November 23, 2008
A (thin) silver lining
By Bill Kraus
The only known desirable side effect of tough times in Wisconsin and the inevitable big state budget deficits that follow is that a lot of sacred cows are no longer sacred.
Spending initiatives that would be untouchable or not big enough to be worth the trouble to eliminate suddenly look inviting. Anything and everything that might produce even a few bucks of extra revenue gets an extra look.
Things like getting rid of the offices of secretary of state and state treasurer which don’t cost much but don’t have much to do either become possible.
I know these offices are in the Constitution and we would have to go through the long amendment process to get this done. Or would we? What if the money to run these offices was removed from the budget?
The state government budget is benefit-driven. The state assesses the taxes and then gives most of it to entitlement programs like medicaid and to local governments and school districts. This gives the state the ability to impose its will by shutting down the money flow to change resisting defenders of the status quo.
The reassessment of local governments can go beyond the relatively obvious “What is it that town governments do?” to "How many school districts should we have?" or whether a department of education which could eliminate the Department of Public Instruction would save some money beyond the cost of electing the State Superintendent. It might even lead to radical thinking about who should run the K-12 system and how.
And speaking of money, the big and small revenue enhancements are no longer chopped liver either.
Collecting sales taxes on Internet sales is complicated but doable.
Less complicated is bringing the reach of the sales tax up to date. When it was enacted 50 years ago the Wisconsin economy was product intensive. No longer. Like most of the rest of the country, service industries are prominent to dominant now, and services are not subject to the sales tax. How smart is that?
Every possible sales tax extension that has been blunted by special interests for years is now on the table. Suddenly the general interest has more leverage than the special interests like, say lawyers, accountants, and newspapers’ advertising departments. We might even find that the $2 a barrel beer tax could be jacked up to the $6 national average at least.
Another icon that might tumble in tough times is the privileged position that all kinds of non profits in the healthcare and housing sectors have on property taxes. There are some attractive revenue possibilities in having these organizations cough up even if only for such minimal essential services as fire and police protection.
Corporate income taxes are not very high in Wisconsin, but the list of important companies that have figured out how to dodge them altogether is long and imposing. Loophole closers will have to outsmart some pretty smart tax accountants. Not easy, but not impossible either.
It’s hard to think well of what is happening to us in tough times, but it would be criminal not to take advantage of desperate times to take the needed and productive desperate measures that probably should have been taken long ago.
post a letter about this blog »
It always irks me to see people who call themselves Democrats acting undemocratically. Abolishing elective offices? Why not just abolish elections? Less important offices like Treasurer and Secretary of State still have at least the function of giving voters a look at potential public servants---makes the field bigger rather than smaller for statewide races; lets lesser-known or underfunded people get a chance to increase recognition and voter contact . . . and the offices could be beefed up with functions now delegated to undemocratic entities like that board you have now administering elections and abetting the privatization of that critical process!
As for the sales tax . . . there's a dilemma. You can hardly invent a more regressive form of taxation, but it is more popular than the income tax---due, I suppose, to decades of right-wing propagandizing on the topic. Still it's regressive and ought to be the last resort for raising revenue.
You know what they did in the last Depression? They repealed alcohol prohibition so that the liquor business could be taxed. It helped a lot! Now I suggest you seriously start advocating the re-legalization of cannabis, because there's the sure source of revenue that could pull us through the upcoming depression. Sure, politicians are scared of it---they're scared of their own shadows, really. So throw that into the debate---at least put it out there. The idea will generate its own momentum.
-O. Steinberg | St. Paul, MN | November 24, 2008