There are tons of things wrong with our political system. The main one is the inability of our governments (federal, state, and local) to deal with problems that effect the daily lives of the people. Jobs, stagnant wages, health care, education, and on and on. Transportation is another important issue, especially in a fast growing state like Texas.
This article from the Texas Tribune shows how sorry the politicians in Texas have become, Transportation Funding Likely to Be Big Issue in 2015.
Most of the state’s transportation funds come from a 20-cent gas tax and vehicle registration fees. Neither revenue source has kept up with inflation. Over the last decade, Texas has increasingly relied on debt financing and tolls to expand its highway system.
Citing strong population growth and rising costs, TxDOT officials told lawmakers in January that the agency needs an additional $4 billion a year to maintain current traffic levels. Budget writers found the agency $200 million a year toward narrowing that gap.
A lack of urgency on the issue permeated the Capitol in part because there are major road construction projects underway across the state. That will change after TxDOT’s bond proceeds dry up in about two years, TxDOT Chief Financial Officer James Bass said. Drivers would still see some road construction work in 2016, but the signing of contracts for new projects would slow considerably.
“It would take a while for that to work it’s way through the process but you’d eventually see less and less activity on the highway system,” Bass said.
Because roads are being built, politicians don’t believe there’s a funding problem. What that means is that until it is painfully obvious that there is a problem, or crisis, nothing of any consequence will be done.
In the meantime the gas tax, which used to fund our pay-as-you-go system, hasn’t been raised in over 20 years. But tolls have been implemented and are being raised automatically. Check out what’s happening in North Texas, Texas lawmakers’ stubborn refusal to pay for roads.
Times change, but what doesn’t is the need to keep up existing roads and build new ones, such as Sam Rayburn Tollway and Bush Turnpike. Without new tax dollars, that task mostly falls to the North Texas Tollway Authority, which must remain fiscally sound through current indebtedness and future projects.
This is why your toll charge went up Monday — by 5.9 percent to 16.2 cents per mile — and no one asked you about it. For that matter, your tolls go up again in two years and again two years after that, as far as the eye can see, thanks to a 2009 NTTA board vote that authorized the regular increases. Board chairman Kenneth Barr acknowledges that no customer likes it but asks you to consider NTTA’s perspective.
Small scheduled increases allow NTTA to pay off debt while maintaining a strong credit rating that keeps interest rates down. NTTA owes about $9.4 billion to bondholders for roads and has promised bondholders it will keep revenues at 1.5 times its debt payments, which officials say will rise to $540 million per year by 2019.
Sure, it could gamble on higher traffic instead of higher fees, but if that bet failed, toll customers would get stuck with even more dramatic — and unscheduled — increases. The bottom line is the bottom line: NTTA must cover debt plus 50 percent.
That gives toll customers two choices: Pay more every two years or stay off Dallas North Tollway, Sam Rayburn and Bush.
Oh, there’s another: Build more roads from tax dollars. Except that’s not really an option, when it’s a monumental struggle in Texas to dedicate the funding just to maintain current highways. As this newspaper has noted repeatedly, it’s a consequence of a Legislature that refuses to consider even modest increases to the gasoline tax or alternative funding solutions.
Even the bill awaiting passage in the second special session would account for less than a quarter of the known road-funding needs. So we’re stuck with more toll roads, a wish and a prayer.
If you want better answers, clearly they must come from someone other than your no-new-taxes-no-way state legislators.
Or as the FWST put it, TollTags will become your next utility bill. Another way to look at it is that it’s a road privatization tax. The fact of the matter is that roads, no matter what, have to be paid for by the people of Texas. The previous system was much more fair and sane. We should go back to that, but it will likely take a crisis or a turnover of our government before anything like that will happen in Texas.
The Texas GOP, since taking control of all the levers of government in Texas, has been doing everything they can to move taxpayer money into the hands of their campaign contributors, in the form of privatization schemes – aka Public Private Partnerships or P3’s. Instead of government being a pay as you go, non profit system, it’s turned into a system of privatized profits and socialized losses.
They’ve tried it and somewhat succeeded with toll roads, although the biggest boondoggle, the Trans Texas Corridor, mostly failed. They tried privatizing state services which imploded, see Accenture and IBM. They haven’t yet been able to get their hooks completely into public education, but a new attempt is coming in January. And more then likely Kyle Janek will be putting forward some kind of scheme soon.
The reason this is important is because another one for Gov. Rick Perry’s great “achievements” has become nothing more than an give-away to his wealthy corporate contributors. This article from James Moore at Progress Texas PAC points out the latest atrocity, Cancer and Crony Capitalism in Texas.
It is a growing scandal that could forever change Texas politics. As national political players look toward turning red Texas blue, something that would put the electoral college out of Republicans’ reach for years, many see the scandal as the beginning of the end of GOP dominance in Texas.
Republican Gov. Rick Perry and his cronies in and out of public office have diverted funds intended for cutting-edge cancer research into the campaign pockets of Perry and Lt. Gov. David Dewhurst. You read that right. Proceeds from millions in taxpayer-backed bonds awarded by the Cancer Prevention Research Institute of Texas (CPRIT) have fallen victim to corruption and cronyism. Cronies get the state money; the cronies give some of the money back to Perry and others.
The agency might better be named the Crony Capitalist Research Institute as searches for cancer prevention, treatment and cure are sacrificed to the feeble political ambitions of a few petty politicians and greedy plutocrats. It is hard to imagine a greater moral failing. Unless, of course, you remember that Perry and his cronies are the very same people fighting against the expansion of Medicaid and the creation of health care exchanges under the Affordable Care Act. People are going to get sick and die because of the actions of Perry and others. That is not hyperbole or political spin.
