Tuesday, May 02, 2006

Trimming the Pork—There Is Only One Way

Politicians have long bragged about how much federal money they were bringing back home, and it worked because citizens of one's district or state knew that tax money sent to D.C. that did not come back in the form of direct services or greater national security would simply be spent on projects in states with representatives who were better at getting their way. That brought about a natural process known as pork-barreling, in which every successful representative tried to get the most federal money possible spent in his state, which led to an incredible amount of taxpayer money being spent on boondoggles such as roads to literally nowhere and federally financed hot dog museums. Politicians would brag about how much bacon they were bringing home, regardless of how unconstitutional and worthless the projects actually were.

Now that the Republicans have been in power for a few years and have become openly addicted to pork-barreling, it's no longer fashionable.

Well, good! As the New York Times reports, challengers in some congressional and Senate races are actually talking about their opponents' success at bringing home this federal money—and using the incumbents' spending as a weapon, "portraying them as symbols of corruption and waste in Washington," as the Times puts it. The national controversy over these "earmarks"—which finally occurred when the hated (by the media) Republicans gained control of both houses of Congress—has begun to turn the public against this wasteful spending—in principle (see below). Aspiring politicians are quick to take advantage, as the Times story notes:

And so, in a reversal of tactics, challengers here and in other states like Montana, Ohio and Rhode Island are telling voters what the incumbents have brought home, in the hopes, it seems, that the national controversy over the pet projects known as earmarks has come home, too.

"In a time of war, and with the costs of Katrina, we've got to look at what we want to have and what we've got to have," said Mr. Ricketts, who has never run for office but was ahead of the two other Republican candidates in a recent poll. "We've got to end earmarks — or at least reform them."

The
Times story correctly observes that it's far too early now to tell whether the tactic will work, but the old reality probably still applies, as this comment from a Nebraska voter suggests:

"I am critical of the fact that the federal government is worried about paying for parking garages — and for a million other things like that," said Steve McCollister, who heard Mr. Ricketts speak at a recent fund-raiser in west Omaha. "But they are. And if they are, I want my senator to be in there. I want Nebraska to compete."

That's probably the way most people feel. And despite the fact that nearly all of these projects are wasteful and are not constitutionally appropriate candidates for federal spending, it's important to remember that the real bloat is in the entitlement programs, corporate welfare (including farm subsidies), and national defense. The federal budget is in large part an accumulation of politicians' attempts to buy votes in order to remain in office, using our money.

That's the way the system works, and that's not going to change until the federal government is made subject to the kind of constitutionally imposed tax and budget limitations (known as taxpayers' bills of rights, or TABORs) many states have implemented or are considering.

The only solution is a real federal TABOR.

8 comments:

Tlaloc said...

The state's TABOR movement seems to have lost a lot of steam recently.

Colorado was their flagship and recently the voters turned out to decisively suspend their state TABOR because it was a disaster for them.

Given that pushing for a federal version is likely to be hard going.

S. T. Karnick said...

The Colorado TABOR has worked just fine. The taxpayers decided to allow the state to keep excess money it collected, which the voters had a legal right to do and which would be allowed under a federal TABOR. It's also worth noting that the vote was just 52-48 even though the state's employee unions hugely outspent the pro-TABOR forces.

Tax revenues rose in Colorado under TABOR. What caused the money problem was that the state passed a law requiring education spending to rise more quickly than the sum of population growth and inflation, which has raised state spending radically. That is what created the state's budget squeeze.

Instead of losing steam, the TABOR movement has increased in states across the nation during the past year: http://www.heartland.org/Article.cfm?artId=18302.

Tlaloc said...

"The Colorado TABOR has worked just fine."

Unless you ask the people who actually, you know, live there. They seem to disagree with your assessment.



"Tax revenues rose in Colorado under TABOR. What caused the money problem was that the state passed a law requiring education spending to rise more quickly than the sum of population growth and inflation, which has raised state spending radically. That is what created the state's budget squeeze."

Uh, no. The Colorado TABOR PREVENTED education spending from rising faster than population+CPI which meant education got severley underfunded.
What caused a problem was the "ratchet effect" which meant if they collected less one year the tax was automatically reduced so they could not collect more than that any following year. In other words the law made what could have been one time dips into permanent slumps.

