Extreme MakeOver: School Choice Edition

Why can't we fund the student instead of the educational bureaucracy? Lidia Downs of the Family Taxpayers Foundation in a current editorial letter brings the bony finger of indignation to bear on the Illinois legislature and Illinois Education:

The fact is that public schools are like other monopolies - they squander money.

Their newest ploy is this so-called “tax swap” which would raise both individual and corporate state income taxes by 67% in exchange for a promise of temporary property tax relief, which they can’t guarantee. Under this bill, 6¼ % sales tax would also get applied to such services as movie tickets, hair salons, parking, golf courses, car repairs and more. The result would be about $6 billion more for state government, plus less local control of our schools. A better name for this bill would be a “tax swindle!”

The real test for state leaders AND for education bureaucrats is to find solutions like charter schools, virtual schools, and opportunity scholarships, that have actually been proven to result in vastly improved academic achievement. It’s time we funded the student instead of the system.

Jump cut to another excellent analysis of why some "vouchers" are bad and some are very good according to anti-school choice folks.

When is a voucher not a voucher? When is is for college! The Heritage Foundation's Dan Lips
points out:

When the scholarship is for higher education, rather than for elementary, junior, or high school. Pell Grants, the G.I. Bill, and Hope Scholarships--all essentially vouchers--earn wholehearted support from liberals who demonize "vouchers."

Pell Grants, the G.I. Bill, "Lifetime Learning" tax credits, and college scholarships are all school choice initiatives. Why is ok for some age students and not for others?

President Clinton embodies Democrats' strange position on school vouchers. In 1998, he vetoed bipartisan legislation that would have provided school vouchers to 2,000 low-income children in Washington, D.C., calling the plan "fundamentally misguided." But just a year earlier, he signed a tax package that included the Hope Scholarship and Lifetime Learning tax credits. At the time, those tax subsidies were projected to help 13 million Americans enroll in a postsecondary institution of their choice after high school.

Mr. Lips continues,

There is no magic reform proposal that will fix all of the failures of our K-12 system. That’s why it's important to shift the focus from the system to the student. Students have diverse needs, and there are many schools that could meet those needs, including private schools.

That's why school choice programs, including vouchers, hold great promise and promote equal opportunity. Like Pell grants, existing school voucher programs in Cleveland, Milwaukee, and Washington, D.C., are structured to give disadvantaged families the same opportunity that more affluent families already have -- the ability to enroll their children in safe and high quality schools.

Say no to the "Tax Swipe" and yes to school choice. Let's fund the kids and not the system.

Talk Ain't Cheap! Can You Hear Us Now?

Here in Illinois, the average monthly cell phone tax is above the national average, close to 19 percent every month. One recent survey and study says Illinois ranks No. 10 in the nation in cell phone taxes. Nebraska is No. 1 at almost 25 percent. So, the average monthly cell phone tax per month in Illinois is at least 10 percent above the average sales tax! Who ever said, "talk is cheap"? Of course, in addition to taxes, you are also charged about $1 to maintain cell phone 911 service.

According to Illinois and Chicago departments of revenue, it is estimated that in 2005 Illinois collected $330 million in cell phone taxes. The City of Chicago collected $68 million.

Local governments tax cell phone bills just like they have always taxed home (land-line) phones, however,there is a difference - wireless isn't a "regulated utility."

"Regressive" Taxation Hypocrisy

Every Spring when the IRS comes calling, and local Real Estate Tax bills arrive, talk turns to how "unfair" taxation is in this country - "tax cuts for the richest 1%", etc.

The tax-spenders want more money and on the surface decry anything resembling everyone paying the same rate of tax on anything. They feel that those that have more should pay a greater percentage to the communal pot (for the social "experts" to spend). This is the concept of "progressive" taxation.

We are constantly amazed at the silence of these folks on the most regressive taxes of all - property, cigarettes, alcohol, and most insidious, state lotteries.

It is extremely difficult to get a hold of State "target demographic" marketing data. They don't want to talk about it. However, WoodfordTaxFacts.com has obtained some of this information and it is stunning.

Essentially, what we need to understand is that those most prone to smoking, drinking, and gambling with "lotteries" are at the lowest rungs of the socio-economic ladder. These taxes are a disproportionate burden on the undereducated, elderly, and immigrant populations. They always have been and they always will be.

The Real Estate tax as we've discussed many times is a tax on savings, not income, and burdens those on fixed incomes the most (read - low income/retired/elderly).

Where is the "progressives' " outrage? As an aside, how can you have "sin taxes" on certain behavior/consumption and then "profit" from same in the form of taxation? The status quo indicates it can be politically justified by putting those monies into "education, training, treatment, and heathcare" programs. However in Illinois, after the promises faded, the monies end up in the "General Fund" anyway. Remember when the Illinois Lottery was instituted? The sales pitch was that gambling (the numbers racket) was going on anyway, and why not just have the state horn in on the illegal enterprises and take a piece of that pie. Who could complain? That was supposed to be a property tax relief deal for education funding. It was going to go into the proverbial "lock-box".

The huge hike in tobacco taxes and the lawsuit settlements (tax) on "Big Tobacco"? That was to go into Medicare. The State is still not paying doctors and hospitals for 18 months.

