Would you purchase a refrigerator without comparing models and reading reviews? How about buying a car without a test drive or a home without an inspection?
If you’re a taxpayer or parent of a school-age child in Kansas, that’s what your elected representatives have done with public education that spends more than half of the state’s budget and has a major influence on our children.
Continue reading from Kansas Watchdog at Education Data Collected But Not Shared to Inform Policymaking.
Kansas Representative Charlotte O’Hara, who represents Kansas House District 27 in southern Johnson County, offers a look at the politics surrounding wind power in Kansas. Besides O’Neal, other prominent supporters of renewable energy in Kansas include Kansas Governor Sam Brownback, who has been vocal in his support of wind power. So too has been Wichita Mayor Carl Brewer, who has been busy promoting Wichita as a site for wind energy-related industry. Contrast this with U.S. Representative Mike Pompeo of Wichita, who has introduced legislation to end all tax credits related to energy production.
By Kansas Representative Charlotte O’Hara
The world of Topeka politics continue to amaze, frustrate, entertain and humor me in my second year of representing the 27th District. Case in point:
On Tuesday of this week during the Republican Caucus discussion of HB 2446 (concerning the expansion of definition of alternative energy to include storage facilities/devices) this fact came to light: The Kansas Legislature, in 2009, passed the Renewable Energy Standards Act (KSA 66-1258), which requires 10 percent of our power companies’ capacity to be from renewable energy sources by 2011, 15 percent in 2016 and 20 percent in 2020.
So, being the conservative that I am, I suggested an amendment that would freeze renewable energy standards to the current 10 percent. Rep. Dennis Hedke carried the amendment on the floor. The amendment received 43 votes.
Only 43 out of 125 representatives voted to stop strangling the Kansas economy and burdening consumers with high energy costs of these draconian requirements. According to the Heritage Foundation, just a 15% renewable energy mandate would increase electricity prices for consumers by as much as 11.3 percent!
After the defeat of the amendment, Rep. Forrest Knox introduced an amendment that would tie the freeze to licensing of the Holcomb Power Plant, which currently has been stopped by federal court and another environmental impact study has been ordered. The Knox amendment received 65 votes, a majority. However Speaker of the House Mike O’Neal (who voted against both amendments) interceded and referred the amended bill, HB 2446, back to committee (with the approval of the House members) and removing it from final action.
So, why would Speaker O’Neal oppose a freeze at the current 10% on the Kansas Renewable Standard Act? Well, let’s see. Could it possibly be that these required increased standards in Kansas law is why Siemens chose Hutchinson (O’Neal’s district) in 2009 to locate a $35 million wind turbine plant? Is this the type of crony capitalism we want to build our economic future on in Kansas?
Another wrinkle in the future of renewable energy is that extension of federal tax credits is in doubt. Those credits currently subsidize renewables by 2.1 cents per kw. Without the federal, state and local tax incentives, abatements and exemptions, the economics of renewable energy collapses.
Here is a link to Heritage Foundation on this issue of renewable energy subsidies: No More Energy Subsidies: Prevent the New, Repeal the Old.
It always puzzles me why after the fall of the Soviet Union, government mandated / subsidized / incentivized industries continue to flourish in the U.S. and, in particular, here in our own Kansas backyard.
So, if you would like to register your concerns about the Speaker’s action to circumvent final action on HB 2446, which as amended would freeze Kansas Renewable Energy Act requirement at 10 percent and stop it from going to 20 percent, call his office: 785-296-2302 or e-mail at Mike.ONeal@house.ks.gov
Trackside is a column written occasionally by John D’Aloia Jr. He lives in St. Marys, Kansas.
TRACKSIDE © by John D’Aloia Jr.
February 5, 2012 AD
How do you view government grants? Are they “free” money handed out by a caring and beneficent government? My view is that government grants are funded by a forced redistribution of the resources from many people for the benefit of a few. Such grants are a means by which the grantor achieves control over the grantee. Such grants are morally and politically unacceptable.
