Tax Limitation: A First Step, Not the Last One
Tax limitation first became popular in the late 1970s in California.
Proposition 13 rolled back property taxes and put a lid on Big Government growth in California.
Tax rollbacks and tax limitation ballot initiatives swept the nation.
In 1980, Proposition 2½ limited property tax increases to 2 ½ % each year in Massachusetts.
In 1992, TABOR both limited state expenditure growth and mandated refunds to taxpayers of all surplus revenues in Colorado.
What happens when tax limitation measures succeed?
Advocates of Big Government work to undermine them. Create work-arounds and exceptions. Impose unfunded mandates. Propose relentless referendums to override the laws.
Pro-tax cut advocates work hard to stave off attacks on these limitation measures and to minimize the growth of state and local taxes. Testifying before the legislature. Running ballot initiatives. Litigating. Facing off against the teachers’ unions that want more money for delivering worse education.
Now we must build on the work of citizens who advanced tax limitation. We must add bold tax reduction. Here’s why.
The assaults of Big Government on our life, liberty, and property — well-funded by our tax dollars — are endless. Federal, state, and local governments have exploded over the last 20 years.
Budgets have grown far beyond the rates of inflation and population growth combined. Astronomical debt. Billions of dollars hoarded in rainy day funds. New and expanding government bureaucracies.
Dramatically higher taxes. Dwindling tax deductions.
New and increased taxes on retail sales, alcohol, utilities, gasoline, meals, tobacco, Medicare, gun permits — and income tax penalties when you don’t buy state-mandated medical insurance, to name just a few.
Businesses are increasingly burdened, sometimes to the point of bankruptcy, with tax collection, new regulations, and mandated employee benefits.
Local governments and local schools are being consumed by centralized, authoritative state and federal bureaucracies.
Why didn’t tax limitation stop the growth of Big Government? Why didn’t tax limits curb this massive growth?
Because tax limitation is designed to slow the growth of Big Government. Not to stop it. Not to freeze it. Not to make government small.
Tax limitation allows government to grow. Massachusetts property taxes grow at least 2 ½% every year. State government grows even faster.
This happened in California and in every other state that passed tax limitation.
Given the shameless demands of state legislatures, would taxes be even higher today without the work of tax limiters?
But even with tax limitation, taxes have roughly doubled at both the state and local levels in just ten years. In Massachusetts, property taxes have doubled and continue to rise an average of over 5% every year — well beyond the 2-1/2% limit set by Prop 2-1/2.
If you are satisfied to curb the growth of Big Government and to slow the rate at which taxes grow, then tax limitation is all you need.
If you want to keep Big Government where it is, we must do more than limit its growth. Regular tax and spending cuts are necessary just to maintain the Big Government status quo. To offset the rapid growth of Big Government.
If you want to move in the direction of small government, then we must do even more. We must cut taxes — boldly and immediately.
We must substantially reduce the total taxes taken by government. We must slash spending and close down wasteful, ineffective, and damaging government bureaucracies.
We must challenge not just the presumption that government needs more of our money. We must expose the harmful results of Big Government spending already in place.
We must advance the idea that government needs less of our money.
There are Five Iron Laws of Big Government.
1. Big Government doesn’t work.
2. Big Government makes things worse, often hurting the very people it is intended to help.
3. Big Government creates new problems.
4. Big Government is costly and wasteful.
5. Big Government diverts money and energy from positive, productive uses.
That’s why we must make government small!
The 2002 ballot Initiative to End the State Income Tax in Massachusetts was one attempt to make government small. It won 45.3% of the vote (885,683 votes). It proved that there’s broad support for bold reductions in state government taxation and spending — even in liberal Massachusetts.
The 2008 ballot Initiative, also to End the State Income Tax in Massachusetts, was another attempt. It still didn’t pass, but got 901,802 votes.
These initiatives proved that bold proposals to shrink Big Government are possible.
