Posts Tagged ‘States’

Here’s a quiz for readers.

When politicians increase taxes, the result is:

This is a trick question because the answer is (j), all of the above.

But let’s look at some of the evidence for (d), which deals with the fact that the geese with the golden eggs sometimes choose to fly away when they’re mistreated.

The Internal Revenue Service has a web page where you can look at how many taxpayers have left or entered a state, as well as where they went or where they came from.

And the recently updated results unsurprisingly show that taxpayers migrate from high-tax states to low-tax states.

Let’s look at some examples, beginning with Maryland. Here are some excerpts from a report in the Daily Caller.

Wealthy taxpayers and job-creating businesses fled Maryland at an accelerating rate as then-Gov. Martin O’Malley implemented a long list of tax hikes during his first five years in the state capital. More than 18,600 tax filers left Maryland with $4.2 billion in adjusted gross income from 2007 – O’Malley’s first year as governor — through 2012, according to a Daily Caller News Foundation analysis of the most recently available Internal Revenue Service state-level income and migration data. …Nearly 5,600 state-tax filers left Maryland in 2012 and took $1.6 billion with them, more than double the 2,300 who departed with $732 million in 2011. The fleeing 5,600 filers had average incomes of nearly $291,900. …Most of 2012’s departing residents moved to the more business-friendly Virginia, according to the data. …Florida was the third most common destination for Marylanders.

Here’s a chart looking at the income that moved into the state (green) compared to the much greater amount of income that left the state (red).

The story then makes a political observation.

O’Malley’s economic record may partially explain why his campaign for the 2016 Democratic presidential nomination has yet to gain traction among voters outside of Maryland.

Though I wonder whether this assertion is true. Given the popularity of Bernie Sanders, I can’t imagine many Democrat voters object to politicians who impose foolish tax policies.

Now let’s shift to California.

A column in the Sacramento Bee (h/t: Kevin Williamson) explores the same IRS data and doesn’t reach happy conclusions.

An unprecedented number of Californians left for other states during the last decade, according to new tax return data from the Internal Revenue Service. About 5 million Californians left between 2004 and 2013. Roughly 3.9 million people came here from other states during that period, for a net population loss of more than 1 million people. The trend resulted in a net loss of about $26 billion in annual income.

And where did they go?

Many of them went to zero-income tax states.

About 600,000 California residents left for Texas, which drew more Californians than any other state.

Here’s a map from the article and you can see other no-income tax states such as Nevada, Washington, Tennessee and Florida also enjoyed net migration from California.

Last but not least, let’s look at what happened with New York.

We’ll turn again to an article published by the Daily Caller.

More taxpaying residents left New York than any other state in the nation, IRS migration data from 2013 shows. During that year, around 115,000 New Yorkers left the state and packed up $5.65 billion in adjusted gross income (AGI) as well. …Although Democrat Governor Andrew Cuomo acknowledged that New York is the “highest tax state in the nation” and it has “cost us dearly,” he continues to put forth policies that economically cripple New York residents and businesses.

Once again, much of the shift went to state with no income taxes.

New York lost most of its population in 2013 to Florida — 20,465  residents ($1.35 billion loss), New Jersey — 16,223 residents ($1.1 billion loss), Texas — 10,784 residents ($354 million loss).

Though you have to wonder why anybody would move from New York to New Jersey. That’s like jumping out of the high-tax frying pan into the high-tax fire.

At this point, you may be wondering why the title of this column refers to lessons for Hillary when I’m writing about state tax policy.

The answer is that she wants to do for America what Jerry Brown is doing for California.

Check out these passages from a column in the Wall Street Journal by Alan Reynolds, my colleague at the Cato Institute.

Hillary Clinton’s most memorable economic proposal, debuted this summer, is her plan to impose a punishing 43.4% top tax rate on capital gains that are cashed in within a two-year holding period. The rate would drift down to 23.8%, but only for investors that sat on investments for six years. This is known as a “tapered” capital-gains tax, and it isn’t new. Mrs. Clinton is borrowing a page from Franklin D. Roosevelt, who trotted out this policy during the severe 1937-38 economic downturn, dubbed the Roosevelt Recession.

