Sunday, October 28, 2012

Ballot Proposal Mayhem Part V: No Taxation Without 2/3 or Simple Majority Representation?

We meet again!  And for the second time in just a few hours no less.  That's got to be some kind of record for me :-)  So if you're looking for any of the other Ballot Proposal Posts you can find 12-1 here, 12-2 here, 12-3 here, and 12-4 here

And on this delightfully sunny afternoon as my son watches Baby Einstein and I miss choir practice and some amazing preaching and music by The Galkin Evangelistic Team due to sickness I will inform you about Proposal 12-5.  No offense but I'd rather be at church :-)

This proposal would:
  • Require a 2/3 majority vote of the State House and the State Senate, or a statewide vote of the people at a November election, in order for the State of Michigan to impose new or additional taxes on taxpayers or expand the base of taxation or increasing the rate of taxation. 
  • This section shall in no way be construed to limit or modify tax limitations otherwise created in this Constitution.
Should this proposal be approved?

This proposal is pretty basic and the gist of it is that to create a new tax or to raise a current tax you would need a 2/3 majority of the House of Representatives and a 2/3 majority of the Senate to pass it.  This is what's known as a super majority. 

So on the outside this proposal looks like a pretty little Christmas present all wrapped nicely with a fancy shmancy bow but life and politics aren't always that simple right?!  Unfortunately that's the case with this proposal.   When you look at the terms of this proposal the thought of needing 2/3 of the House and 2/3 of the Senate to pass new taxes or increase current taxes sounds like a great idea.  I don't like having my taxes raised at all to the point where I'm excited that we finally have our own little "tax deduction" this year ;-) Granted I love my little man to pieces for reasons other than that, but it certainly helps! Plus if I could have a say in new taxes through a vote of the people that would be fantastic!

Supporters of this proposal state that often legislators go to the simple solution of raising taxes when there are problems closing a gap in the state budget.  They say that this amendment to the Constitution would help them think more about government reform, fiscal responsibility, and prioritizing spending before raising taxes.

You know what? I like the sound of that, don't you?!

They also say that it will encourage legislators to work across party lines because a narrow party majority won't be able to pass a tax alone.

Bipartisanship is a nice idea too!

They also say that often times legislators ignore the feelings of the people when choosing to raise taxes and this would cause them to be more in tune with what the people want.  Plus there are other places in the Constitution that require a 2/3 supermajority so this isn't unique at all.

Yes!  However I do have a couple concerns with this last statement.  Just because you don't like something doesn't mean it's not in your best interests.  Plus, how often do we, as humans, have a complete understanding of a topic before we are for or against it (hence the reason for these posts!)? And how does "just because someone else is doing it" (i.e. requirement of supermajority in other places in the Constitution) mean it needs to be done again?  That sounds a little bit like the reasoning of a 5 year old doesn't it?

So all of this sounds nice, and well and good, etc but there are several troubling pieces of information that I find hard to ignore.

First of all because this proposal is rather vague it will most likely cause problems by tying the hands of  legislators in unintended ways.   A great example is the Michigan Business Tax.  In 2007 the Michigan Business Tax Act (Public Act 37) was created.  This was behemoth of a tax law that actually hurt Michigan businesses and drove many businesses out of state where business tax laws were more favorable.  After the current governor took office he worked with the legislature to repeal PA 37 and enact Public Act 39 in 2011 (PA 39).  This law has a simplified tax code that is much more fair to businesses and has encouraged some businesses to move back to the state.   Because of the nature of PA 37 of 2007 it had to be completely repealed and a new tax, PA 39 of 2011 was created.  If the proposal to amend the Constitution is approved this new and better business tax most likely never would have been approved and we would be stuck with the business hurting tax.  Because some taxes need to be completely repealed and replaced with new taxes to make them lower some existing taxes that are not very popular will be left on the books by default.

Another interesting thing to note is that for it's lofty goal this proposal does nothing to address the fact that the legislature can still "raise" taxes with a simple majority by ending or decreasing tax credits.  More food for thought:  Opponents of this proposal fear that if taxes can't be raised when it's absolutely necessary fees for things like licenses, assessments, and user fees would be increased which only requires a simple majority vote.

The last concern, and my biggest concern, is that while this is known as a super majority rule, it is actually minority rule.  You're probably wondering what I mean so let me break it down for you.  There are 110 State Representatives and 38 State Senators.  In a normal simple majority situation you would need 50% plus 1 person to pass a bill.  So in the House you would need the support of 56 Representatives and in the Senate you would need the support of  20 Senators.  In a super majority situation you would need the support of 73 Representatives and 25 Senators.  That means that with as few as 37 Representatives and 13 Senators bill after bill after bill could be opposed.  That is a hefty amount of power to be given to such a small group of people.  Furthermore this small group of legislators may not represent the feelings of the majority of their constituents.  In the worst case scenario it's significantly easier to buy the votes of 37 Representatives and 13 Senators than the number needed for a simple majority.

While I think a super majority vote on taxes is a good idea in theory and it sounds really great this proposal could do a lot more damage than people realize.  And, if you're interested, both the Michigan Chamber of Commerce and Business Leaders of Michigan oppose this proposal. 

My Opinion on Proposal 12-5: Vote NO

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