Author: Bob Weeks

  • George W. Bush leads in discretionary spending

    In an article published by The Cato Institute (Bush Beats Johnson: Comparing the Presidents), we can read this:

    Revised data released during the summer by the Congressional Budget Office (CBO) provide analysts the ability to make side-by-side comparisons of the spending habits of each president during the last 40 years. All presidents presided over net increases in spending overall, though some were bigger spenders than others. As it turns out, George W. Bush is one of the biggest spenders of them all. In fact, he is an even bigger spender than Lyndon B. Johnson in terms of discretionary spending.

    This is before the prescription drug plan spending has started, and before costs from the recent hurricanes were known.

    It makes me long for the days of the Clinton presidency, when a Congress led by the opposing party seemed to hold spending in check. But now that Republicans hold both Congress and the White House, it seems that spending is spiraling out of control.

  • Fact Sheet: The Truth About Colorado’s Taxpayer’s Bill of Rights

    The Taxpayer’s Bill of Rights amendment has been an overwhelming success in Colorado. Colorado’s TABOR has successfully restrained the growth of state government and allowed millions of taxpayers to keep more of their hard-earned money.

    Since Colorado enacted the Taxpayer’s Bill of Rights in 1992, the state has experienced one of the strongest economic growth rates in the country and has provided taxpayers with more than $3 billion in tax rebates and refunds.

    Colorado experienced a challenge almost entirely because of Amendment 23 — a state constitutional amendment that mandates large increases in spending on education programs. The ultimate answer to Colorado’s budget challenge is the repeal of Amendment 23.

    While Amendment 23 is the main cause of Colorado’s challenge, that state’s version of the Taxpayer’s Bill of Rights isn’t perfect. That’s exactly why the TABOR legislation proposed in Kansas includes key improvements that will help us achieve even better results than Colorado has enjoyed.

    One key improvement we’re proposing to the Taxpayer’s Bill of Rights in Kansas is the inclusion of budget stabilization and emergency funds that will help us better deal with economic downturns. In periods of rapid economic growth, when revenue exceeds the TABOR limit, surplus revenue would be deposited into the emergency fund and budget stabilization fund. When the cap is reached on those funds, surplus revenue is then offset by tax cuts or tax rebates. In periods of recession, when revenue is falling, money is then transferred from the budget stabilization fund.

    Another important improvement we’ve proposed to the TABOR in Kansas is the elimination of the so-called “ratchet-down” effect. In Colorado, when revenues drop during a recession, the TABOR spending and revenue limit drops to that lower level and will grow from there — even after the economy recovers and revenues bounce back. That’s not the way it’ll work in our state. Here, when revenues drop during a recession, the “Rainy Day” fund allows TABOR spending and revenue limit to remain at the pre-recession high-water mark and only kick back in after revenues recover to pre-recession levels.

    These three key differences between a Kansas Taxpayer’s Bill of Rights and Colorado’s — the absence of constitutionally mandated annual spending increases here, the ratchet-down correction, and the budget stabilization and emergency funds — means our Taxpayer’s Bill of Rights will give us stronger economic growth, more tax relief and restrained government spending — without any of the minor side effects Colorado has experienced.

    Courtesy of Americans For Prosperity, Kansas Chapter.

  • TABOR Fact Sheet: Kansas vs. Colorado

    TABOR Fact Sheet: Kansas vs. Colorado

    Estimated at 10.4 percent of income, Kansas’s state/local tax burden percentage ranks 14th highest nationally, well above the national average of 10.1 percent.

    Kansas taxpayers pay $3,629 per-capita in state and local taxes.

    Kansas ranks 32nd in the Tax Foundation’s State Business Tax Climate Index: Missouri (11th), Oklahoma (14th), and Colorado (8th).

    Source: Tax Foundation

    Taxpayer’s Bill of Rights: GOOD FOR COLORADO…GOOD FOR KANSAS*

    3-year average poverty rate, from 2002 to 2004

    Colorado: 9.8 percent
    Kansas: 10.7 percent

    Change from 2003 to 2004

    Colorado: .1 percent
    Kansas: .7 percent

    Since TABOR was enacted in Colorado in 1992:

    Colorado ranks 3rd in population growth, Kansas ranks 36th.
    Colorado ranks 3rd in personal income growth, Kansas ranks 41st.