FDR had so many bad policies that it’s difficult to pinpoint the negative impact of any specific idea.

But there’s certainly some evidence that his malicious treatment of capital gains was spectacularly unsuccessful.

In the 12 months between February 1937 and 1938, the Dow Jones Industrial stock average fell 41%—to 111 from 188.4. That crash presaged one of the nation’s worst recessions, from May 1937 to June 1938, with GDP falling 10% and industrial production 32%. Unemployment swelled to 19% from 14%. Harvard economist Joseph Schumpeter, in his 1939 opus “Business Cycles,” noted that “the so-called capital gains tax has been held responsible for having accentuated, if not caused, the slump.” The steep tax on short-term gains, he argued, made it hard for small or new firms to issue stock. And the surtax on undistributed profits, Schumpeter wrote, “may well have had a paralyzing influence on enterprise and investment in general.” …A 2011 study from the Federal Reserve Bank of St. Louis reported…“The 1936 tax rate increases,” they concluded, “seem more likely culprits in causing the recession.” …A 2012 study in the Quarterly Journal of Economics attributes much of the 26% decline in business investment in the 1937-38 recession to higher taxes on capital.

So what’s Alan’s takeaway?

Hillary Clinton’s fix for an economy suffering under 2% growth is resuscitating a tax scheme with a history of ushering in recessions. The economy would be better off if the idea remained buried.

Maybe we should ask the same policy about her that we asked about FDR: Is she misguided or malicious?

P.S. Some folks may argue that Hillary has more leeway than governors to impose class-warfare tax policy because it’s harder to emigrate from America than it is to move across state borders.

That’s true.

The United States has odious exit taxes that restrict freedom of movement. And even though record numbers of Americans already have given up their passports, it’s still a tiny share of the population.

Likewise, not that many rich Americans have taken advantage of Puerto Rico’s status as a completely legal tax haven.

But while it’s true that it’s not easy for an American to escape the jurisdiction of the IRS, that doesn’t mean they’re helpless.

There are very simple steps that almost all rich people can take to dramatically lower their tax liabilities. So Hillary and the rest of the class-warfare crowd should think twice before repeating FDR’s horrible tax mistakes.

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There are eight current or former governors running for the Republican nomination in 2016. In alphabetical order, we have Jeb Bush, Chris Christie, Mike Huckabee, John Kasich, Bobby Jindal, George Pataki, Rick Perry, and Scott Walker.

So who’s the best of that bunch? That’s a subjective judgement, of course, but one valuable piece of information is to see what grades they earned from the Cato Institute’s Fiscal Policy Report Card on America’s Governors. This superb publication provides a comprehensive analysis of the overall fiscal policy record of each state executive. The latest version is here, and that will give you the scores of current governors, as well as the score of Rick Perry (who just left office).

For former governors, you can dig through the Cato website to find earlier versions of the Report Card. Or if you want to be lazy and don’t care about the nuances, this post by my colleague Nicole Kaeding is a nice summary.

For today, though, let’s focus solely on their spending records.

Here’s some of what Nicole wrote in a separate article on the fiscal record of the governors.

A governor who promises to cut federal spending is more believable if he held spending in check when he was governor. …Using data from the National Association of State Budget Officers, I wanted to see just how much each governor increased spending on an annual basis. …The graph below shows the average annual increase in spending during each candidate’s time as governor. Jeb Bush has the highest spending with a 6.08 percent average annual increase. John Kasich is second. He increased spending by 4.95 percent. Rick Perry finishes third with an average annual increase of 4.01 percent. Bobby Jindal shows the most fiscal restraint. He cut spending by 1.76 percent a year on average.

And here’s her chart.