“The Eighth Commandment does not say ‘Thou shalt not steal … except by a majority vote or unless it’s for a park swing set.’” (A paraphrase of a line from Mark Hendrickson’s article “Our National Blind Spot,” American Thinker, 6 February 2010.) Those who accept government grants for projects that they cannot fund from local tax sources are stealing resources from others, and in so-doing, are no better than the Occupy Wall Street gang which wants government to extract dollars from everyone else to give them what they want. (I am conflicted on grants that fund what would otherwise be an unfunded federal mandate — if the feds mandate X, then the feds should provide the dollars and take the budget hit, not the government unit needing the dollars to comply — but what if only some governments get a grant to pay for X, setting up an environment for favoritism? or the feds give a grant only to the governments that accept all the attached strings? As I said, conflicted.)
The only real beneficiaries of this government-forced redistribution of resources are the politicians who buy “good” press by making the grants available (look what we are doing for you), crowing that they have “brought-home-the-bacon” for their constituents, the Clerks in the myriad agencies who administer the grants, and those companies to which some of the dollars ultimately trickle down.
The willing accomplices in the grant process ignore Frederic Bastiat’s concern for the unforeseen consequences, particularly the impact of grants on the national fiscal mess, the inability of the citizens whose resources have been taken (higher taxes, inflation) to use those resources for their own benefit, and the impact of grants on future tax demands. Grants do put a long term tax burden on communities. In their report titled “Do Intergovernmental Grants Create Ratchets in State and Local Taxes — Testing the Friedman-Sanford Hypothesis,” Russell Sobel and George Crowley wrote: “Our findings confirm that grants indeed result in future state and local tax increases of roughly 40 cents for every dollar in grant money received in prior years.” The report is cited as Mercatus Center Working Paper No. 10-51, West Virginia University, August 2010.
For immediate satisfaction, grantees are placing the financial burden on others and on future generations. Grant dollars come from three sources: taxpayers at large, deficit spending (insane, obscene borrowing), and the Fed’s printing presses creating phony money out of thin air (inflation). All three sources extract resources in one way or the other from citizens who cannot, will not, benefit from the grant, nor even ever receive a thank-you note.
Bastiat said that “Government is the great fiction, through which everybody endeavors to live at the expense of everybody else.” In The Law, published in 1850, (which should be mandatory reading for all legislators and voters), Bastiat used the term “plunder” to describe the “legal” appropriation of the fruits of one person’s labor for the benefit of another. If he were alive today, he would be applying it to grants, recognizing that specific organizations and local governments are using the grant process to obtain the resources of others for their specific benefit and enjoyment.
Grants are not an economic development plus — at best neutral (dollars not spent by X are spent by Y) — but most likely they have a negative economic impact, directly because the grantor government agencies extract a “shipping and handling fee” out of the economy to keep themselves employed, and indirectly because grants provide an impetus for a sprawling, out-of-control Leviathan.
Accepting grants also place the grantee under the thumb of the grantor, as grants impose requirements that detract from the authority and sovereignty of the grantee. People look in glee at the line in the grant contract that has a dollar sign and a bunch of numbers after it but neglect to read the fine print that requires them to do this and that for eternity. The federal government uses grants to bribe states to pass laws that the feds want but don’t have the authority to impose. In all too many situations, federal grants are unconstitutional in that they are for purposes that are not within the enumerated powers given to Congress by the Constitution.
The ends (accomplishment of a project that local groups want but will not fund locally) do not justify the means (stealing now, and in the future, from all citizens).
See you Trackside.
By Clinton D. Coen
In the City of Wichita, Sedgwick County, the State of Kansas, and even in Washington DC, we have a problem with rampant legal corruption. Corruption, in and of itself, is not necessarily illegal; corruption is simply a moral depravity.
The problem deals with the pay-to-play policies of our governments. Politicians are allowed to vote to directly enrich campaign contributors. Many governments have laws in place that prohibit politicians from voting to directly enrich their campaign contributors, but we don’t have such laws in Wichita, Sedgwick County, or the State of Kansas.
