Clark Colvin Oregon Governor Candidate – 10 Commandments of State Government

Clark Colvin, Oregon Governor Candidate – 10 Commandments of State Fiscal Policy

 The following is applicable to all States. But let’s first start in Oregon as an example to all other States.

1) Thou shall not impose high taxes.  Income taxes have a large negative effect on economic growth.   

Before 1913 (except in times of war), the year the 16th Amendment of the U.S. Constitution was ratified creating the IRS, the effective tax rate imposed by all levels of government seldom rose above 5%.  Today it is 31.6 % of personal income. Income taxes are against what the founders fought for in our War of Independence.  The only fair tax is a national and state sales and consumption tax that would be caped at 5%.

2) Thou shall not penalize investment earnings.  Taxes on investment earnings slow economic growth.

States that want more economic growth should eliminate their taxes on both income earnings and investment earnings.  Both discourage business investments that make job creation possible. Taxes on investments also discourage saving for future consumption.  Eliminating taxes on capital will automatically increase Gross Domestic Product for all States and the United States.

3) Thou shall not impose excise taxes.  Excise taxes are obsolete.

Excise taxes originated long ago when government’s revenue needs were smaller, interstate commerce was rare, and enforcement was easy. Today excise taxes are regressive, are imposed unfairly, often lead to evasion, and are an unreliable revenue source. They are on the other hand attractive to elected officials because they are less visible to a majority of constituents. 

4) Thou shall create a transparent and accountable State Budget.

The core functions of State Government are to ensure public safety, facilitate a fair system of justice, assure educational opportunity, assure basic human needs, and act as a responsible steward of public property. Thus if the sole purpose of collecting taxes is to finance the core functions of state government, then it follows that first state legislators and the Governor must identify those core functions and measure the performance of stated agencies. Second, Governors then must utilize a line-by-line, department-by-department, program-by-program, agency-by-agency performance based budgeting system. And third, Governors must perform performance audits with results reported directly to the people. 

5) Thou shall privatize public services whenever possible.  

Privatization is a proven way to reduce government spending while improving the quality of core public services. So once a state’s core functions are identified, Governors and state legislators must decide which public services can be privatized. Costs are always higher in the public sector because the discipline of the market is missing.  However Governors must hold both public service agencies and private companies providing public services accountable by reviewing profit and loss statements on a monthly basis. 

6) Thou shall avoid corporate subsidies. Subsidies, tax abatements, business loans, and economic development programs are questionable politics and bad economics.

It is far wiser to leave money in taxpayers’ hands than to give it to a chosen few in government in hopes that they will make the best economic development and investment decisions. Public officials will seldom succeed in choosing winning programs and avoiding losers, thus lowering tax rates will benefit the state economy as a whole. 

7) Thou shall cap expenditures as a percentage of State Gross Domestic Product, and to the sum of inflation and population growth.

In simple terms you don’t spend beyond your means. And you don’t spend money you don’t have. Government cannot grow faster than the private sector, and the best way to measure this is by comparing the per capital ratio of state expenditures to number of state citizens. The best way to enforce such measures is to pass a constitutional amendment. 

 8) Thou shall fund students not schools.

Free and universal K-12 education is generally agreed to be one of the core functions of state government.  However, by historical standards, public schools are costly and yield poor achievement results.  Funding students means creating voucher programs which pay for tuition even if parents choose private schools for their children. School choice allows parents to play a much more important role in their children’s education.

 9) Thou shall reform the health care industry state by state, though not by Federal mandates.

Next to education, health care is the next largest state concern and expense.  However, costs have been rising at double-digit rates in many states. It is the health care industry and the professions that milk the system that needs change, specifically in reducing costs. Such reforms include:  Enroll people with preexisting medical conditions in high-risk pools offering subsidized private health insurance. Reduce the price of private insurance by removing unnecessary price controls and coverage mandates, which increase health care costs by forcing people to buy insurance for services they don’t need. Limit Medicaid eligibility to the truly poor. Implement disease control programs, which will reduce unnecessary drug expenditures. And, create benefit packages that allow people to opt out of Medicaid plans and use their state-paid premiums to purchase private insurance.

 10) Thou shall prohibit the use of state employee’s paychecks to fund public sector labor unions political purposes. 

 State and local governments condone the practice of forcing government workers to pay union dues to support political activities, whether they agree or disagree with such activities. Legally there is no reason why state and local governments should do this for unions. Contributions of money for political purposes should be voluntary, lest it is tyrannical. In order to break the power of state government unions we must stop deducting the paychecks of public workers for political purposes, thus reducing pressure for bigger and more expensive government.