Column for September 29, 2011

When will these people get it? Liberal tax and spend Democrats (and even some Republicans) don’t know what the word, “NO!” means or understand basic economics. I was reading a news story about a North Carolina State Legislator who wants to bring back a one cent sales tax increase for us citizens to pay. It did not take long to comprehend why it is being proposed again. Bill Faison is a state representative from near Berkley East, meaning liberal Orange County.

The plan that he has been pitching is to reinstate a one penny (1%) sales tax hike to fund state jobs that have recently been cut. His wants to rehire over 6,400 state employees that were laid off because of budget cuts. His claim is that the tax hike would bring in over a billion dollars a year. His slogan is “Give a penny, hire a state worker.” I will admit that a one cent sales tax would be nearly invisible to the average shopper. When I go to Wal-Mart and spend a few hundred dollars, I may never notice the increase in the tax. However, over a year’s course of time, that one penny sales tax hike adds up.

Several things occurred to me as I read the news story. First is that someone is actually proposing a tax hike in a down economy. That is abject stupidity. Of course that is exactly what is currently happening on the national level, not just the state level. The second thing is that state employees were laid off. Obviously they were not essential to the workings of the government, hence their dismissal. That tells me that they was extra baggage that was attached to an already bloated bureaucracy. I feel for the people who lost their jobs. We had to deal with it in our own household, too, as my wife used to be a government employee. I know first hand as a former state employee that there are more employees than are necessary for the efficient running of the government. I also know that some agencies are anemic on employees whereas other departments are employee laden and bloated.

On December 15, 1802, Thomas Jefferson said in his annual address to Congress, “...when merely by avoiding false objects of expense we are able, without a direct tax, without internal taxes, and without borrowing to make large and effectual payments toward the discharge of public debt and the emancipation of our posterity from that mortal canker, it is an encouragement, fellow citizens, of the highest order to proceed as we have begun in substituting economy for taxation...” Congress, along with the previous two administrations had instituted certain taxes. Jefferson decided to eliminate those taxes and instead allow the economy to grow. A growing economy with lower taxes actually eventually brings in an increased amount of revenue. John F. Kennedy, Ronald Reagan, and George W. Bush also knew this principle.

One oft overlooked portion of that quote is “avoiding false objects of expense”. This simply means cutting spending levels and unnecessary expenditures. Jefferson also endeavored to eliminate the public debt rather than allow what he considered a moral canker to affect future generations. In all of the presidential administrations from George Washington to George W. Bush, the national government accrued some $12 trillion in debt. Under the present administration alone, we have doubled that figure. Jefferson would have most certainly considered this more than just a moral canker.

The Town of Smithfield has not figured out simple economics yet, either. Smithfield is attempting to force new businesses just outside of their public utility boundary to use their services rather than allowing them to use the cheaper, equally available electricity provided directly from Progress Energy. It is all about bringing in more revenue into the town. It has nothing to do with fostering a business friendly climate under which a company can thrive. It is all about feeding the voracious appetite of government.

I have written of my views on public power grids and their detrimental affect upon citizens and business. It would be one thing if Smithfield offered rates the same as Progress Energy, but they don’t. Furthermore, it is unconscionable to me to force businesses to go with a higher energy cost just because a town wants to use its governing power to gain more revenue. Lower overhead costs like the cost of electricity will help foster a better business climate, not forced, punitive, higher rates. Anything higher than what the power company would charge is nothing more than a tax increase, and I doubt that Thomas Jefferson would find it to be anything more than yet another moral canker.