CPRIT is the nation’s second largest source of cancer research money, behind only the federal government. Texas voters approved the agency’s bonding authority in November 2007 (a few days later, wannabe recipients of the largesse were lavishng money on Perry and Dewhurst). The agency could spend $3 billion over ten years.
Amid calls for state and federal criminal investigations (I filed one of the state complaints under the auspices of Progress Texas PAC), agency officials are scrambling. Now it has been revealed that key emails among those officials have disappeared. That is a sign that evidence is being destroyed and that a coverup is underway.
The players involved include such stalwart Perry-ites as James Leininger and Jimmy Mansour. They have also been central players in the right wing’s nationwide effort to privatize public education. Even though he once held stock in a company that received CPRIT funding, Mansour remains chairman of the agency’s Oversight Committee. Other Oversight Committee members include Texas Attorney General Greg Abbott and State Comptroller Susan Combs. Perry, Dewhurst and the Texas House Speaker appoint the others.
This scandal opens a window into the crony capitalists’ privatization mania. What will happen to public education when the greedy and morally unmoored get their hands on taxpayer money through school privatization? Or through Medicare vouchers? Or Social Security private accounts?
If these people will sacrifice victims of cancer to further their own wealth and power, it is doubtful they’ll resist the temptation to destroy education or raid our earned savings and health care insurance. If crimes have been committed, maybe the perps will get to spend some time in a private prison. That might end privatization mania forever.
If Texas taxpayers could only get so lucky. He points to these three articles for anyone that needs to get up to speed – here, here and here.
Recently reelected Democratic state Sen. Wendy Davis is on the case, Senator Davis Calls On Perry To Fast Track Reform Of Cancer Agency.
This is just the way our dysfunctional government malfunctions with our current leadership at the helm. Rick Perry as the longest serving Texas governor in Texas history, by far, has more control over Texas than any governor ever. In modern history he is the only governor to serve at least two consecutive four year terms. There are Perry loyalists in every nook can cranny of Texas government. He, essentially, owns them all.
All of this proves that the Texas GOP’s plan since taking over the levers of power in Texas is to shift taxpayer money to their corporate sponsors through privatization schemes. It the scam that’s always been there for everyone to see.
That’s a lot of money.
Not just vouchers, corporate-sponsored vouchers.
Yesterday that was an interim hearing in the House State Affairs Committee, regarding two interim charges. Via the Texas Legislative Reference Library:
Charge: Resource adequacy in the Texas electricity market
- Seasonal Assessment of Resource Adequacy for the ERCOT Region: Fall 2012, ERCOT, September 4, 2012
- Annual Energy Outlook 2012, U.S. Energy Information Administration, June 25, 2012
- ERCOT Investment Incentives and Resource Adequacy, The Brattle Group/ERCOT, June 1, 2012
- Report on the Capacity, Demand, and Reserves in the ERCOT Region, ERCOT, May 22, 2012
- Texas Electricity Profile 2010, U.S. Energy Information Administration, January 30, 2012
Charge: Inefficiencies in the regulation of public utilities to minimize cost to consumers
I was struck by a couple of things while reading the AAS article on the hearing, Lawmakers urge decision on electricity market. Most of what was discussed was not about how to make the market better for the consumer. It was about how to make the building power plants more profitable for corporations in Texas, which will definitely make energy more expensive for the consumer.
State lawmakers on Wednesday grilled utility officials on the cost of addressing the threat of electricity shortages by 2015 and urged the Public Utility Commission to act quickly to choose a solution.
They were told wholesale prices might need to rise 30 percent — though retail rates for consumers might not go up that much — but several hours of testimony underscored that various segments of the industry and its customers, particularly manufacturers, disagree whether the situation is dire enough to dramatically change the wholesale electricity market. [Emphasis added]
Does anyone really believe the price increase won’t be passed onto the consumer, in total? But as the article goes on to show the price has to be raised so the corporations that build power plants in Texas can make a profit.
But Sam Newell with the Brattle Group, the state’s consultants, warned that ERCOT has a structural problem with low wholesale prices that discourage investment in new power plants to keep up with the state’s growing economy.
In 2011, when extreme weather temporarily hiked electricity demand and prices, Newell said a power plant would only have made what it needs to average over its lifespan: “You’d have to have weather like 2011 (every year) for the economics to work out for the investor.”
How is that any different then raising taxes to build a new power plant? The only way it’s different is that it will actually cost the consumer/taxpayer more because now a profit has to be guaranteed. And the consumer/taxpayer used to own the finished product. What it also means is that building new power plants in Texas has little to do with what’s best for Texans (the consumer), but whether a profit can be made by the corporation that builds the power plant. This is what privatization has brought us and it’s not right.
Texas officials may double electricity price cap.
In January it will be 10 years since the Texas GOP takeover of all levers of government power in Texas. The Texas Tribune has a look back, Looking Back at Texas’ Republican Decade.
It was a gradual takeover, with the minority party trending upward for several years: George Bush was elected governor in 1994, Republicans took over the state Senate in 1997, and by 2001 the party was just four seats away from taking a majority in the House. The resulting 2001 legislative redistricting maps would cement the state’s shift from blue to red.
A new House map and an influx of campaign funds — some of which were eventually deemed illegal — led 88 Republicans to be elected to the House in 2002. Tom Craddick was elected the state’s first Republican speaker since Reconstruction. Craddick says the new majority carried responsibilities and freedoms many Republicans had never experienced, which led to a few problems during that 2003 session.