It is similar to the idiotic system that business often use which is why you see so many end of the quarter splurges to use up anything left in the budget. If they don't use it they won't have it next quarter.



"Tax revenues rose in Colorado under TABOR."

Colorado had a huge population boom. When your population goes up 30% in ten years, yeah revenues from taxes are going to rise too.



"Instead of losing steam, the TABOR movement has increased in states across the nation during the past year: http://www.heartland.org/Article.cfm?artId=18302."

Maybe. Exept as I said before everyone now can point to Colorado whcih had been TABOR's main selling point as it's most obvious failure. It has been tried and it didn't work. That doesn't mean it can't work in a different way but people are going to be more skeptical than ever.

In fact has any state approved a TABOR other than Colorado's now defunct one? California rejected one. Wisconsin was looking at one as was Missouri if I remember correctly but neither has of yet actually made it, right?

I have trouble seeing a record of 0-1 as picking up steam. YMMV.

S. T. Karnick said...

No, this comment is wrong on all points. The facts I stated are correct. For example, education spending did rise in CO, and squeezed out OTHER spending. Etc.

Tlaloc said...

You'll have to provide some references for that Karnick because everything I have read says the exact opposite.


One of the big issues for colorado voters was that Colorado DROPPED precipitously in terms of education.

example:

"THE COLORADO EXPERIMENT
The only state to live with TABOR has been Colorado,
which learned, firsthand, about its devastating impacts.
Under TABOR, Colorado residents saw:
• The state drop from 35th to 49th in the nation in K-12
education spending as a share of the overall economy;
• The state’s percentage of fully vaccinated 3-year olds
sink to last in the nation;
• The share of low-income children covered by health
insurance fall to last in the nation;
• Higher property taxes for 100,000 senior citizens who
lost their exemptions;
• 39% of the state’s roads deteriorate to poor conditions;
• The closure of 33 driver’s license offices, resulting in
longer lines and longer waits; and
• Continuous reductions in higher education funding
and huge increases in college tuition. (It was estimated
that state funding for Colorado’s universities would
completely disappear as early as 2009.)"

http://www.azchildren.org/caa/_mainpages/Publications/Newsletter.pdf

notice the first and last bullets especially.

S. T. Karnick said...

Every one of those claims, plus several others, is refuted in the following analysis: http://www.taxfoundation.org/news/show/316.html.

For example, regarding the claims about education funding:

IV. K-12 Education

The claim: Colorado teachers make less than the national average, and are paid poorly relative to the private sector.19

The facts: Colorado ranked 22nd in average teacher salary in 2003, with salaries up 5 percent from 2002.20 Colorado also had the highest average instructional salary of any state in the Rocky Mountain region during 2003-2004.21 While there is little evidence that average teacher salary correlates with education outcomes, Colorado teachers are not underpaid by any reasonable standard.

The claim: Colorado ranks 47th in K-12 education spending as a share of personal income.22

The facts: In a study by the National Education Association (NEA) on nineteen different measures of school expenditures, Colorado ranked, on average, 27th in school spending.23 The measure of education spending as a share of personal income is only one of these nineteen rankings, which include measures such as education spending per student enrolled and per capita education spending. Colorado’s ranking of 4th is its lowest ranking in any of the nineteen separate ranking tables. Colorado averages 27th in all nineteen tables, doing very well in per capita state and local capital spending for higher education (6th) and per capita state and local capital spending for K-12 (7th). Colorado is, by these measures, an average state when it comes to education spending, not near the bottom.

Furthermore, the amount a state spends does not guarantee a quality education. Research by the American Legislative Exchange Council (ALEC) shows that there is virtually no correlation between how much a state spends on education and the scores achieved by its students on standardized tests.24 For instance, the District of Columbia ranks second in per-pupil expenditures, but ranks last in test scores on the NAEP, ACT and SAT.25 If one only looks at per-pupil expenditures, one could erroneously conclude that the District of Columbia is providing a good education for its students.

