California Democrats seek to extend 'temporary' taxes
Democrats in the state Senate on Monday countered Gov. Arnold Schwarzenegger's proposed budget cuts with a plan to raise taxes by nearly $5 billion, largely by extending temporary taxes and delaying corporate tax breaks for two years.Hmmm, now what neighboring state of California passed "temporary" taxes in its last legislative session?
During a Senate subcommittee hearing, Democrats said they want to delay the start of corporate tax credits demanded by Schwarzenegger and Republicans last year to secure enough budget votes. Their plan also would extend by two years the temporary increases in the income tax and vehicle license fee that were approved last year.
Democrats proposed raising the tax on alcohol but would allow a temporary 1 cent increase in the state sales tax to expire at the end of the year. [Emphasis added]
The taxes [raised during Nevada's 2009 Legislative session] included a $220 million increase in hotel room taxes enacted early in the session with Gibbons' blessing and the $781 million package of temporary increases to four existing taxes enacted by veto override Friday.
As election season approaches, Nevadans deserve to know candidates' response to this question: "Would you raise taxes by extending or making permanent the 2009 temporary tax increases?"
This is an important question to ask, because all around the country - and even in Nevada - "temporary" taxes usually aren't.
For more information on how your legislators voted, check out NPRI's 2009 Legislative Review and Report Card. The Report Card is on pages 18 and 19.
Read moreUnemployment for Nevada's young workers hits 21.8 percent
What results when you combine an epic failure of a stimulus with Nevada's minimum-wage law? High unemployment that disproportionally affects Nevada's youngest and most unskilled workers.
The Nevada Department of Employment, Training and Rehabilitation, which tracks the jobless rate, says March data show 21.8 percent of 16 to 24-year-olds were unemployed. The rate, calculated over a 12-month moving average, is almost twice that of older age groups...Are the failed stimulus and Nevada's well-intentioned but misguided minimum-wage laws the only factors affecting young-worker unemployment? Of course not - the economy is enormously complex. But the minimum-wage law is a factor that is depressing youth employment.
And for many people this year, the stakes are higher. Jobs are needed not simply to stay busy or earn spending money but to help pay the family bills.
"We're seeing more turmoil, family stress and teens competing with older people for fewer jobs," said Erik Schoen of Community Chest Inc., a Virginia City-based nonprofit resource center for rural counties in northwestern Nevada.
"For teens, there are no magic bullets. They are at a disadvantage with not a lot of experience." [Emphasis added]
Young workers (in Nevada, the state minimum wage doesn't apply to those under 18) have little to no experience and little to no skills, because they are just starting their careers. In essence, they are not able to provide the same level of value as someone who's proven himself or has greater skills (older workers).
In a free market, this leads to younger workers being paid less, because they provide less value to their employers. As their experience and skills increase, however, they become more valuable and worthy of a higher salary. If their current employers don't increase their pay, they can work for another employer who will pay them more, or they can start their own businesses.
While it'd be nice to pay every employee more regardless of his abilities, this would lead to businesses or (governments!) going bankrupt. What happens instead is that younger and unskilled workers just aren't able to find work, which can stunt their earning potential for up to 10 years.
Unfortunately, the news isn't getting better. I called the Nevada Department of Employment, Training and Rehabilitation this morning, and they told me the unemployment rate for young workers jumped to 24.1 percent in April.
For anyone not familiar with Nevada's minimum-wage law, the RJ had a good description this morning.
Since then, the state's minimum wage has jumped more than 40 percent -- and will go up again on July 1 to $7.25 for those who have worker-paid health insurance. The minimum wage for those who have no such insurance will be $8.25. (The difference is a result of Big Labor's push to punish employers that don't provide health insurance.)To be fair, the federal minimum wage also has increased - so the problem isn't just with Nevada. But our state law has exacerbated the problem.
Nevada's jobless rate jumps to 13.7 percent
So, how's that stimulus working out?
Unemployment in Las Vegas in April shot to a record high of 14.2 percent with an estimated 140,900 residents out of work.Just another reminder that President Obama's stimulus was and is an epic failure.
