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TAXING BUSINESS IS NOT THE ANSWER. BUT WHAT DOES THAT LEAVE/ Print E-mail
by Scott Bennett    Fri, Nov 25, 2005, 02:06 PM

Now that the Texas Supreme Court has ruled Texas’ current education funding system unconstitutional legislators are mulling exactly what type of system would be constitutional. They have until June 1st of next year to decide. Given that December is a lost month and that party primary campaigns will take up most of January, February and March lawmakers really have about two special sessions worth of time. Needless to say the issue of taxation and school funding will dominate the party primaries to the virtual exclusion of all else.

There are several opening options. One, a state income tax, is presumably off the table until Uvalde freezes in July. A state property tax appears to be off the table, as it will require a constitutional amendment and because too many legislators oppose introducing a new tax. Some type of business activity tax seems to be an option – at least in the Senate. Increasing and/or broadening various existing taxes including the sales tax is in a strong position. Republican rhetoric says local property taxes will be somehow cut, but talk is cheap when you consider just how much other taxes will have to go up to fill in the whole local property tax reduction will leave.

Democrats will oppose any scheme that shifts the tax burden from the more well to do to the less well to do. Any shift from the local property tax to any other consumer-focused taxes (cigarette, sales, etc.) does that. Democratic demands will be for business to pay its fair share and not long suffering folks.

Fair enough. So what would business “fair share” be? Bill Hammond, CEO of the Texas Association of Business and Chambers of Commerce (henceforth TABCC) shocked me last week by asserting that ‘business’ pays 60% of all Texas taxes. That seemed excessive if not outrageous. As it happens Hammond is on the money. When you consider the share of the sales and property taxes paid by businesses business indeed pays 60% of all state and local taxes.

Is that not ‘fair’ enough? By comparison the national average is 43%. Or how about this: In California business pays 41%. Ah, but Texas is indeed a low cost state so that means their tax burden is still very light. Right? A non-partisan outfit called COST (Council on State Taxation) says that Texas businesses tax payments represent 5.8% of the state’s gross product (now approaching $1 trillion). By comparison businesses in California pay only 4.1 %. “Fair” would seem to mean a cut in business taxes.

An organization you have probably never heard of, but who will have a lot to say about the shape of taxes to come, The Texas Public Policy Foundation (full disclosure: I was a founding director back in the early 80s but have not served on the board in many years) makes the case businesses don’t pay taxes they merely collect them. In other words businesses either pass on taxes as a cost of doing business to consumers if economic conditions allow, or if not they pass them on to their employees and shareholders in the form of lower wages, abolished jobs, or decreased investor equity.

Put another way if you get less of what you tax then increased taxes on business will mean less businesses in Texas, less economic activity and fewer jobs.

There is a broader concern about business taxation: since people don’t realize it is really they who pay there will always be political pressure to pile it on business. The reason that commercial and residential property are taxed in tandem is that once separated homeowners would demand all property taxes be piled on business.

The TPPF opposes any new business taxes. It does make a distinction between taxes imposed on everyone including business (e.g. sale and property) and taxes imposed only on business (e.g. franchise). Yet property tax relief can be provided to homeowners only one of three ways: separate commercial and residential tax rates (terrible policy), by dramatically increasing the homestead exemption (the same effect as separating), or by giving commercial property a break too (very expensive).

TPPF is right. Businesses don’t pay taxes they collect them although many will collect it from consumers who live elsewhere. TABCC is right in that businesses in Texas are over taxed. And Texas’ homeowners carry far too much of the burden of financing local government including education. And the Texas combined sales taxes (although only mildly regressive so long as food is exempt) is pushing 10-cents and that is too high.

So what to do? How about a very low flat rate personal income tax (2%?) with no deductions, constitutionally dedicated to public education that can only be raised by a vote of the people or by a two-thirds vote of the legislature (for one year)? And take the power to tax property away from school districts altogether? And cut the sales tax? And abolish the grossly unfair business franchise tax?

I wonder what the weather forecast is for Uvalde?

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VIEWPOINTS: HAPPY BIRTHDAY, BILL BUCKLEY by Bill Murchison Print E-mail
by Scott Bennett    Tue, Nov 22, 2005, 07:20 PM

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William F. Buckley Jr.
Maybe we could just, you know, take a break from the Murtha mess and the rivalries that underlie it -- large as they are -- and note a notable birthday, that of William F. Buckley, Jr. which date occurs this Thanskgiving.

Appropriately enough. As our brother becomes an octogenarian, some of us rosy-cheeked sexagenarians would offer thanks for the blessing of such a life and career as Bill Buckley’s.

