Sunday, December 21, 2008

Talking Taxes

Since the end of the year is galloping up on us right after the yule log is cinders, let's take an honest look at what we have to encounter: taxes. I was looking at the IMF chief expressing his dismay that leaders are hesitating around instituting the spending that will be needed to provide necessary economic activity, when the financial institutions worldwide are breaking down.

What is the problem? aside from hesitation to wreak ruin by letting all of the recklessly uncontrolled action continue on. Even Alan Greenspan has admitted that he gives up on waiting for the unregulated financial community to protect itself or its clients by controlling itself. Could it be that dreaded word, Taxes, is hard to bring up? On the local scene, it has crept into the conversation.

A U.S. Supreme Court justice once famously admitted that defining obscenity is an impossible task, but, he added, “I know it when I see it.”

The same could be said in Nevada today, but it wouldn’t be applied to deviant sexual behavior. No, what passes for obscenity to certain Nevadans is a tax increase.

Which explains why Gov. Jim Gibbons and legislators — Democrats and Republicans alike — are going through linguistic contortions to define the steps they are taking to balance the budget as “revenue enhancements,” or “redirection,” or “rebate eliminations.” Just not tax increases.

Most definitely, not tax increases.

Will it work? Or will Nevadans, as Supreme Court Justice Potter Stewart wrote in an opinion in 1964, know this particular obscenity when they see it?

The latest round of euphemistic juggling came Monday, when the Legislature passed two measures under the “revenue adjustment” header.

The first nontax scheme was this: Legislation reduced the amount of money retailers could keep for administering sales, liquor and cigarette tax collections. The benefit to state coffers is about $2.5 million.

State government gets more money. Business gets less. But, it is not a tax hike.

So said Chuck Muth, the conservative activist, pundit and local lifeline to national anti-tax crusader Grover Norquist, the national figure who has advocated for a “starve the beast” approach to government.

During Monday’s session, Muth, who challenges political candidates to sign a pledge not to raise taxes, sent out a news release headlined: “Sales tax proposal NOT a tax hike.” Instead, he compared it to a pay cut for the businesses that had been administering the tax collections.

The second maneuver took a 1 percent tax on car rentals and sent it to the state. The state had been allowing rental companies to keep the money to offset vehicle registration fees.

The industry spoke up.

“I said, ‘They’re taking money away from us.’ It was a tax increase,” said Bob Ostrovsky, a lobbyist for the rental car industry.

Aren't those worms cute when they squirm? Biting the bullet seems to be a lot harder for them than shooting folks with it.

The purveyors of tax cuts as the magic wand that will bring prosperity - from the 2001 situation when we had a surplus, right through to the onset of recession when the surplus disappeared - keep pushing the magical tax cuts for the rich when the absurdity has become obvious. Cutting taxes on business did not produce jobs. It was part of the ruin of our economy that we all, business included, are faced with. The ideologists who produced this are about to wash their hands of destroying the ship of state, and sneak away to Crawlforth. While there they will create a 'Freedom Institute' based on principles they have just totally disproved.

The business community is left facing reality at this time of year when it depends on consumers to give it a large percentage of its total yearly profits. The beast that has been starved is the one they were counting on for Christmas/Saturnalia dinner. It looks pretty scrawny lying there on the platter.

As President-elect Obama has said, the adults are back in charge. Reality has been denied for too long, and we will have to face the facts.

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