Beer, wine, and liquor license fee increases and excise taxes? Well, those were always intended to ease the transition from prohibition and were to go into prevention and care of abusers; never happened.

So next time your friends complain about how the poor and middle class pay too much tax relative to "the rich", remind them that an easy way to put real money into low income pockets would be to eliminate the aforementioned taxes, get rid of the lottery, and gently remind them that less than half of all Americans pay any federal income tax.

Next up - we'll discuss the federal "Earned Income Tax Credit" monies gushing out to Mexico via illegals living here, but legally able to file and claim dependents back home. Anything we can do to help out Mexico . . .

Ethanol Source Switch To Switchgrass?

The U.S. government gives refineries a tax incentive or subsidy of 51 cents for each gallon of ethanol they blend with gasoline.

Last week President George W. Bush said Congress should drop a 54 cent-per-gallon tariff on ethanol imports from Brazil.

The Brazilians say they will be "energy independent" next year, although their fuel usage is miniscule compared to the U.S. Brazil, and much of the rest of the world, process sugar cane and switchgrass for bio fuels.

Demand for ethanol may someday outpace the ability of U.S. farmers to produce corn (the year 2025 is bandied about). Sugar growers have enjoyed Federal protection and largesse since the hay-days in Cuba. This new vision is one of a nation dependent on switchgrass as the key feed for ethanol production.

It takes about 6 to 8 years to develop the switchgrass enzyme conversion technology sufficient for ethanol production plant practicability, according to our sources.

O.K. So here's the question - do we want to eliminate the (primarily) Brazilian tariff, or do we want to continue subsidizing domestic production with the tariff in addition to all of the other ethanol/sugar incentives and mandates?

In this corner . . . A.D.M,

In this corner . . . Cargill . . .

we'll let you figure out who is whom in the ring and why.

What Do You Pay In Taxes?

Quick, how much total do you pay in taxes? Perhaps the greatest innovation of bureacrats in the 20th century was the tax load shell game - the clever balkanization of the tax load that makes it nearly impossible for the average person to truly know how much they pay in taxes to the government.

Start with income taxes. April 15 is long gone for this year, but even so, how many people know how much they paid in income taxes last year? For many people, this is the single largest expense they have, but the total amount is disguised by the fact that most income taxes are taken out as direct payroll deduction. Governent employees everywhere in the US should get up in the morning and give thanks for direct payroll deduction -- without it, if every American had to write a single check once a year for the sum total of their annual income taxes, there would have long since been a revolution.

OK, so you don't know how much you paid in federal, state and local income taxes. But in addition to that, how much did you pay in social security and medicare (typically about 8% of salary)? Property taxes (typically 1-2% of your home value)? How about sales taxes (typically 6-9% of your purchases)? What about vehicle licensing fees and special taxes on hotels and airfare and rent carsand fuel? If you add all these up, the average American pays about 30% of his/her salary in taxes. The Tax Foundation has a great chart summarizing this shell game, with relative burdens expressed as days of work each year required to pay the tax. Note that on average, your federal income tax is only 1/3 of the total of what you are paying:

So those are the direct ones, but how much are you also paying in higher prices due to government import duties? What about the 8% FICA and medicare that employers pay on your behalf - how much higher might your salary be and how much lower the cost of the products you buy if they did not have to pay these? What about corporate taxes - you may not pay them directly, but they certainly get passed on to you in the form of higher prices and lower dividends on your 401k.

We won't even get into the confiscatory nature of "Death", "Property", and "Capital Gains" taxes. While certainly less hidden, they are perhaps the most insidious, since they are a tax savings and not income or spending.

- - - the Coyote

County Gas Tax?

The Peoria Journal Star today has an article speaking to the inclination of some Woodford County Board members to do something with the 1% "Public Safety" sales tax.

We believe there is an embarassment of riches there.

Specifically a trial balloon seems to have gone up from the Board regarding eliminating the County sales tax on fuel purchases at retail. We don't think the short term savings (one or two cents per gallon) justifies such a knee-jerk reaction.


We do, however, find a plan to retire early the bonds which funded the new "Public Safety" complex intriguing.

We've got the tax. We're living with it. Accelerate the repayment of the debt, to the extent the agreement allows, plan for a lean "Public Safety" budget, and ultimately reduce the cost to property tax payers.

Woodford County's future should not include a business unfriendly permanent 1% "Public Safety" sales tax, nor a balancing of the "public safety" budget on the backs of property owners. There must be a middle ground to plow.

Please review this previous post for County revenues.

Topinka Advocates Sales Tax Cap On Gas

We're pretty sure that the total excise tax, State and Federal, is 58 cents per gallon in Illinois. If we're off a few cents, it's only because on the incredible obfuscation on this issue. The dirty little secret over the past year or so is that sales taxes on the increased prices at the pump have been a huge windfall for State, County, and Municipal governments.

Yesterday, Judy Barr Topinka said she'd like to "freeze" State sales tax when the pump price is $2.50 per gallon or higher. The tax would be collected on $2.50 even if the actual price was $4.00

Aside from the retailers' nightmare of tracking a change like this, it sounds like a good start to us. Now to get the feds on board. If the sales and excise tax on fuel isn't going to be dedicated exclusively to road building and maintenance, then we've prefer getting rid of them entirely. They shouldn't be used as windfalls for the "general funds". How's that for a "windfall profits tax"?