'76 Blog

(CCU Faculty) Last November, New Jersey and Virginia, two states with Democratic Governors, elected Republicans to replace them.  In Virginia, it was an open seat, while in New Jersey, the incumbent John Corzine was defeated.  As the administrations of Governor Christie of New Jersey and Governor McDonnell of Virginia begin to take shape, there is great hope for education reform from these new Republican governors.  Each Governor-elect has picked a supporter of school choice plans to head his department of education. In Virginia, Gerard Robinson has been selected to serve as the next Secretary of Education.  Robinson has been serving as the Director of the nonprofit Black Alliance for Education Options (BAEO).  Seeking widespread reforms, the BAEO’s mission statement emphasizes that they seek to: “increase access to high-quality educational options for Black children by actively supporting parental choice policies and programs that empower low-income and working-class Black families.” In New Jersey, Governor Christie has named former Jersey City Mayor and two-time candidate for Governor Bret Schundler to be his education commissioner.  As mayor and candidate, Schundler has been a vocal advocate for education reforms, including support for school vouchers, charter schools and merit pay for public school teachers.  Representatives from the teachers’ unions in New Jersey are quoted in the New York Times, stating that Bret Schundler is “the antithesis of everything we hold sacred about public education.”  The nomination of neither Robinson nor Schundler to head these state education departments would have occurred had the democratic candidates succeeded last November.  Teachers’ unions have based their support for democratic candidates on opposition to vouchers, charter schools and school choice. Hopefully, these republican administrations will be able to implement real school reform in these states by allowing citizens to make choices about the schools their children attend.  School choice plans that give parents and their children options encourage competition, which in turn demands improvements in quality, while at the same time seek reductions in cost. 

“If a foreign power had done this, we would consider it an act of war.”  So said a national blue-ribbon panel, outraged by bad education policies.  I say the same about Colorado Democrats’ economic mismanagement.  Bill Ritter’s tax-hike threat this week is the latest absurdity. Now that Obama’s socialistic interventions and massive stimulus have failed to cure the recession, policymakers in each state must look to their own toolbox for policies to revive prosperity.  Gov. Ritter, his legislative majority, and their liberal allies are making all the wrong moves at the worst possible time.  Deliver us. There’s more than Republican rhetoric to back up my indictment.  For witnesses I call Arthur Laffer, the father of supply-side economics; Stephen Moore, economist for the Wall Street Journal; and Jonathan Williams, fiscal analyst for the American Legislative Exchange Council.  They’ve authored “Rich States, Poor States,” the ALEC economic competitiveness index for 2009.  The book’s findings should both please and worry Coloradans.  For the decade through 2007, our economic performance ranked 10th among the states, based on personal income growth, employment growth, and population growth.  ALEC’s data belie the lament that fiscal restraints are “strangling Colorado” (Susan Barnes-Gelt in a recent TV debate) or that tax cuts would make this “a state we want to leave” (reader Robert Schmidt after my Aug. 2 column on the car-tax backlash).  Mr. Schmidt can move away if he wants, should Initiative 10 with its reduction of income, vehicle, and phone taxes pass next year.  But most people tend to vote with their feet in the other direction. Laffer, Moore, and Williams report that in the 10 states with lowest personal and corporate tax rates, population grew more than twice as fast as it did in the 10 states where tax rates were highest.  “Strangling” indeed. Overall, it’s clear our state was doing something right since 1997, despite shifting party control in the General Assembly and Governor’s office.  Colorado families benefited hugely from what Laffer and his colleagues call the “shocking power” of tax and regulatory policy to lift or depress prosperity.  Why now, of all times, amid a global economic downturn, would the Ritter crew decide to push every policy lever into full dive? The “Rich States, Poor States” index puts Colorado 2nd nationally in terms of favorable economic outlook to keep gaining wealth and population, based on a scorecard for 15 variables.  Eight of those measure taxation.  The others look at debt burden, public employee burden, workers’ compensation, minimum wage, right to work, the liability climate, and fiscal guardrails such as TABOR. The big-government zealots now in power could not be more backward in their handling of these levers if they were using a checklist.  Democrats have raised property taxes and car taxes.  They boosted the minimum wage via the 2006 ballot and blocked right to work via the 2008 ballot.  They also tried an energy tax and a TABOR-buster in 2008.  They’ll seek more debt and taxes for RTD in 2010. They’ve added over a thousand jobs to state payrolls in each of the last two budgets, deficit woes notwithstanding.  This spring they attempted to raid the workers’ comp agency, Pinnacol, and they’re prepping for another try this summer.  Our Taxpayer’s Bill of Rights, lauded by Laffer, is Dracula as far as Ritter is concerned.  Reelect him next year and it’s gone the year after, he has said.  Legislators are prepping for that as well. If Coloradans let this economic rampage continue, Arizona, Utah, Nevada, and other highly-ranked states on the ALEC index will be quick to pounce.  Our loss is their gain.  Wealth will flow out of state as surely as water flows downhill. But what a fiasco, to sabotage our state’s competitiveness that way.  What a shame.    