The state Department of Employment, Training and Rehabilitation also said the Nevada jobless rate hit a record high of 13.7 percent for the month.
I wonder if Sen. Harry Reid still thinks rising unemployment is good news? Video after the jump.
What the Sun gets right about education
From today's editorial:
One of the problems with education today is that it too often has a one-size-fits-all quality. The reality is that not all kids learn at the same pace or have the same academic interests. That is why on one hand it is encouraging to see the district do what it can to better tailor education to the needs of each child.Exactly - the one-size-fits-all public education system has been and is a disaster. Taking away choice and forcing children into a government-run, union monopoly of a school system has led to Nevada having one of the worst educational systems in the country. It's encouraging to see the Sun recognize the need for more variety in education and wanting unique educational choices for Nevada's unique children.
Unfortunately, while its goal is laudable, the editors at the Sun have no idea how to make it a reality.
Still, until we provide the schools with a better level of funding to accomplish this, students in Nevada won't receive the education they deserve.Fact: In the last 50 years, Nevada's inflation-adjusted, per-pupil spending has nearly tripled. Educational achievement has been and remains stagnant.
But there is a better way. Just over 12 years ago, Florida enacted a series of free-market education reforms that changed its one-size-fits-all system. These changes included online schools, over 350 charter schools, corporate tuition tax credits and scholarships for students to leave failing schools. And Florida did this while increasing inflation-adjusted, per-pupil funding by less than 70 percent of the national average and only $152 more than Nevada has since 1997. The results of reform speak for themselves.
And for those who are looking for alternatives to the one-size-fits-all education system we currently have, Patrick R. Gibbons, NPRI's education policy analyst, has a new study out on Virtual Schools and how online education can - and already is beginning to - change Nevada education.
Has sovereign debt reached the point of no return?
That's the question asked, and answered, by Philipp Bagus in his Mises Institute column today. I highly recommend this piece. Although Bagus is primarily concerned with how the Greek bailout is likely to exacerbate sovereign debt crises within the EU, many of the lessons are equally applicable to US states (California comes instantly to mind).
Nevada Vision Stakeholder Group: Recap and where does it go from here?
Nevada Vision Stakeholder Group Chairman Robert LangIf you've followed any of the coverage of the Nevada Vision Stakeholder Group's Friday meeting or Write on Nevada's live blog, then you know that the NVSG rejected its and Moody's Preliminary Executive Summary and is going to meet at least once more to confirm a new document.
For those who aren't familiar with the NVSG, it's a group comprised mainly of government officials, government employees (or union officials) and those receiving government handouts. The Nevada Legislature's Interim Finance Committee created the NVSG to set five-, 10- and 20-year quality-of-life goals for Nevada that would require greater government spending. The legislature, led by Sen. Steven Horsford, would, in turn, use these calls for more government spending as political cover for its attempt to pass a tax increase, specifically a broad-based business tax, during the 2011 Legislative Session.
The Nevada Vision Stakeholder Group's decision to meet again and demand that Moody's (the NVSG's consultant, which is writing the report) rewrite the report was unexpected.
From the NVSG's first meeting in January 2010 (incidentally, the same month NVSG Chairman Robert Lang moved to Nevada from Virginia), its last meeting was going to be the May 14 meeting. Moody's Analytics, the stakeholders, Chairman Lang and the public all expected this. So when Moody's and the NVSG released the Preliminary Executive Summary early last week, I expected Chairman Lang to push it through.
A funny thing happened, though - thanks to good reporting by the RJ, stakeholder Doug Busselman's comments, talk radio coverage from KDWN and KXNT and the Nevada Policy Research Institute's commentary, the public found out about the report and wasn't impressed at all.
This caused Chairman Lang to back away from the Executive Summary at the very beginning of the meeting. He even claimed it never called for tax increases (although it did call for government "investment" well over a dozen times). Lang then threw Moody's under the bus: "All we have is an executive summary of a report that doesn't exist." Reflecting the consensus of the other members, he then demanded that Moody's redo everything and produce a full report for the NVSG to vote on.