We would benefit greatly from such laws. This would prohibit a large chunk of the crony capitalism that is rampant at the local, state and federal levels.
As an example, the developers and contractors associated with the Ambassador Hotel have donated to multiple city council members. There are numerous executives from the construction company that is working on the Ambassador project that have donated to campaigns, making for a substantial amount of money.
This is just one more reason to vote against the guest tax rebate for the Ambassador Hotel Project on February 28th. And, a reason to write your representatives about pay-to-play laws and prohibiting elected officials from voting to directly enrich campaign contributors.
The following argument in favor of the Fair Tax for Kansas is from Larry Halloran, who is Chairman of the Wichita — South Central KS 912 Group. Also included is a presentation by Earl Long of FairTaxKC. I particularly like his characterization of the Kansas statehouse as the “favor factory.”
By Larry Halloran
Why would the State of Kansas ignore the opportunity to generate a $2.1 billion surplus for fiscal year 2013 in the State General Fund (SGF)?
On Friday, January 20, a number of us attended the Senate Standing Assessment and Taxation Committee hearing in Topeka. It was both astonishing and obvious, from the questions that were not ask by the committee members, that they (individually or as a committee) had no real interest in considering any alternative to the Governor Sam Brownback’s tax reform proposal or plans they may have individually devoted time to crafting.
At the turn of the last century, the United States was essentially debt free. Then in 1913, we provided Congress, by constitutional amendment, the authority to tax our income. With the new taxing authority in place, federal lawmakers would no longer need our advice and consent and the march to socialism was on. It would take the better part of the next hundred years to make the million-dollar question obsolete but once government reached the billion dollar spending mark the leap to a trillion dollars occurred in a relative flash. Today, the accumulated annual deficit of the current administration alone exceeds the combined cumulative total deficit of all previous administrations. In less than a decade, we would learn to speak in billions although we really cannot comprehend the quantity.
Today, the million-dollar question equates to little more than pocket change lost in the couch cushions. Perhaps tomorrow, our children will be perplexed at our inability to comprehend such an insignificant amount as a trillion dollars.
Unfortunately, Kansas, like most other states, simply mimics the deficit spending habits and taxation policies of the federal government and now finds themselves in the dubious position of operating its own favor mill, selecting winners and losers each year for receipt of the state’s shrinking revenue — a fact easily witnessed by the parade of interest groups present and providing testimony in order to protect their share of the pie. With federal tentacles burrowed deep in their hide, our governor and state legislators lack the fortitude to make a clean break with the federal schemes of taxation.
Their plan does not mark an end to state sponsored charity but instead simply shifts state funds from one entitlement (the state earned income tax credit (EITC) for instance) to another (Medicaid) for the purpose of attracting more funds from the federal government. Drawn inextricably like a moth to a flame, our governor and legislators fail to appreciate that federal dollars are borrowed dollars that become a liability for future Kansas taxpayers. It is like paying the MasterCard bill with the Visa card. It provides only temporary relief for a chronic if not fatal problem.
The FairTaxKC Triple Zero + 6.3% plan offers the governor and state legislators the opportunity to cut the shackles and make a clean break with the federal government and from the federal schemes of taxation without cutting a single dime from their current projected expenditures.
The FairTaxKC Triple Zero + 6.3% plan would replace all current methods of taxing goods, personal and business income with a single rate consumption tax on services and new products at the Point of Sale only, with zero exceptions or exemptions.
The FairTaxKC Triple Zero + 6.3% plan would provide a prebate (prepayment) monthly to every legal citizen and resident on the registered tax rolls in Kansas for the consumption tax paid up to the poverty level.
The FairTaxKC Triple Zero + 6.3% plan projects a net positive reserve equal to roughly one third of the current SGF total planned expenditures in the first year, or $2.1 Billion, compounding annually. The governor’s tax proposal can only muster on paper about three quarters of the required statutory 7.5% general fund reserve or $350 Million.