But Nicole then explains that you don’t get a full picture when you simply look at spending increases.

…this comparison is somewhat biased because population grows at different rates in the states. …The graph below presents annual average spending growth on a per capita basis. The spending increases of Jeb Bush and Rick Perry now look much smaller. Jeb Bush’s increases are still above the average, but Rick Perry falls below it. …This further confirms Kasich’s lack of fiscal restraint. Bobby Jindal actually cut spending on a per capita basis by an average of 2.41 percent a year.

And here’s her second graph.

The bottom line is that Bush and Kasich don’t look very good, whereas Bobby Jindal is easily the most frugal.

But don’t make a decision just on this basis. We have some more data to investigate.

John Stossel and Maxim Lott analyze the same group of governors (other than Pataki) in a column for Fox News.

Every Republican presidential candidate has promised to keep government spending in check — but which ones actually have a track record of doing that? …The “Stossel” show crunched the numbers on that — adjusting them for inflation and population growth. …Bush cut spending the most. Though he’s criticized by conservatives as “too moderate,” the former Florida governor cut spending by an average of 1.39 percent each year he was in office.

On this basis, Bush goes from last place to first place!

Stossel and Lott then re-slice the numbers based on how frugal governors were compared to their counterparts in other states.

But the above chart isn’t perfect for comparing candidates, because governors serve terms in very different time periods. Some served during recessions, when most states must cut spending. We adjusted for that by doing another comparison — how much each governor spent compared with other governors in office at that same time… Bush was indeed the biggest budget cutter. During his tenure, Florida’s spending shrunk by 3.6 percentage points more than the average. He cut spending by 1.39 percent per year in his state, while other states increased theirs by 2.3 percent during that same period. Kasich was also conservative by this measure, cutting spending 1.76 percentage points more than other states did. But both charts show spending grew by the most under New Jersey Gov. Chris Christie and former Arkansas Gov. Huckabee.

This next chart show Bush and Kasich doing better than their political rivals.

So how can Bush and Kasich do better in one set of calculations but do the worst in another set of calculations?!?

Does adjusting for inflation really make that much difference? Or perhaps they used different measures of spending, with one including outlays financed by federal transfers?

Nicole walks through some of these methodological challenges in a post reviewing Kasich’s record (i.e., how much should he be blamed for expanding Medicaid/Obamacare in Ohio when all the initial cost is shifted to federal taxpayers?).

For what it’s worth, Jindal probably comes in first place if you average all the above numbers. And he also has tried to abolish Louisiana’s income tax, so that’s another point in his favor.

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There’s an old saying that states are the laboratories of democracy. But since I’m a policy wonk, I focus more on the lessons we can learn from the states about public policy.

Such as the importance of limiting the destructive nature of taxes.

Such as the economic benefits of not having an income tax.

Such as the horrible consequences of adopting an income tax.

Such as the negative effects of excessive compensation of bureaucrats.

Such as better job creation in states with less government.

But it’s always good to have more data and evidence.

So I was very interested to see that the Mercatus Center at George Mason University has a new report that ranks states based on their fiscal solvency.

Here are some of the details.

Budgetary balance is only one aspect of a state’s fiscal health, indicating that revenues are sufficient to cover a desired level of spending. But a balanced budget by itself does not mean the state is in a strong fiscal position. State spending may be large relative to the economy and thus be a drain on resources. …How can states establish healthier fiscal foundations? And how can states guard against economic shocks or identify long-term fiscal risks? Before taking policy or budgetary action, it is important to identify where states may have fiscal weaknesses. One approach to help states evaluate their ongoing fiscal performance is to use basic financial indicators that measure short- and long-run fiscal position.

Here are some of the findings.

