As a recent op-ed in the Wall Street Journal reports, high-tax states continue to bleed residents and income. Between 2022 and 2023, California lost a net $11.9 billion in adjusted gross income (AGI), New York $9.9 billion, and Illinois $6 billion. Higher earners with income over $200,000 drove much of this exodus. In Massachusetts, they accounted for 70% of outflows, doubling the 2019 share.

Meanwhile, no-income-tax states saw the largest gains. Florida added $20.6 billion in AGI, Texas $5.5 billion, and Tennessee $2.8 billion. Even non-income tax states with more frigid climes saw significant inflows, including Wyoming and South Dakota. In short, states without income taxes dominated the top destinations for both people and wealth.

Missouri, with its current 4.7% top individual income tax rate, sits in the middle of the pack. While we are not a major loser like California or New York, we are far from the magnet status of Florida or Tennessee. Drawing upon IRS migration data, past Show-Me Institute reports have shown that Missouri has consistently lost more people and more income than it gained. This has been particularly the case among working-age and higher-earning households seeking better economic climates.

These national migration patterns emerge at a pivotal moment for Missouri. State lawmakers recently approved HJRs 173 and 174, a proposed constitutional amendment backed by Governor Mike Kehoe that would ask voters to authorize the gradual phaseout of the state’s individual income tax. If approved, the general assembly would begin reducing the tax as revenues grow and would have the authority to speed up the process while modernizing Missouri’s outdated sales tax code.

Eliminating the income tax would align Missouri with proven winners in the migration data, making our state far more attractive to high earners, businesses, and young professionals—key drivers of growth. Moreover, we sit right next door to Illinois, which, while losing top earners at a breakneck pace, is also ranked the least friendly state for middle-class earners according to one report.

The pattern is clear. People and capital continue to flow to states with lower tax burdens and pro-growth policies. Missouri has the chance to join those states. By modernizing our tax code now, we can shut off the outflow of the past and build a more prosperous future.

The post Missouri’s Opportunity to Attract Talent: Latest IRS Data on “Voting with Their Feet” appeared first on Show-Me Institute.

The twelve states with occupational licensing reciprocity are Arizona, Colorado, Florida, Idaho, Oklahoma, Missouri, Montana, New Jersey, Pennsylvania, South Dakota, Utah, and Wyoming. Notably, only one of Missouri’s border states and very few midwestern states have adopted this policy.

Being on the forefront of this movement gives Missouri a competitive advantage. We’ve significantly decreased the red tape that burdens workers when they relocate. Many licensed workers can move to Missouri and continue working much more easily than if they moved to Kansas or Illinois, for example. It’s the legislative equivalent of a giant arrow above Missouri telling workers to move here.

Though there is still more work to be done, occupational licensing reciprocity was a step in the right direction. It’s icing on the cake that Missouri was one of the first states to adopt this legislation, giving us a huge advantage over surrounding states.

The post Hey Licensed Professionals: It’s Time to Move to Missouri appeared first on Show-Me Institute.

In the June 2018 South Dakota vs Wayfair decision, the U.S. Supreme Court overturned what was essentially a “physical presence” rule for requiring a seller to collect a sales  tax in the United States. That means states can now impose a sales tax collection responsibility on internet retailers even if they don’t have property or employees in the state.

Some assume large companies will be most affected by this change, but many big companies have a physical presence in the states they do business, so they already collect and remit sales taxes. For example, Amazon has a warehouse in Missouri and collects taxes on its sales in the state accordingly. This means that those likely to be most affected by a new collection responsibility are smaller Internet retailers based outside of Missouri.

In the Wayfair majority opinion, Justice Kennedy claimed the physical presence rule “has prevented market participants from competing on an even playing field.” This may be true, but policymakers should consider how a tax increase could affect Missourians. Internet sales taxes aren’t paid by retailers; they’ll be paid by Missouri taxpayers. The costs of “evening the playing field” through tax policy have to be paid by someone, and it’s almost always consumers that have to pick up the bill. This could add to an already-high sales tax burden for Missourians.

