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Posts Tagged ‘state’
January 21st, 2014 at 7:46 pm
Time to REIN-in State & Local Govt. Too

Steven Hayward is out with a blistering piece on the need to remember that state and local governments can be just as mind-numbingly bureaucratic as the feds.

“A key principle of federalism is that state and local government would resist the centralization of power in Washington, and defend the principle of ruling with and by the consent of the governed,” writes Hayward. “It is time to recognize that this kind of government no longer exists…”

As proof he cites several stories of local cops shutting down kids’ lemonade stands, and county air pollution regulators that make more than the top officials at the federal EPA. One could add to this Santa Monica’s “ban the [plastic] bag” campaign, and any of former New York City Mayor Michael Bloomberg’s wars on salt and soda, among many others.

And it’s not just in deeply blue states that bureaucrats revel in meddling. The four lemonade stand shut-downs that Hayward spotlighted occurred in Texas, Georgia, Iowa and Wisconsin.

In a nutshell, states and localities have succumbed to a me-too mentality that simply creates mirror images of federal bureaucracy all the way down. In order to justify their existence, each level imposes fines, collects fees and issues regulations – many times at odds with each other. The duels over rule have gotten so pervasive, there’s even a judicial doctrine called “preemption” to help courts sort through competing claims over which gang of regulators gets to control citizens’ lives.

One way to limit any bureaucracy’s social footprint is to make its decisions subject to approval by the legislature that creates it. At the federal level, the REINS Act would require congressional approval before any regulation costing $100 million or more annually goes into effect. Similar efforts, with lower thresholds, could and should be pursued at the state and local level.

Putting state legislators and city council members on the record when it comes to imposing increases to the costs of living will likely reduce the number of increases imposed. After all, if it makes sense at the federal level, why not closer to home?

June 10th, 2013 at 7:03 pm
More Problems for a Hillary Clinton 2016 Run

On the day Hillary Clinton joins Twitter, the Washington Post reports that her popularity is dipping as Independents turn a bit sour on the former Secretary of State, U.S. Senator, and First Lady.

A big factor affecting the public’s perception of Clinton is the Benghazi scandal that helped to accelerate her exit from office. Because of her defiant testimony in the aftermath of the terrorist-led killings of four Americans, congressional investigators have been laying the groundwork to summon her to Capitol Hill to clarify her remarks, and this time as a private citizen.

A private citizen with an eye toward running for President of the United States in 2016, that is. So far, Clinton has been able to avoid culpability for Benghazi, in part because the fiasco seems like anomaly in an otherwise scandal-free tenure at State.

But as of today, that perception may be changing. Radically.

CBS News is reporting that “Uncovered documents show the U.S. State Department may have covered up allegations of illegal behavior ranging from sexual assaults to an underground drug ring.”

An internal investigation now made public cites examples of an ambassador being allowed to continue at his post despite deliberately losing his security detail “to solicit sexual favors from prostitutes,” and several instances where investigators “were simply told to back off investigations of high-ranking State Department members.”

If this story gets legs – and with all the attention paid to whistleblowers at the moment, I expect it will – it looks like the Hillary 2016 speculation will first have to overcome revelations of gross mismanagement that enabled criminal behavior and exposed four Americans to a deadly, and avoidable, attack.

Not exactly the profile of a future president.

May 2nd, 2013 at 1:16 pm
Hidden Costs of Gang’s Immigration Bill

Andrew Stiles explains the reality behind the Gang of Eight claim that illegal immigrants won’t be eligible for public benefits until 13 years after being legalized:

“A notable loophole in the Gang’s legislation explicitly prohibits DHS from considering the likelihood that an applicant for provisional legal status will become a “public charge” — defined as any individual who is “primarily dependent on the government for subsistence, as demonstrated by either the receipt of public cash assistance for income maintenance, or institutionalization for long-term care at government expense.” Critics fear that if a significant number of immigrants meeting that definition are given legal status, state and local government could face an immediate financial burden, and one that could worsen over time.”

Moreover, as I explain in my column this week, the Gang’s prohibition against using federal law’s “public charge” criteria to decide whether illegal immigrants should be legalized undermines claims from Gang members and their allies that mass legalization won’t lead to big government spending increases.

The Heritage Foundation’s Robert Rector is still studying the impact of the Gang’s legalization effort on government spending, and my hunch is that he, unlike the Gang, will include the probable increases incurred by state and local governments if the public charge prohibition becomes law.

If so, the American people will get a clearer picture of the actual costs of legalization. Only then can we have an honest debate about what to do.