The five dimensions (or indexes) of solvency in this study—cash, budget, long-run, service-level, and trust fund—are…combined into one overall ranking of state fiscal condition. …States with large long-term debts, large unfunded pension liabilities, and structural budgetary imbalances continue to hover near the bottom of the rankings. These states are Illinois, New Jersey, Massachusetts, Connecticut, and New York. Just as they did last year, states that depend on natural resources for revenues and that have low levels of debt and spending place at the top of the rankings. The top five states are Alaska, North Dakota, South Dakota, Nebraska, and Florida.

And here’s a map so you can see the rankings of each state. Dark green is good and yellow is bad.

I’m shocked and amazed to see California, Illinois, and New York near the bottom of the list.

Here’s the same information, but in a table so you can see the specific scores for each state.

So what should we learn from these rankings?

According to an editorial from Investor’s Business Daily, there are some very obvious lessons.

What do the most fiscally sound states have in common? Good weather? Oil? Blind luck? Or is it conservative policies such as keeping taxes low, regulations reasonable and spending under control? …There’s only one factor these fiscal winners and losers share in common. And that’s their political leanings. …if you look at the 25 best-performing states, only three could be considered reliably liberal. …There’s only one factor these fiscal winners and losers share in common. And that’s their political leanings. Of the top 10 states in the Mercatus ranking, just two — Florida and Ohio — voted for the Democratic presidential candidate in the past four elections, and just one — Montana — has a Democratic governor. Even if you look at the 25 best-performing states, only three could be considered reliably liberal.

Now let’s shift from policy lessons to political implications. There are several governors and former governors running for President.

Based on the Mercatus ranking, can we draw any conclusions about whether these candidates are in favor of taxpayers? Or do they support big government instead?

We’ll start with the current governors.

Kasich – Ohio ranks surprisingly high on the list, particularly given the Ohio governor’s expansion of Obamacare in the state. Maybe the state’s #7 ranking is due to fiscal restraint by his predecessors.

Christie – New Jersey ranks low on the list, and this isn’t a surprise. The relevant question is whether Christie can argue, based on some of the fights he’s had, that the state legislature is an insurmountable impediment to pro-growth reforms.

Jindal – The governor of Louisiana has proposed some big reforms, but the state’s #35 ranking doesn’t give him any bragging rights on fiscal policy (though the state is leading the way on education reform).

Walker – Thanks to his high-profile fight with unionized bureaucrats, Walker has a very strong reputation. But his state doesn’t rank very high, and he can’t blame the legislature because it’s GOP-controlled as well. But perhaps the low ranking is a legacy of the state’s historically left-wing orientation.

What about former governors?

Well, there’s probably not much we can say because we don’t have long-run data. There was a similar Mercatus study last year, but that obviously doesn’t help with the analysis of governors that left office years ago.

Nonetheless, here are a few observations.

Bush – I’m very suspicious of politicians who express an openness to tax hikes, and Bush is in that group. But he did govern Florida for a couple of terms and never flirted with imposing an income tax. And former governors, particularly from recent history, presumably can take some credit for Florida’s relatively high ranking.

Pataki – Since New York is one of the worst states, Pataki has guilt by implication. But he did lower a few taxes during his tenure, and you also have the same issue that exists with Christie, which is whether a governor should be blamed when the state legislature is hostile to good policy.

Perry – It’s hard to argue with the success Texas has enjoyed in recent years, and Perry (like Bush) never even hinted at the imposition of a state income tax. Though the #19 ranking shows that there are issues that should have been addressed during Perry’s several terms in office.

Huckabee – There aren’t many conclusions to draw about Arkansas and Huckabee. He’s been out of office for a while and the state is in the middle of the pack.

The bottom line is that the Mercatus study is very helpful in identifying well-governed (and not-so-well-governed) states, but the newness of the project means we can’t make any sweeping statements about governors because of limited data.

Fortunately, the Cato Institute for years has been publishing a Report Card that grades governors based on fiscal policy. So fans (or opponents) of different candidates can peruse past issues to see the degree to which governors pushed policy in the right or wrong direction.

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Since I’m a bit old-fashioned, I think polygamy is rather weird.