In 1972, the total federal budget was approximately $230 billion. Today, the federal government will pay approximately $238 billion in interest payments alone this year. Historically, our state budget reflects the same trend in spending and debt (much of which is largely hidden from the public).
The only common thread in comments of the committee members and those testifying on behalf of their sacred cow was the apparent acknowledgment that significant change in Kansas tax policy was required (even if many hoped it would not affect them).
The only question remaining for us is: Will Kansas take the bold steps required that would allow the state to operate with billions of whole dollars in reserve?
Or will Kansas take a half-measured approach to modifying the federal schemes of taxation and leave the state operating on couch cushion change and a greater dependence on a bankrupt federal government?
Please take the opportunity now to contact the Governor and your legislators asking that they give the FairTaxKC Triple Zero + 6.3% plan fair treatment in their deliberations.
From Erik Telford
Wireless technology is great. Only a few years ago, most Kansans were using their phones to call, and perhaps even text, now mobile devices are essentially small computers in the palms of our hands — capable of almost anything.
According to Nielsen research, about 44 percent of U.S. mobile subscribers now own smartphones.[i] In Kansas, there are more than 2.4 million wireless subscribers[ii] and nearly 450,000 of those subscribers have data plans with full Internet access for more than 1 million high-speed mobile devices as of December 2009.[iii]
With mobile devices capable of almost anything, Kansans are finding more ways to use them — from uploading pictures during a concert at the Sprint Center to updating their Facebook status about K-State’s football team to checking into their favorite Wichita restaurant on Foursquare.
However, in what is becoming an all too familiar occurrence, some of these efforts are unsuccessful because we just can’t seem to connect online in a stadium or arena full of people. This is just one localized example of how the looming spectrum crisis could become a widespread reality — crippling innovation and investment in one of our country’s most vibrant sectors.
Thankfully, Congress is currently considering legislation that would help avoid the looming crisis by freeing up more spectrum through an auction process. Spectrum auctions are widely supported by both Republicans and Democrats; however, as with most things — the devil is in the details.
As the agency in charge of spectrum auctions, the FCC is pressuring Congress to give the FCC complete control over the auction design process. While the FCC’s request seems somewhat innocuous, if allowed, it could have dangerous consequences.
Recent actions by the FCC suggest it would use its power to limit which companies will get to participate in the auction, effectively determining the winners and losers.
Some members of Congress, support the FCC’s request and argue that proposals that would restrict the FCC from imposing eligibility conditions on auction participants “could have a deterring effect on fostering competition and maximizing auction proceeds to pay for a public safety network and deficit reduction.”[iv] The argument that fewer auction participants would result in more competition and more revenue, however, just doesn’t make sense.
The FCC’s desire to impose conditions to increase competition and encourage innovation is not only counterintuitive; it is unnecessary. As the FCC’s own data demonstrates, the wireless market is already fiercely competitive. Nearly 90 percent of Americans have a choice of five or more wireless providers.[v]
In, Kansas, consumers in communities both large and small have a number of options for wireless services. Consumers in Salina and in Wichita can choose from six or more wireless providers.[vi] In Garden City, subscribers can choose from seven or more wireless companies.[vii]
Furthermore, eligibility restrictions could prevent companies like Sprint, Verizon and AT&T from acquiring more spectrum, which could prevent them from deploying 4G service to other communities outside the Kansas City market due to spectrum constraints.
As the expert agency, the FCC is right to ask for some flexibility with the auction design process. Congress, however, should reserve its right to protect our wireless future by preventing FCC overreach and ensure that all companies can participate in the auction process. It’s only the fair choice to make.