The most flagrant offense likely to be charged to Bill Buckley, on his 80th, is that of helping generate a conservatism capable of entering into the kinds of disputes that now rage over Iraq, the Supreme Court, federal spending, federal power, etc.

. Life would unquestionably be quieter, absent our brother Bill. Also more fraught with peril and/or pure tedium. Without Buckley, without his wit and grace and brains, the dominant liberalism of post -World War II America might have washed all dissent out to sea. There would have been no conservative comeback; no Goldwater, no Reagan. The present menace to life and limb would be the Soviet intercontinental ballistic missile, instead of the jihadist suicide bomb. Our taxes would certainly be steeper, our lives more bureaucratized, our hands less free to improvise and invent.

That is because the essence of conservatism, as Bill Buckley understood and began advertising it, half a century ago, was Christian freedom as shaped by tradition. It was a proposition at odds with all the ends of human manipulation.

Manipulation, by those who understood themselves to be wise and generous at heart, was the style of the times: the product mostly of Depression times and vain, boastful science. Buckley and fellow believers in the higher freedom began as a scattered lot. Gradually they came together under his leadership and inspiration, to preach the gospel of human freedom as mediated by the spirit of Christianity.

Buckley founded National Review in 1955. In 1960, a then-18-year-old Texan with whom I am on intimate terms discovered the publication and its learned, impassioned writers; swooned dead away with passion; subscribed; read every issue at a single sitting.

National Review wasn’t just a journal -- a mass cogitation. It was an ongoing, often hilarious, argument with society’s most facile assumptions. Out in front of its readership NR shoved the expostulating, bickering, needling, wise-cracking likes of Willmoore Kendall, Russell Kirk, James Burnham, Frank Meyer, Whittaker Chambers, and the editor himself, William F. Buckley, Jr.

Some of those once-esteemed names occasion head-scratching in modern conservative purlieus. Well, they didn’t always. They inspired and invigorated. To be in those days young -- and conservative -- under such auspices and influences was very heaven. It seemed there was something after all to work for, something to fight for.

Life wasn’t a square, linoleum-floored, thermostatically controlled room with a single light bulb. It was a banqueting hall - a place, as NR showed us, for Stradivariuses, Stratocasters, or both at the same time, playing merry accompaniment for each other. It grooved. I believe that might be it: National Review grooved, after the manner of all enterprises organized around the purposes of human freedom.   In the 21st century many have come to think of conservatism as a political blunt instrument: something for beating liberals over the head with on Fox News. And the variety of conservatives -- bewildering! Free-marketers, pro-lifers, "intelligent designers," "strict constructionists," Reaganites, even "W." fans! Something for everybody! Come one come all!

Well, don’t you see, that’s why they did come and still do -- because a creed of freedom lived out in gratitude to the God whose service is perfect freedom was about the richness of all life. You could speak with a modified prep school accent, like Bill Buckley; or with a Texas twang; or in a language with no resemblance to English. Still, you were conservative. And probably are now -- that is, if you prize the nobly ordered freedom depicted for so long, so ably, so engagingly by Bill Buckley.

For whose sterling gifts, O Lord, make us truly thankful.

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CONGRESSIONAL PAY RAISE SENDS WRONG SIGNAL by Tom Pauken Print E-mail
by Tom Pauken    Mon, Nov 21, 2005, 03:01 PM

Members of Congress gave themselves a $3,100 pay increase last week. This hikes their annual salary to $165,200 per year.

A few years ago, Congress changed the process for how votes on pay raises for its own members were handled. Previously, Congressmen had to vote affirmatively to give themselves a pay raise. Under the new procedure they automatically give themselves a pay raise every year unless Congress itself votes to block the raise. There is no longer an up or down vote on pay raises for Congressmen. Unless a member offers an amendment to an existing piece of legislation stopping the raise (which rarely happens), the raise is automatic.

We have huge budget and trade deficits; Americans are increasingly strapped financially with high levels of mortgage and credit card debt. Our military is overextended, and troops in Iraq are facing a difficult challenge.

What kind of signal does this send to the American people when Congressmen seem more interested in taking care of themselves rather than setting an example for the country by freezing their own salaries?

Isn't it about time that someone resurrected the movement for Congressional term limits?

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Are Pro-Lifers Unfit for the Court? By Tara Ross Print E-mail
by Special to DallasBlog.com    Mon, Nov 21, 2005, 11:22 AM

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Tara Ross
Are Pro-Lifers Unfit for the Court?

Tom commented, below, that the Samuel Alito nomination is “all about abortion.” It certainly seems to be. As I’ve been watching television commentators in recent weeks, I keep wondering if liberals are honestly trying to make the point that pro-life judicial nominees should not be confirmed to the Court.

