It Makes No Sense to Take Back Taxes From Stimulus Checks

Posted on by David Stokes

There have been a few articles recently about state and local governments intercepting federal stimulus payments in order to take out taxes owed. Missourinet has one of those stories about our own state. I hate to sound like a defender of tax scofflaws, but it makes no sense to intercept the money. If the point of the stimulus plan was to stimulate our economy (we’ll leave aside for now what a stupid idea it is) then how does it do any good to have that money go from one government to another? There is no stimulus effect or consumer spending in that transfer (assuming those things exist in the first place).

The stimulus plan is deficit spending, nothing more. If the feds send $600 to a Missourian, and the state takes half of it, federal taxpayers (all of us) are still out the $600 the feds sent, but now there is $300 less to be used to stimulate the economy. So, basically, it’s a shell game in which the feds increase deficit spending while the states add it to their collections. It might make more sense for the federal government to withhold their own back taxes, but in this case you would be essentially giving a gift to a tax scofflaw without any stimulus effect at all.

I want to be clear that taking out money for back child support — which makes up a lot of what Missouri is doing — is a different matter, and should clearly be continued. Money collected in this way will be transferred to other people, not just to the government, and those people will be able to spend the money in ways that might stimulate the economy. (Again, this whole post is based on an assumption that the feds should “stimulate” the economy, which I don’t necessarily agree with.) Although just taking out back taxes alone from the stimulus money might make a state’s bottom line look better, it misses the supposed point of the entire program in the first place.

Remarriage?

Posted on by Cynthia Juedemann

Partisanship has long been divorced from most school elections in the United States.

In fact, all school board elections in Missouri are nonpartisan, according to Kelli Hopkins, a director of education policy for the Missouri School Boards Association. Board candidates don’t run as Republicans or Democrats.

Theoretical papers argue that nonpartisan school board members are beholden to all citizens, not just those of a particular party, and that without partisanship there’s a wide variety of candidate choice — not just Republicans and Democrats.

To even further divorce all school elections from partisanship, districts rarely hold elections in November. Many elections run in February, April, June, or August, but most often in April — a month least linked with partisan elections.

“The separation of school board elections from general elections was a deliberate attempt by Progressive-era reformers to reduce partisan influence in the school election process,” write Ann Allen and David Plank in a 2005 paper for the Politics of Education Association.

Still, there is controversy surrounding both the timing of school elections and school board candidate partisanship. Some have argued that partisan school board elections would bring up lagging turnout. Others, that holding school elections in November would do the same. The question is, is it worth it?

These arguments have some serious implications for school district governance. But would partisanship or November school elections do what advocates say? Would turnout increase dramatically?

Continue reading “Remarriage?”

Pharmacists in the Post-Dispatch …

Posted on by David Stokes

… is the perfect excuse for me to link the Post‘s article with my case study about pharmacy privatization from last year. The Post-Dispatch article primarily details how neighborhood pharmacies are struggling in competition against corporate pharmacies, despite the increasing demand for prescription drugs from our aging population.

One thing that could help is for more governments to do what St. Louis County did in 2003 and privatize the pharmacy portions of the local public health care system. All of the local pharmacies in St. Louis County are able to participate in the public health system because LDI, a pharmacy benefits company, has the county contract (won through competitive bidding), and neighborhood pharmacies all accept the LDI card. If more local governments did this, it would save taxpayers money, improve options for citizens using the public health case system, and benefit local businesses. There is absolutely no downside to this, as my case study demonstrated. (The only potential downside could be government pharmacists losing their jobs, but because the article emphasizes the incredible demand for pharmacists, I don’t need to point out they wouldn’t be out of work for long.)

Honesty

Posted on by Audrey Spalding

It is legal for government employees fulfilling Sunshine Law requests to reasonably charge for research time, copying costs, and postage. When Cynthia and I file requests, we state the maximum a clerk or school district can charge without letting us know before beginning the work.

If they reasonably charge below our maximum and provide the information, we have to pay.

At first, we began with a $100 maximum. But when Cynthia hit $717.38 in total charges, with more than 25 county clerks left to contact, we panicked. She had a $1,000 budget, and the Show-Me Institute is a non-profit organization. I didn’t have an explicit budget, because school districts big and small rarely charge to fill Sunshine Law requests — but I wasn’t eager to run up a large bill either.

So we lowered the maximum. Her new maximum was $50, stated as: “If you determine not to waive these fees, please notify me of any cost that exceeds $50 before fulfilling this request.”

I lowered my maximum to $30. All other wording in our requests stayed the same.

Yesterday afternoon, it dawned on me that we had accidentally tested the integrity of county clerks and superintendents. If they were less than honest, they would charge just below the maximum we stated, to collect the most cash without scrutiny.

Continue reading “Honesty”

Helping Immigrants by Hurting Immigrants

Posted on by Matt Simpson

Yesterday, the governor signed a new immigration bill that, among other things, stiffened penalties for employers who knowingly hire illegal immigrants. Reporting on the bill, the Joplin Globe notes:

We realize there are workers willing to do work and businesses who need those workers. Those workers stimulate our economy by buying goods and services from local sellers.

But there is no reason for that work, and the economic side effects, to occur outside the law.

