Wednesday, August 02, 2006

More Populist Pandering From Bauer

Last week House Minority Leader Pat Bauer (D) called for an investigation of oil companies for price gouging. This week he's calling on Gov. Daniels to suspend the sales tax on gasoline, which would reduce state revenues between $300-$400 million a year. That's about how much of a surplus Gov. Daniels said the state had on hand at the end of the most recent fiscal year.

AI has contended that the state actually ended the fiscal year with a deficit, but the administration used several budget gimmicks to make it appear that the state had a surplus. Bauer has similarly argued that the state is still running a deficit, but now he is pretending that the state has some huge windfall laying around to give back to taxpayers.

The Governor's office opposes Bauer's proposal, "saying the state was trying to dig itself out of a deficit and suspending the tax would provide little relief to motorists." His office also said "that Indiana was not getting a big windfall from higher prices because people were conserving fuel or spending less money on other items subject to sales taxes." House Speaker Bosma thinks Bauer's proposal is "irresponsible." He said he rejected a suggestion made to him by "political people" to propose the same thing as Bauer should have done.

Why does Bauer think the state can give up this much revenue without affecting state services? He says "the state could afford the repeal because it was getting more revenue from an improving economy, and was earning tens of millions of dollars in interest from leasing the Indiana Toll Road to a private venture for $3.8 billion." AI wonders if Bauer ran this idea past educators, who already think the state is short-serving education funding. You can forget any talk of funding full-day kindergarten if the state gives up that much in revenues. And Bauer knows full well that the toll road lease dollars are earmarked for the Major Moves projects and cannot be diverted for general fund expenditures.

Bauer's dependency on political rhetoric and gamesmanship has reached discomforting levels in recent months. The reality is that there is a high likelihood that Democrats will regain control of the House after this year's election and Bauer will once again become Speaker. He offers the public little confidence in his leadership when he chooses politics over substance time and time again.


Anonymous said...

Thank you! Suspending the sales tax on gas is ridiculous. First, it offers an insignificant reduction in the cost. Second, the law doesn't allow the Gov to do it. The statute says that if an energy emergency exists, then the Gov may suspend some laws to fix the problem. An emergency would be, for example, if the supply of gasoline was interrupted for an extended period -- then the Gov could suspend some laws. However, suspending the sales tax on gas, making it cheaper to buy gas, would actually make the emergency shortage worse, not better. This was the fallacy behind O'Bannon's suspension. Refineries faced a production problem which interrupted the flow of gasoline, so O'Bannon's campaign was able to call it an emergency. Fine, but suspending the sales tax on gas did not help the so-called emergency, it made it worse! Finally, just when the state's budget is finally under control, Bauer has his hand out for money, ready to spend, spend, spend. Full day kindergarten that he seems to want so bad will cost about $300-400M after the first year -- exactly how much money the state would lose if Bauer becomes Speaker and makes good on his promise to eliminate the sales tax on gas. He seems to want to give more money to education, which Republicans seem to want to do also, but you can kiss that goodbye, too, if Bauer cuts $300-400M out of the budget. And for what? So we can save a few bucks a month and give a gas price reduction to out-of-staters who travel through the state? The whole thing is a dumb idea and a transparently desperate attempt to grab back a House majority that may be just beyond his reach.

Anonymous said...

I'm not a big fan of Bauer or his ridiculous proposal but I find it hypocritical of Bosma to criticise him on wasting effort and tax dollars when Bosma has spent millions of our hard earned money trying the keep "Christ" in statehouse prayers.

On a semi-related note....I read in The Star that the state is earning 500K every day in interest off the toll road revenue. I haven't read or heard about any funds yet being distributed, so theoretically we should be up 10 million or so. Where is that money going?

Gary R. Welsh said...

The interest will be used for the Major Moves initiatives. They're going to need every penny of it to fund all of the projects in the pipeline.

Anonymous said...

Amen, Kevin. (No pun intended.)

Bosma ought to be ashamed. He's the original Pander Bear. The whole State House prayer thing has cost us, at my last check, $345,000 in legal fees.

Not unlike the County Clerk pursuing two legal actions a few years ago, in the City Council races, that were overturned by courts, at a huge cost to taxpayers.

Evidently if it fits their idea of "right," these folks will spend our tax money on legal fees out the whazoo.

This is what a dying elephant sounds and looks like. It's costly, but, ultimately, it's effective. Ms. Sadler isn't running again. Bosma has a credible opponent this fall. And he won't be Speaker even if he does win his district.