(Wellfleet, MA - July 20) This is a small Cape Cod community –about 500 people when I was growing up- now part of Massachusetts’ National Seashore Park.  It's also home to a few hardy souls with whom I shared the experience of a one-room school house presided over by a septuagenarian female teacher whose reproving glances struck abject fear in our young hearts. One of the advantages of encountering such old friends is that it is possible to discuss current events without hitting the high wall that these flinty New Englanders usually erect between themselves and nosy “outsiders”.  Thus of a recent morning I enjoyed some illuminating conversation concerning Massachusetts politics- usually a good source of light entertainment if not moral uplift. It’s been a tough week for the state’s Democratic governor, Deval Patrick.  On Monday the Democratic State Treasurer Tim Cahill announced he was quitting the party and signaled pretty clearly that he would run against Patrick as an Independent.  On Wednesday Charles Baker, a prominent Republican businessman with deep pockets, announced that he too would challenge the incumbent. Illustrating a key reason for Patrick’s vulnerability was the discovery on Tuesday that the state’s budget gap- already 3.2 billion dollars- had worsened by an additional 200 million dollars owing to dismal June revenues. The basic cause of Patrick’s plummeting approval ratings and the consequent electoral challenges is no mystery: Taxes.  With the concurrence of the Democrat controlled legislature Patrick has recently done the following: a. increased highway tolls by 25 %; b. increased Metropolitan bus and subway fares by 30 %; c. imposed a first ever tax on retail alcohol sales (two dollars on a fifth of Scotch. Ouch!); and d. –causing the most outrage- raised the already high sales tax by 25%. The use of weasel terms like “fee adjustments”, or “revenue enhancements”, or Patrick’s gem-“state income improvement measures” does not fool but does further infuriate a public that knows a tax increase when it sees one. Also significant is that all of those taxes are regressive in nature falling most heavily on those lower income groups that have traditionally been the foundation of the Democrats’ electoral base. All of this however is not just a Massachusetts story, but rather a template for states across the nation where Democrats are running things.  The recession has put the Democratic Party under a harsh spotlight that has simultaneously exposed their deeply flawed approach to governance and their fundamental incapacity to preside over difficult economic times like the present. The recession undermines and ultimately makes counter-productive the Democrats favorite activity: Spending.  It also impels them toward the only remedy tolerated by their ruling elites: The political Kool-Aid of Tax Increases. At the heart of the Democrats’ dilemma are three inherent defects that have long plagued their party: 1.They are constitutionally incapable of grasping the concept that lower tax rates can generate higher tax revenues (See Reagan,R., 1981); 2. They are politically incapable of any budget or policy initiative opposed by their union allies; and 3. Ideology makes them utterly blind to the fact that creating a “business friendly” climate is essential to any sustained economic recovery. Historically, political change in the U.S. begins at the state level before going national.  An excellent example is Proposition 13- California’s 1978 tax revolt that prefigured the triumph of Ronald Reagan. A major reason for this pattern is that economically speaking reality bites earlier and harder at the state level.  Economic make-believe can be sustained longer at the Federal level because it is a remote and artificial environment that prints its own money- a luxury unavailable to states where budgets must be balanced in real time. Accordingly political retribution is swifter at the state level.  Gubernatorial approval ratings nosedive faster than the Presidential variety, but in the end both are reflective of economic malfeasance, and the populist backlash it generates. In 2006 Deval Patrick was an attractive, articulate outsider who preached a gospel of “Hope and Change”.  His good friend Barack Obama even admitted in 2008 to plagiarizing a few of Patrick’s speeches. No doubt friend Obama has noticed that Patrick’s “Hope and Change” bandwagon has collided head-on with “Reality and Disillusion”. An increasingly restless nation waits to see what if any lessons our new President will learn.William Moloney’s columns have appeared in the Wall St. Journal, USA Today, Washington Post, Washington Times, Philadephia Inquirer, Baltimore Sun, Denver Post, and Rocky Mountain News.