Chairman Lang and other big-government advocates retreated rhetorically at Friday's meeting, but they retreated only in their words. The purpose and intent of the NVSG - providing political cover for tax increases in 2011 - still remains the same. I expect to see this at the NVSG's next meeting. They have not scheduled it yet, but when they do, I will let you know.
Advocates of freedom and limited government should take heart that exposing the NVSG's agenda has forced the NVSG into a temporary regrouping, but we shouldn't be naïve and think we have won the battle over tax increases in 2011 yet.
The (political) fight's only just begun.
How the Clark County Democratic Party platform "promotes" capitalism
The Clark County Democratic Party has just released its 2010 platform. The good news is that it claims to support capitalism and small businesses.
It is the government's responsibility to promote capitalism ... Since the backbone of the American economy is small business, responsible for up to 75% of all employment, supports effective government policies to foster small business development and success.
The bad news is that aside from a couple of platitudes, the rest of the platform is full of job-killing ideas and regulations. For instance:
2. Supports legislation that requires firms receiving favored tax status to meet fair economic standards for wages, benefits and work conditions for employees and to satisfy all Federal and State standards of environmental and social responsibility...
4. Encourages public policies that level the playing field for all Nevada businesses by providing affordable health care for employees and their families; equitable taxes and regulation; fair access to capital; and support for business innovation and technology.
Core services must not be privatized...
Efficient and fair tax structure that meets the legitimate needs of its citizens by employing progressive tax policies that share the cost and meet the needs of core services across the broadest spectrum of participants that is linked with their ability to pay.
1. Supports examining all possible tax options to ensure a stable, long term tax base.
2. Supports efforts to change the Nevada State Constitution so that the mining industry is taxed on "gross revenues" instead of "net revenues." ...
8. Supports taxes based on wealth, not just work.
9. Tax policy needs to ensure that businesses cover the true social and environmental costs of their products and services instead of shifting the costs to the community of future generations.
Unfortunately, that's just the warm-up. Check out the party's job-killing and economy-depressing labor platform.
Urges the state and federal government adopt the Workers Bill of Rights:If you like the sound of these ideas, please move to Venezuela, Greece or California. Those places have implemented policies based on the ideas outlined above and are now enjoying the inevitable results of government getting in the business of redistributing wealth.
WORKER'S BILL OF RIGHTS
In the workplace, every individual is entitled to all of the basic rights and protections of the United States Constitution and The Constitution of the State Of Nevada.
Every worker is entitled to health care disability benefits, unemployment benefits and retirement Benefits.
Every worker and every Public Employee is entitled to organize for the benefit of Collective Bargaining and an absolute right to Binding Arbitration.
Every worker is entitled to a living wage and fair compensation and benefits for their labor including the opportunity for affordable healthcare for themselves and their family.
Every worker is entitled to a safe and healthful work environment.
Every worker is entitled to protection from unfair business practices or work rules or the exporting of jobs for the purpose of denying or evading The Worker's Bill Of Rights.
Every worker is entitled to a work place environment that promotes a positive Worker-Business Partnership for the benefit of all.
Prohibits business from utilizing unfair business practices and exporting jobs to evade the basic Worker's Bill of Rights.
Supports the right to organize with collective bargaining and binding arbitration including all public workers
1. Protect public employee collective bargaining and don't roll back NRS 288.
2. Calls on employers to acknowledge the rights of employees to organize, and to support those employees who organize a union by recognizing that union by simple card check recognition only. Additionally, calls on employers to negotiate fairly with those workers.
3. Supports legislation that prevents, and opposes the permanent replacement of workers engaged in a legal strike.
4. Opposes the anti-worker so-called "paycheck protection" initiative which destroys the political viability of unions...
Supports a living wage and fair compensation and benefits for all workers
1. Supports efforts to eliminate poverty by increasing the minimum wage, increasing salary as cost of living increases, and repealing withholding taxes on unemployment compensation.
2. Urges the use of project labor agreements on government projects.
If Nevada wants to avoid the long-term disasters facing Venezuela, Greece and California, it must confine state government to its proper role - ensuring public safety and individual freedom and providing basic services, like education and roads, through the most effective means.
