Four Democrat lawmakers have introduced a bill to require the state of Colorado to promote tax increases and discourage tax cuts.
House Bill 21-1321 applies to voter initiatives to raise or lower taxes. It would achieve its purpose by deliberately biasing the ballot language on such measures.
In Colorado, citizens seeking a tax hike or tax cut may gather petition signatures to put either kind of measure on the ballot. If they succeed in gathering enough signatures, then proponents and opponents square off in public debate. Traditionally, that debate features such issues as:
* Would the change actually increase or reduce revenue?
* What effect, if any, would it have on government services?
* What effect would it have on the economy?
* What are the moral implications of the proposal?
* Who would really pay for any tax increase?
But HB 1321 would short-circuit all that. Instead, it would incorporate, as official state orthodoxy, pro-tax talking points into the ballot language. Instead of facts, the ballot language would consist of propaganda.
Suppose an initiative reducing Colorado income taxes is on the ballot. HB 1321 would require that the state tell you the measure would “reduce state tax revenue” for what are currently “the three largest areas of program expenditure…impacted by the reduction.”
But the truth is that not all tax rate cuts reduce revenue. Some are revenue neutral, and some ultimately raise revenue. Those that raise revenue do so by encouraging state residents to make investments or purchases they otherwise would not have made. They also encourage out-of-staters to make investments in Colorado rather than in other states or countries.
So it misrepresents the facts to say that all tax rate cuts “reduce state revenue.”
Or consider the spending side: The bill mandates that the ballot language list the “three largest areas of program expenditure” affected. But in the real world, these may not be the programs most affected. The legislature very often reallocates revenue and spending streams. In fact, the bill recognizes this: It provides that whatever the representations are made to the voters, those representations shall not bind the politicians. (“shall not be interpreted as restrictions on the state’s budgeting process”).
The bill further mandates that ballot language promote tax increases. Specifically, it prescribes that the language include (1) debatable propositions about effects on revenue and services and (2) unreliable predictions about who would pay the bill. Let’s examine each of these.
First: HB 1321 would require that ballot language tell voters that if they approve a proposed tax hike, the increased revenue will “increase or improve levels of public services.”
But anyone familiar with government knows this is often not true. Administrators who receive a revenue windfall may—and often do—spend it on items unrelated to service quality. Examples include pork-barrel projects, politically-correct escapades, and other dubious projects, as well as awarding raises without regard to productivity. (Citizens who follow the public school system have seen this more times than they can count.)
Moreover, the economic effect of some tax hikes may be so bad that they ultimately reduce, rather than increase, government revenue. States with “progressive” income taxes are particularly familiar with this phenomenon.
Second: For income and sales tax hikes, HB 1321 would require the ballot language to list “the average tax burden change for filers” within each of twelve income brackets—as if that were a matter of previously-knowable fact.
In the real world, of course, income tax hikes often are not paid by those they allegedly target. For one thing, upper income people can afford professional advice on how to avoid taxes. Additionally, over the long term, wages tend to rise or fall with capital investment. So if higher levies diminish capital investment, then much or all of the burden falls on poorer citizens in the form of lower wages.
Finally, economists tell us that nominal taxpayers often can “shift the burden forward” to the consumer. That means that lower income people may bear the burden through higher prices.
In sum, HB 1321 would require that the ballot language tell us things that are often false.
Finally: The state constitution allows Coloradans to petition for a referendum on legislatively-adopted bills. The legislature may dodge this by certifying that “this act is necessary for the immediate preservation of the public peace, health, or safety.” As the wording suggests, this kind of “safety clause” was intended only for genuine emergencies.
HB 1321 clearly addresses no emergency. Yet the sponsors cynically added a safety clause to prevent Coloradans from voting on their bill.
The sponsors are Senators Chris Kennedy and Mike Weissman and Representatives Dominick Moreno and Brittany Pettersen. At the very least, they need to answer two questions: Why are they trying to corrupt our elections? And how does official cheating on ballot measures further “the public peace, health, or safety?”
Robert G. Natelson, a former constitutional law professor, is Senior Fellow in Constitutional Jurisprudence at the Independence Institute and a former Senior Fellow at the Initiative and Referendum Institute.
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