    In 1992

    Colorado ranked 18th in per capita income
    Kansas ranked 24th in per capita income

    In 2003

    Colorado ranked 9th in per capita income
    Kansas ranked 28th. In per capita income
    Colorado ranked 6th in per capita income growth
    Kansas ranked 30th in per capita income growth

    Since 1992

    Colorado ranks 3rd in productivity growth
    Kansas ranks 32nd in productivity growth
    Prior to the passage of the Taxpayer’s Bill of Rights in Colorado in 1992, economic growth in Colorado and Kansas was similar.

    From 1980 to 1992:

    Kansas per capita income growth ranked 47th, Colorado was 34th.
    Kansas ranked 25th in population growth, Colorado ranked 13th.

    Income

    Kansas rank for per capita income in 1980 was #16, Colorado was #12
    Kansas rank for per capita income in 2004 was #29, Colorado was #8

    Median Household income

    1984 rank: Kansas 14, Colorado 10
    2004 rank: Kansas 36, Colorado 10

    State Economic Productivity (Gross State Product)**
    Economic growth from 1980 – 1992

    Colorado rank #26
    Kansas rank #43

    Economic growth from 1993 – 2003

    Colorado rank #3
    Kansas rank #37

    Job Growth**
    June 04 to June 05 private sector job growth:

    Colorado ranks #16
    Kansas ranks #32

    June 03 to June 05 private sector job growth:

    Colorado ranks #21
    Kansas ranks #34

    Education* **

    Kansas 2003 Spending Per Student ($) 7,454
    Colorado 2003 Spending Per Student ($) 7,384
    Kansas Bachelor’s degree or higher, persons age 25+, 2000 25.8 percent
    Coloardo Bachelor’s degree or higher, persons age 25+, 2000 32.7 percent

    *U.S. Census Bureau
    *Bureau of Economic Analysis
    *Standard & Poor’s

    Courtesy of Americans For Prosperity, Kansas Chapter.

  • Employer-paid health insurance

    In the past I have written on how the system in America where almost everyone gets their health insurance through their job (Let’s Pay for Our Own Health Insurance) does not serve us well. Now I have become aware of even more evidence as to why we should all choose and pay for our own health insurance.

    A Harvard study (Illness And Injury As Contributors To Bankruptcy) concluded that of families that declared bankruptcy, about half cited medical bills as the reason. Of those, 76% had medical insurance at the time they became sick. Some of the problem is that when people become seriously ill, they can’t work. After they lose their job they have no income, and they can’t pay the premium to continue their existing coverage.

    Many types of insurance, and some health insurance policies, I have found, offer an option called “waiver of premium.” This option, if selected and paid for, pays the policy’s premiums when the insured can’t. This would help in the case where people are too sick to work and can’t afford their premiums. They would still be covered.

    If your employer, through whom you get your health insurance, doesn’t offer this waiver of premium option, you realistically have no way to obtain it. But if we all chose and paid for our own health insurance, those who wished to could have this option. This is just one more reason why the current system of employer-provided health insurance does not work well.

  • Randy Scholfield and less government

    In an editorial in the September 18, 2005 Wichita Eagle, Randy Scholfield wrote “Less government is a laudable goal.”

    The dictionary defines laudable as “Deserving commendation; praiseworthy” or “Deserving honor, respect, or admiration.” Mr. Scholfield’s past writings don’t treat the goal of less government this way. In fact, it doesn’t seem there is a single government program that Mr. Scholfield doesn’t like and praise.

    On September 13, 2004, he advocated more funding for early childhood education, writing “… the state Legislature needs to do the right thing for the state’s children and future, and invest in early childhood education.”

    He seems to automatically believe that schools need more money.

    He believes in government subsidies. In an editorial in The Wichita Eagle published on April 19, 2005, he wrote: “Wichita should stick to its subsidies. They’re fostering competition, not stifling it, and paying off big-time for the community by lowering airfares and boosting economic development.”