(h/t Ralston)
Government shouldn't pick the winners and losers: Las Vegas arena edition
Yesterday the Clark County Commission heard proposals for three new sports arenas in Las Vegas. Now, while I'm all for sports and for businesses expanding, there's a problem with each of the proposals - they all want government handouts.
Three rivals have detailed plans for developing state-of-the-art arenas that would cost half a billion dollars or more, seat 20,000-plus people and require some public funding.Sisolak and other commissioners are right to resist subsidizing an arena (or any business) during a recession, but they shouldn't stop there. Taxpayers have no business subsidizing an arena (or any business) when times are good, either.
Last month, commissioners resisted the idea of subsidizing an arena when the county is grappling with a budget crunch. A couple of commissioners said last week that they would not rule out offering public aid but that they were unsure about the timing.
"I just don't know if it's the right time," Commissioner Steve Sisolak said. "I have a lot of questions. I'm still concerned with record unemployment and a huge shortfall."
Proponents estimate that an arena would create 3,000 to 4,000 construction jobs while it was being built, and thousands of support jobs after it opens.
Well-paying construction jobs that last 18 months or more would be welcome in this economy, Sisolak said. But he questioned how much taxpayers would be on the hook for financially and whether it was worth generating short-term construction work and low-paying service jobs.
One of the problems conservatives/libertarians have with welfare and other handouts is that they reward poverty. You receive "free" money for not working. This changes the recipient's mindset and makes him or her less likely to work. Also, it encourages other people who are working, but only earning a low level of income, to quit working and get just as much or just a little less from the government.
The same problem emerges when government gives subsidies or redevelopment money or special tax breaks to businesses. Instead of consumers rewarding a business for meeting customer demand, a business is now rewarded for its ability to lobby and impress politicians. In turn, this leads other businesses to shift their focus from satisfying customers to satisfying politicians, which means scarce resources will be used to justify political, not consumer, demand. And in a world with limited resources, this leads to less employment and wealth creation, because political dollars and tax breaks come at the expense of the private sector and become entrenched in businesses that are only profitable because of government subsidies.
And if an arena were to go through, it's easy to see who the loser would be - the MGM Mirage, which already owns five arenas in the Vegas area.
MGM Mirage Chief Marketing Officer Bill Hornbuckle said the company is not opposed to having more arenas in the area, but giving one group public financing would be an unfair competitive advantage.That's exactly right. Let the marketplace, not the politicians, determine the winners and losers in the economy.
And as election session gears up, be cautious when politicians start talking about "creating jobs," as they're usually referring to special tax breaks or subsidies for favored businesses. Low taxes are a good thing, but only if the rate is uniformly low. Politicians shouldn't be picking the winners and losers in the economy, even if they're using tax breaks.
People, not politicians, create jobs.
Public vs. charter schools
From New York. The case for school choice in six paragraphs.
A building on 118th Street is one reason that the parents who are Perkins's constituents know that charters can work. On one side there's the Harlem Success Academy, a kindergarten-through-fourth-grade charter with 508 students. On the other side, there's a regular public school, P.S. 149, with 438 pre-K to 8th-grade students. They are separated only by a fire door in the middle; they share a gym and cafeteria. School reformers would argue that the difference between the two demonstrates what happens when you remove three ingredients from public education - the union, big-system bureaucracy and low expectations for disadvantaged children.
On the charter side, the children are quiet, dressed in uniforms, hard at work - and typically performing at or above grade level. Their progress in a variety of areas is tracked every six weeks, and teachers are held accountable for it. They are paid about 5 to 10 percent more than union teachers with their levels of experience. The teachers work longer than those represented by the union: school starts at 7:45 a.m., ends at 4:30 to 5:30 and begins in August. The teachers have three periods for lesson preparation, and they must be available by cellphone (supplied by the school) for parent consultations, as must the principal. They are reimbursed for taking a car service home if they stay late into the evening to work with students. There are special instruction sessions on Saturday mornings. The assumption that every child will succeed is so ingrained that (in a flourish borrowed from the Knowledge Is Power Program, or KIPP, a national charter network) each classroom is labeled with the college name of its teacher and the year these children are expected to graduate (as in "Yale 2026" for one kindergarten class I recently visited). The charter side of the building spends $18,378 per student per year. This includes actual cash outlays for everything from salaries to the car service, plus what the city says (and the charter disputes) are the value of services that the city contributes to the charter for utilities, building maintenance and even "debt service" for its share of the building.
