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Tax Visibility

Ever wonder why you pay separate sales tax, income tax, payroll tax, property tax and gas tax?  Among other reasons, if you were levied the full amount of what you pay through one means, your tax would appear a whole lot bigger.  In fact, it would appear to be as big as it actually is.

Likewise, ever wonder why when an automobile is manufactured and sold in this country, the employees, the investors and the consumers are all taxed separately?  Among other things, the answer is the same as above.  All three taxes are built in to the price of the car, but the consumer only sees the sales tax.

Therefore, a logical precursor to lowering taxes is to make them visible.  Reform-minded legislators could do this.  So could employers, if they had the guts.

A simple example is gas stations: they could easily post signs reminding their customers of the federal and state gas taxes their customers are effectively paying.

A more complex example: a company could add up all the taxes for the year that it pays -- employer's portion of social security tax, property tax (including on leased property), corporate income tax, and even regulatory costs if known.  Divide the total by the number of employees.  Send out an email every year and say, "FYI, this is how much $$$ the company paid in taxes per employee last year."  The implication of course, is the more money the company pays in taxes, the less is available for wages.

In fact, I once pitched the latter idea to a company I worked for.  The Director of Communications looked at me like I was crazy.  Sometimes I think if businesses won't even tell their own employees or customers what the government is doing to them, then they deserve to be taxed and regulated into oblivion.
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Freedom of Association

The Colorado Springs Gazette* reports on the surpising effect of a Democrat-controlled legislature and a Democrat governor:
A bill making it easier to establish a closed union shop in Colorado passed the Senate on Monday on a party line vote, prompting Republicans to warn Gov. Bill Ritter that signing it would endanger his political future.

HB1072 eliminates the second, secret-ballot vote of employees required to set up a union shop at any company in the state. Democrats, including Sen. Jennifer Veiga, the proposal’s Senate sponsor, argue it is a minor change that removes government interference from the union-forming process.

Republicans, however, say it will remove one of the state’s key selling points to prospective employers.  GOP senators tried unsuccessfully to amend the bill 73 times Friday.
[Governor] Ritter has said he is leaning toward signing the bill. Spokesman Evan Dreyer said Monday that the governor has paid close attention to all that has been said and that he will make a decision in the next week or so.
* http://www.gazette.com/display.php?id=1329662

Benjamin DeGrow of the Independence Institute* lays out the history:
The [1943] Labor Peace Act dictates how private employees can choose union representation in a workplace. Affected workers need a majority of yes votes on their secret ballots to choose a union to represent them in employer negotiations. Workers who abstain from voting are not counted when determining the majority. All employees in a workplace who have the same union representation belong to a “collective bargaining unit.”
 
Under the Act, an “all-union agreement” is a separate contract between an employer and a collective bargaining unit “compelling an employee’s financial support or allegiance to a labor organization.”  A second secret ballot election must be held to set up an all-union agreement. Support is required from “at least a majority of all the employees eligible to vote or three-quarters or more of the employees who actually voted,” whichever is greater.
 
As introduced before the Colorado General Assembly in January 2007, House Bill 07-1072 (HB 1072) would eliminate the second election before an all-union agreement could be established.
* http://www.i2i.org/articles/IB2007A.pdf

Ahhh, sweet coercion.  And if Colorado's new Amendment to raise the Unemployment Wage by $1.70 didn't kill enough jobs, turning more power over to the unions will surely kill even more jobs.  Employers considering Colorado, please pay no attention to the man behind the curtain...
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School Choice in Utah

John Fund notes in the WSJ Opinion Journal* that a statewide school choice plan passed the House in Utah.  Two highlights:
- School choice supporters were persistent and relentless. Doug Holmes, chairman of Parents for Choice in Education, and Patrick Byrne, chairman of Overstock.com, are both passionate believers that every child deserves a quality education. Although Utah is known for its large Mormon population (62% as of 2004), Mr. Holmes points out that the biggest beneficiaries from the enhanced options parents will have in Utah will be the state's surging Hispanic population, now about one-ninth of Utah's 2.6 million people.

