Entire NC Republican delegation opposes storm relief

The second part of the Sandy relief legislation--a $50 billion package to help New York, New Jersey, and other northeast states rebuild and prepare for future storms--passed the House of Representatives last night despite overwhelming Republican opposition--including "no" votes from every single member of North Carolina's Republican delegation.

Representatives Foxx, Holding, Hudson, and Meadows, who had already voted against borrowing to allow the National Flood Insurance Program to pay its obligations to victims, were joined in the latest vote by Representatives Coble, Ellmers, Jones, McHenry, and Pittenger.

All four NC Democratic representatives voted for the measures.

A closely-related measure that combined both parts of the House bill passed the Senate late last term with a bipartisan 62-32 vote. Democratic Senator Hagan voted for that measure; Republican Senator Burr voted against.

I can't predict the weather. But I can predict that the "attaboys" the Republican delegation are getting from its Tea Party supporters will be replaced with cries for federal relief when a big storm eventually hits Hurricane-prone NC.

Financing Charlotte's stadium upgrade

Source: http://sayanythingblog.com/entry/36577/

Carolina Panthers' owner, Jerry Richardson, has his hand out asking the city of Charlotte to fork over $125 million to renovate and upgrade Bank of America Stadium. Regrettably (for the citizens of Charlotte who would have to foot the bill), members of the Charlotte City Council have expressed a willingness to help, and the Council has discussed an extra 1 percent ($24 million annual or $32 per resident) tax on food and beverages to cover the cost.

There is another financing option that could save Charlotte taxpayers and shift the most of the costs to the actual beneficiaries--issue $125 million in city-guaranteed bonds with an agreement that the stadium owners will pay back the bonds.

16 (increasingly hot) candles

Has global warming paused over the last 16 years? The record high temperatures in the continental U.S. and the following video suggest it hasn't.



Source: Skeptical Science.

Your glowing problem could be a growing problem

Although the increasing possibility of fracking in the Tar Heel state has many North Carolinians in a dither, there's actually another mineral extraction opportunity just over the border in Chatham, Virginia that could be much, much worse.

Virginia's General Assembly might make that opportunity a reality very soon.

It's not a new concern.

Legislative ethics NC-style

The Republican Senate chair of the Legislative Ethics Committee has been caught with his hand in the cookie jar. The Charlotte Observer reports

State Sen. Fletcher Hartsell Jr. spent nearly $100,000 of his campaign’s money in 2011 and 2012 paying off debts on at least 10 personal credit cards, according to new campaign finance reports.

...The disclosure forms also show the campaign writing checks to two banks and a credit union in relatively large amounts. Last month, for example, the Hartsell campaign paid the State Employees’ Credit Union $750. The listed purpose of the spending is “bank transfer.” Hartsell said he could not immediately explain the bank spending and would not rule out cash withdrawals.

Sen. Hartsell was unopposed in his most recent primary and general election campaigns, so you really have to wonder why the contributions were needed in the first place. Just as Pig-Pen from Peanuts was the only kid who could create a dust cloud in a snow-storm, Sen. Hartsell seems to have a rare ability to create expenses in uncontested elections.

It is probably not too surprising that Sen. Harsell's Legislative Ethics Committee found no violations whatsoever last year (heck, it even managed to dismiss more complaints than it received).

Sen. Hartsell's campaign finance reports are available from the State Board of Elections website. If his 2nd quarter 2008 report is any indication ($8,872.66 paid to cover his personal American Express card), Sen. Hartell's questionable reporting goes back a ways.

Sound familiar?

This sure has a familiar and immiserating ring to it.

Gov. Bobby Jindal is proposing to eliminate Louisiana's income and corporate taxes and pay for those cuts with increased sales taxes, the governor's office confirmed Thursday. The governor's office has not yet provided the details of the plan.

Do ya ever get the feeling that these folks are all reading off the same script?

