Saturday, May 29, 2010

Taxing ourselves

Boyes expressed surprise that Prop 100 passed, in essence Arizona taxpayers agreed to tax (coerce) themselves. I was not surprised (although I was disappointed) and I think part of the explanation lies in item 5 of Boyes' post - the rise of public sector unions.

Our previous discussions on this blog point out that public sector employees, in many cases, earn wages and benefits above that of their private sector counterparts. To protect these rents in the face of transparency (an issue that has become explosive in Greece and will I suspect become equally explosive here in the US) public sector unions must work aggressively to protect these rents. There are any number of strategies employed by the public sector unions, one of the most effective is that of propaganda. In the case of Prop 100, the public sector union effort aligned nicely with the intellectual/elite view that the government should be the provider of educational services. The "crisis" in public school education is not surprising, it is inevitable - the government has no incentive for efficiency, indeed local governments in the form of school districts and individual schools have an inability to react to changing conditions. Compare the plight of public schools in Arizona to private or charter schools like Tempe Prep, Basis, The Awakening Seed . . . these schools are continuing on - the private schools raising tuition if necessary, but all adjusting operations. It is notable that these schools have lower average wages and benefits that comparable public schools.

But the essence of the question remains, why was there overwhelming support to increase sales taxes - a tax that interventionists and elites must grind their teeth at due to its regressive nature?

Unfortunately the bulk of "citizens" now have a default view that the government should take care of _______________________(fill in the blank - the media blathering about the BP spill is another example that deserves a separate blog post). So, over time, the elite/intellectual position articulated by JFK has permeated the consciousness or subconsciousness of the masses - "ask not what your country can do for you, ask what you can do for your country".

So, teachers unions, elite intellectuals, local governments all asked Arizonans to raise taxes and, in another step on the road to serfdom, a large majority in Tempe complied.

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