Mr. Byrne gave $500,000 last year to fund private scholarships for low-income children. He also gave money to a political action committee that leveled the playing field in education politics by ensuring that school choice supporters wouldn't be steamrollered out of office by the powerful Utah Education Association. "It's no longer a question of legislators asking if they should vote their conscience or vote with the union," says Elisa Peterson, the director of Parents for Choice in Education. "Legislators who vote for school choice know we will be there to defend them--and if they vote against choice, they know there will be consequences. The teachers union isn't the only game in town anymore."

- A profile in courage. The choice bill would have gone down to defeat had Rep. Brad Last not changed his vote. Just last month, Mr. Last, himself a former public-school official, voted against the bill as a member of the Education Committee. Last Thursday, he voted "yes," prompting gasps from the visitor's gallery.

"I believe history will demonstrate to supporters and detractors that this is a good choice," he told a hushed chamber. "To those of you in public education who want to kill me right now, I'm really sorry. I understand your pain. I would ask you, go read this bill, and don't say a word to me until you read this bill."

Another surprise supporter of the bill was freshman Rep. Keith Grover, a vice principal at a junior high school, who said during the floor debate that "everyone knows how I make a living" and that he had wrestled with his conscience on how to vote. He said he believed public education needed the innovation that choice could bring.
It is interesting to note how two representatives with such an intimate knowledge of the edu-system voted for the medicine.

The article also notes they threw a boatload of money at the public system in exchange for choice.  Works for me.  Legislators usually throw boatloads of money at public education anyway and get nothing in return.

If this becomes law in Utah, it will be the successor event to Brown v. Board of Education.  It will be the day the Teacher's Union was no longer allowed to stand at the schoolhouse door and keep certain children in.  Who knew the Mormons could be so progressive?

* http://www.opinionjournal.com/diary/?id=110009624
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Tax Myths

The Heritage Foundation* tackles ten myths about the Bush Tax cuts:
Myth #1: Tax revenues remain low.
Fact: Tax revenues are above the historical average, even after the tax cuts.

Myth #2: The Bush tax cuts substantially reduced 2006 revenues and expanded the budget deficit.
Fact: Nearly all of the 2006 budget deficit resulted from additional spending above the baseline.

Myth #3: Supply-side economics assumes that all tax cuts immediately pay for themselves.
Fact: It assumes replenishment of some but not necessarily all lost revenues.

Myth #4: Capital gains tax cuts do not pay for themselves.
Fact: Capital gains tax revenues doubled following the 2003 tax cut.

Myth #5: The Bush tax cuts are to blame for the projected long-term budget deficits.
Fact: Projections show that entitlement costs will dwarf the projected large revenue increases.

Myth #6: Raising tax rates is the best way to raise revenue.
Fact: Tax revenues correlate with economic growth, not tax rates.

Myth #7: Reversing the upper-income tax cuts would raise substantial revenues.
Fact: The low-income tax cuts reduced revenues the most.

Myth #8: Tax cuts help the economy by "putting money in people's pockets."
Fact: Pro-growth tax cuts support incentives for productive behavior.

Myth #9: The Bush tax cuts have not helped the economy.
Fact: The economy responded strongly to the 2003 tax cuts.

Myth #10: The Bush tax cuts were tilted toward the rich.
Fact: The rich are now shouldering even more of the income tax burden.
* http://www.heritage.org/Research/Taxes/bg2001.cfm
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Warning

According to the Washington Times*:
Sen. John W. Warner will join his fellow Republicans in voting Monday to block the resolution he wrote rebuking President Bush's Iraq war policy.
And here's my in-depth political analysis:
Whaaaa...?

* http://www.washtimes.com/national/20070203-121353-1086r.htm
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