 On Point Vincent Carroll, editor of the editorial pages, writes his On Point column most weekdays. He is also an author and freelance writer. Reach Vincent Carroll at carrollv@RockyMountainNews.com. |
Main | April 2007
With April's filing deadline creeping closer, it's tough to think of nice things to say about the tax code. Impossible, actually, if the federal code is the one we're talking about.
With April's filing deadline creeping closer, it's tough to think of nice things to say about the tax code. Impossible, actually, if the federal code is the one we're talking about.
But the Colorado tax code is different. While it hardly warrants hosannas, the state income tax does at least have one thing going for it: It's flat.
A flat tax is easy to calculate, minimizes cheating, is least subject to constant tinkering and reduces the monumental transaction costs involving lawyers, lobbyists and accountants.
A flat tax is also fair.
Colorado's tax rate is 4.63 percent. Beginning in 2011, it will fall to 4.50 percent when the state budget surplus exceeds a certain size.
It was exactly 25 years ago that the scholars Robert Hall and Alvin Rabushka proposed a flat tax for the United States. They're marking the anniversary by releasing an updated version of their book The Flat Tax (Hoover Institution Press).
"We remain convinced, as ever," they write, "that the adoption of a flat tax would give an enormous boost to the U.S. economy by dramatically improving incentives to work, save, invest and take entrepreneurial risks. The flat tax would save taxpayers hundreds of billions in direct and indirect compliance costs. It would also shift billions of dollars from investments that reduce taxes to those that produce goods and services."
By setting the rate at 19 percent and exempting the first $25,000, they add, "all wage earners would pay less . . . than under the current system."
The U.S. moved toward a flat tax in 1986 when multiple tax rates were replaced by only two. Since then, unfortunately, the federal tax code has slid backward into hopeless complexity.
There is good news elsewhere, though. Since 1994, 15 nations, including Russia, have adopted a flat tax, and the movement continues to spread.
Jimmy Carter once declared the tax code "a disgrace to the human race." It was probably the least controversial comment he ever made - and it's just as true today.
Solar powers powerful
When is it good to subsidize the rich at the expense of the poor? Apparently when it's done on behalf of renewable energy.
At least that's one conclusion to draw from the legislature's effortless passage of House Bill 1281, which the governor signed Tuesday at the National Wind Technology Center in Boulder.
The new law doubles Colorado's renewable energy standards - meaning for the most part a huge boost for wind power.
Fortunately, wind power can hold its own in terms of price; and even if it couldn't, ratepayers would all share equally in the extra cost.
Not so with solar energy. Not only is it expensive, but half of the bill's solar mandate "shall be derived from solar electric technologies located on-site at customers' facilities." This is where the subsidy for the well-to-do comes in.
Who puts solar technology on their homes and then pockets a fat check from their utility to cover a major part of the cost? Not the average checkout worker at Wal-Mart, you can be sure.
But don't take my word for it. A recent report by the Colorado Public Utilities Commission says it all. That document reveals that since the passage of Amendment 37's renewable energy mandates, more than half of all homeowners who collected a solar subsidy live, incredibly, in Boulder County; moreover, their average incomes and home values far exceed those of the average Coloradan.
No wonder H.B. 1281's three main sponsors hail from Boulder (Rep. Jack Pommer), Genesee (Rep. Rob Witwer) and Snowmass Village (Sen. Gail Schwartz). They recognize a good deal for their prosperous constituents when they see one.
Vincent Carroll can be reached at carrollv@RockyMountainNews.com.
Posted by vcarroll at 06:21 PM | Comments (2)Even in 2000, even at the height of the stock market's tech bubble . . . no, especially in 2000, especially at the height of the tech bubble - how could any sensible adult invest all of her regular savings in a single telecommunications company?
Even in 2000, even at the height of the stock market's tech bubble . . . no, especially in 2000, especially at the height of the tech bubble - how could any sensible adult invest all of her regular savings in a single telecommunications company?
Yet that's what Sally Anderson says she did after receiving a rah-rah e-mail in the fall of 2000 from Qwest CEO Joe Nacchio - an e-mail he sent to all Qwest employees touting the company's future.
Her testimony last week at Nacchio's trial on insider trading charges was presumably meant to supply the face of a "victim" of the CEO's upbeat assessments. Whether it succeeded in the jury's eyes remains to be seen. But what it also supplied was the face of someone once apparently oblivious to the most elementary advice drummed into every investor: Diversify, diversify, diversify.
On Monday, Nacchio's attorneys filed a motion for a mistrial based on Anderson's testimony, arguing that it wasn't even relevant to the period in 2001 that prompted the insider-trading charges. They're reaching, of course, but you do have to wonder what Anderson's investment naiveté - and that's a gentle word for it - really has to do with Nacchio's guilt or innocence.