A bill introduced last year that would have implemented an Internet sales tax made some progress in the legislature, but the legislative session ended before any real action could be taken.  It’s a good bet that this issue will come up again in 2020. Missourians interested in tax policy should monitor the debate closely, as a new law implementing an Internet sales tax could have big ramifications for our state.

The post Hoping for the Best with the Internet Sales Tax appeared first on Show-Me Institute.

THE SOLUTION: Right to work.

Right to work ends forced unionism and lets workers decide whether joining a union best serves their interests. This means that being a member of a union cannot be a requirement for employment, and gives employees the final decision about whether they want to give money to a union that may or may not have their best interests at heart.

In 2017, Missouri passed Right to Work, but in 2018, the state will hold a referendum on that law.

WHO ELSE DOES IT? Alabama, Arizona, Arkansas, Florida, Georgia, Guam, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin, and Wyoming.

THE OPPORTUNITY: If the state’s Right to Work law is put into full effect, Missouri will join the majority of American states that already have right to work laws, finally placing Missouri employers and employees on a level playing field with other states.

KEY POINTS

• Missouri will be better able compete with neighboring right-to-work states in attracting businesses.
• Existing unions will be more responsive to the concerns of members, thanks to the credible threat of members leaving the organization.
• Employees will have greater control over their representation in negotiations with their employer.
• Employers will have greater flexibility in managing their businesses and making their operations more successful.
• Private employers are the focus, but similar laws in the public sector, like paycheck protection, should be pursued by policymakers as well.

SHOW-ME INSTITUTE RESOURCES

Policy Study: A Primer on Government Labor Relations in Missouri

Op-Ed: Rise of the Roosevelt Law: Is Reform in Government Unions Coming to Missouri?

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

The post 2018 Blueprint: Right to Work appeared first on Show-Me Institute.

The prevailing wage sets a floor for pay, but it can actually hurt the workers it’s intended to help by denying employment to people who can do the job at a more competitive price. To make matters worse, making projects more expensive also means that less taxpayer money will be available for other priorities.

THE SOLUTION: Let the market set wages.

Rather than dictate wages, the government should have policies that support a healthy jobs environment where higher wages for all sorts of construction projects—including public construction—develop on their own without the harmful effects of wage floors.

Policymakers must keep in mind that project delays can hurt their communities over time. It would be better to let the market set wage rates for these projects and to begin delivering those public services sooner rather than later.

WHO ELSE DOES IT? States with no prevailing wage law include Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Utah, Virginia, and West Virginia.

THE OPPORTUNITY: Moving away from market-distorting policies like the prevailing wage will help the state promote job growth and spend taxpayer money efficiently.

KEY POINTS

• These reforms would promote job growth and make public works projects more affordable.
• Taxpayers get the most bang for their tax buck when their money is spent efficiently and effectively.

SHOW-ME INSTITUTE RESOURCES

Blog Post: Special Interests Inhibiting Joplin’s Recovery?

Blog Post: Playing Favorites on the Board of Aldermen?

Blog Post: The Race Is On: Wisconsin Pushes to End Project Labor Agreements and Prevailing Wage

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

The post 2018 Blueprint: Prevailing Wage appeared first on Show-Me Institute.

THE SOLUTION: Reduction or elimination of the individual income tax.

Lowering or eliminating individual income taxes allows Missourians to increase their take- home pay, increase business investments, and encourage population growth through in-migration.

WHO ELSE DOES IT? Seven states (Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming) currently have no income tax. Two other states (New Hampshire and Tennessee) levy income tax only on dividends and income from investments.

THE OPPORTUNITY: Income tax reductions could be achieved in several ways. Reductions in tax incentives and spending can, for instance, provide the budgetary space to cut taxes. Whatever the pathway, reducing an obstacle to state and personal income growth should be a high priority if we want to jumpstart Missouri’s economy.

KEY POINTS

• Missourians work hard for their money and deserve to keep what they earn.
• Income taxes penalize and discourage work.
• If you include the 1 percent earnings tax in our two biggest cities, Missouri has a top income tax rate of 7 percent, which is more than all but 17 states. Our top income tax rate equals or exceeds those of all but one of eight neighboring states.
• A real reduction in individual income taxes raises take-home pay and encourages more consumption of Missouri goods and services, making Missouri more competitive with other states in the nation.

