Ari Armstrong, Business/Economy, Exclusives, Politics, Uncategorized

Armstrong: Keep Colorado a free enterprise state

I know you’re just itching to read the full 109-page “Free Enterprise Report” put out by the Common Sense Institute, but I hope you’ll indulge my brief review of it. I agree with the thrust of the report: “The free enterprise system, in which individuals choose the allocation of their energies and resources, yields superior results than systems with a high degree of central planning and control.” Let’s look at some of the details.

The report issues a warning: “Colorado faces an inflection point. The state has historically been a highly attractive place to live and do business and in many respects remains so. However, warning signs are appearing. Colorado’s cost of business and cost of living have become increasingly expensive, communities face serious quality of life issues, K-12 student outcomes remain disappointing despite improved funding, and the recent slowing of net migration will have significant negative economic consequences if it persists.”

Anyone worried about the hard-left takeover of the legislature likely will share CSI’s concerns. Although in some ways the Democrat-controlled legislature takes pro-freedom stands at least by the lights of this libertarianish writer, generally the default approach among legislators these days seems to be to try to tax-and-regulate their way out of any problem, real or imagined.

Today’s Democrats often seem unable or unwilling even to consider that maybe some problems can best be addressed without political “help.” Even more rare is the Democrat who asks whether existing political controls are part of the problem.

But the news remains fairly good. Believe it or not, there is some countervailing movement within the Democratic Party against the “democratic socialists.” Democrats can pass bad bills only so fast, and often the full effects of those bills are not felt for years. And Democrats remain somewhat constrained by the spending limits of the Taxpayer’s Bill of Rights (TABOR).

By looking at GDP, labor-force participation, business creation, inequality, poverty, median household income, and net interstate migration, CSI ranks Colorado “8th out of 51 [this includes D.C.] for economic performance.” So we’re not number one, but eight ain’t bad. Of course this is relative. For reference, the seven states ahead of us, starting with first place, are Utah, South Dakota, Idaho, North Dakota, Wyoming, Nebraska, and Vermont. We could argue about whether CSI is looking at the right metrics.

Democrats will crow about many of the policies that CSI blames for a worsening business environment, including energy and emissions regulations and “labor and family leave benefits.” It would be pleasant if legislators at least could acknowledge that such controls involve trade-offs.

Unlike news journalists who uncritically accept the teacher’s union line that the problem with schools is underfunding (ahem, Colorado Sun and CPR), CSI notes that school “funding over the last several years has increased significantly.” Yet students have continued to struggle, with “just 40% of Colorado 4th and 8th graders perform[ing] at grade level in reading and math.” Shockingly, despite such dismal figures, “Colorado still ranks near the top of all states.”

One problem, CSI notes, is relatively low “spending on instruction as a percent of total per pupil funding.” It doesn’t matter how much money we spend on schools if the money is not actually going toward teaching kids.

CSI worries about “the underlying inequities in Colorado’s school funding formula” but doesn’t get into details; CSI is hopeful that new legislative task forces will find solutions to the problem.

CSI also worries about health “insurers leaving the state amidst challenges in conforming with
the state’s new ‘Colorado Option Plan’ premium reduction targets.” Although Colorado ranks relatively well in health care so far, CSI views the outlook as negative.

Housing costs are a huge drag on Colorado’s economy. “Colorado’s overall competitiveness in housing fell to 51st, last among all states and Washington. D.C.,” CSI reports. Like me, CSI applauds “the ban on local housing growth restrictions.” Like me, CSI hopes for “easing land
use restrictions and lowering the costs related to litigation on condominiums.”

Colorado spends a lot on public safety for not-so-great results, CSI notes. I’m hopeful that governments finally are getting more serious about cracking down on auto theft, at least.

Tax-wise, Colorado faces two huge problems. First, despite some legislative trimming around the edges, Coloradans face “large potential tax increases for property owners.” And “there is a growing interest from elected officials to use fees as key policy tool to fund new initiatives.” In Colorado elected officials play this game of calling taxes “fees” in order to evade spending restraints.

There are more details within the CSI report. Perhaps even some Democratic legislators will take a look.

Ari Armstrong writes regularly for Complete Colorado and is the author of books about Ayn Rand, Harry Potter, and classical liberalism. He can be reached at ari at ariarmstrong dot com.


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