February 1st, 2013 at 1:00 pm
Could a Higher Sales Tax Lead to Less Expensive Government?

A Governing.com blog post by finance writer Liz Farmer includes a little history lesson for conservative governors looking to swap income tax cuts for higher sales taxes.  In order to avoid a massive drop-off in tax revenue in such a scenario, states would be obliged to not only increase their sales tax rate, but expand it beyond goods to include services as well.

But an example from Florida’s recent past gives reason to pause:

Expanding the sales base to include services would address both of those issues. However, getting that idea past the powerful lobbies that advocate for the affected industries is another question. In 1987, the Florida Legislature enacted an expanded sales tax on services like including advertising, legal, accounting and construction services. The move was met with enormous outcry. Major corporations like Coca-Cola and Procter & Gamble canceled or reduced their advertising in the state to protest the tax while business groups canceled at least 60 conventions they had booked in the state. The tax lasted just six months until it was repealed and the legislature instead voted to raise the sales tax from 5 percent to 6 percent, a rate that is still in effect today.

It’s worth noting that a tax expert quoted in the blog confirms that income taxes are the most destructive tax because they create a disincentive to build wealth.  However, as the experience in Florida shows, a workable sales tax runs the risk of becoming quickly unpopular once consumers start seeing the true cost of government on every commercial transaction.

Assuming some states do enact the income-for-sales-tax swap, maybe the sticker shock will prompt another round of reform; one that perhaps lets third-party vendors compete for government contracts to deliver services at a fraction of what it costs to fund a bureaucracy.

April 24th, 2012 at 12:59 pm
How to Make Obamacare Exchanges a State Campaign Issue

In a presidential election year like 2012, it’s easy for national issues to crowd out state and local concerns at the ballot box.  But thanks to Obamacare’s costly mandate on states to create health insurance exchanges, fiscal conservatives running for state offices can easily make opposition to more government a central plank in their campaign platform.

According to Cato Institute scholar Michael F. Cannon, outside of the U.S. Supreme Court’s potentially striking down Obamacare’s individual mandate, the most important health policy battle to be waged is state government opposition to creating Obamacare’s state-based health insurance exchanges.

As I’ve written previously these exchanges are a subtle way to coerce states into spending millions of dollars to set-up a government-controlled, taxpayer-subsidized “market” for health insurance.  Thereafter, when Obama’s bureaucrats at HHS decide the state version isn’t performing exactly the way they want, Obamacare grants HHS the power to take over any state’s exchange and run it from Washington, D.C.  Thus, the bait-and-switch is yet another way for Obamacare to hide its impact on the federal budget deficit by shoving some of its start-up costs onto the states.

Cato’s Cannon outlines a different strategy, with talking points that to me seem ready-made for a state campaigner’s website:

Jobs. Refusing to create an exchange will block Obamacare from imposing a tax on employers whose health benefits do not meet the federal government’s definition of “essential” coverage. That tax can run as high as $3,000 per employee. A state that refuses to create an exchange will spare its employers from that tax, and will therefore enable them to create more jobs.

Religious freedom. In blocking that employer tax, state officials would likewise block Obamacare’s effort to force religious employers to provide coverage for services they find immoral — like contraception, pharmaceutical abortions, and sterilization.

The federal debt. Refusing to create exchanges would also reduce the federal debt, because it would prevent the Obama administration from doling out billions of dollars in subsidies to private insurance companies.

The U.S. Constitution. The Obama administration has indicated that it might try to tax employers and hand out those subsidies anyway — even in states that don’t create an exchange, and even though neither Obamacare nor any other federal law gives it the power to do so. If that happens, the fact that a state has refused to create an exchange would give every large employer in the state — including the state government itself — the ability to go to court to block the administration’s attempt to usurp Congress’s legislative powers.

A lower state tax burden. States that opt to create an exchange can expect to pay anywhere from $10 million to $100 million per year to run it. But if states refuse, Obamacare says the federal government must pay to create one. Why should states pay for something that the federal government is giving away?

Bye-bye, Obamacare. That is, if the feds can create an exchange at all. The Obama administration has admitted it doesn’t have the money — and good luck getting any such funding through the GOP-controlled House. Moreover, without state-run exchanges, the feds can’t subsidize private insurance companies. That by itself could cause Obamacare to collapse.

There is no reason a state should agree to spend millions of dollars laying the groundwork for a federal takeover of health care.  Fiscal conservatives running for office this cycle should articulate this argument well and often.