SHOW-ME INSTITUTE RESOURCES

Essay: The 49th State: Revisiting Missouri’s GDP Sector by Sector

Essay: Taxes Matter and They’re Too High for Missouri

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

The post 2018 Blueprint: Income Tax Reform appeared first on Show-Me Institute.

THE SOLUTION: Repeal the Certificate of Need law.

Eliminating CON requirements would allow Missourians to benefit from true marketplace competition in the health care arena.

WHO ELSE DOES IT? California, Colorado, Idaho, Indiana, Kansas, New Hampshire, New Mexico, North Dakota, Pennsylvania, South Dakota, Texas, Utah, and Wyoming have no CON law.

THE OPPORTUNITY: Missouri would join a growing list of states that have opened the door to real health care competition.

KEY POINTS

• CON laws separate patients who need care from doctors who want to provide it.
• More competition would create pressure to reduce health care prices.
• Missouri would be able to compete with nearby states, including Kansas, where smaller hospitals are opening up because they aren’t restricted by CON laws.
• CON reform is an opportunity to help communities threatened by the loss of existing hospitals.
• Ending CON would empower patients to make choices that benefit their families, rather than support the government-backed competitive advantages of hospitals.

SHOW-ME INSTITUTE RESOURCES

Essay: Demand Supply: Why Licensing Reform Matters to Improving American Health Care

Blog Post: Missouri’s Certificate of Need Law Needs to Go

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

The post 2018 Blueprint: Certificate of Need appeared first on Show-Me Institute.

The chart below plots the average annual growth rate for each of the 50 states and for the United States as whole for the period 1997 through 2015. The good news is that Missouri’s average annual growth rate increased from 0.93 percent when computed over the 1997 through 2014 period to 1.02 percent when computed over the 1997 through 2015 period. Missouri reported a 1.29 percent growth rate in its real GDP between 2014 and 2015. No one really jumps for joy when growth rates are reported at 1.3 percent for a year; however, Missouri did manage to stagger its way one rung up the ladder, from 49th-fastest to 48th-fastest growing state economy over the period from 1997 through 2015.

Overall, the story for Missouri is little changed compared to a year ago. Since the late 1990s, Missouri’s economy has increased at half the rate of that of the United States as a whole. Eighteen years is not a terribly long time, and we all hope that Missouri’s future will be brighter. But the question remains: Why has the Missouri economy reported such slow growth over the past eighteen years?

The answer is not simple. Note that the ten fastest growing states are: North Dakota, Texas, South Dakota, Oregon, Utah, Colorado, California, Idaho, Arizona, and Oklahoma. There is no one clear feature shared by these ten states that can account for their economic success. Some of them do have natural resources and have benefitted from being able to dig a hole in the ground and extract things that are valuable to the rest of the world. But that is not the only explanation. For example, Arizona, Idaho, Oregon, and Utah (at least) do not fit the oil/natural gas story. Alternatively, the ten states with the lowest growth rates are Michigan, Louisiana, Missouri, Mississippi, West Virginia, Maine, Ohio, Kentucky, Illinois, and New Jersey. No single attribute these states might have in common would account for their struggles, either.

Income tax rates cannot, alone, explain the differences in growth rates. The nine states with no earned income taxes (followed by rankings) are: Alaska (40), Florida (20), Nevada (16), New Hampshire (25), South Dakota (3), Tennessee (30), Texas (2), Washington (13), and Wyoming (11). The nine states with the highest marginal income tax rates (followed by rankings) are: California (7), Hawaii (37), Oregon (4), Minnesota (17), Iowa (23), New Jersey (42), Vermont (26), New York (29), and Maine (46). The mean rank for the nine states with no income taxes is 17.8 while the mean rank for the nine states with the highest income tax rates is 25.7.