Reported offenses down in the Guilford County Schools

The North Carolina Department of Public Instruction Released its Annual Consolidated Data Report for 2011-12 for school crime and violence, suspensions and expulsions, and dropout rates. Statewide, the reported number of criminal and violent acts decreased 4.3 percent from the previous year from 11,657 to 11,161. The offense rate (number of acts per 1000 students) fell 5 percent from 8.03 to 7.63.

In Guilford County, the decrease was even more pronounced with the number of reportable acts decreasing from either 693 or 700 (there's a minor discrepancy in the 2010-11 numbers) to 589. Figures for all reported offenses for the Guilford County Schools from the 2005-06 school year to 2011-12 are listed below.

Reported Offenses in the Guilford County Schools 2005-12

 

 

Source: NC DPI Annual Reports (various years).

A modest tax reform proposal for NC

Suppose that you had a perverse desire to maximize tax inefficiency--that is, maximize the administrative and compliance costs of taxes while minimizing the net revenues and net social benefit. What would you do? One strategy would be to enact a special tax charge and a special tax break the same activity.

This strategy sounds and is perverse, yet it is exactly what North Carolina does with appliance sales.

On the one hand, the state applies a White Goods Disposal Tax of $3 on each appliance sale to defray state and local waste management costs associated with appliances (e.g., special disposal of refrigerants). The Disposal Tax comes on top of the regular sales tax.

On the other hand, the state holds an Energy Star Sales Tax Holiday on the first weekend of each November in which sales taxes are waived for purchases of special energy-efficient appliances.

North Carolina also exempts the installation charges for those appliances (and installation charges generally, if the charge is separately stated on a receipt) from sales taxes.

N-R, look at tax shenanigans closer to home

The editorial in this morning's News & Record lambastes Congress for including a host of additional business tax breaks in the recently-enacted fiscal cliff legislation, including $15 million over two years for films shot in the U.S and a $70 million break over two years for NASCAR .

When the editorial staff finishes cooking their federal goose, they might take a gander at the special-interest tax goodies that are parts of the North Carolina tax code. According to the NC Department of Revenue, the state provides a $35.8 million annual corporate tax break to in-state movie production, including a refundable tax credit (the tax credit is set to expire in 2014) and $400,000 in tax breaks for aviation fuel and vehicle parts used in "professional motorsports." Motorsports facilities are also classified as a special business class that are eligible for tax credits for adding jobs or investing in property.

Hobbesian conclusions of NRC panel

In Leviathon, Thomas Hobbes famously conjectured that life in the state of nature, with every man against every other, is "nasty, brutish, and short." A scientific report by a panel of the National Research Council, U.S. Health in International Perspective: Shorter Lives, Poorer Health, has concluded much the same thing about life in the U.S. in the 21st century.

From the report summary (bold from the original)

The panel was struck by the gravity of its findings. For many years, Americans have been dying at younger ages than people in almost all other high-income countries ... This disadvantage has been getting worse for three decades, especially among women. Not only are their lives shorter, but Americans also have a longstanding pattern of poorer health that is strikingly consistent and pervasive over the life course -- at birth, during childhood and adolescence, for young and middle-aged adults, and for older adults.

In almost every category you could imagine--infant health, injuries and homicides, sexually transmitted diseases, drug abuse, diabetes, heart disease--Americans suffered worse outcomes than most other developed countries, leading to especially high odds of dying before age 50.

Even worse, the reasons for these disparities are as unnecessary as they are tragic. The panel cited gaps in our health system (especially the lack of insurance), poor health behaviors (especially over-eating and drug abuse), accidents, violence (especially the availability of firearms), poverty, social immobility, and physical environments that discourage natural exercise. As the NRC panel states, "The tragedy is not that the United States is losing a contest with other countries, but that Americans are dying and suffering from illness and injury at rates that are demonstrably unnecessary."

Many of these gaps are addressable, but one party seems determined to widen, rather than close, nearly every addressable one. That party's fiercely professed "respect for life" is belied by a host of policies that promote death.

