|
Tax Reform Heats Up
We’re going to be hearing a lot about tax reform in the coming months, and the talk got started at the tax conference Tuesday sponsored by the Utah Taxpayers Association. I wasn’t able to attend, but here are reports from the Tribune, Morning News, and Standard Examiner. Sen. Curt Bramble says there will be no sacred cows.
Assuming Utah’s economy stays strong and tax revenues continue to build, we could have an ideal scenario at the next legislative session for meaningful tax reform. (Although it will also be an election year.) Healthy budget surpluses can lubricate tax reform by allowing fundamental restructuring without increasing the overall tax burden and perhaps even allowing a small tax cut.
Among the Huntsman administration’s top priorities are tax reform, economic development and transportation infrastructure. The three priorities have to be dealt with in sync because they are very much interdependent. A healthy economy is very much dependent on good mobility. And transportation needs a reliable, long-term funding base or the state will always be playing catchup. We’re currently multi-billions of dollars short on transportations funding.
So in the context of tax reform and significant budget surpluses, the Legislature could increase the gas tax or impose a sales tax on gasoline and/or impose other long-term funding mechanisms for highways and mass transit without increasing overall taxes and without robbing other government programs.
Likewise, the Legislature could broaden the sales tax base by taxing services, while reducing the tax rate, and not increase taxes overall. It’s easy to talk about this, of course, and much more difficult to actually do it. But it needs to be done and the environment is right to step up and do it.
Sorenson’s DNA Database
Billionaire James Sorenson, the wealthiest person in Utah, made the front page of the Wall Street Journal on Tuesday. He was featured in an interesting story by Pulitzer Prize-winning reporter George Anders on the Sorenson Molecular Genealogy Foundation, which collects DNA all over the world and helps connect people with their roots through genetic testing. Sorenson is portrayed in a very positive light.
For any business, being featured in a highly positive story on the front page of the Wall Street Journal is as big as it gets. Getting the nice coverage was a big coup for David Parkinson, who handles public relations and media placement for the Sorenson Companies, and for Kimball Thomson, who is starting a PR firm and who helped with the messaging on the story.
Is Reid a Leading Democratic Voice?
Harry Reid is the top Democrat in Washington, so is he the leading voice of the Democratic Party? Republican insiders certainly don’t think so. But Democratic insiders say his voice is bigger than Hillary Rodham Clinton’s.
National Journal asked the question, “Who is currently the leading voice of the Democratic Party?” to 54 prominent Republicans and 53 prominent Democrats. Here are the Republican results: Hillary Clinton, 17 votes, “No one,” 16 votes, Harry Reid, 6 votes; Bill and Hillary Clinton, 3 votes; Bill Clinton, 2 votes; and Howard Dean, 2 votes. The Republicans obviously think the Clintons are the big voices of the party; they received 22 votes total.
Among prominent members of his own party, Reid does better. Here are the results: “No one,” 20 votes; Harry Reid, 10 votes; Hillary Clinton, 7 votes; Bill Clinton, 4 votes; Bill and Hillary Clinton, 3 votes; Edward Kennedy, 2 votes; Nancy Pelosi, 2 votes.
Reid will speak to Utah Democrats next week, May 6, at the annual Jefferson-Jackson dinner on on the topic, “How the West Will be Won.”
Reader Response
From Rep. David N. Cox, R-Lehi:
“I very much agree with your subscribing to Norm Bangerter's thoughts that our biggest problem in education is governors and presidents and that the best thing that could happen to education would be local control (See Tuesday’s Utah Policy Daily). That will not happen with the big regional districts we have now. I understand Gov. Bangerter also felt, as my research leads me to believe also, that the best size for our school districts would be one high school and its feeder schools. Our big regional districts control state education as well. Only 10% (4 of 40) of our districts have over 50% of the students -- and legislators. We can't get local control until we break up the big districts because they dominate the agenda even with the smaller districts. That will create accountability that no laws can bring.”
National Politics
President Bush is barely four months into his second term, but lots of national political pundits are saying the steam has gone out of his ambitious agenda. Here are some excerpts from National Journal columnist Charlie Cook’s Tuesday e-mail column (Sign up here):
The Cost Of Overreaching
President Bush's proposal to allow a portion of a younger worker's Social Security payroll taxes to go instead into a personal account that could, within limits, be invested in the stock market could not have come at a much worse time.
After a long expansion in the market and many years of generally good economic times, five years of volatility have caused the public to become very cold to this plan. Indeed, 55 percent of respondents in the latest Gallup poll had a negative outlook on the economy, while 22 percent had a positive view and 20 percent had a mixed reaction. The poll of 1,003 adults, conducted April 18-21, has a 3-point error margin.
Had this idea been aggressively pushed in early 2000, before the tech bubble burst and the stock market went south, the outcome might well have been different. But today, the second word in Social Security reins supreme; Americans want to see the system stabilized and put on sounder footing, but without adding an element of risk to how much their monthly check will be when they retire.
All of this political capital would have been better spent on stabilizing the system and on efforts to boost the country's notoriously low savings rate. According to the Commerce Department, in February, for example, the personal savings rate -- measured as a percentage of disposable personal income -- was 0.6 percent.
In terms of John Bolton (Bush’s nominee to become U.N. ambassador), as long as the Democratic attacks centered on the undersecretary of State having said mean things about the United Nations, his nomination was a foregone conclusion: He was going to be confirmed.
But when the argument pivoted to charges that he had sought to punish intelligence analysts at the CIA and State Department who emphasized intelligence findings that were contrary to his own policy views, it was a different story.
While this behavior might not have been a big deal five years ago, and might not be five years from now, it is a very big deal today.
No policymaker has truly paid the price for the selective use and misuse of intelligence during the months leading up to the Iraq War, and indeed some even got medals. More than at any time since Pearl Harbor, there is a sensitivity to policymakers wearing blinders and only wanting to hear findings that are consistent with their policy views. It seems that somebody has to pay the price for this; it looks like it might well be Bolton.
But there is an important connection here.
The difficulties that the president's Social Security proposal and his nominee to the United Nations have encountered underscore the argument that, given the choice between Bush and Sen. John Kerry, D-Mass., last Nov. 2, more people liked, agreed with or trusted Bush than Kerry.
This was a very specific choice between two specific people, and the election did not mean that the American people were so supportive of Bush that they decided to award him a platinum Carte Blanche card to do whatever he wanted to do and however he wanted to do it.
The Bush campaign's strategy of putting a premium on appealing to the Republican Party's conservative base, of organically growing the party, rather than reaching out to the ideological and partisan middle ground, may well have worked brilliantly in last year's campaign.
But it might not work so well with a Congress as closely divided as this one, or specifically with as many moderates and free agents as the Senate has.
The danger is that the more legislative and nomination battles Bush loses, the less deference lawmakers will give the president, and the less he will accomplish. There is a real price to over-reaching, and Bush and his aides might soon have to pay it.
|
Utah
Policy Daily is a service