Qwest's merger with U S West was completed barely two months before the e-mail that supposedly moved Anderson to redirect her investments. What sort of message did she expect from the new company's top executive: one of defeatism and gloom?
Yes, Virginia, corporate CEOs like to emphasize the upside, especially when addressing their own workers.
Incidentally, those of you poised to accuse me of being in Nacchio's corner can spare yourselves an e-mail. I was lambasting his arrogant, buccaneer style and "preposterously outsized compensation" - yes, those were my words - long before he was ever indicted.
Job security
"We all know there is a misconception out there that tenure is an appointment for life, no matter what you do, and that's not true," declared University of Colorado Regent Michael Carrigan recently during discussion of a plan to streamline how long it takes to fire a tenured professor.
Carrigan is technically correct: You can't do literally anything and remain a professor for life. You can't burn down your neighbor's house or prey on children for sex. And as Ward Churchill found out, you can't repeatedly mock and denounce the "little Eichmanns" who pay your salary while engaging in a wholesale pattern of academic fraud, plagiarism and invention.
Short of such gross misbehavior, though, tenure is an appointment for life, "no matter what you do." And with the exception of federal judges, there's probably no other job in the land with anything close to equivalent security.
carrollv@RockyMountainNews.com
Vincent Carroll can be reached at .
It's safe to say that Coloradans haven't lost sleep worrying that some retailer somewhere might be selling something at below cost.
It's safe to say that Coloradans haven't lost sleep worrying that some retailer somewhere might be selling something at below cost.
Selling "below cost" is called a bargain. A sale. A close-out. A loss leader. A marketing strategy.
It's called competition.
If the Colorado Senate has its way, however, selling something at below cost - as officially defined in the law, of course- will be illegal in every county with a population of less than 200,000, meaning throughout most of the state.
Ironically, the Senate was poised to do a good thing when it fell to temptation and decided to micromanage retail transactions in rural and small-town Colorado. Indeed, it was all set to pass a bill that would lift Depression-era restrictions preventing supermarkets and big-box stores from selling cheap gas and prescription drugs.
House Bill 1208 had already passed the House and had survived early tests in the Senate, too. But it was crippled with the 11th-hour amendment exempting smaller counties.
Attorney General John Suthers, who has promoted the lifting of so-called predatory pricing restrictions, was understandably stunned and disappointed by news of the amendment. The House sponsor, Rep. Cheri Jahn, D-Wheat Ridge, told me that the amendment will make state law worse than ever because the ban on below-cost sales seems to nullify previous legal qualifications and includes all products and services.
"We're are talking about the $5 turkeys at Safeway - gone," she said. "We're talking about 'buy one, get one free' - gone." She predicts more consumers than ever will end up driving from small counties to large ones to do their shopping.
The Senate sponsor, Republican Steve Johnson of Fort Collins, echoed her frustration. "It's really insane what they did," he told me.
What was the Senate majority thinking? Have they fallen under the spell of economic tracts penned by Hugo Chavez? Did someone tell them "land of the free" applies only to urbanites?
The bill will go to a House-Senate conference committee, so sanity might still prevail. If not, someone needs to explain why a $5 turkey sale is such a hideous threat.
Dangerous step
When you hear the phrase "union workplace," do the words "flexible," "innovative" or "fast-reacting" immediately come to mind?
Say what you like about the benefits of unions - proclaim their virtues to the sky - the fact remains that they were created to limit management's options, not enhance them. Which is why the congressional decision to allow workers in the Transportation Security Administration to unionize is so bizarre.
"I voted against today's bill because I believe that allowing collective bargaining for Transportation Security Administration workers would undermine the ability of the TSA to perform its critical aviation security mission," explained Colorado Sen. Wayne Allard earlier this week. "This provision was not a 9/11 commission recommendation. While strengthening special interests, it weakens homeland security. That is not a trade-off I am willing to make."
Alas, most of his colleagues, including his Colorado colleague, Sen. Ken Salazar, were.
If you find airport security a nuisance now, just wait a few years while work rules are steadily carved into collective bargaining stone. The resulting check-in hassles won't even be the worst part. As Arizona Sen. John Kyl has pointed out, "the TSA must have the ability to rapidly alter security procedures and deploy screeners to confront threats."
Rapidly alter security procedures? Sure, right after the next five sessions of union-management negotiations. Who could possibly have a problem with that?
Vincent Carroll is editor of the editorial pages. Reach him at carrollv@RockyMountainNews.com.
Posted by vcarroll at 06:24 PM | Comments (0)