On the other side of the fire door, I encounter about a hundred children at 9:00 a.m. watching a video in an auditorium, having begun their school day at about 8:30. Others wander the halls. Instead of the matching pension contributions paid to the charter teachers that cost the school $193 per student on the public-school side, the union contract provides a pension plan that is now costing the city $2,605 per year per pupil. All fringe benefits, including pensions and health insurance, cost $1,341 per student on the charter side, but $5,316 on this side. For the public-school teachers to attend a group meeting after hours with the principal (as happens at least once a week on the charter side) would cost $41.98 extra per hour for each attendee, and attendance would still be voluntary. Teachers are not obligated to receive phone calls from students or parents at home. Although the city's records on spending per student generally and in any particular school are difficult to pin down because of all of the accounting intricacies, the best estimate is that it costs at least $19,358 per year to educate each student on the public side of the building, or $980 more than on the charter side.
But while the public side spends more, it produces less. P.S. 149 is rated by the city as doing comparatively well in terms of student achievement and has improved since Mayor Michael Bloomberg took over the city's schools in 2002 and appointed Joel Klein as chancellor. Nonetheless, its students are performing significantly behind the charter kids on the other side of the wall. To take one representative example, 51 percent of the third-grade students in the public school last year were reading at grade level, 49 percent were reading below grade level and none were reading above. In the charter, 72 percent were at grade level, 5 percent were reading below level and 23 percent were reading above level. In math, the charter third graders tied for top performing school in the state, surpassing such high-end public school districts as Scarsdale.
Same building. Same community. Sometimes even the same parents. And the classrooms have almost exactly the same number of students. In fact, the charter school averages a student or two more per class. This calculus challenges the teachers unions' and Perkins's "resources" argument - that hiring more teachers so that classrooms will be smaller makes the most difference. (That's also the bedrock of the union refrain that what's good for teachers - hiring more of them - is always what's good for the children.) Indeed, the core of the reformers' argument, and the essence of the Obama approach to the Race to the Top, is that a slew of research over the last decade has discovered that what makes the most difference is the quality of the teachers and the principals who supervise them. Dan Goldhaber, an education researcher at the University of Washington, reported, "The effect of increases in teacher quality swamps the impact of any other educational investment, such as reductions in class size."
This building on 118th Street could be Exhibit A for that conclusion.
Threats to free speech on campus
"New Threats to Freedom," a book about free speech, campus censorship and political correctness run amok, hits bookstores this week. One chapter, written by Freedom for Individual Rights in Education (FIRE) President Greg Lukianoff' and titled "Students Against Liberty," highlights the censorship of Chris Lee, an African-American student at Washington State University.
Lee wrote a musical parody of Mel Gibson's "The Passion of the Christ" titled "The Passion of the Musical," which offended a wide array of students and professors at the university, including Mormons, Catholics, Methodists, gay and lesbian students, Latinos, feminists, the university's professors and even the local police. Ironically, the university not only defended the actions of the hecklers as free speech (some of whom shouted threats to Mr. Lee and his actors), but it even paid for 40 students and professors to attend, protest and heckle the play. According to Lee, the local police even refused to defend the actors if the crowd got physically violent.
Yes, this happens frequently in America - mostly in our institutions of alleged higher learning.
The university system is full of authoritarians who are teaching students that it's perfectly OK to threaten, shout down and heckle in order to silence your political foes. It's a good thing FIRE is around to put a damper on campus censorship and hypocrisy (click the link to see Washington State University's hypocritical stance on what plays are acceptable and what plays offend).