But what really shines through is why we’ve gotten such bad legislation over the years.
The new leadership had clear priorities: insurance regulations aimed at stabilizing a homeowners insurance market with skyrocketing premiums, and legislation limiting medical malpractice lawsuits.
“Most of the people that carried the major legislation had never passed a major bill,” Craddick says. “Many of them had never passed anything but local bills.”
One example of that inexperience surfaced at the end of the session. When bills headed to conference committees to reconcile differences between House and Senate versions of a bill, Craddick often had multiple committees meeting in different parts of his apartment in an effort to help with the negotiations.
“My wife, Nadine, came home after an event and said, ‘What’s going on? There are people everywhere in the apartment,’” Craddick says. “And I said, ‘Nadine, you know more about conference committees then most of them. Dig in and help with one of them.’”
Kronberg says the inexperience also showed in how quickly some bills were passed, sometimes with little understanding of what was in them. That includes passage of bills that gave new powers to Texas’ traditionally weak governor.
[Harvey Kronberg, the editor of the Quorum Report] says Republican inexperience also showed in some of the key legislative committees. More experienced Democrats were either voted out of office or relegated to the background, and eager but “green” Republicans took control.
The GOP leadership also had problems getting business-centric lawmakers to get out of their comfort zone and tackle other topics. Craddick says that was a problem, especially when trying to fill out the House committees focused on health care.
“No members wanted to do it. No Republicans wanted to be on those committees. No Republicans wanted to be chairmen of it,” Craddick says. “We had a real hard time. I had to sit some members down and say, ‘You know this is a major issue in the state. We’ve got to be able to do it.’”
The new majority also had to contend with a multibillion-dollar budget deficit. The hole was filled through program cuts, fee increases and some accounting tricks. But there were no outright state tax increases.
And at the end Cal Jillson echoes something I’ve been saying for years.
We can’t expect our current leaders who believe government is the problem, to know how, or even try for that matter, to use government for, or as part of, a solution.
Using government to help people – not corporations – is a foreign concept to Republicans. (And these days for far too many Democrats as well). And this goes to the heart of what once was the difference between Democrats and Republicans. Here’s Jillson:
Southern Methodist University political scientist Cal Jillson says that budgetary road map established in 2003 has directed GOP policy ever since. Over the years, he says, this has led to less money for state infrastructure, health care programs, and public and higher education.
“They are far more oriented towards stopping bad things from happening — from their perspective — than causing good things to happen,” Jillson says. “They don’t have a positive agenda in the sense of [making] improvements to education or access to health care, transportation, the environment or any of the other major policy issues.”
I would put that slightly different. The GOP has what they would consider a positive agenda for education, health care, transportation. etc. It’s called corporatization, or privatization. As far as they’re concerned there’s no reason to spend taxpayer money unless it’s to overpay the private sector for something the government used to do cheaper. Exhibit A, State, Accenture split is final.
Texas hired the Accenture-led Texas Access Alliance in 2005 to manage the Children’s Health Insurance Program and to run call centers enrolling Texans in food stamps and Medicaid.
It was one of the most ambitious outsourcing projects of its kind in the country: a deal originally worth $899 million over five years. The call center project was envisioned as a way to save money and give Texans more ways to apply for services than in person at offices. But the project hit problems — advocates for the poor reported widespread difficulties in eligible Texans getting benefits — and the savings never materialized.
The Texas GOP deregulated college tuition in 2003 and as a result:
According to Texas Higher Education Coordinating Board data, since tuition deregulation was passed in 2003, overall designated tuition has increased 156 percent. The percentage increase at select Texas universities is even higher. Since fall 2003, tuition at the University of Texas at Austin has increased 230 percent; tuition at the University of Texas at Dallas has increased 219 percent; tuition at Texas Tech University and the University of Houston has increased 178 percent; and tuition at Texas A&M University and increased 165 percent.
The list goes on and on. The Trans-Texas Corridor. The GOP tax swap scheme of 2006. In 2011, for the first time ever, enrollment growth was not funded in public education. They Cut children’s heath insurance, aka CHIP, funding in 2003. Also in 2003 they increased state fees to the tune of almost $3 billion.
Besides that there have been a couple of taxpayer funded corporate welfare funds set up since 2003. The Texas Enterprise Fund (TEF) was created in 2003. It’s described as being, “Overseen by the governor, lieutenant governor and House speaker, TEF doles out taxpayer money to private companies to create jobs in Texas”. If’s performance has been discouraging. The other is the Emerging Technology Fund which has been tied to cronyism since it’s inception. Including this from today, 4th bankruptcy in Texas gov’s tech fund pushes losses above $5M, clouds earnings.
Critics have questioned why the state invested any money in Terrabon. It’s among a handful of tech fund recipients with ties to campaign donors of Perry, who has repeatedly denied that politics influence the funding process. The final say on whether a company receives a taxpayer investment is made by Perry, the lieutenant governor and the House speaker.
One of Terrabon’s backers is Texas A&M regent Phil Adams, who was appointed to that job by Perry and who has contributed more than $300,000 to the governor’s campaign. On his state financial disclosure form filed in 2010, Adams stated that he received between $10,000 and $24,000 in interest, dividends or other income sources from Terrabon.
And the one thing that seemed like it had a chance of being worthwhile was the Cancer Prevention and Research Institute of Texas (CPRIT). And now it appears to have been politicized with cronyism, Top scientific reviewers defect from cancer agency and As annual meeting begins, embattled Texas cancer agency looks forward.
It’s been a tumultuous few months for Texas’ cancer-fighting program.
