American Republic Online

After the recent tragedy of the bridge collapse, I’ve heard a lot of politicians calling for “more taxes”. The problem is that Minnesota has a budget SURPLUS of 1 Billion dollars for their 2006-2007 budget (they do two year budgets) that is projected to grow to 2 Billion dollars for the 2008-2009 budget. (minnesota.publicradio.org)

As pointed out in the debate column, the problem is not lack of money, it’s money management. Politicians love to call for more money at every crisis, because people fall for it. And then once the money is blown somewhere else (like MN spending $1M on a virtual reality spray paint simulator system and training program), they can always go back ask for more money to meet the government “needs”.

Thomas Sowell believes the cause to be a fundamental problem with the political incentives involved in different types of money management:

There may be enough money available to maintain bridges and other infrastructure but that same money can have a bigger political payoff if spent building something new instead of maintaining and repairing existing structures.

When money is spent building a new community center, a golf course, or anything that will be newsworthy, there will be ribbon-cutting ceremonies and the politicians who cut the ribbons can expect to see their pictures in the newspapers and on TV.

All that keeps their name before the public in a positive role and therefore enhances their prospects of being reelected.

But there are no ribbon-cutting ceremonies when bridges are being repaired or pot-holes are being filled in. These latter activities may be more valuable than a community center or a golf course, but they are not nearly as photogenic.

This surplus article is also quite instructive as you discover how the government thinks it should deal with an excess of the people’s money. The Finance Commissioner wanted to save the money for the next short fall. Some legislators called for a mix of new spending and one-time tax rebates. Others called for more permanent tax relief. My personal favorite was the response by Nan Madden, a liberal with the Minnesota Council of Nonprofits. Her response to the SURPLUS of tax payer’s money: “an income tax increase or an expansion of the sales tax on some services”. Some people can never have enough. Oh well, at least the government knows how to spend my money better than I do.