Sunday, February 08, 2009

The Beebe Doctrine: A Constant Search for Isolated Groups of People to Loot

Divide and conquer. If the people of this state are greedy and unprincipled enough, the Governor's plan to pit us against one another group by group should continue to result in significant revenue enhancements to the one group that really matters- government.

A distinct pattern is emerging from Arkansas Governor Mike Beebe. When humans display patterns, it is often because they are following a strategy. Find the pattern and one can draw reasonably conclusions as to what the strategy might be.

His record is one of tax cuts and tax increases, with the net result being a gain in tax revenues for the state. The tax he likes to cut is a general one- the sales tax on food. In other words, this tax cut is popular with just about everybody. And here is HOW he would like to cut the tax on groceries: as incrementally as possible. That way, he can get credit for cutting taxes three or four times even though it is the same tax.

More instructive is his pattern of tax increases. One was on natural gas well production. At the time, we were expecting tremendous revenue growth from projects in the Fayetteville Shale play even at the old tax rates. He proposed increasing them many times over, so that some warned it would discourage some projects. Time will tell if natural gas production fails to meet the original rosy estimates, but so far its not looking good.

Beebe taxed a very narrow group but did not use the revenues for the benefit of that group- I.E. he did not use it for road maintenance in the counties who would need more highway dollars because of the increased truck traffic. He spread it around the state and into his own control through a "quick closing fund". So he found a narrow group that was out of favor with the people (high gasoline prices at the time had people mad about almost everyone that had anything to do with hydrocarbons). Then he stuck them with a big increase to getting back even more than he gave up with the grocery sales tax cut.

Now he is doing the exact same thing. This time the narrow group that is looked at disfavorably by much of the rest of the population is smokers. Contrary to conventional wisdom, they don't drive up health care costs for the simple reason that smokers die an average of 7 years sooner, leaving off some of the most expensive years of life. But that did not stop the Governor from singling them out for big tax increase for benefits that could apply to the general population. And again the state revenues to the general fund from this tax increase will dwarf the 30-40 million dollars the population will get back through the grocery tax cut.

So a pattern is established here. Draw out the broad-based tax cuts, and dole them out in tiny bits so as to repeatedly get credit as a tax cutter, but every time you do, find some small isolated group and hammer them with large tax increase that nets you more money than you gave up. Last time the isolated group that was looted for the good of "the whole" was natural gas producers. This time it is smokers. Next time it could be left-handed midgets that like to fish.

Or it could be a group you are in. And if you have not cared about those other groups when it was Mike Beebe's turn to step on them, then you ought not to get too upset with people if they don't care when it is Mike Beebe's turn to step on you. What makes civilization possible is the capacity to feel moral outrage over an injustice done to a stranger.

Government leaders who appeal to our corruption by offering us "services" by taxing some random group whose actions have no special connection to the services offered will lead us to a society where no one is safe. The state will be on the constant prowl for the next small group to loot, and the only defense will be to pay your lobbyist more than the next guy so that they get the knife not you.

What a pathetic way to live, each of us begging for our neighbor's bread to men who are supposed to be our public servants. But that's the way it is going if we don't do an integrity check and I mean yesterday.


Anonymous Chuck said...

Excellent analysis. Tax-and-spend by sleight of hand, as Beebe is doing, is the modus operandi of Democrats. It's a shell game of reducing a tax and increasing a tax at the same time, with a net gain in tax revenue, but making the citizenry believe they're getting a better deal. Meanwhile, the voters of Arkansas keep electing them and we will remain 50th.

5:18 PM, February 08, 2009  

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