And it would also be a practical nightmare. Thinking about it from a guy’s perspective, imagine having to remember multiple birthdays and anniversaries?

Not to mention dealing with a more complicated approval process if you want to get permission to join another softball league or take an out-of-town trip!

To be fair, polygamy could also mean one wife and multiple husbands, but what woman would want to subject herself to that burden?!?

She wouldn’t even know who to blame if she found the toilet seat in the up position.

But let’s look at the issue from a more serious perspective, especially because of the Supreme Court’s recent decision on gay marriage.

In a column for Politico, Fredrik deBoer argues that polygamists should also be allowed to marry.

Welcome to the exciting new world of the slippery slope. Following on the rejection of interracial marriage bans in the 20th Century, the Supreme Court decision clearly shows that marriage should be a broadly applicable right… Where does the next advance come? The answer is going to make nearly everyone uncomfortable: Now that we’ve defined that love and devotion and family isn’t driven by gender alone, why should it be limited to just two individuals? The most natural advance next for marriage lies in legalized polygamy.

Yes, he’s serious.

…the moral reasoning behind society’s rejection of polygamy remains just as uncomfortable and legally weak as same-sex marriage opposition was until recently. …If my liberal friends recognize the legitimacy of free people who choose to form romantic partnerships with multiple partners, how can they deny them the right to the legal protections marriage affords? Polyamory is a fact. People are living in group relationships today. The question is not whether they will continue on in those relationships. The question is whether we will grant to them the same basic recognition we grant to other adults: that love makes marriage, and that the right to marry is exactly that, a right. …the notion that procreation and child-rearing are the natural justification for marriage has been dealt a terminal injury.

He makes a very good point that polygamous relationships exist, regardless of whether they’re legally recognized.

But should they get some form of legal recognition? Mr. deBoer says yes, and asserts that polygamists should be allowed to marry, while being careful to argue that the slippery slope should be limited.

…mutually-informed consent explains exactly why we must permit polygamy and must oppose bestiality and child marriage. Animals are incapable of voicing consent; children are incapable of understanding what it means to consent. In contrast, consenting adults who all knowingly and willfully decide to enter into a joint marriage contract, free of coercion, should be permitted to do so, according to basic principles of personal liberty.

And here’s his bottom line.

…many progressives would recognize, when pushed in this way, that the case against polygamy is incredibly flimsy, almost entirely lacking in rational basis and animated by purely irrational fears and prejudice. …The course then, is clear: to look beyond political convenience and conservative intransigence, and begin to make the case for extending legal marriage rights to more loving and committed adults. It’s time.

But maybe “it’s time” for a different approach, and not merely because the marriage penalty might be enormous in a polygamous marriage.

Before looking at an alternative to government-sanctioned marriage for polygamists, let’s ask ourselves a weighty philosophical question. Is it possible for good things to happen for the wrong reason?

Consider what’s happening in Alabama, where the state senate has voted to abolish government-granted marriage licenses.

In Alabama, resistance to same-sex marriage continues.  …we have legislation making its way through the house right now that could get rid of the entire institution of marriage as we know it in Alabama. Right now, if you want to get married you go to the courthouse and the probate judge gives you a marriage license. Attorney Jake Watson explains, “[SB377] does away with that and requires parties to enter into a contract and file it at the courthouse, as I understand it.” …The bill passed the Senate by a vote of 22-3. It’s now in the House.

The politicians presumably took this step because they don’t want gay marriage rather than because of libertarian principles.

But isn’t this the ideal outcome, even if the motivating force is hostility to gay couples? After all, why should the government have any role in sanctioning a marriage? In think that’s the right question whether we’re talking traditional marriage, gay marriage, or polygamous marriage.

Wouldn’t it be interesting if Alabama showed up the path forward, albeit unintentionally?

Sort of reminds me of how the Democratic Party in Virginia had a campaign of “massive resistance” to school integration during the civil rights era. Motivated by racism, the state government even flirted with a voucher system.