The agency, whose annual meeting begins Wednesday, has seen mass resignations, accusations of politics overtaking science and new divisions over how the state should best spend $3 billion in taxpayer money fighting cancer over the next decade.
The Cancer Prevention and Research Institute of Texas is trying to repair a once-celebrated image that has been battered by top scientists publicly condemning the agency over how it operates the nation’s second-biggest pot of cancer research dollars.
Thirty-three of the agency’s scientific peer reviewers have recently resigned, many in protest. They include a Nobel laureate and other top names in the science community who say politics have seeped into decisions over which projects get funding and which don’t.
What all of this shows is that in almost 10 years Texas, under GOP dominance, is unrecognizable from what it once was before the takeover. And hat’s not a good thing for the overwhelming majority of Texans. And the truly sad part is that unless the people of Texas realize it and demand something else it will continue.
[UPDATE]: Part 2 from the Texas Tribune, In Decade of GOP Power, Cuts Moved Costs to Local Level.
Just imagine if you were still making the same amount of money you were in 1993. Would you still be able to eat, pay your bills, survive? It’s pretty clear what the answer is. That’s what has happened with transportation funding in Texas. The gas tax is the same now as it was in 1993, and since then the price of everything else has gone up. No one in Texas should be wondering why our transportation infrastructure in Texas is having trouble surviving. Via the Texas Tribune.
Federal and state gas taxes remain the primary revenue source for road construction and maintenance, but they are widely viewed as inadequate for the state’s needs. Texans pay 38.4 cents in federal and state taxes per gallon, a figure that hasn’t changed in nearly 20 years despite inflation, rising construction costs and the improving fuel efficiency of cars. And the state’s 20 cents-per-gallon gas tax is lower than the national average of 29.7 cents per gallon, according to the Legislative Budget Board.
The Texas Legislature, though, is unlikely to approve raising the gas tax for the foreseeable future, lawmakers and political observers say. Past efforts to raise fees or taxes have failed, in part, due to criticism that a large portion of the gas tax is currently diverted to spending on things other than roads, such as funding the Department of Public Safety and public education. But ending the diversions also faces an uphill battle, because those areas of government that rely on some of the gas tax would have to find new funding to replace it.
That should make it crystal clear to everyone why very soon we won’t have any money in Texas to pay for new roads or maintain existing ones. It’s easy, (and I’ve done it), to simply blame neglect. But that’s too easy and it lets the real culprit, or culprits, off the hook. The real culprit is ideology and greed, and our political system taken over by the wealthy and corporations. (See, University of Texas Rootstrikers: Why I Joined the Movement).
It’s hard to understand why more people don’t have a problem with the corporate takeover of our government. We’ve gone so far from where we once were, using a pay as we go system, to pay for our needs. And we understood that prices rise and things cost more over time.
But that’s no longer how we operate, especially in Texas. It’s been chronicled here and elsewhere over the last 8 years how a minor increase in the gas tax, then indexed to inflation, could have prevented this crisis in Texas. Instead our leaders have tried what amount to the “to good to be true” schemes our parents warned us about as children.
Many of us have realized it, but our leaders have not. It’s painfully obvious that, no matter what happens in three weeks, that’s all were likely to get in the near future. Here are a few snippets from the business lobby’s recent Op-Ed on the subject, More public-private deals can help with Texas road needs.
Texas is facing a transportation crisis.
By this time next year, the state will have exhausted its funds for new roads, with only enough to maintain the highways we have, and we’ll soon run short of money to do even that.
Major funding sources for highway development — the gas tax and vehicle registration fees — can no longer keep pace with our transportation needs.
Highway funding has been covered primarily by the gas tax. However, this tax doesn’t go as far as it once did, even if it weren’t diverted to other priorities, which has been the case for years in Texas. The Wall Street Journal recently reported that the gas tax buys only about half the construction materials it did 20 years ago.
To keep pace with population growth and upgrade existing highways, Texas must explore creative ways of funding its roads.
In recent years, the Legislature has authorized the Texas Department of Transportation to partner with the private sector to meet the state’s most pressing infrastructure needs. Thanks to those public-private agreements, Texas has become a model state for infrastructure finance. Public-private partnerships offer the opportunity to create real, innovative and sustainable transportation infrastructure solutions, without raising taxes.
Several privately-funded transportation projects in Texas are on track to unclog some of the most heavily congested stretches of roadway in the state, while employing more than 400 Texas firms during construction.
These partnerships are part of the solution to getting us where we need to be — further down the road toward effective solutions to today’s transportation challenges. They also can jump-start economic growth, not only by creating jobs, but by delivering faster, more efficient transportation systems to connect Texans and build our communities.
The state also is considering turning to public-private partnerships to handle routine repair and maintenance work on various roadways. These are projects Texas sorely needs and could not afford through tax revenues alone.
At the same time, we will call on legislators to pass a modest increase of $50 in the vehicle registration fee. While no one likes new fees, the cost of doing nothing is far higher.
The major points are:
- We have a funding crisis.
- The gas tax can’t buy what it used to because it hasn’t been raised in almost 20 years.
- Because of this crisis we must get creative(?) and, essentially, privatize TxDOT.
- It’s implied that because of privatization there were 400 jobs created that wouldn’t have been created if we’d used tax money to build roads (WRONG!).
- And oh, by the way, were going to raise fees – but remember it’s not a tax (wink, wink, nudge, nudge).
The only difference between a fee and a tax, for Republicans, is that no one has signed a pledge to Grover Norquist not to raise fees. But the truly tragic part is that essentially privatizing TxDOT will only cost us all more money, in the long run, while driving down the quality and level of service, as it always does. It’s also likely force all the workers who currently are employed by the state into jobs working for corporations that pay less and offer less, or no benefits. Call it the “Wal-Mart-ization”, if you will, of transportation in Texas.