    He has consistently supported the government building the downtown Wichita arena.

    He advocates more government spending on arts (August 9, 2005 “Culture requires community support”).

    He supports more funding for Exploration Place.

    Mr. Scholfield, is there any government program you have opposed, any example that would lend credibility to your claim that less government is a laudable goal?

  • Judicial abuse authorized in Kansas

    Thank you to Karl Peterjohn of the Kansas Taxpayers Network for this fine article that explains the problems that Kansas should be aware of in the Kansas Supreme Court. Readers of this website may remember that I joined Karl in filing ethics complaints against Justices Allegrucci and Nuss (The Ethics Case Against Justice Donald L. Allegrucci, The Ethics Case Against Justice Lawton R. Nuss). I thought the case we made against Justice Allegrucci was compelling, but the Commission on Judicial Qualifications didn’t think so (The Wrong Canon; The Wrong Allegrucci). But someone did, as his wife — the link to Governor Kathleen Sebelius that was the source of the ethics problem — resigned her position. Readers might be asking where is the coverage in Kansas news media of these cases.

    Judicial Abuse Authorized in Kansas
    By Karl Peterjohn, Executive Director, Kansas Taxpayers Network

    A closed door meeting in early September in Topeka provided the excuse to expand judicial abuse at the highest level of Kansas government. The Commission on Judicial Qualifications met to consider the complaint that Kansas Supreme Court Justice Lawton Nuss should not participate in the school finance lawsuit. This commission decided that Justice Nuss did not need to recuse himself from ruling on this billion dollar lawsuit.

    Prior to joining the Kansas Supreme Court in 2002, Nuss had been an attorney representing the lead school district plaintiff that is participating in this lawsuit. The Salina public schools had joined with Dodge City public schools in filing and financing this lawsuit back in the 1990’s and Nuss was one of Salina’s lawyers at that time. Nuss should have recused himself from this case since he had represented one of the plaintiffs when this case arrived in front of the court.

    Three years ago when Nuss joined the Kansas Supreme Court he was expected to obey the ethics rules that supposedly exist for the members of Kansas courts. The judicial canon includes provisions that judges are supposed to avoid all appearances of impropriety. These rules in part say, “A judge shall not allow family, social, political, or other relationships to influence the judge’s judicial conduct or judgment. A judge shall not lend the prestige of judicial office to advance the private interests of the judge or others; nor shall the judge convey or permit others to convey the impression that they are in a special position to influence the judge.”

    Would you like to go in front a judge who used to represent the person who is suing you? No one would want to do so. This is basic legal ethics. However, you are now a target of an aggressive tax funded plaintiff that is suing you indirectly as a taxpayer. Millions of tax dollars have been spent to finance this school finance litigation in Kansas. The school districts are now suing to transfer $1 billion from the private sector to the public school districts every year. This year they received $290 million more than last year. Next year is likely to be even more costly to Kansas taxpayers.

    This appointed commission has now decided that it is perfectly appropriate for Justice Nuss to rule that hundreds of millions of additional tax dollars must be spent for one of the clients he use to represent according to this judicial commission. Well, who appointed this commission of judges, ex-judges, lawyers, and mainly members of the news media? The Kansas Supreme Court appointed them to their four year terms.

    So who will oversee the appointed members of this court? The answer is that the Kansas Supreme Court is untouched by ethics rules for the rest of the legal profession. Nuss’ case follows the recent dismissal of similar ethics complaints by this commission. The second complaint concerned Justice Donald Allegrucci, whose wife was until recently the chief of staff as well as the 2002 campaign manager for Governor Sebelius. Governor Sebelius has been supporting the school district’s position that state spending must be dramatically raised.

    An oxymoron is a word that describes a phrase that combines contradictory elements like, “thunderous silence.” The Kansas Supreme Court now orders legislators on what is appropriate as well as what amount should be in the appropriation, issues edicts that could shut down the schools, and capriciously re-writes Kansas law. The term, “judicial ethics,” for the highest court in this state is now an oxymoron. Kansans need to know that the appointed judicial elite is now untouchable by their own ethics rules. The fiscal abuse of Kansans by this state’s highest and, arguably, most activist state court in the entire country continues. Every Kansas taxpayer will have to pay this court’s huge bill.