Agreed. Forcing immigrants to operate outside of the law has several undesirable consequences. First, and foremost, in my opinion, it hurts the illegal immigrants, who tend to be extremely poor people looking for a better life. By being forced to operate outside of the law, illegal immigrants can’t expect the same degree of police protection and contract enforcement as legal citizens. As a result, they are more likely to be subject to violence.

Second, it increases the likelihood that an immigrant will commit a crime in two ways. Immigrants who would rather obey the law are less likely to immigrate if it means they have to break the law, while law breakers see immigration as potentially more attractive. So, their illegal status changes the composition of immigrants to include more law breakers. Also, once immigrants arrive in the United States, they are more likely to break other laws, because they are already here illegally. Violence may even be used as a contract enforcement mechanism, because recourse to the courts is out of the question.

Finally, the illegal status for most immigrants decreases the overall amount of immigration, because preventative measures increase the costs of migration. This means the U.S. will have less of the most valuable resource on the planet: the human mind. Not only does an increase in population through immigration help our economy for the reasons the Globe lists, but more minds leads to a better chance for technological innovation.

So, it seems natural to conclude that the governor made a mistake, and should instead petition federal legislators for an easing of immigration restrictions. Instead, the Globe concludes:

[The bill is] a big improvement over current state law, which simply takes away tax credits and abatements as a penalty. Combine those with federal punishments, and employers now have severe consequences to fear.

Wait … what? The Globe seemed to agree that immigration benefits the U.S. economy, which includes Missouri. And an increase in legal immigration would entail more open borders. Here is the author’s rationale:

People who work in the United States should be paid a fair wage and granted certain workplace rights. Employers should not be able to take advantage of a worker’s legal status by paying substandard wages and offering no benefits.

Apparently, the author has never been to Mexico. There is a reason so many Mexicans migrate here illegally in order to work for employers “paying substandard wages and offering no benefits.” In Mexico, the wages are even lower and the benefits are worse. Simply by moving here, they improve their lot. If the issue is a concern for the welfare of the illegal immigrants, letting them come here illegally is much better than not letting them come at all.

Taking the Bad With the Good: A Recap

Posted on by Cynthia Juedemann

It’s been a mixed bag.

Some county clerks have been efficient and forthcoming, while some have been obstructionist or even incompetent. But I have been able to collect 97 sets of school district voting records from Missouri’s 114 counties (plus the city of St. Louis) using Missouri’s Sunshine Law. And I’m not done yet.

I will continue to try to collect the remaining counties’ records, but in the meantime, I wanted to give Missourians a recap of my dealings with their public officials.

Continue reading “Taking the Bad With the Good: A Recap”

Public-Private Partnerships, Please

Posted on by Patrick Eckelkamp

KY3 News has a story (link via Combest) discussing MoDOT’s expected budget shortfall, because of the rapid increase in gas prices. The piece includes some commentary from Missouri’s three gubernatorial candidates, all three of whom agree that raising the gas tax is off the table and that other solutions must be found. While the articles does not explicitly state the candidates’ ideas, it does mention one solution offered by Rep. Kenny Hulshof:

Hulshof called the public private partnership idea (also known as some type of toll road) intriguing. “Imagine a parallel truck lane along Interstate 44 with just truck traffic that’s built with private funds,” Hulshof asked attendees during his hour session with the Chamber.

Here at the Show-Me Institute, we couldn’t be happier. David Stokes, an expert of sorts on public-private partnerships, has been advocating this type of solution for a long time, and recently gave a presentation in Mexico, Mo., discussing alternative ways to fund and fix the state’s roads. His policy study highlights the benefits of this type of partnership, and outlines the ways in which it can alleviate MoDOT’s budget problems. Although Hulshof stopped short of advocating public-private partnerships, it is good to hear that the idea is at least garnering some discussion.

A Farewell to Farms

Posted on by Matt Simpson

Missourinet reports that the federal farm bill has increased the maximum loan under the Beginning Farmer Loan Program from $250,000 to $450,000. The rationale for this? According to Tony Stafford, director of the Agriculture Business Development Division within the State Department of Agriculture:

[…] too many young people are leaving the farm. He hopes the enhancement of the program will lure more Missourians to return to farming.

Au contraire; it is more likely that not enough young people are leaving the farm. There is nothing intrinsically important about farms. Farms are valuable because they do one thing: produce food. If we can produce more food with fewer farmers, great! Then people — the most important resource we have — are freed to work on something else of value.

Throughout the 20th century, U.S. farm output has increased despite the fact that fewer people have chosen to be farmers. According to the Federal Reserve Bank of Dallas:

Since 1948, agricultural production has doubled, while total input use, including labor, land and machinery, declined slightly. […] Between 1948 and 1996, agricultural labor productivity increased more than eightfold. The number of people fed by one farmer has jumped from 15 in 1950 to 128 in 1995, including 34 outside the United States.

Because production doubled and productivity increased by a factor of eight, fewer people are working in agriculture despite this doubling of production.

In A.D. 1000, almost everyone was a farmer. Now, almost no one farms in industrialized nations. A quick comparison of living conditions seems to favor present times. You might object that the driving factor here is technology, not the amount of farmers we have. But you would be missing my point: The fewer people we have farming, the more people we have working on other things, like technological advances.

Farm subsidies such as the Beginning Farmer Loan Program only serve to slow down the tremendous gains in prosperity we have been achieving during the past couple of centuries. And for what? According to Stafford, to get a few Missourians back on the farm. Why, exactly, do we want them on the farm again?

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