That’s odious, but imagine if vouchers had been put in place 50-60 years ago for a bad reason and had developed today into a model for better schools at lower cost? One that was especially advantageous to minority students! The old-time segregationists would be rolling in their graves.

Returning to the marriage issue, it’s also worth noting that there are additional benefits to getting government out of the marriage business. Churches would not face any pressure to alter their beliefs. Baptists could stick to traditional marriage, Unitarians could allow gay marriage, and Mormons (if they wanted to be retro) could allow polygamy.

Heck, maybe we could even allow statists to somehow marry government. Elizabeth Warren and the IRS would make a great couple!

And once we solve all those issues, all that remains is convincing people that they should find bakers and photographers without using coercion.

P.S. If the government was out of the business of marriage, that would eliminate an excuse for wasteful and ineffective pro-marriage spending by governments.

P.P.S. For those who appreciate humor, there are good gay marriage one-liners among the rest of the jokes you can peruse here, here, and here.

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If you’re a libertarian or a small-government conservative, it’s quite likely you believe both these statements.

  1. Instead of picking winners and losers with special preferences and penalties, the tax code should be simple and fair, treating all economic activity similarly.
  2. Anything that reduces revenue to government is a good thing, and it’s especially good if the net result is to improve public safety by expanding gun ownership.

But what happens if these two statements are in conflict?

This isn’t a hypothetical question. As reported by Politico, there’s legislation in Louisiana to have a special three-day “tax holiday” on purchases of selected products, including guns and ammo.

Louisiana’s state legislature decided Tuesday to eliminate a tax holiday for hurricane equipment and school supplies, but keep one for guns and other hunting tools. In a 7-2 vote, the Louisiana Senate’s Committee on Revenue and Fiscal Affairs decided that for a three-day weekend at the beginning of September the state would eliminate its sales tax on firearms, ammunition, knives and ATVs. …Ultimately, three Democrats voted with four of their Republican colleagues to keep the tax holiday for hunting while eliminating the other two.

Is this a good idea?

I’m conflicted. As a fan of the flat tax, I obviously don’t want government to micro-manage the economy with back-door industrial policy in the tax code. And I’ve also written that tax holidays are a less-than-ideal way of reducing taxes. So this suggests that I’m against the Louisiana proposal.

But on the other hand, I’m an advocate of “starve the beast,” which means I support policies that will shrink the amount of revenue controlled by politicians. And I also strongly support the Second Amendment and want safer communities, so I like the idea of expanded gun ownership.

So how would I have vote if (Heaven forbid!) I was a Louisiana legislator?

I guess I would vote yes. Based on the limited information in the article, the proposal is a pure tax cut. So while I don’t like loopholes, I’ve also stated that I only want to eliminate such preferences if all the revenue was used to lower tax rates.

So the bottom line is that I would oppose the policy if the holiday was financed by an increase in the overall sales tax rate (similarly, I would support getting rid of the holiday as part of a proposal to lower the overall sales tax rate). But since such tradeoffs don’t apply, I would grudgingly offer my support (especially since I know the plan would offend anti-gun statists such as Michael Bloomberg).

P.S. We’ll add this post to my collection of libertarian quandaries.

P.P.S. Since we have a gun-related topic, I can’t resist sharing this example of pro-Second Amendment propaganda.

By the way, if you disagree with the message in this image, please take this IQ test for criminals and liberals and reconsider your views.

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Every so often, I get asked why I’m so rigidly opposed to tax hikes in general and so vociferously against the imposition of new taxes in particular.

In part, my hostility is an ideological reflex When pressed, though, I’ll confess that there are situations – in theory – where more taxes might be acceptable.

But there’s a giant gap between theory and reality. In the real world, I can’t think of a single instance in which higher taxes led to a fiscally responsible outcome.

That’s true on the national level. And it’s also true at the state level.