Notes:
[i] Nielsen Wire, “Android and iPhones Dominating App Downloads in the U.S
[ii] Federal Communications Commission, 15th Annual Mobile Wireless Competition Report, Table C-2: FCC’s Semi-Annual Local Telephone Competition Data Collection: Mobile Telephone Subscribership, in Thousands,” p. 248, June 27, 2011
[iii] Federal Communications Commission, 15th Annual Mobile Wireless Competition Report, Table C-5: Mobile Wireless Devices Capable of Sending or Receiving Data at Speeds Above 200 kbps and Subscribers with Data Plans for Full Internet Access as of December 31, 2009, in Thousands,” p. 260, June 27, 2011
[iv] Sen. John Kerry, Press Release, “Democratic and Republican Senators Urge Smart, Inclusive Spectrum Reform
[v] Federal Communications Commission, 15th Annual Mobile Wireless Competition Report, “Estimated Mobile Wireless Voice Coverage by Census Block, 2010,” p. 6, June 27, 2011
[vi] Cell phone provider coverage as found by zip code on http://www.wirelessadvisor.com/
[vii] Cell phone provider coverage as found by zip code on http://www.wirelessadvisor.com/
Following in an article from U.S. Representative Mike Pompeo, a Republican who represents the Kansas fourth district, including the Wichita metropolitan area. It provides an example of how hard it is to reduce the size of government. The legislation that is mentioned in the article is H.R. 3090: EDA Elimination Act of 2011, which would shut down the Economic Development Administration.
By U.S. Representative Mike Pompeo
As part of my efforts to reduce the size of government, I have proposed to eliminate the Economic Development Administration (EDA), a politically motivated federal wealth redistribution agency. Unsurprisingly, the current leader of that agency, Assistant Secretary of Commerce for Economic Development John Fernandez, has taken acute personal interest in my bill to shutter his agency.
Last week, Secretary Fernandez invited himself to Wichita at taxpayer expense and met with the Wichita Eagle’s editorial board. Afterwards, the paper accurately noted I am advocating eliminating the EDA even though that agency occasionally awards grant money to projects in South Central Kansas. They just don’t get it. Thanks to decades of this flawed “You take yours, I’ll take mine” Washington logic, our nation now faces a crippling $16 trillion national debt.
I first learned about the EDA when Secretary Fernandez testified in front of my subcommittee that the benefits of EDA projects exceed the costs and cited the absurd example of a $1.4 million award for “infrastructure” that allegedly helped a Minnesota town secure a new $1.6 billion steel mill. As a former CEO, I knew there is no way that a taxpayer subsidy equal to less than one-tenth of one percent (0.1%) of the total capital needed made a difference in launching the project. That mill was getting built whether EDA’s grant came through or not. So, I decided to dig further.
I discovered that the EDA is a federal agency we can do without. Similar to earmarks that gave us the infamous “Bridge to Nowhere” or the Department of Energy loan guarantee scandal that produced Solyndra, the EDA advances local projects that narrowly benefit a particular company or community. To be sure, the EDA occasionally supports a local project here in Kansas. But it takes our tax money every year for projects in 400-plus other congressional districts, many if not most of which are boondoggles. For example: EDA gave $2 million to help construct UNLV’s Harry Reid Research and Technology Park; $2 million for a “culinary amphitheater,” tasting room, and gift shop at a Washington state winery; and $500,000 to construct (never-completed) replicas of the Great Pyramids in rural Indiana.
Several times in recent decades, the Government Accountability Office has questioned the value and efficacy of the EDA. Good-government groups like Citizens Against Government Waste have called for dismantling the agency. In addition, eliminating the EDA was listed among the recommendations of President Obama’s own bipartisan Simpson-Bowles Deficit Reduction Commission.
So why hasn’t it been shut down already? Politics. The EDA spreads taxpayer-funded project money far and wide and attacks congressmen who fail to support EDA grants. Soon after that initial hearing, Secretary Fernandez flew in his regional director — again at taxpayer expense — to show me “all the great things we are doing in your home district” and handed me a list of recent and pending local grants. Hint, hint. You can’t say I wasn’t warned to back off. Indeed, Eagle editors missed the real story here: Secretary Fernandez flew to Wichita because he is a bureaucrat trying to save his high-paying gig. The bureaucracy strikes back when conservatives take on bloated, out-of-control, public spending, so I guess I’m making progress.