Of course, part of the problem is that commentators can be sloppy and imprecise in their language, and they often do not distinguish between a judge’s personal views and his judicial philosophy. However, some commentators truly seem disturbed at the mounting evidence that Alito may be personally pro-life.

Let’s assume for a minute that Alito is as staunchly pro-life as his opponents fear. Do they expect us to believe that every single pro-life citizen in this country is automatically ruled out for judicial positions, regardless of their legal qualifications? Such a stance would rule out between 1/3 and 1/2 of the American public (depending on which poll you believe). I refuse to believe that such a sizable component of the American public can honestly be deemed “so out of the mainstream” that one of its members can’t be nominated to a position on the bench.

Moreover, Alito’s personal views on abortion are completely and utterly irrelevant. The more important questions are whether Alito has a judicial philosophy of originalism and whether he can fairly apply the law, even when it leans against his personal preferences.

Alito has repeatedly proven that he can do just that.

A November 11, 2005 , report of the L.A. Times noted four abortion cases that were heard by Alito during his tenure on the Third Circuit. In three of these cases, Alito ruled in a manner that does not accord with a pro-life viewpoint. In one case, he did. But liberals blithely dismiss this fair and equitable judicial track record, instead pointing to a 1985 statement that Alito made on a job application. Alito’s 1985 statement was an apparent reference to Thornburgh v. American College of Obstetricians and Gynecologists, a case in which the Reagan administration argued that Roe v. Wade should be overruled. Alito was apparently proud of his work in this case.

So what’s the big deal?

It is politically incorrect to say so, but Roe was not particularly well reasoned. Many pro-choice jurists, including liberal Justice Ruth Bader Ginsburg, have freely acknowledged this simple fact. If a right to abortion exists, it is most certainly not for the reasons enunciated in Roe. Alito’s 1985 statement should not undermine his 15 years of demonstrated impartiality on abortion issues while serving as a Third Circuit Judge.

Alito has proven, repeatedly; that he will do his best to fairly interpret the law. His personal pro-life views should not be used as a reason to automatically disqualify his nomination.

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MURTHA’S DEFECTION A MAJOR STORY by TOM PAUKEN Print E-mail
by Tom Pauken    Fri, Nov 18, 2005, 02:41 PM

Representative John Murtha of Pennsylvania, who voted for the Iraq war, Thursday called for the withdrawal of American troops from Iraq within six months.

Murtha, a much decorated Vietnam Veteran, made this statement to his fellow Democrats in the House as reported by the New York Times: "‘Our military has done everything that has been asked of them. It is time to bring them home.’ Mr. Murtha said, at times choking back tears." Republican Speaker of the House Dennis Hastert responded "in a statement that Mr. Murtha and Democratic supporters had ‘adopted a policy of cut and run’".

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John Murtha

The problem for the Republicans in Congress (and for the Bush Administration) is that John Murtha is no left-wing Democrat. This is not like Nancy Pelosi issuing a similar public statement. John Murtha is one of the most respected Congressmen in the House by members on both sides of the aisle. He is an old-fashioned patriot who served his country honorably in the military in the Korean and Vietnam wars. He is one of a shrinking percentage of Congressmen who also are military veterans of foreign wars.

I got to know John Murtha when I started the Vietnam Veterans Leadership Program (VVLP) as Director of Action in the Reagan Administration. The VVLP was designed to help Vietnam Veterans who were having trouble getting employment after they came home; and it also sought to change the negative (and false) stereotypes of Vietnam Veterans that were in fashion in the late ‘70s and early ‘80s. John Murtha was a great supporter of the VVLP initiative to help veterans even while some of his left-wing Democratic colleagues were doing everything they could to kill the program.

VVLP turned out to be a very successful initiative – thanks in no small part to the support and encouragement of Vietnam Veterans in Congress like John Murtha, Tom Ridge, and John McCain. John Murtha is a great friend of the troops and our veterans. For him to change his position on the war and make the difficult decision to call for the immediate withdrawal of our troops from Iraq is not a decision John Murtha would make lightly or do for partisan political gain. He is not that kind of man.

A growing number of Republicans are "off the reservation" as well over our policy in Iraq. Senator Chuck Hagel, another Vietnam Veteran, said this week that "it was patriotic to question the president’s use of the intelligence". He joins conservative Congressman Ron Paul of Texas, John Duncan of Tennessee, and Walter Jones of North Carolina in questioning the wisdom of our policy in Iraq and the "intelligence" that was used to justify the war.

Click here to link to the New York Times story.

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