It’s really sad that few, if any politicians, talk about this. We used to take pride in our highways in Texas, they were some of the best in the nation. Now they’ve been sacrificed to profit, greed and ideology.
One of the most despicable attacks of the GOP regressives in Texas is their decision to take on teacher pensions. One group that sacrifices and deserves to have their pension protected, not privatized, are teachers. Via the AAS, Report: ConvertingTexas teacher pensions to 401(k) would be costly.
Dropping the guaranteed pension benefit for Texas’ future school employees would be costly, complicated and reduce benefits for retirees, according to a new study by the Teacher Retirement System of Texas.
The study, mandated by lawmakers last year, states that the $110 billion teacher fund can pay the benefits it owes through 2075 but will need additional contributions from the state or members to erase a $24 billion long-term funding liability.
That liability, however, would increase to $36 billion if new employees were closed out of the pension and instead received a retirement benefit akin to a 401(k), as critics of public pensions recommend.
The state would then need to find some way other than member contributions to pay off that liability, said Brian Guthrie, executive director of the Teacher Retirement System.
By all means. Let’s “fix” something that isn’t broken by making it cost more, provide less coverage, and more complicated. Those are the three things most people want in a retirement plan?! Here’s what the billionaire Koch-funded regressive “think tank” had to say about this disaster.
Even so, the critics say, they will continue to press for changes to the pension system during next year’s legislative session.
“It will get a good look. There is a high likelihood that changes will be made,” said Talmadge Heflin of the Texas Public Policy Foundation, a conservative think tank.
Lawmakers must ensure that the state’s retirement offering “is a combination of the best buy for the employee and for the taxpayer,” Heflin added.
This is just like the Social Security debate. It likely needs a boost in money for inflation over the next 60 years. No surprise there. There’s no reason to destroy teacher pensions through privatization. Teachers certainly deserve to have their pensions protected.
[UPDATE]: Read the report here.
As QR’s Harvey Kronberg so aptly pointed out yesterday, with the resignation of Tom Suehs from the Health and Human Service (HHS), it leaves both HHS and the Texas Education Agency (TEA) leaderless. Two of Texas’ most important agencies.
Vacancies now at the two largest state government agencies — TEA and HHS — with a whole heap of challenges in store for the new leadership at HHS
Today’s jarring news that Tom Suehs is leaving as chairman of Health and Human Services later this summer means another experienced hand in state government is leaving the tiller. He joins his Medicaid chief Billy Millwee who is also leaving his post in August. And, of course, these leadership changes are mirrored in public ed where Education Commissioner Robert Scott steps down next month and the chairmen of both legislative education committees won’t be returning next session.
I’m sure Perry and the wing-nuts see this as the bathtub being half-full. It’s their opportunity of a lifetime, and their not going to let it go to waste.
It’s hard not to see what’s being setup here. I’m sure privatization schemes, that rival the Trans Texas Corridor (TTC), will soon be coming for health care and education. Medicaid/Medicare and public education have always been the main targets of the “conservative” movement.
Perrys’ picks to replace Suehs and Scott will likely be right wing and pro-privatization. And it’s likely, no matter how the Speaker and US Senate/Lt. Gov. races turnout, that the committee chairs will be more right wing and pro-privatization. So cuts and privatization will likely be the proposed “fixes” for these two long-beloved public programs in our democracy.
It’s key to understand thr “The Public is necessary for The Private“. Without quality public education, the private sector will not have its needed, well educated,workforce. Also without an educated populace democracy struggles, at best, or at worst dies.
But not only are privatization schemes like the TTC coming, there’s more. Another tax swap scheme, like the one in 2006 that created an annual structural budget deficit, to finish filling up the bathtub. State Lawmaker Wants to Abolish Texas Property Taxes.
State Rep. Harvey Hilderbrann (R-Kerrville) tells 1200 WOAI news that he will introduce a measure in the upcoming legislative session to begin the process of abolishing residential and commercial property taxes, which are the largest income generator for local governments and schools.
Hilderbrann chairs the House Ways and Means Committee, which is the key committee in dealing with tax issues and tax reform.
“There is no way we are going to abolish property taxes overnight,” Hilderbrann told 1200 WOAI news. “It would be a long term project. We need to first reduce the growth in property tax revenues being used for schools.”
So far there is no proposal to replace the property tax, which provides a majority of revenue for school districts, and about 40% of the revenue to local governments. It also accounts for up to 100% of the revenue for agencies like hospital and water districts.
“You have such a large amount of revenue that you have to replace, certainly not over a short period of time, and probably not over a long period of time,” Hilderbrann said.
But he said that is no reason not to start discussing alternatives to property taxes, which he says are the biggest barriers to economic growth.Tea Party groups oppose property taxes, saying they turn people into ‘squatters in their own homes’ due to the need to pay the government.
Texas has no state income tax, so the property tax looms even larger in revenue projections. There is a proposal on the table to double the state’s portion of the sales tax, which is now about 6.25%, to replace the revenue lost by abolishing property taxes.
“If you were just to do away with school property taxes, you would have to replace it with something that would generate billions and billions of dollars,” Hilderbrann said.
To put this in perspective most states fund their government with a balance of three taxes major taxes – sales, property, and income. Texas doesn’t have an income tax, has an under performing business tax causing annual shortages, and now we’re supposed to start looking at doing away with the property tax. That not only makes no sense it’s crazy.