Overall, the evidence does not prove, but does suggest, that income tax rates do matter for economic growth. Of course, a host of other factors matter as well. In order to assess the role of income tax rates on growth, the ideal test would involve holding everything else constant. In other words, you would want to examine a parallel version of New Jersey, for example, but one with a lower income tax rate. Holding everything else constant, economic theory suggests that New Jersey would grow faster.

The broader message is that lots of factors that influence a state’s economic growth rate. Each state is an experiment in which tax rates, school quality, and various government services are provided endogenously by state policymakers. The bundle of policies and regulations is too large and complicated for us to identify how each one matters. And on top of the political attributes, there are the things that lie underground, or on the ground itself (or the ocean front—or lack thereof), that people living in each state can consume. All policymakers can do is to try and manage the factors they can influence in a way that will help their state grow faster.

In case you are wondering, Kansas ranked as the 29th-fastest-growing state over this period. So, why can’t Missouri grow at least as fast as its neighbor? It’s a frustrating question, because we have a Gordian knot of regulations, laws, and policies that make it difficult to determine specific causes of our stagnation. Not only have policymakers failed to move Missouri in the right direction in the 21st century, but the complexity of our state’s problems prevents us from understanding why various initiatives have failed to produce their intended results. In my view, it seems like a good time for Missouri to review its entire spectrum of policies. For instance, we have not had a constitutional convention in this state since 1947. Maybe it is time for an institutional overhaul.

The post It Could Be Worse. Not Much Worse, but It Could Be Worse. appeared first on Show-Me Institute.

Far from it. Of the 77 U.S. cities that KPMG ranked (which was not exhaustive of all major metros), Saint Louis ranked 45th and Kansas City ranked 46th. Among the cities cheaper than Saint Louis (and Kansas City) are regional competitors like Nashville, Omaha, Cincinnati, Memphis, Indianapolis, Cleveland, and Oklahoma City, to name a few. Worse yet, Saint Louis was more expensive than all 18 Southeastern cities KPMG looked at, from Atlanta to New Orleans.

So where did the Post-Dispatch get a top ten ranking for Saint Louis? If we only consider regions with populations greater than two million (of which KPMG ranked 31), Saint Louis is the 9th cheapest. I will leave it to the readers of this blog to decide if Saint Louis should pat itself on back for being cheaper than New York, Los Angeles, and Chicago, when it has higher costs for businesses than Nashville, Memphis, and just about every other regional competitor. But if we do decide to use population as criteria, it seems more justified to look at metros with populations similar to those of Saint Louis and Kansas City (between two and three million residents). When we do that, Saint Louis is 7th and Kansas City is 8th out of 14 such cities. That seems awfully middling.

That’s probably why, if one reads the study that the Post-Dispatch reports on, they’ll find that it does not claim that Saint Louis is among the most competitive cities in the country. KPMG didn’t even break down cities by population in the study, choosing instead to do so by region.  The Post-Dispatch story (while citing the study) is actually based on an ancillary KPMG press release, which lauds Cincinnati, and is careful to note context.

Titling an article “St. Louis among most cost-competitive cities for business, report says” when the report in question says no such thing is a questionable decision for a newspaper of record. But this is not just a problem with the headline. The article itself is equally misleading, and it was not a headline writer who placed this story front and center on the Post-Dispatch’s website less than a week before a vote on multiple tax issues (where the city’s business climate is an issue). 

The post Report: Saint Louis, Kansas City *Not* Among Most Cost-Friendly Cities for Business appeared first on Show-Me Institute.

Read the full testimony:

The post On The Enactment Of A “Living Wage” In Kansas City appeared first on Show-Me Institute.

Why the push to raise the gas taxes? Missouri, like other states, depends on its fuel tax to fund its state highway system. In 2014, the state’s fuel taxes brought in approximately $489 million for the Missouri Department of Transportation (MoDOT). Furthermore, because 30 percent of fuel tax revenue goes to cities and counties, local governments also rely on fuel taxes for road improvements. In 2014, fuel taxes provided $179 million to local governments statewide.

