Monday, January 11, 2010

If Perry lacks trust in Texas voters, the feeling is mutual


Perry lacks trust in Texas voters


Houston Chronicle
Copyright 2009

Gov. Rick Perry must be worried that the citizens of Texas are going to lose their minds and turn state government over to the Democrats.

This week on the campaign stump, he proposed two state constitutional amendments based on the notion that we can't afford democracy.

One is that any state tax increase would require a two-thirds vote of the Legislature.

Functionally this is already the case in the Senate, where everything but voter ID bills needs a two-thirds majority, but apparently Perry is concerned because Texas two years ago elected an uncomfortable number of Democrats and tossed autocratic Speaker Tom Craddick in favor of a speaker who will actually work with said Democrats.

Maybe Perry has become a great admirer of California, where a two-thirds requirement for passing a budget led to the state paying its bills with IOUs while the Legislature bickered and showboated.

Perry's second proposed amendment also has its spiritual roots in California. It's a revenue cap that would require the Leigislature to limit budget growth to a combination of inflation and population growth.

Personally, I don't share Perry's worries about the people of Texas. I don't think we are in much danger of turning into Massachusetts or Connecticut or any of those other socialist states.

I trust democracy. If some politicians can persuade Texans that we should re-elect them after they increase our taxes, I figure they must have a pretty good argument.

Our state sales tax, by far the state's largest revenue source, hasn't increased since 1990, when Gov. Bill Clements reluctantly agreed to a quarter-cent hike for school funding under pressure from the Texas Supreme Court.

In other major areas, we've had effective cuts.

In 2006, for example, Perry and the Legislature instituted a new tax on businesses with the notion that this would provide enough money to cut local school property taxes by a third.

‘Rainy Day Fund' takes hit

Experts said the new tax wouldn't provide enough money to make up for the property tax cuts forced on the school districts, but Perry argued that the tax cuts would increase business activity so much that everybody would come out ahead.

The experts were right. The new business tax was several billion dollars short of making up the difference.

The 2007 Legislature covered the gap with a budget surplus based from inflated property values (meaning the state had to pay districts less under the old formula) and on high oil and gas revenues, explained Houston Rep. Scott Hochberg, the Legislature's resident school finance expert.

The 2009 Legislature largely made up the difference with billions of federal stimulus dollars.

Next year the state's “Rainy Day Fund” can expect to take a hit. And after that?

Gas tax same since '91

Then there's the gasoline tax, a major source for road construction and maintenance. It's been at 20 cents per gallon since 1991. That's about 12.5 cents in today's dollars, about a 38 percent cut.

No wonder our cities have become so congested, and the governor responded with a plan based on privatized toll roads.

Tax caps can be expensive. Ask students in Texas colleges and universities, where skyrocketing tuitions and fees are making up for limited state funds.

Under-18 population

Dick Lavine, a pre-eminent tax analyst for the Center for Public Policy Priorities, notes that limiting budget increases to inflation plus population growth doesn't reflect the Texas reality of a large population under 18 — a stage when humans cost considerably more than they earn.

Yet if we don't provide them a good education, high school and beyond, we don't need an expert to tell us that our economy will not generate enough income to meet our budget needs with low taxes.

Employers love low taxes, but they need skilled workers. That's not an easy balance, but I'd rather trust it to democracy than to a simplistic mathematical formula.

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