Last NC meth prescription caused side effects

Last month, a North Carolina legislative panel recommended requiring people to obtain a doctor's prescription in order to purchase over-the-counter cold medicines with pseudoephedrine, an ingredient that can be used to produce methamphetamine. NC already prohibits off-the-shelf sales of cold medicines, limits the number of purchases during a single visit and during a month, requires photo identification for purchases, and requires customers' names to be entered into a central, searchable database. Nevertheless, the legislative panel wants even more onerous and costly restrictions--restrictions that would add the time and expense of a doctor's visit the cost of a cold medicine purchase. The panel cites the continuing rise in meth lab busts as evidence of a worsening meth problem.

What's behind the increase in meth lab busts? Much of the rise can be traced to the very laws that the legislature has already put in place, as NC's Attorney General, Roy Cooper, inadvertently explained in a press release yesterday.

Meth lab busts in North Carolina reached a new high in 2012 as a simpler method for making small amounts of the drug spread statewide. At the same time, electronic tracking of pseudoephedrine buys is helping stop illegal sales and leading law enforcement to more meth labs, Attorney General Roy Cooper said Tuesday.

...State Bureau of Investigation agents responded to 460 meth labs in 2012, compared to 344 meth labs in 2011 and 235 labs in 2010. Approximately 73 percent of the meth labs busted in 2012 used the “one pot” method. One pot labs, also known as shake and bake labs, make smaller amounts of meth than previously seen larger meth labs. Criminals can cook meth in a plastic soda bottle using a small amount of pseudoephedrine, the illegal drug’s key ingredient found in cold medicine.

A new electronic system that tracks purchases of pseudoephedrine is helping to block illegal sales of that key ingredient and lead law enforcement to meth labs, Cooper said. Approximately 54,000 purchases, a total of more than 66,000 boxes of pseudoephedrine, were blocked last year in North Carolina by pharmacies using the system, called the National Precursor Log Exchange (NPLEx). The amount of pseudoephedrine blocked could have been used to make 277 pounds of meth.

Making it harder to get the key ingredient has prevented an increase in the number of larger labs and has forced some criminals to use the one pot method.

There is no evidence that meth production is up. Meth busts have risen because of an increase in enforcement that is tied to last year's law. Also, the vast majority of busts that are being made involve much, much smaller labs than previous years--due also to changes in the law.

The proposed prescription requirement would increase money costs, increase time costs, and generally inconvenience all North Carolininians. The requirement would discourage many, many more legitimate purchases (another cost) than illegitimate purchases. The increase in meth lab busts provides no justification whatsoever for imposing those widespread and very real burdens.

Insanity

Completely and insanely legal right now in the United States.



This is what our crazy gun laws allow.

Four NC Tea-Party Reps. vote against Hurricane Sandy relief

North Carolina Tea Party Reps. Virginia Foxx (NC-5), Richard Hudson (NC-8), Mark Meadows (NC-11), and George Holding (NC-13) joined 63 other Republicans in voting against H.R. 41 to allow the National Flood Insurance Program to borrow $9.7 billion to assist victims of Hurricane Sandy who had paid their flood insurance to receive benefits.

Apparently, North Carolinians are never in need of this help. Oh wait, they are!

Gun deaths up again in 2011

Preliminary statistics from the Centers for Disease Control indicate that the number of deaths in the United States attributable to firearms rose from an upwardly revised 31,672 in 2010 to 32,163 in 2011. The increase mainly reflected increases in firearms-related suicides (up from 19,392 in 2010 to 19,766 in 2010) and accidents (up from 606 in 2010 to 851 in 2011). The number of firearms-related homicides was essentially unchanged (edging up slightly from 11,078 in 2010 to 11,101 in 2011).

The unadjusted mortality rate from firearms (number of firearms-related deaths per 100,000 people in the population) remained constant from 2010 to 2011 at 10.3. The age-adjusted mortality rate from firearms was also constant (10.1 in both years). In contrast, the overall number and rates of homicides fell. Also, the overall age-adjusted mortality rate from all causes fell.