However, given the amount MoDOT claims it needs to maintain the state highway system, current revenue may be insufficient. Missouri’s fuel tax has not increased since 1996. With Missourians buying less gas, and the costs of maintaining the state highway system growing all the time, MoDOT warns of a large budget shortfall by 2017. As fuel taxes allow people who benefit from the roads to pay for them, it is an attractive funding source for roads in Missouri and other states.

Fortunately for Missourians, any fuel tax increase would be from a low base. At 17 cents a gallon (both regular and diesel), Missouri has the fifth lowest regular fuel tax and fourth lowest diesel fuel tax in the nation. As of January 2015, the average national state fuel tax was 29.89 cents per gallon regular, 30.02 cents per gallon diesel. Missouri also has a low fuel tax compared to its neighbors:

As the map above demonstrates, Missouri has a lower fuel tax than any neighboring state save Oklahoma, which substantially tolls its state roads. The size of Missouri’s state highway system adds to the problem. With more than 33,000 lane miles, Missouri has the nation’s seventh largest state highway system, the largest of its neighbors.

If SB 540 becomes law, MoDOT would see approximately $165 million additional dollars per year, which likely would stave off the implementation of the 325 Plan. It would also mean more revenue for cities and counties. For example, Saint Louis City could see almost $4 million more per year to spend on local roads from the passage of SB 540.

Missouri has comparatively low fuel taxes, and low taxes benefit residents. But a well-maintained highway system has benefits of its own. Missourians should consider whether preserving that system is worth paying a little more at the pump.

The post Missouri’s Fuel Taxes in Context appeared first on Show-Me Institute.

If “stealing jobs” were as bad as — and essentially no different than — stealing cars or stealing horses, Texas Gov. Rick Perry might expect to wind up at the end of a rope — the traditional fate in cowboy movies for horse thieves and cattle rustlers in the Lone Star State.

While that is not about to happen, the Texas governor has clearly been having a fun time infuriating some of his fellow governors in going to their states to pitch CEOs on the idea of relocating their businesses to Texas — one of only nine states (the others being Alaska, Florida, New Hampshire, South Dakota, Tennessee, Washington and Wyoming) with no state income tax on personal income. In venturing into California, Illinois, New York and several other high-spending, high-tax blue states, Perry has made a lot of speeches and spent some $2 million in TV ads singing the virtues of “limited government, low taxes and a fair legal system.”

Perry also made two visits to Missouri — in August and again in late September. In the earlier trip, he took Missouri Gov. Jay Nixon, a Democrat, to task for promising to veto the first tax cut in Missouri’s income tax in many years. As it turned out, even with heavy majorities in both houses of the Missouri legislature, Republicans were unable to override Nixon’s veto.

“Vetoing a tax cut is the same thing as raising your taxes,” Perry said in the commercials aired in several Missouri cities. “But there is a state where businesses flourish and jobs are created — Texas.”

That brought out the usual charges of “stealing jobs” in the two big-city, liberal dailies — the St. Louis Post-Dispatch and the Kansas City Star.

But if someone is guilty of “stealing” a job, someone else must own the job. But who?

How about no one? As Harry Stonecipher, the outspoken former CEO of Boeing, liked to say, “Only the customer can guarantee your job.”

In a competitive marketplace, no one really owns a job — not the jobholder, not the company providing the job and certainly not the governor of any state. Companies naturally gravitate to — and create employment within — the jurisdictions that provide the lowest costs of production, and taxes are an important part of the cost of production.

At the end of the day, there is no such thing as “stealing” a job. Like it or not, the states are in competition with one another in trying to attract and retain businesses focused on creating the greatest value for their customers, shareholders and employees. One of the keys to doing that is keeping the “tax price” in your location below that of competing jurisdictions.

Missouri should be focused on lowering the tax burden for all businesses. The best way to promote growth (and compete for jobs) is to get rid of all income taxes on business. Let the people who have earned the money put it back to work in their own businesses.

Andrew B. Wilson is a resident fellow and senior writer at the Show-Me Institute, which promotes market solutions for Missouri public policy.

The post Is Texas Gov. Rick Perry Guilty of “Stealing” Missouri Jobs? appeared first on Show-Me Institute.