Let’s boil down what Hilderbran is saying. As we face another budget shortfall, it’s time to begin the long process of abolishing the property tax in Texas. But first we need to cut education spending more, (reduce the growth in property tax revenues being used for schools). Because the property tax provides the majority of the money for public education. It’s a lot of money to replace (over $40 billion/yr.), and if it was just done away with it would have to be replaced by something that would generate many billions of dollars. And the only suggestion offered is to double the sales tax.
It’s hard to find the starting point for attacking this, but here goes. Texas already has one of the most regressive tax systems in the United States. Which means the less money a person makes in Texas the higher a percentage of their income they pay in taxes, and vice versa. The main reason for that is because our sales tax is so high. The sales tax is a very regressive tax. Another reason is because Texas does not have an income tax, one of the fairest taxes. The property tax is a much less regressive/fairer tax then the sales tax. Which makes it easy to see that removing the property tax and replacing it with a higher sales tax would hurt poor, working and middle class Texans, while making it better for wealthy Texans. (See Who Pays Texas Taxes).
The best option for The Public would be to bring down property taxes with a state income tax.
The quality of life in Texas depends on our producing a well-educated workforce that can meet the demands of a global economy. A strong and vibrant public education for all Texas children is an essential precondition for a prepared workforce and a prosperous, competitive economy. In fact, providing public education is one of the constitutionally mandated charges of the state legislature. However, the state?s current revenue system is not providing adequate funding to fulfill this charge. Adding a personal state income tax to our tax mix is the best way to meet our needs.
But an income tax will never enter the debate as long as the right wing runs our state. The current policy debates in Texas are not about what’s best for the people of Texas. They’re about getting rid of government and The Public. Perry, and the Texas GOP truly believe that corporations will do a better job of educating our kids and providing health care. And that’s why the assault will continue.
A great article from the Texas Observer, The Brains Behind the Curtain. It’s extremely informative, especially for those who don’t know about the connection between a right wing think tank and Rick Perry’s successful political career.
It’s probably safe to say that the Texas Public Policy Foundation—whose officially stated mission is to “promote and defend liberty, personal responsibility and free enterprise”—is not a household name. But for Rick Perry, the influential think tank—modeled after the nationally known Heritage Foundation—has been a fast friend. During Perry’s 11 years as governor, the Texas Public Policy Foundation has provided the intellectual heft for his administration.
The article goes on to detail how the think tank was founded by San Antonio billionaire James Leininger, and how he brought a corporate PR guy to set it up. And he went straight to the gates of hell for advice.
Leininger reached out to Fritz Steiger, who at the time was the public relations director for Wal-Mart, for ideas. Steiger agreed to conduct some research for Leininger. His errand led him to a congressman from Wyoming named Dick Cheney, who suggested taking a look at the Heritage Society, a think tank based in Wyoming and patterned on The Heritage Foundation, the granddaddy of conservative think tanks. At the time, state-level think tanks were still a novel idea. Just a handful existed, none in Texas. Leininger jumped at Steiger’s proposal to launch a Heritage-type organization in Texas. “[He]said, ‘I’ll fund it, you’ll run it!” Steiger recalled in 2009 to Veritas, TPPF’s house publication.
It was started with two main right-wing goals. Ending public education and corporate accountability.
Leininger set out to amass that intellectual capital, and his first goal was to bring his two favorite issues out of the wilderness: school vouchers and tort reform.
But the crown jewel of what the TPPF does is meshing their “research” with the needs of corporations to acquire the funding they need to survive.
Still, the small cadre of activists clustered around Leininger was slowly laying the groundwork for a rise to prominence. One of the main tasks was securing a donor base for the nonprofit beyond Leininger’s personal fortune. The foundation’s laissez-faire bent and championing of big-business agendas (tort reform, tax cuts, deregulation) created wealthy allies.
Melinda Hasting—who served as the foundation’s vice president from 1996 to 1998 but has since broken with the conservative movement—says one fundraising tactic involved approaching corporations, wealthy businessmen, and corporate-funded foundations with a pitch. Hasting (formerly Melinda Wheatley) describes it: “We think this is beneficial to your industry and would you consider providing us with a non-profit contribution. … Here’s the timeline for the completion of the research; the parameters of the research are this; we expect it will result in some savings or outsourcing.”
For example, she says, the Associated General Contractors of Texas and the Consulting Engineers Council of Texas helped fund a 1997 TPPF study called “Sundown on Big Government.” The study purported to show that the Texas Department of Transportation and 11 other state agencies could collectively cut more than $737 million from their budgets by, in part, privatizing and outsourcing agency functions—a potentially lucrative proposal for the contractors and engineers that had helped fund the study.
“I remember that as the watershed moment for TPPF,” says Hasting, who spearheaded the report. “That set into place that TPPF was a real player.” She says the foundation estimated that it earned between $2 million and $2.5 million worth of media coverage and, more important, got 20 or so of the Sundown report’s recommendations passed into law or adopted as administrative changes.
The study caused a stir at the Capitol, but few people knew that the study was paid for by the same special interests that stood to gain from its recommendations. (The two industry groups didn’t respond to request for comment.) Like other 501(c)(3) nonprofits, including the Observer, TPPF isn’t required to disclose its donors.
TPPF’s vice president for communications, Josh Treviño, says that the foundation was a different place before its current president, Brooke Rollins, arrived. “Whatever Melinda told you, she may in fact be telling you the entire truth,” he said. Treviño added that TPPF could neither confirm nor deny Hasting’s story, but noted, “That would never happen today. That’s just something we don’t do, and we wouldn’t do.”
Except when they do.
