Common Sense. I’m Paul Jacob.

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initiative, referendum, and recall tax policy

My Favorite Control Group

Tim Eyman

Tim Eyman strikes again. 

In deep blue Washington State, the ballot measure activist celebrated another Election Day victory last week with Initiative 976, limiting vehicle taxes. Not to mention Referendum 88, whereby voters kept a ban on government use of racial preferences, enacted via an initiative Eyman had co-​authored two decades ago.

And still, there were a dozen more issues on last Tuesday’s statewide ballot thanks to Mr. Eyman’s 2007 initiative, I‑960, which mandates “advisory votes on taxes enacted without voter approval.” (Also thanks to state legislators, I guess, for racking up 12 new tax increases this year without bothering to ask voters!)

Yet, perhaps it matters not at all. Nearly two million votes cast on each of these measures? Three supported by a majority? Nine rejected? Two esteemed Evergreen State newspaper columnists pooh-​pooh them as “meaningless.”

“The Legislature has never taken the voters’ advice when they say a tax should be repealed,” writes Spokane Spokesman Review columnist Jim Camden. 

That’s a failing of the Legislature, Jim,* not these advisory measures … which you seem to acknowledge when you write that these votes at least “provide a good control group for any experiment on the voters’ knee jerk reaction to higher taxes.”

If legislators cared to know. 

While dumping on the dozen measures as “an empty remnant of an earlier initiative,” The Columbian’s Greg Jayne notices that “their presence on the ballot this year reminded voters, over and over again, of the Legislature’s spendthrift ways.”

Helping create an anti-​tax mood that spurred support for I‑976.

Not bad for being meaningless.

This is Common Sense. I’m Paul Jacob.

* I use his first name because I know Mr. Camden from decades ago when he was a reporter covering House Speaker Tom Foley, who after suing to overturn the 1992 citizen initiative for term limits became the only Speaker defeated for reelection since the Civil War. 

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Tim Eyman

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initiative, referendum, and recall tax policy

Blue Colorado Big Spenders

Colorado, elections, taxes, Bruce,

“The Trump years may have cemented Colorado’s blue-​state status — time will tell,” writes Alex Burness in the Denver Post, “but voters in the Centennial State continue to hold a hard line on anything that has even a whiff [of] new tax.”

Burness is talking about Proposition CC, a measure placed on Tuesday’s ballot by the state’s Democratic-​controlled legislature, which would have allowed state government to keep and spend $37 million annually coming into government coffers over the state’s constitutional spending cap, rather than refunding those dollars to taxpayers as required by the Taxpayer Bill of Rights passed back in the 1990s.

The elite supporters of Proposition CC devoted more than $4 million to promoting the measure, outspending opponents better than two-​to-​one and arguing that government desperately needed the money for education and transportation. Opponents cried foul over the official ballot summary voters read, which began with the words “Without a tax increase …”

 “But the measure lost,” Burness informs, “and it wasn’t close.”

“The measure’s failure amounts to a significant victory for supporters of the Taxpayer’s Bill of Rights,” Colorado Public Radio reports. “That constitutional amendment requires voter approval for all tax increases, sets a revenue limit for every government in the state and requires any surpluses be returned to taxpayers.”

“Who’s in charge?” TABOR author Douglas Bruce asked years ago. “We, the people, who earn the money, or the politicians who want to spend it?”

The answer from supposedly blue-​leaning Colorado voters was unequivocal.

This is Common Sense. I’m Paul Jacob.

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Colorado, elections, taxes, Bruce,

Photo credit: Pictures of Money

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national politics & policies too much government

NowhereCare

Elizabeth Warren, healthcare, taxes,

Even people who get their information only from major network news know that, in their mad rush to promise free health care, Democratic presidential hopefuls would raise taxes for nearly everybody including the “hard-​working middle class.”

How do they know?

Because at least one of the eager promisers won’t give a straight answer.

Her name is Senator Elizabeth Warren. 

Like Bernie Sanders (but not Amy Klobuchar and Joe Biden) she is offering “Medicare for All,” which Fox’s Tucker Carlson calls straight-​up socialism.*

George Stephanopoulos, Chris Matthews, and “other strident Democratic partisans” have been pressing her on the tax hike issue, and at the recent, fourth national primary debate, Warren continued to evade. Even Sleepy Joe knows that universal single-​payer health care spending would require more taxes than can be squeezed out of the very rich and the big corporations (which Warren, Sanders, and other Democrats incessantly push). But Warren just will not say the words: yes, your taxes will go up. She continually feints to her follow-​up argument, that since overall health care costs would [according to plan] go down, we would all come out ahead.