The top four states in CNBC’s survey are right in the middle of the growth corridor: 1. South Dakota, 2. Texas, 3. North Dakota, and 4. Nebraska. And make no mistake, not all of these states were always ranked so high. As far back as 2008, Nebraska’s CNBC ranking was tracking closely with Missouri’s. But then . . . it wasn’t. Nebraska moved into the top five nationwide; meanwhile, Missouri fell further behind. Kansas is always cited as a reason Missouri should be working hard to make itself more attractive to business, and that remains an obvious argument. But Missouri’s economic problems do not begin and end with Kansas, as the Nebraska example bears out. A broader picture of the region that includes only our immediate neighbors should also concern Missourians: Of the eight states that border Missouri, only two are ranked worse — Illinois and Kentucky, both on Missouri’s eastern border.

Now as we always note, your mileage will vary with these surveys, but as Hafer notes, when just about all of them are showing basically the same thing, it makes Missouri’s economic problems all the more clear.

Should we care about such surveys[?] When they converge, yes. CNBC’s ranking corroborates Forbes magazine’s 2013 ranking analysis that placed Missouri at 29. And a report from CNBC earlier this year showed that using data from the National Association of Manufacturers, Missouri did not even make the list of 20 states with the highest manufacturing job creation since the end of 2009. Notably, Illinois, Iowa, Kansas, Kentucky and Tennessee all made the list.

Will Missouri continue down a path of mediocrity? It will unless its leaders — both political and business — grapple with those issues over which they have some control to change in a manner that enticed businesses to start or relocate to our state. Education and tax policies seem like a good place to start the discussion.

Missouri has been headed in the wrong direction for far too long. It’s time to change course.

The post In Case There Were Any Doubts About The ‘Growth Corridor’ We’re In, Here’s Another Data Point appeared first on Show-Me Institute.

St. Louis resident Jim Roos, in front of the offending sign. Photo by the Institute for Justice.

Good news for Saint Louisans: That “End Eminent Domain Abuse” sign that you can see at the intersection of Hwys. 44 and 55 is here to stay. In a partial free speech victory, the U.S. Supreme Court declined to hear the appeal of a circuit court ruling that struck down portions of Saint Louis City’s sign code for violating the free speech clause of the First Amendment.

For those of us in the Midwest, this is great news. This means that government cannot regulate signs and murals based on their content. And, as a result, the St. Louis Post-Dispatch reports that the offending portion of the city’s zoning code may have to be rewritten.

This is also a meaningful victory for anti-eminent domain activists in Saint Louis. Jim Roos, the plaintiff (pictured above), has had more than his fair share of struggles with city government. Using eminent domain, the city took 24 different properties from Sanctuary in the Ordinary, or managed by Neighborhood Enterprises, a nonprofit that provides low-income housing that Roos founded.

In protest, Roos painted the large “End Eminent Domain Abuse” sign on another property threatened with eminent domain. As a result, the city hit Roos with a citation, and said that a permit was required. He applied for a permit, only to be denied.  We wrote about this issue in 2011, in a post aptly titled, “Using Your Property to Criticize Us for Taking Your Property? You’d Better Believe That’s Illegal.”

Fortunately, Roos  and the Institute for Justice, a nonprofit libertarian public interest law firm, continued to challenge the city’s zoning code, leading to the partial free speech victory today.

Those of us in the 8th Circuit (Missouri, Arkansas, Iowa, Minnesota, Nebraska, North Dakota, and South Dakota) can take solace in knowing that our First Amendment rights are a little more secure. However, as Michael Bindas, the Institute for Justice attorney who represents Roos, pointed out, “Unfortunately, citizens in some other federal circuits do not enjoy the same protections that Jim’s case secured.”

Hopefully this case will help give victims of eminent domain abuse the courage to stand up and complain about it. Of course, the best victory for property owners would be for laws that allow eminent domain abuse to be repealed.

You can learn more about Jim Roos and the Institute for Justice here.

The post A Free Speech Win In Saint Louis appeared first on Show-Me Institute.