In 2004, The Dallas Morning News reported that the governor had spent a three-day weekend in the Bahamas with a group including foundation president Brooke Rollins, anti-tax guru Grover Norquist, and Leininger. When confronted, Perry spokesman Robert Black shrugged it off as a “working retreat.” At the time, lawmakers were gearing up for a school finance battle, and the Texas Public Policy Foundation had recently held a conference on that very topic.
“You can describe [the weekend in the Bahamas] as a continuation of the TPPF conference,” Black told the newspaper.
That Sundown report that put them on the map, was a blueprint for privatization of government services in Texas. Here’s how they sold privatization, and boy it sure sounds good. But you know what they say about things that sound too good to be true?
A recently released study by a home-grown think-tank, the Texas Public Policy Foundation (TPPF), charts the course: Texans don’t have to raise taxes to obtain better services, or eliminate services to reduce spending. In fact, by harnessing the reins of the private sector, Texans can cut both state and local taxes and have better services: better streets, better libraries, cleaner water, better airports, better police protection, a better environment, better schools.
How? By using the proven management techniques of competitive outsourcing, sometimes called ‘privatization’, to contract for the best service at the lowest qualified cost. At the same time, such practices enhance the careers of public employees. Other states are way ahead of Texans in outsourcing, and it’s time, says TPPF, for Texas to join the 1990’s. After all, it’s the taxpayers’ money, and the public’s services.
And we will all ride unicorns to work. Of course the right wing schemes haven’t quite worked out that way. (See Accenture and the Trans-Texas Corridor). That original study was called “shoddy” by TxDOT, before being taken over by Perry cronies, and was called “totally independent and unbiased” by convicted felon and former GOP Congressman from Texas Tom DeLay.
But as this part of the TO article points out, the TPPF and so-called “conservatism” don’t always agree.
Occasionally, TPPF’s and Perry’s dealings with special interests put them crosswise with the conservative grassroots. Case in point: the politically disastrous Trans-Texas Corridor, a $175 billion transportation system proposal that would have used government power to seize land while allowing private investors to toll Texas drivers.
From the plan’s unveiling in 2002, TPPF was an enthusiastic booster. Foundation transportation fellow Wendell Cox called it “ambitious and visionary.” The group was especially enthused about the widespread use of tolling to pay for the infrastructure and warned in a 2005 paper that the corridor needed to be “as profitable as possible for private developers.”
Anti-toll activists like Terri Hall of Texans Uniting for Reform and Freedom, which helped torch the Trans-Texas Corridor, blast TPPF’s support of the corridor, and toll roads, in general as contradicting free-market principles.
“We’re essentially handing over taxation to a private company,” Hall says. “As a conservative, I’m going, ‘Have these people lost their minds?’”
Mostly because the TPPF’s main goal is to advance corporate profits. It’s not about a free market, it’s about a rigged market. In favor of corporations and the wealthy with a government that’s only function is to collect taxes and hand them over to corporations for privatization schemes.
Because of most of the Texas GOP’s blind allegiance to the TPPF and Perry, they’re unable to see what’s keeping our economy from growing as it should, and hurting our competitiveness:
- Notably depleted infrastructure
- Marked fall-off in the effectiveness of education and training
- Much decreased effectiveness of government, particularly in its ability or even willingness to concern itself with long-term issues.
All things the TPPF, Perry, and the GOP have been saying for years would be fixed by their way of doing business government. Much of the right wing success over the last 40 years can be attributed to their demonization of government. But what has hurt the people in Texas and the US has been their successful spinning of the false premise that for-profit corporations can do everything better.
There are just some things that governments should do and do better then corporations. Infrastructure, health care, care for the elderly and handicapped, and education just to name a few. The inequality and accumulation of wealth by the richest 1% in our society over the last 40 years (greed), and lack of corporate accountability, is what has caused much of what is ailing us as a state and a country.
Meriting a separate, special point are the drastic declines in both U.S. income equality – the U.S. has become
quite quickly one of the least equal societies – and in the stickiness of economic position from one generation to another. We have gone from having been notably upwardly mobile during the Eisenhower era to having fallen behind other developed countries today, even the U.K.! The net result of these factors is a growing feeling of social injustice, a weakening of social cohesiveness, and, possibly, a decrease in work ethic. A healthy growth rate becomes more dif?cult.
It’s long past time for all of us to open our eyes and see that there’s a better way.
More on the Military Spending Fairy.
It seems that every year when the final county budget is approved the thing that gets the headline is what happened with the tax rate. And this year is no different, Williamson County commissioners vote to keep taxes steady. But should the tax rate be the main concern for the county every year during the budget debate? Certainly to those on the right of the political spectrum that is their only concern. But for a growing county like Williamson the level of service, which includes being able to hire and keep quality employees, certainly must be at least an equal part of the equation.
The Wilco Watchdog does a great job of breaking down much of the budget shenanigans, The Wilco 5 Adopt Their Smoke and Mirrors Budget. Their outrage and call for accountable government in Williamson County, (and the traditional media), echoes what we’ve been saying her for years.
It’s doubtful the mainstream media will pick up on this fact, so once again, we will report it. Much of our local media has an “if the commissioners say it, it must be true and we will print it” mentality. The Williamson County Sun’s journalistic integrity is front and center with many in the public in agreement reporting on County issues is favorably written for the Commissioners Court.
The latest from the Sun is their reporter has the County Judge quoted as saying “Alright reporters, I want the headline to be Williamson County lowers tax rate”, and guess what the Suns headline reads?“Commissioners cut budget, tax rate”.