Please don’t misunderstand. I am not faulting cities, universities, or companies for having sought “free” federal money from the EDA. The fault lies squarely with a Washington culture that insists every program is sacred and there is no spending left to cut.
A federal agency run at the Assistant Secretary level has not been eliminated in decades. Now is the time. My bill to eliminate the EDA (HR 3090) would take one small step toward restoring fiscal sanity and constitutional government.
For those who pay attention, it is astonishing to witness the non-stop, over-the-top efforts of liberal mainstream media like the New York Times to discredit Wichita-based Koch Industries and its principals Charles G. Koch and David H. Koch. They have been non-stop advocates for limited government, free markets, and economic freedom for many years, and this is something the political left just can’t stand. Following is a letter from Melissa Cohlmia of Koch Companies Public Sector, LLC to Arthur S. Brisbane, the Times’ public editor, or readers’ representative. The letter was originally published at KochFacts.com.
Mr. Arthur Brisbane
Public Editor
New York Times
Dear Mr. Brisbane:
We have been observing coverage about us in the Times over the last year that appears in many cases driven by a political agenda and in others so gratuitous that it stretches the bounds of newsworthiness to absurd lengths. You will recall that we brought a number of these specifics to your attention last April and May. Since that time, there have been more than 50 articles in the paper critical of Koch (zero that are positive) written by some 41 different Times authors. You were gracious to offer a continued dialogue on the matter and two such pieces that appeared over the weekend prompt us to reach out again.
The first, by art critic Anthony Tommasini, complained about our support for the arts, compared us to the deposed King Ludwig of 19th-Century Bavaria and the Renaissance Medicis and therefore urged that the situation “would seem to make the performing arts a natural focus for the Occupy activists.”
The second piece, appearing in the “Ethicist” column by Ariel Kaminer, applauded a reader for keeping her granddaughter away from a performance of “The Nutcracker” because we donated to the production. “Tolerance has its limits” Ms. Kaminer explained, and “Tchaikovsky makes strange bedfellows.”
In other words, Times writers apparently must perform contortions so bent-over-backward that it involves medieval references and politicizing children’s Christmas ballets, all to squeeze a disparagement about Koch into their copy. My question to you is: if the paper is going to be indulging a hostile approach that is this far-fetched, then don’t we deserve some explanation from editors for the sheer frequency and the underlying purpose?
Readers themselves might wonder if they’ll soon read moral circumspection about the many performing arts or left-leaning institutions supported by the Sulzberger family, which owns the paper. Doubtful, it would seem. (And never mind at all the Sulzberger family’s role in building the New York Stock Exchange, stifling the Times’ unions, giving golden parachutes to underperforming executives, and other such activity the paper lately characterizes as “the one percent”).
When we last interacted, you explained that we could “expect the Times to continue to cover Kochs’ activities rather closely, as your organizations’ activities have acquired quite a high profile.” I’m troubled that this is a kind of circular logic — the Times is covering Koch because Koch is being covered — and tells readers little about the thinking and motives of the Times’ apparent fixation with us.
Let me reiterate that these are far from the only such examples. In October, a Times dining critic commenting about what protestors prefer to eat wrote, “Unlike the Tea Party, funded as it is by wealthy reactionaries like the Koch Brothers, ‘Occupy’ is sustained by energy, frustration … pizza and apples paid for by supporters or donated by farmers.” In November, one of your columnists denounced where we choose to live, saying, “even when oligarchs clearly get their income from heartland, red-state sources, where do they live? OK, one of the Koch brothers still lives in Wichita; but the other lives in New York.” And though the group Americans for Prosperity has tens of thousands of members, supporters, and co-founders, it is routinely described specifically as a project of ours.
As one of your predecessors once pointed out, the Times is a liberal newspaper. We understand that and have been documenting the often irrational and cynical ways in which left-wing groups have targeted us. But if the Times is going to take part in that bandwagon and go to lengths so far afield from legitimate news coverage, then it ought to have the integrity to acknowledge it.
We would be grateful if you could look into the examples we’ve cited and the larger point. We look forward to hearing your thoughts.