Currently, a bipartisan group of more than 20 state attorneys general and elected officials are asking a judge in Florida to invalidate the federal health care reform law. Missourians should encourage their attorney general, Chris Koster, to join this multistate lawsuit, which resumes on Jan. 10. In my view, the precedent that Missourians set by approving Proposition C could be continued if Attorney General Chris Koster joined the lawsuit.

The following are some facts related to the lawsuit:

• Twenty attorneys general are challenging the Affordable Care Act (ACA), the health care reform law that Congress passed earlier this year, in a courtroom in Pensacola, Fla. They are arguing that the law is unconstitutional and would set a dangerous precedent.
• The case involves two arguments. The first is that the requirement for all Americans to purchase insurance is unconstitutional. The second is that expanding the eligibility requirements for Medicaid, the joint federal-state health insurance program for the poor, threatens state sovereignty and will burden state budgets.
• The states party to the suit are Florida, South Carolina, Nebraska, Texas, Utah, Louisiana, Alabama, Michigan, Colorado, Pennsylvania, Washington, Idaho, South Dakota, Indiana, North Dakota, Mississippi, Arizona, Nevada, Georgia, and Alaska. Additional states, such as Wisconsin, are considering joining.
• Americans are divided in their support for the health care legislation. Only 42 percent of Americans say they have a generally favorable view of the law, while 41 percent say the opposite, according to a poll by the Kaiser Family Foundation in December 2010.

Missouri voters were the first to oppose this attempt by the federal government to take control over health care. As Missourians, we live in a democracy. We should have a government that represents the demonstrated wishes of Missourians in this matter, thereby advancing liberty with responsibility by promoting market solutions for health care policy.

I will discuss the effort to encourage Attorney General Koster to join the Florida lawsuit on the Mike Ferguson show on the Eagle 93.9 FM tomorrow, Jan. 6 at 5:00 p.m in Columbia. I encourage our readers to tune in or listen online.

The post Attorney General Chris Koster Should Join the Multistate Health Care Lawsuit in Florida appeared first on Show-Me Institute.

Every dime that the state takes away from an individual or business, through an income tax, is essentially taken out of the productive economy. Consequently, the capital that would have been spent investing in future goods is no longer available to the entity that would have otherwise used it. This, in effect, stifles growth.

Some might argue that public spending pumps that money back into the economy, but the 2009 American Recovery and Reinvestment Act is a perfect example of that kind of Keynesian theory failing in practice. The bill massively increased government spending,but did little to stimulate growth in the economy; unemployment remains around 10 percent. In practice, government spending provides much less of a stimulative effect than comparable tax cuts.

It would be in Missouri’s best interest to lower — or even abolish — the state income tax, thus enabling Missourians to spend and invest more of their own money to grow our stagnant economy. As demonstrated in the table below, which displays average annual growth rates per state between 1997 and 2008, Missouri’s growth ranks seventh-worst in the nation. Abolishing or reducing the state income tax would be a step in the right direction toward positive change.

Source for GDP Numbers: Bureau of Economic Analysis

The post Growth by State appeared first on Show-Me Institute.

We would like to emphasize that these are separate filmmakers from those involved in production of the film The Scientist, also referenced in the blog entry below.]

Three companies and three individuals that were involved in the production for the film The Scientist have been charged with inflating and falsifying expenses in order to obtain more than $1.85 million in tax credits through Iowa’s film tax credit program.

According an article in the Des Moines Register:

Weiner Runge, a 44-year-old film-maker and resident of St. Louis Park, Minn., is accused of a felony for reportedly inflating values of expenses on applications to the state for tax credits. Over the course of the project, Weiner Runge inflated the cost of making the film from $767,250 to almost $1.8 million, according to the Attorney General’s office. […]

Saunders, 37, […] provided free services that were used to claim $2.5 million in credits. Saunders also faces felony theft charges.

The following are specific examples of how they are accused of inflating the cost of the services and products that they consumed under the guise of the film tax credits.

Court records indicated Maximus Production Services filed claims for rental equipment that were significantly inflated, such as $225 each for a push broom, a hand broom, a metal rake, a pick axe and a sledge hammer, and two shovels for $450.