The claim: Colorado’s high school graduation rate fell from 76 percent in 1990 to 70 percent in 2004.26

The facts: Looking at graduation rate data provided by the Colorado Department of Education (CDE) paints a different picture. According to data collected and reported by CDE, Colorado’s graduation rate in 1997 (the year Colorado taxpayers started receiving automatic tax refunds under the Taxpayer Bill of Rights) was 78.5 percent.27 In 2000, the graduation rate reached 80.9 percent.28 In 2003, the graduation rate was measured at 83.6 percent.29 Thus, looking at graduation rates as measured by Colorado’s own education agency, Colorado is steadily graduating more students under the Taxpayer Bill of Rights, not fewer.30

It is true that Colorado’s high school graduation rate fell by 6 percent from 1990 to 2004, as reported by the United Health Foundation, which relied on the National Center for Education Statistics for its graduation rate data. However, the rate was as low as 68 percent in 1998 and has been edging back up in recent years (to the current 70 percent).31 Furthermore, United Health Foundation reports that the overall graduation rate in the United States is declining, and has been declining since 1990—two years before the Taxpayer Bill of Rights was enacted.32 Colorado is following the national trend, and no evidence is presented to suggest that the Taxpayer Bill of Rights is to blame, or that a high graduation rate necessarily implies that the state is educating its students well. Colorado compares favorably to other states in other graduation statistics. Colorado’s 70 percent graduation rate in 2004 (up from 69.3 percent in 2003), according to the United Health Foundation, ranked 30th among all states, down only two spots from 28th in 1990.33 Colorado also ranked 2nd in the percentage increase in high school graduates (59.3 percent) from 1992-1993 (the school year during which the Taxpayer Bill of Rights became law) to 2002-2003.34 Furthermore, Colorado overall ranks well in test scores: 13 th on NAEP, 42nd in ACT, and 19th on SAT.35 To the extent that these measures allow us to say that Colorado is educating its students well, it appears that Colorado compares favorably to other states.

V. Higher Education

The claim: Colorado ranks 48th in the nation for state funds for higher education per $1,000 of personal income.36

The facts: Colorado does rank 48th among states in funds spent on higher education as a share of personal income. It is misleading, however, to use this ranking to suggest that Colorado has a poor higher education system, and even more misleading to suggest that it has anything to do with the Taxpayer Bill of Rights. Colorado also ranks 2nd in total higher-ed instruction staff per 10,000 students.37 Colorado ranks 12th in total higher-ed instructional staff per 10,000 population.38 Colorado also had very high growth in per capita personal income from 1993-2003 (4.6 percent), exceeding the national average of 4.0 percent.39 The Taxpayer Bill of Rights has also kept tuition increases at Colorado universities in check.40 According to information from the University of Colorado, Colorado residents pay $1,200 less in tuition than residents of other states at comparable institutions.41 Residential tuition, according to the University of Colorado, has been falling steadily since 1991, the year before the Taxpayer Bill of Rights was enacted.42

VI. Conclusion

Contrary to the assertions of its opponents, the Taxpayer Bill of Rights has not decimated Colorado. In other measures of fiscal standing, not mentioned by the opponents of the Taxpayer Bill of Rights, Colorado compares very favorably to other states. Colorado’s per capita tax burden is the tenth lowest in the nation,43 ranks as the 8th friendliest business-tax climate (the highest ranking of any state with a sales tax and a corporate and personal income tax),44 and ranks as the state with the 2nd highest level of economic freedom.45 It is simply inaccurate to say that Colorado is a sub-standard state based on selectively cited statistics and national rankings, and even more inaccurate to blame the Taxpayer Bill of Rights for any perceived inadequacies.

Tlaloc said...

Most of those addressed statements I hadn't made so I won't bother to address them. The few that did address statements I made conflict with other sources of data.

look:

"The claim: Colorado ranks 47th in K-12 education spending as a share of personal income.22"

http://www.coe.ilstu.edu/grapevine/table10_05.htm

From the Center for Study of Education Policy out of the University of Illinois. Colorado ranks 47th and 48th in terms of per capita and per $1000 of personal income.

Your source uses the NEA so what do they say? Well look here:
http://www.nea.org/edstats/images/04rankings.pdf

on page 58 they have a handy chart that is called "F-5. PUBLIC SCHOOL REVENUE IN 2000–01 PER $1,000 OF
PERSONAL INCOME IN 2001 ($)"

Where does Colorado rank? Number 48.

Wierd that. It would seem that taxfoundation.org is well... lying.

S. T. Karnick said...

We now have enough data and references, etc., for the readers to decide who is "lying" or misstating things, etc. I refer readers to the Tax Foundation article for further info: http://www.taxfoundation.org/news/show/316.html.