  • Book review: What’s The Matter With Kansas?

    What’s The Matter With Kansas?
    Thomas Frank
    Metropolitan Books, 2004

    Much has been written about this book and its premise of the great backlash, the revolt against the increasingly liberal society of the 1960’s and 1970’s. Mr. Frank believes (I think) that working-class social conservatives in Kansas are not using their votes wisely, that they vote for Republicans for social reasons, and in turn Big Business Republicans turn around and mistreat them. Their social interest, in other words, works in opposition to their economic interest.

    I have some quarrel with this, although I think it is true in some ways. Is it true that the interests of big business are opposite of that of the working man? That’s not always the case.

    Reviewers of this book have remarked how witty and funny it is. I must have missed those pages. Mr. Frank is a liberal. He advocates liberal government positions, and there’s not much funny about that. Certainly, Mr. Frank is nowhere near as funny as P.J. O’Rourke. But then, I agree with most of what P.J. writes.

    The best part of this book is the extensive research of Kansas and Kansas politicians that Mr. Frank did, and how much of that he includes. The footnotes are valuable. I read this book on loan from the library, but I may look for a used copy to keep as a reference work. It is for that reason that I can recommend reading this book.

    Links to good reviews of this book: Resenting the Heartland’s Success by Kimberly Shankman

  • Prices ration scarce goods

    As the price for gasoline rises, politicians hear increased calls for regulation of gas prices. We hear news stories of hotels increasing prices for victims of hurricane Katrina, and prices for needed goods in the destructed area could rise, too.

    In Wichita, when gasoline prices rose rapidly, someone told me that this was price gouging, because the price the gas stations pay for gasoline hasn’t increased yet. I’m sure that’s true, their cost hasn’t increased yet, as they’re still selling gasoline they already bought some time ago. This analysis, however, doesn’t consider the most important role of prices: to strike a balance between supply and demand. That’s what prices do.

    Consider what the economist Walter E. Williams wrote about plywood prices:

    Windfall profits are indeed profits far beyond what’s necessary for an entrepreneur to stay in business, but windfall profits also play a vital role. Windfall profits signal that a human want is not being met. Resources emerge to meet that want. For example, when Hurricane Andrew devastated parts of South Florida, plywood prices skyrocketed. Florida’s attorney general threatened actions against companies for price-gouging.

    Those windfall profits conveyed messages to the rest of the economy. Let’s say that pre-hurricane plywood prices were $10 a sheet and afterward they were $20. That profit potential created a powerful signal. Instead of plywood manufacturers selling their plywood inventory to, say, Pennsylvania wholesalers for $8 a sheet, they were more than happy to ship them to Floridian wholesalers for higher prices. Wholesalers in other states were happy to sell their plywood to Floridians for higher prices. Since plywood supplies were moving to Florida, plywood prices elsewhere rose.

    From a social point of view, this is wonderful. Say I planned to spend a Saturday afternoon building a house for my dog. I go to my neighborhood lumberyard in Pennsylvania expecting to pay $10 for a plywood sheet, and get there and find out it’s $18. I say, “The heck with the dog; let him sleep in the rain!” I have voluntarily made a plywood sheet available for a more valuable use — rebuilding the house of a human.

    None of these and other voluntary actions making plywood available to Floridians would happen if price controls were slapped on plywood making the pre- and post-hurricane prices the same. Freely fluctuating prices, including the potential for windfall profits, encourage people to do voluntarily what’s in the social interest.

    In free and open markets, profits are to be praised — not scorned, as economic and political charlatans would have us do.