The invoices also included various sizes of step ladders that ranged from $900 each up to $1,125, and a 24-foot extension ladder reported to have been rented for $1,350.

As for the most egregious misuse of Iowa’s film tax credits, filmmakers involved in two other productions bought a Mercedes and a Land Rover for themselves. From the Des Moines Register again:

[S]tate officials found [movie]-makers had used the tax credit program to purchase two luxury vehicles worth more than $60,000 and other items later put to personal use.

If these filmmakers purchased their vehicles in Minneapolis, the combined state and county sales tax rate would have been 7.375 percent if not for the tax credit exemption. That means that the filmmakers avoided paying more than $8,850 in sales taxes on their combined vehicle purchases. This is the amount of money that the film producers saved buying the vehicles in Iowa under the guise of a film production, and it represents lost sales tax revenue for Minnesota. Filmmakers who live in Hollywood, Calif., would have an even greater incentive to buy luxury cars using film tax credits in other states because the combined state and county sales tax rate there is 9.75 percent. For a purchase of $120,000, then, a person would have to pay an additional $11,700 in sales tax.

Supporters of film tax credit programs say that the films have economic and fiscal impacts beyond the amount that the filmmakers spend in the state. We’ve discussed this concept in a previous post on this blog, in fact. I’d like to pose the following questions to these supporters: How much economic activity does the purchase of a luxury car generate in the state economy? How much extra output does it yield for the state? Will this motivate more people to move to the state? My answers are, in order, “not much,” “none,” and “no,” but I am eager to read their comments.

I worry that Missouri’s film tax credit program could be at risk of the same kind of fraudulent activity, because it has a structure similar to Iowa’s program. Under both programs, the tax credits are transferable. Iowa has since pulled the plug on its program to scrutinize its accounting, and Missouri would be better off doing the same.

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There are a few other Census promotions that I just don’t get. One is this public service announcement that urges viewers to “make your voice heard.” The Census asks people very specific and limited questions, as it should. It doesn’t ask for your opinion or for a personal statement. People who fill out every line of the Census form won’t be making their voices heard — they’ll just be reporting basic details about their households to the government.

And then there’s a clip from a legislator from the Rosebud Sioux Tribe of South Dakota that’s both inspiring and scary. I say “inspiring” because it starts off with a message of being true to yourself and overcoming whatever obstacles you face. (The legislator then loses me by saying that the way to overcome those obstacles is to participate in the Census.) The scary part is the end of the segment, when the legislator ominously warns that federal funding for health care will be insufficient if some tribal members don’t fill out their forms.

I hope Show-Me Daily readers will mail back their Census forms, in accordance with the Constitution. But I’m not expecting thunderbolts from heaven if a few of you don’t participate. And, to the people who want to express themselves: Blogs are a better medium than government paperwork.

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So, with that in mind, here is a quick summary of things important to me, and to the Show-Me Institute, and how they are going in our beautiful state capital. (Note: That was not sarcasm; I really think Jefferson City is great and the capitol building is wonderful.) Thanks to Combest for most of the following links.

Efforts at reforming the judicial selection process have apparently stalled. This is too bad. I didn’t like the more wholesale changes proposed in the past, but the alterations proposed by Sen. Jim Lembke in the latest bill seemed very reasonable, and would likely have made the system better.

The legislature passed a small but important victory for individual liberty when it approved legislation eliminating the mandate for motorcycle helmet laws. Missourians will be better off if the governor signs this return to liberty.

Distribution of the stimulus funds is still up in the air. The proposed tax refund for Missourians deserves to be seriously debated by the legislature. How is this line, from Missourinet, for a little frying pan / fire commentary?

In another move during floor debate, $12 million dollars was taken from a fund to pay ethanol plant incentives and given to aid the financially strapped Metro transit system in St. Louis.

It is also still in dispute how much we will subject the rest of the Midwest to those “Wake Up to Missouri” ads that air during sitcoms. I say cutting those funds is a smart idea. I don’t imagine that even one person in the history of the world has said, “Hey, I just saw an ad for South Dakota while watching Friends. Let’s go there next month!”

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