On an age-adjusted basis, people were more likely in 2011 to be killed by a firearm-related suicide or accident (6.4) than to be killed by any type of homicide (5.2; the firearms-related homicide rate was 3.6). Age-adjusted firearm-related death rates were higher than the age-adjusted rates for HIV (2.4), liver disease and cirrhosis (9.7), Parkinson's disease (7.0), and prostate cancer (8.3), but lower than the age-adjusted rates for motor-vehicle accidents (10.9), septicemia (10.5), pancreatic cancer (10.9), and breast cancer (12.0).

If the CDC broke out the figures, age-adjusted firearms-related mortality would have been the 11th leading cause of death in the U.S.

"Some of the firearms that we've fallen in love with"

A few weeks ago, Wayne LaPierre, the foaming at the mouth executive vice president of the National Rifle Association, excoriated the entertainment industry for promoting violence and contributing to the Newton school shootings.

...I mean we have blood-soaked films out there, like “American Psycho,” “Natural Born Killers.” They’re aired like propaganda loops on Splatterdays and every single day.

1,000 music videos, and you all know this, portray life as a joke and they play murder -- portray murder as a way of life. And then they all have the nerve to call it entertainment. But is that what it really is? Isn’t fantasizing about killing people as a way to get your kicks really the filthiest form of pornography? In a race to the bottom, many conglomerates compete with one another to shock, violate, and offend every standard of civilized society, by bringing an even more toxic mix of reckless behavior, and criminal cruelty right into our homes. Every minute, every day, every hour of every single year.

A child growing up in America today witnesses 16,000 murders, and 200,000 acts of violence by the time he or she reaches the ripe old age of 18. And, throughout it all, too many in the national media, their corporate owners, and their stockholders act as silent enablers, if not complicit co-conspirators.

What has LaPierre's NRA been doing to help curb the culture of violence? Pimping that exact form of pornography in exhibits glorifying the firearms used in violent television shows and movies at its National Firearms Museum.

Media Matters for America has a video of the museum's curator boasting about an exhibit that includes the shotgun used by Heath Ledger as the Joker in The Dark Knight and the shotgun used by Javier Bardem in No Country for Old Men. Or as the curator puts it, "some of the firearms that we've fallen in love with in our youth and our adulthood wishing that we too could be like our matinee idols."

Civitas proposes taxing insulin, artificial arms and legs

How cruel is the proposal by the John W. Pope Civitas Institute to replace North Carolina's progressive income, corporate, and privilege taxes with expanded sales, franchise, and real estate transfer taxes? It could literally cost amputees their artificial arms and legs and diabetics their insulin.

The sales tax elements of Civitas's proposal include increasing the tax rate from its current level of 6.87 percent on average (4.75 percent at the state level and 2.00-2.50 percent at the local level) to 8.05 percent and expanding the tax base. The largest part of Civitas' tax base expansion (and the largest gain in anticipated revenues) comes from "repealing current exemptions, preferential rates, and refunds" (p. 4). Civitas provides almost no detail for what these "exemptions, preferential rates, and refunds" include, leaving the impression that they are just a bunch of loopholes.

Every other year, the North Carolina Department of Revenue (NC DOR) compiles a list and estimates the value of tax "expenditures" (the value of exemptions, deductions, special rates, etc.) throughout the state's tax code. The latest estimates come from 2011 and generally provide estimates of the value tax "breaks" for 2011-12. An examination of these items reveals why Civitas was silent on these details.

The table below lists some of the items that would be included in Civitas' proposal.The table also lists the NC DOR estimate of the value of the state taxes saved in 2011-12 under the existing 4.75% rate and an estimate of how much the 8.05% Civitas sales tax would cost.

Law enforcement officer deaths down 23 percent in 2012

Fatalities among law enforcement officers fell 23 percent from a year earlier, according to a preliminary report from the National Law Enforcement Officers Memorial Fund (NLEOMF). The NLEOMF reports that 127 law enforcement officers lost their lives while performing their jobs in 2012.