    We might consider the prices for hotel rooms. As families evacuated before (or after) Katrina struck, they needed hotel rooms. If the usual price for a hotel room was, say, $50, and hotel operators can’t increase their prices, there will be a shortage of hotel rooms. Why is this? Think of the Jones family with children. At a room price of $50, the Jones family might take two rooms, one for the parents, and another for the children. If the hotel operator is allowed to increase prices, the room price might rise to, say, $100. At that price, the Jones family might decide they could all stay in one room. That makes the second room, the room the Jones family children would have occupied at a price of $50, available for the Smith family. Otherwise, the Jones family children would be in the second room, and the Smith family is on the street, or has to drive farther to find a room.

    Yes, the Smith family had to pay $100 for a room when they would prefer to pay only $50, but if the price is $50, there is no hotel room available for them.

    Some people might object that the hotel operator is unjustly enriched by being able to sell hotel rooms for $100, when normally they fetch only $50. But what is the alternative? Is there anyone who has the power to say to the Jones family that they should all stay in one room, leaving a room free for the Smith family? Or, in the case of gasoline prices held artificially low through price controls, someone has to judge whose use of gasoline is more valued.

    But if the prices of hotel rooms, plywood, and gasoline are allowed to fluctuate, each person is free to make their own judgment as to how much they want to consume. If the Jones family really wants two hotel rooms, they can have them. If Dr. Williams really wants to build the doghouse, he can. But people acting as they do — demanding less of something as its price rises — there will be more hotel rooms or plywood available for others. If the price of plywood in Florida is controlled so that it can’t increase, the cost of plywood in Pennsylvania will likely be the same $10 as it always is. So plywood is used in Pennsylvania to make doghouses as people in Florida need plywood to patch the roofs of the homes so that they can stay dry.

    That’s what is important about prices. They represent people voluntarily — and that’s a very important word that Dr. Williams used — adjusting their behavior. The alternative is shortages, gas lines, rationing, government control, and commissions deciding who gets what at what price — all the signs of a planned economy. That does no one any good.

    In the case of my friend in Wichita, who was going to make a weekend trip that would require about 100 gallons of gasoline in a vehicle that gets 12 miles per gallon, I suggested renting a car that gets better fuel economy. That’s what he did. In the end, he’s saving about $100, even considering the cost of car rental, and he’s making about 50 gallons of gasoline available to someone else. That’s the power of prices in action.

  • Kansas income has large drop in 2004, says census report

    Kansas Income Has Large Drop in 2004 Says Census Report
    By Karl Peterjohn, Kansas Taxpayers Network

    Kansas Taxpayers Network (KTN) expressed dismay at the latest Census Department income figures that show Kansas income dropping at the second worst rate among the 50 states in 2004. The U.S. Census Department released this data at the end of August in their report on Income, Poverty and Health Insurance Coverage in the United States: 2004.

    This report is available online at: http://www.census.gov/prod/2005pubs/p60-229.pdf (see page 30 for the 50 state data). In this report Kansas is listed as having the second largest drop in income among the 50 states. Here’s how Kansas ranked with our five neighboring states and the U.S. average:

    State                 % Change      Change in Dollars
    KANSAS                - 4.2%            -$1,890
    Colorado              + 0.3%            +$  164
    Missouri              - 3.2%            -$1,419
    Nebraska              + 0.1%            +$   53
    Oklahoma              + 1.8%            +$  693
    U.S. avg.             - 0.2%            -$   79

    This large decline in income for Kansas also indicates that this state is lagging behind our neighbors. “The Census Department’s report of declining Kansas income indicates that this state continues to be in economic trouble. This should be worrisome to state officials who seem intent on figuring out more ways of spending taxpayers’ money instead of focusing upon growing this state’s economy,” said Karl Peterjohn, executive director of the Kansas Taxpayers Network.

    “The massive fiscal uncertainty created by the activist Kansas Supreme Court and the profligate state spending hikes supported by Governor Sebelius and the legislative big spenders during the special session have put this state in a fiscal bind. The increases in property and income taxes, various other state ‘revenue enhancements,’ and permanent extensions of supposedly ‘temporary’ state sales tax hikes are putting an anchor on this state’s economic prospects. This federal census data dramatically shows the recent decline in Kansans’ incomes. Soaring state spending will only worsen this problem.”

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