Voters send officials a clear message about raising taxes

By Gary Palmer

Going into Alabama's next legislative session, politicians, government employees and concerned citizens alike are focused on numbers-and some pretty daunting numbers at that. Right now the numbers capturing their attention show that the state could be short anywhere from $200 to $500 million in revenues for the education and general fund budgets this year.

But there are a couple of other numbers our elected officials, the media and others that are clamoring for higher taxes should pay attention to-80 and 20.

Going into Alabama's next legislative session, politicians, government employees and concerned citizens alike are focused on numbers-and some pretty daunting numbers at that. Right now the numbers capturing their attention show that the state could be short anywhere from $200 to $500 million in revenues for the education and general fund budgets this year.

But there are a couple of other numbers our elected officials, the media and others that are clamoring for higher taxes should pay attention to-80 and 20. Those are the numbers that those pushing for an eight mils property tax increase in the Dothan and Houston County school systems saw on Feb. 4 when 80 percent of the voters said "no' to the increase.

Only the most dimwitted observers would fail to grasp that there is a clear message being sent when 80 percent of the public votes against raising taxes to give more money to the schools. And that message is not that the taxpayers don't care about their schools. It is that the vast majority of voters have lost confidence that the government is using their money wisely.

So the proponents of higher taxes in Alabama can keep throwing numbers out to try to embarrass Alabamians into sending more money to state and local government. They can argue that Alabama ranks 50th among the states in local property taxes and 50th in terms of taxes paid to support state and local government.

But those are not the numbers that count. The numbers that count are the ones from the ballot boxes such as those in the Dothan/Houston County referendum where the public voted "no" in every precinct, across all racial lines and across every economic and social demographic.

Ironically, prior to the Dothan/Houston County referendum, the idea of outsourcing school transportation, food service and janitorial and maintenance services as a means of saving money was proposed. Based on a report published in January by the Alabama Policy Institute, if outsourcing were implemented statewide the schools could save themselves $50 to $80 million a year. Such savings could be a big help in reducing the predicted shortfall in education revenues and would be a strong good-faith gesture to the taxpayers.

But in true government bureaucrat style, the local officials in Dothan summarily dismissed these ideas. Their attitude seemed to be indignant give them more money, not management advice.

Other states have faced even more severe shortfalls than Alabama is facing and made necessary, though very difficult, adjustments to their spending. When John Engler first took office as Michigan's governor the economy was in recession and the state was facing a $1.8 billion deficit. Engler made some gut-wrenching decisions to reduce state spending that included closing an entire department of state government and reducing the number of state employees. Despite these tough measures, Engler was re-elected twice.

Other states facing budget shortfalls have undertaken efforts to reduce their expenses by:

o Putting a freeze on state hiring, offering early retirement incentives, capping the number of employees and reducing the number of government positions;

o Contracting out state services to private companies;

o Restructuring employee health benefits plans;

o Selling excess government property which not only provides immediate revenue, but also puts the property back into the tax base;

o Eliminating programs that perform poorly or that are not part of the core function of government; and

o Implementing waste reduction and cost-cutting measures in every department.

These are just a few ideas that the politicians could implement to begin to restore the public's confidence in government. If the politicians and the bureaucrats really believe that the taxpayers need to do more, then they should set an example by meeting them part of the way. If they are willing to make tough choices, maybe the taxpayers will step in and help.

Frankly, we do need tax reform in Alabama and in the final analysis I think we will find that we do need to increase revenues. But bringing in higher revenues through tax reform without reforming the way we budget and spend will do little good long term and the taxpayers know it.

The Dothan/Houston County referendum sent a clear message to those who are listening. People are fed up with government waste, mismanagement and outright thief. And they are sick of arrogant government bureaucrats demanding more money without making any real effort to manage the resources they already have in a more efficient manner.

The biggest obstacle to enacting meaningful reforms in Alabama is public cynicism. Until public confidence in state and local government is restored, it appears most voters think raising taxes would be equivalent to throwing their money down a rat hole. Based on what we have seen of government mismanagement over the years, unfortunately they are right.

Gary Palmer is president of the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.