Speaking of which, the Wall Street Journal is – to put it mildly – not very happy at the tax-aholic behavior of Connecticut politicians. Here’s some of what was in a recent editorial.

The Census Bureau says Connecticut was one of six states that lost population in fiscal 2013-2014, and a Gallup poll in the second half of 2013 found that about half of Nutmeg Staters would migrate if they could. Now the Democrats who run the state want to drive the other half out too. That’s the best way to explain the frenzy by Governor Dannel Malloy and the legislature to raise taxes again… Mr. Malloy promised last year during his re-election campaign that he wouldn’t raise taxes, but that’s what he also said in 2010. In 2011 he signed a $2.6 billion tax hike promising that it would eliminate a budget deficit. Having won re-election he’s now back seeking another $650 million in tax hikes. But that’s not enough for the legislature, which has floated $1.5 billion in tax increases. Add a state-wide municipal sales tax that some lawmakers want, and the total could hit $2.1 billion over two years.

In other words, higher taxes in recent years have been used to fund more spending.

And now the politicians are hoping to play the same trick another time.

Apparently they don’t care that they’ve turned the Nutmeg State into a New England version of Illinois.

…the state grew a scant 0.9% in 2013, the last year state data are available. That was tied for tenth worst in the U.S. The state’s average compounded annual growth for the last four years is 0.42%. Slow growth means less tax revenue but spending never slows down. Some “40% of the state budget goes to government employee compensation and benefits, including payroll, state pensions, teacher pensions and current and retiree health care,” says Carol Platt Liebau, president of the Hartford-based Yankee Institute. …The Tax Foundation ranks Connecticut as one of the 10 worst states to do business. The state finished last in Gallup’s Job Creation Index in 2014 and now ties with Rhode Island for the worst job creation in the index since 2008.

What’s particularly discouraging is that Connecticut didn’t even have an income tax twenty-five years ago. But once the politicians got a new source of revenue, it’s been one tax hike after another.

Not too many years ago Connecticut was a tax refuge for New York City workers, but since it imposed an income tax in 1991 the rate has kept climbing, as it always does.

There are a couple of lessons from the disaster in Connecticut.

First and foremost, never give politicians a new source of revenue, which has very important implications for the debate in Washington, DC, about a value-added tax.

Unless, of course, you want to enable a bigger burden of government.

And for the states that don’t already have an income tax, the lesson is very clear. Under no circumstances should you allow your politicians to follow Connecticut on the path to fiscal perfidy.

Yet that’s exactly what may be happening in America’s northwest corner. As reported by the Seattle Times, there’s a plan percolating to create an income tax in the state of Washington. It’s being sold as a revenue swap.

State Treasurer Jim McIntire has a “grand bargain” in mind on tax reform and he wants to bend your ear. …the McIntire plan would institute a 5 percent personal-income tax with some exemptions, eliminate the state property tax and reduce business taxes. The plan would raise billions of dollars… The proposal also would lower the state sales tax to 5.5 percent from 6.5 percent.

But taxpayers should be very suspicious, particularly since politicians are talking about the need for more “investment,” which is a common rhetorical trick used by politicians who want to squander more money.

“It is mathematically impossible for us to sustain an adequate investment in education on a shrinking tax base,” he said.

And when you read the fine print, it turns out that the politicians (and the interest groups in the government bureaucracy) want a lot more additional money from taxpayers.

…the plan would raise $7 billion in state revenue but would lower local levies by $3 billion, for an overall increase of about $4 billion.

Advocates of the new tax would prefer to avoid any discussion of big-picture principles.

“We need to have less of an ideological conversation about this,” he said in a news conference.

And their desire to avoid a philosophical discussion is understandable. After all, the big spenders didn’t fare so well the last time voters had a chance to vote on whether the state should impose an income tax.

Voters may not welcome McIntire’s argument, either. In 2010, a proposed income tax on high earners failed by a nearly 30-point margin.

The voters in Washington were very wise back in 2010, so let’s hope they haven’t lost their skepticism about the revenue plans of politicians over the past few years.