This practice is a great disservice to Williamson County taxpayers, but it also explains the rising popularity of alternative media outlets including the Wilco Watchdog. The grandstanding has begun but at the end of the day, members of the Williamson County Commissioners Court are the only real losers in this game. Besides losing the respect of an entire workforce along with many county citizens, voters can – and hopefully will – express their dissatisfaction in upcoming elections.
March 2012 is fast approaching and we will say it here first. It is time for a change in the Precinct 1 and Precinct 3 County Commissioner positions. The back room secret deal-making policies must stop. So also must the good ole boy cover game played by placing other members of the good ole boys network into positions of power so as to facilitate questionable activities and obstruct attempts for corrective action. This type of governance is costly and has been tolerated for too long in Williamson County. It cannot, it should not continue.
It’s time we the citizens of Williamson County take our county back!
But the reality is that this is a fight, at least the way Williamson County politics are right now, that will only play out in the GOP Primary. Where challengers to incumbents are likely to lose. For real accountability we must have a strong and vibrant two-party system in the county. All incumbents in Williamson County will be vulnerable in 2012, a Presidential general election year where turnout will be high. In 2008 was when Democrat Diana Maldonado won a state House race in Williamson County, and Democrat Mike Grimes came withing 321 votes of knocking off Commissioner Lisa Birkman in Precinct 1. A Democratic campaign run on the issues of education, support for county employees, and support for working and middle class tax payers would do very well in November of 2012.
As we’ve said many times about Republicans, and especially the right-wing one that rule in Williamson County and in Texas, you can’t expect well run government from people that don’t believe government can be run well. Those who currently run our government believe that if everything was privatized it would run better and more efficiently. They’re wrong, but if that was done it would certainly enrich those who donate to their campaigns. (see, Austerity budgeting comes to Williamson County).
Instead of focusing on the almighty “tax rate”, next year when the budget debate rolls around, we should have a discussion of what we would level of service we would like our county government to provide for us, the taxpayers. It’s well-documented that Texas is a low tax, and therefore a low service state. Most of that stems from the fact that Texas does not have income tax, and therefore the wealthy and corporations don’t pay their fair share of taxes. (See Who Pays Texas Taxes).
If we want a government that serves us well it can’t happen on the cheap. If we want great public schools, well paid teachers, law enforcement, fire, EMS, and all county employees everyone must pay their fair share. And the only way that is going to happen is if we elect new people. For voters in Williamson County it should be obvious what to expect if Commissioners Birkman and Covey are reelected – more of the same. To keep electing the same people and expecting different results is the definition of insanity.
Fort Worth may be too eager to give businesses tax breaks. First he points out that tax abatements, tax give aways to business, are becoming the norm and not the exception these days.
From Mitchell Schnurman in today’s FWST,
Economic development used to be about swinging for the fences. Game changers like Alliance, Texas Motor Speedway, a new RadioShack headquarters, a Cabela’s store, the Tower condos and the SuperTarget-Montgomery Plaza project were risky and expensive — and offered plenty of upside to go with it.
Not every one has delivered as hoped, but each justified the heavy lifting and political capital required.
Contrast those deals with the small ball that the city was playing last week. The planning department proposed tax breaks for three projects, including one pledging to bring just 60 jobs to the area — and to fast-growing Alliance at that.
Another abatement is for a distribution center for In-N-Out Burgers. This isn’t exactly an operation that could locate in Oklahoma and still deliver fresh meat to new outlets in DFW.
Frac Tech Services, proposing the biggest expansion, is already in Fort Worth. Do you think a fracking company would leave the fracking capital of the world over a tax break?
Guess we got to show ‘em the love.
Tax abatements make sense when trying to entice a business to come to an economically depressed area, not to an area that’s already growing and likley to continue growing. Essentially the business is coming anyway so there’s no reason to give an abatement. But now that business, corporations, and privatization have taken over our government, these deals are expected. They now expect the local taxpayers to pay their fair share to help their businesses, they now feel entitled to taxpayer money, whether is makes economic sense or not.
Even Wendy Davis, a champion of economic development, could be counted on to ask about “the gap.” She’s a state senator now, but when she served on the council, she pored over spreadsheets and demanded to know why a taxpayer contribution was crucial to closing a deal.
She wanted it to pass a test: If not for this tax break, the project wouldn’t happen.
That wasn’t the case with every incentive, of course. Pier 1 Imports got one simply because RadioShack did before it, not because there was any threat of moving.
Somewhere along the line, tax breaks went from being something special to being routine. They now seem to be a business entitlement. [Emphasis added]
They were never reserved for only the biggest deals. Picht said he once approved an abatement for a small project because it was in a distressed area that was desperate for investment and jobs.
The distribution center for In-N-Out is exactly the kind of project that the city shouldn’t subsidize, Picht said. The company has to locate in the middle of the Metroplex, and the CentrePort area south of Dallas/Fort Worth Airport is prime real estate.
If that distribution center went to Irving or Grand Prairie, for instance, Fort Worth residents would still have a good shot to work there. And the city wouldn’t send the message that tax policy has two tracks — one for well-heeled, connected businesses and one for everybody else.
Of course this happens all the time in Williamson County too, Williamson County budget moves higher, Commissioner wants poor to pay the price. And these deals almost never turn out as a good as , unless it’s in an economically depressed area, Hutto/Carmel Creek Tax Incentives Bigger Than Austin/The Domain. The other thing the Carmel Creek deal shows is that the development wasn’t coming because of the tax abatement. If that was true the project would have been built. They were coming because the economy was booming and the area was growing. Once those slowed, so did the project, but it had nothing do to with the tax abatement.
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