The loss of life is appalling; however, the trend is good news. The number of fatalities is not only far lower than last year's toll but also near the 50-year low set in 2009, as shown in a graph from the NLEOMF web-site.

The fall largely reflects a decline in firearm-related deaths, which dropped 32 percent from 72 in 2011 to 49 in 2012. However, traffic-related deaths also fell by 17 percent.

Although the overall trend is welcome news, there were some disturbing developments. Ambush attacks increased and were the largest single source of firearms-related deaths, accounting for just over one in nine officer deaths.

Let's hope that 2013 is safer.

Death by dysfunction

As nauseating and potentially damaging as the current stalemate over the fiscal cliff is, it's only one of several important pieces of legislation to run afoul of the dysfunctional Republican House of Representatives.

Farm Bill. In June, the Farm Bill, which sets the country's agricultural policy, authorizes U.S. Department of Agriculture programs, and funds food and farm disaster assistance programs passed the Senate (S. 3240) with a bipartisan 64-35 majority. The bill includes several tough reforms; the Congressional Budget Office estimates that the bill would cut $23.1 billion in expenditures over the next ten years

The House Committee on Agriculture marked up a version of the bill and passed it with an overwhelming and bipartisan 35-11 vote. However, there it stopped, as House leaders, under pressure from extreme conservatives, refused to allow a general vote. Foreshadowing the shrewd strategy that he would later adopt for the fiscal cliff, House Speaker Boehner substituted a one-year "plan B" bill but then pulled that when the radical right wouldn't go along.

As the year ends, $23.1 billion in program cuts along with five-year certainty for farm policy languish without an up or down vote because the cuts aren't extreme enough for a portion of the radical right. Worse, several provisions of the current farm bill are set to expire on January 1, including the dairy cliff.

"All I need is a miracle" -- growth in the no-personal-income-tax states

Earlier this week, I analyzed a proposal that the John W. Pope Civitas Institute has made to eliminate the corporate, personal, and business franchise taxes that North Carolinians pay and to replace these with a higher and expanded sales tax, a business license fee, and a real estate conveyance fee (a real estate sales tax). The proposal would shift the responsibility for paying taxes away from North Carolina's wealthiest households and most prosperous corporations and towards its poorest households and smaller businesses.

Civitas acknowledges that the tax proposal would be regressive but claims that it would lead to greater economic growth. As evidence it cites the experiences of states that do not assess personal income taxes and of those that do not assess corporate income taxes. These states experienced higher growth in their Gross Domestic Products (GDPs) than other states.

As I wrote in the earlier post, this contention is correct, but it is hardly evidence of the effect of the states' tax policies. For example, total GDP is influenced by the number of people in a state, and GDP growth is influenced by population growth. Each of the no-personal-income-tax (NPIT) states experienced above-average population growth. Several of the states have other things that make them unique. Below I analyze the growth rates for the states, highlighting some of their characteristics.

Civitas' immiserating tax scheme

Charge them for the lice
Extra for the mice
Two percent for looking in the mirror twice
Here a little slice
There a little cut
Three percent for sleeping with the window shut

Taking inspiration where it can (and probably recommending that the poor pay a tax for that too), the John W. Pope Civitas Institute has released an audacious proposal to reduce rich North Carolinians' payments by having everyone else pay more in taxes for food, medicine, and rent.

Specifically, Civitas recommends eliminating the personal income tax, the corporate income tax, and the franchise tax that North Carolina households and businesses currently pay and replacing these with

• a higher (8.05 percent) sales tax which would be extended beyond the current tax base to cover groceries, insurance premiums, out of pocket medical expenses, residential leases, lottery ticket sales, and any service that is taxed in at least one other state (the proposal would also eliminate other exemptions and special rates in the current tax code but would exempt business expenditures on capital goods);
• a business license fee; and
• a real estate conveyance fee (a tax on commercial real estate sales)

Civitas claims that the change would be "revenue neutral," meaning that the new and increased taxes would bring in as much money as the taxes they are replacing. The claims of neutrality are suspect because the revenue figures that Civitas uses are $750 million less than what the state actually took in. Let's assume, however, that the final proposal is revenue neutral.