There’s every reason to suspect, after all, that the adoption of an income tax would be just as disastrous for the Evergreen State as it was for the Nutmeg State.

To close, I want to share some great advice that was presented by the always sound Professor Richard Vedder. I was at a conference a few years ago where he was also one of the speakers. Asked to comment on whether the Lone Star State should have an income tax, he threw his hands in the air and cried out with passion that, “Texas should give the Alamo to Osama bin Laden before allowing an income tax.”

So if I’m ever asked to speak in Seattle on fiscal policy, I’m going to steal Richard’s approach and and warn that “The state of Washington should give the Space Needle to North Korea before allowing an income tax.”

I doubt I’ll capture Professor Vedder’s rhetorical flair, but there won’t be any doubt that I’ll be 100-percent serious about the dangers of a state income tax.

And what about my home state of Connecticut?

Well, I don’t know of any big landmarks that they could have traded to avoid an income tax. About the only “good” thing to say is that New York’s tax system is probably even worse.

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Two years ago, I shared a map looking at how heavily wine was taxed in different states.

What is showed was that you shouldn’t sip your Chardonnay or guzzle your Merlot in Kentucky. Unless, of course, you wanted to give politicians a lot more money to spend (or you slip across the border like Michael J. Rodrigues when buying booze).

Now the good people at the Tax Foundation have a related map. It shows which states have the highest and lowest taxes on beer.

Kentucky is still a high-tax state, but the “winner” of the beer tax contest is Tennessee.

At the risk of drawing too many conclusions, it does appear that southeastern states generally have high taxes on booze. Along with Alaska.

Maybe that’s a “Bible Belt” phenomenon. Though I’m somewhat forgiving of Tennessee for high excise taxes since the Volunteer State at least avoids the huge mistake of imposing an income tax on the wages and salaries of residents. No wonder it’s been growing faster than neighboring states.

Returning to the main topic, the Tax Foundation explains, taxes amount to a big share of the final price.

The Beer Institute points out that “taxes are the single most expensive ingredient in beer, costing more than labor and raw materials combined.” They cite an economic analysis that found “if all the taxes levied on the production, distribution, and retailing of beer are added up, they amount to more than 40% of the retail price.”

P.S. Since we’re looking at states, I can’t resist sharing bad news from one state and good news from another state.

We’ll start with some grim news from Minnesota. I’ve already commented on the insanity of using the State Department’s refugee program to subsidize terrorists.

Well, the Daily Caller reports that terrorists also have learned to bilk other programs to finance that hate of the modern world.

Two Somali-American men living in Minnesota are facing fraud charges — in addition to terrorism charges — after they allegedly used federal student loan money to purchase airline tickets to get them to Syria in order to join ISIS. …

This doesn’t quite entitle them to join the Moocher Hall of Fame, but it should outrage taxpayers anyhow.

Our good news come  from California.

J.D. Tuccille of Reason speculates that gun control has basically become impossible in the Golden State because there are simply too many guns.

California is a state where officials pride themselves on tightening the screws on gun owners. …But it’s a losing battle. Even in a political environment where villainizing guns and gun owners is a winning tactic, the ranks of the same are beyond officials’ grasp, and growing. Last year, almost one million firearms were sold in the state…it’s a good bet that California’s gun owners, and their guns, are here to stay.

Here’s a chart he including showing gun sales.

And J.D. reminds us that these are just the legal sales. As illustrated by the amusing t-shirt at the bottom of this post, there are doubtlessly lots of undocumented weapons in the state.

The bottom line is that future gun control efforts in California will probably run into the same problems that have thwarted the schemes of despicable politicians in Connecticut. Three cheers for the Americans who disobey bad law!

And since it’s Memorial Day weekend, it’s a good time to be thankful the all the folks in the military who fought to preserve our freedoms. Including the freedom to engage in civil disobedience when politicians try to trample our rights.

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