Tucker Carlson, citing an Urban Institute study, gives the answer the democratic socialists won’t: their promise would require spending 3.4 trillion tax dollars per year — $10 grand per person per year, including every child, retiree, and prison inmate.** Warren expects us to repress our common sense and believe that cramming all health care spending through the federal government will increase efficiency.

U.S. Department of Health and Human Services Secretary Alex Azar has the right word for Medicare for All: utopian. 

Noting that Obamacare failed to live up to its promises, Azar predicts the ultimate result, “Medicare for None.”

This is Common Sense. I’m Paul Jacob.

* And not altogether implausibly, since medicine is a fifth of the American economy and (presumably) since socialism is an economy run by government.

** Tucker’s list.

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Elizabeth Warren, healthcare, taxes,

Illustration from a photo by Gage Skidmore

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initiative, referendum, and recall tax policy

The Legislature That Couldn’t Tax Straight

Tim Eyman, Senate Bill 5224, taxes, vote, democracy,

“If you lost count of how many new and higher taxes state lawmakers passed this year,” begins Jerry Cornfield’s recent column in the Everett Herald, “it was 12.”

Cornfield doesn’t appear too distressed about the tax hikes, however, worrying instead that Evergreen State voters will be “awash in tax advisory measures this fall.”

That’s because for every tax increase the Washington State Legislature enacts without putting it to a vote of the people of Washington, an advisory vote is mandated by Initiative 960, passed by voters back in 2007.

So 12 tax increases = 12 tax advisory votes. 

“We wouldn’t be talking about advisory votes and providing Eyman a platform for politicial [sic] ministering,” Mr. Cornfield complains, “had Democratic lawmakers gotten rid of them by passing Senate Bill 5224.”

Seems odd somehow that a newspaper columnist would be berating politicians for not passing a law to silence voters regarding tax hikes. Democrats could have done so without a single Republican vote. SB-​5224 did pass the Senate, but it was blocked in the House by the Democratic Speaker — “democratic,” thankfully, in more ways than one.

Eyman is Tim Eyman, the state’s anti-​tax initiative leader. His group, Voters Want More Choices, spearheaded Initiative 960, which from 2008 to 2018 required 19 tax advisory votes. Voters have expressed opposition to 12 of the 19 tax increases passed by the legislature — 63 percent — and support for seven. 

“It’s a tax increase report card,” explains Eyman, “and the Legislature this year gets an F.” 

A grade that was certainly earned.

This is Common Sense. I’m Paul Jacob.

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Tim Eyman, Senate Bill 5224, taxes, vote, democracy,

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subsidy tax policy

The Truth of Tax Privileges

Tony Gehrig, Dave Piepkorn, Caldevron, taxes,

In Fargo, North Dakota, a company called Aldevron applied to the city council for a tax exemption. If given, it would spare the company from handing $4.6 million dollars to the city government over the next ten years.

Now, Aldevron isn’t just a company with a name seemingly out of a sci-​fi movie. It is science-​fictional in its mission, providing “high-​quality plasmid DNA, proteins, enzymes, antibodies, and other biologicals to help our partners achieve ground-​breaking science,” and so on.

Sounds very interesting. But is it $4.6 million interesting?

That is subjective. A more objective question was asked of the company’s representative by Commissioner Tony Gehrig: “If you didn’t get the incentive would you still expand?”

The answer was revealing: yes.

That is when another commissioner, Dave Piepkorn, got a bit peeved.

He “accused Gehrig of ‘bitching’ about the subsidies,” explains Rob Port of the Say Anything blog. Then Piepkorn went on to “bitch” … about Gehrig. “It really bothers me when he puts words in people’s mouths.”

So Commissioner Piepkorn asked Aldevron’s rep if the company would go somewhere else sans the special privilege.

The company man, looking a tad uncomfortable, as Port notes, said no. Businesses have to take a long view of their relationships with local government, and tax breaks are just one element in overall “friendliness.”

After all, businesses have to go somewhere.

Rob Port concludes that “the subsidies occur because they’re expected, not because they’re needed.” 

Fargo’s voters might consider an initiative to take away politicians’ ability to make creative use of their taxing authority.

Perhaps while voting out Piepkorn.

This is Common Sense. I’m Paul Jacob.

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Tony Gehrig, Dave Piepkorn, Caldevron, taxes,

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