Under a revenue neutral tax reform, some households and businesses will pay less, while others will pay more. The reform shifts the responsibility of paying taxes from one group to another.

For this particular proposal, the responsibility would shift from rich households and prosperous corporations to poor households and smaller businesses. The tax system would lurch from being progressive (meaning that wealthier people pay a higher proportion of their income in taxes than poorer people) to regressive (meaning that poorer people pay a higher proportion of their income in taxes than wealthier people).

Civitas claims that this shift will actually be beneficial because "progressive income taxes (are) more harmful to growth." As evidence in support of this claim, Civitas compares "growth rates" for states with and without corporate income taxes and states with and without personal income taxes. It finds that states without the taxes experienced higher rates of economic growth.

Civitas provides almost no documentation for its figures besides saying that they are based on data from the Bureau of Economic Analysis (BEA). An analysis of the BEA data, however, indicates that the Civitas claims don't hold water.

The "headline" measure of state economic growth that the BEA uses is real (inflation-adjusted) gross domestic product (GDP), an estimate of the value of goods and services produced within the state. For instance, Civitas claims that average annual growth from 2002-2011 was half a percent lower in states with a personal income tax than in states without such a tax (1.7 percent growth vs. 2.2 percent growth). There is some question regarding which states do and don't have personal income taxes. Seven states (Alaska, Florida, Nevada, South Dakota, Texas, and Washington) definitely do not have personal income taxes. Two other states (New Hampshire and Tennessee) only assess personal income taxes on certain types of income, such as dividends or interest. For the present analysis, I computed the annual changes in real GDP for 2002-3, 2003-4, ..., 2010-11, averaged the annual changes for the first seven states, and averaged the annual changes for the remaining 43 states (omitting the District of Columbia). Doing this reproduces Civitas' 2.2 percent average annual growth figure for the no personal tax states but only produces a 1.5 percent growth figure for the other states. These comparisons are more favorable to Civitas' argument than others (such as including DC or treating NH and TN as no-personal-income-tax states), so I'll continue with them.

There are a number of problems with Civitas' analysis. For one thing, Civitas does not adjust its GDP figure for population growth. Redoing the comparisons using real per capita GDP reveals that economic output per person grew slightly more in the personal-income-tax states (0.7 percent per year) than in the no-personal-income-tax states (0.6 percent per year).

Civitas similarly fails to account for the fact that three of the seven no-personal-income-tax states are major oil and gas producers that have benefited from high energy prices over the last decade. Although oil and gas extraction accounted for only one percent of economic output nationally in 2010, it accounted for 16.4 percent of the output in Alaska, 14.2 percent of output in Wyoming, and 6.3 percent of output in Texas. Indeed, Alaska gets so much revenue from its oil and gas fields that it actually pays an annual royalty to its citizens.

Federal government military and civilian activity also accounts for a larger share of economic output in the no-personal-income-tax states than in the others, and federal military and civilian activities grew at a faster rate in the last decade in those economies than in others. For example, although federal civilian and military activities only accounted for 3.7 percent of state economic output nationally in 2010, they accounted for 10 percent of the economic activity in Alaska and 5.1 percent of the activity in Washington. The state and local governments in the seven no-personal-income-tax states also get more intergovernmental revenue from the federal government (e.g., payments from the federal government to help the state and local governments operate schools and build roads) on a per capita basis than other states. Figures from an analysis by The Economist also reveal that the seven no-personal-income-tax states enjoyed a bigger net differential over other states between 1990 and 2009 in the receipt of federal expenditures over the payment of federal taxes. It's much easier to lower your state's tax rates when taxpayers from other states are footing so much of the bill.

Shifting more of the responsibility of paying taxes from those who have benefited from the economy to those who haven't is a cruel prescription, especially given the deprivations that poor families have faced over the last few years. However, it's crueler still to do this with no demonstrable benefit to the economy.