Jim Hiestand wrote:

>    I am not going to argue about the meaning of tax.  I was using the term
> as equivalent to revenues going to the state.  Years ago, when Nelson
> Rockefeller first ran for governor of my home state of New York, he
> promised not to raise taxes.  Instead, after becoming governor, he raised
> "fees"  on lots of things, including auto licenses.  Likewise, we don't
> charge our in-state students tuition; we charge them maintenance fees.

Jim aptly points out a favorite tactic of politicians in their
never-ending battle to extract more of our money to spend on their pet
programs:  defining new terms, or redefining existing ones, to mask
the true meaning and impact of what they want to do in order to
confuse the public and deflect opposition.  If "tax" is a bad word,
call it a "fee"; when people wise up to what a "fee" means, couch it
in different terms and coin some new euphemism for it.  Call it what
you will, though, the underlying truth is that if it is required by
law for people to pay it, it amounts to a tax.  If it is voluntary,
you can call it a tax all day long, but it's not a tax.

>    Of course to play or not play the lottery is a choice unlike a direct
> tax on incomes.  One can buy selectively to somewhat reduce paying the
> sales tax.  One can even avoid paying almost all money to Tenn. by making
> most purchases in Georgia where the sales tax is lower.  This is not
> impossible nor even inconvenient if you live say, in East Ridge.  But I
> don't think such a one is paying his fair share of being a resident of
> Tennessee.

I think this hypothetical person is paying at least his fair share of
what it really takes to run the required functions of the government
of Tennessee.  He/she is still paying property taxes to the city and
county and lots of "fees" :) such as drivers license, car tag, etc. to
the state government.  The problem is, people who can't or don't adopt
this strategy are paying much *more* than their fair share because the
state of Tennessee is spending far more money than necessary to carry
out its essential constitutional functions.

A fellow UTC employee who lives in north Georgia sent me an email
yesterday about all the lottery-funded school construction in GA over
the last two years.  He also stated (I have not verified the accuracy
of this information) that Georgia's 1998 overall budget was $3 billion
*lower* than that of Tennessee despite Georgia's higher population and
greater business tax base.  If true, this raises some serious
questions about what Nashville is doing with the money it is taking in
now.  Why would it cost more to govern a smaller state?  Maybe we are
not using the revenue we already have as efficiently as we should?
This is the sort of thing Tennesseans need to consider before
encouraging politicians to *take* (not just allow them to give, as
with a lottery) more of their hard-earned money via increased taxes.

>    I think it was Oliver W. Holmes who said taxes are the price we pay for
> civilization.  I am willing to pay for I also want the benefits which
> government provides (e.g. police protection, public schools).

It is true that government must have some revenue to pay for essential
functions.  Unless all of this money can be raised by voluntary means
(lottery, etc.), which might be possible if government is kept small
enough, then some sort of tax may be necessary.  I believe that our
federal and state government programs, and the corresponding
expenditures, far exceed those authorized by their respective
constitutions.  Thus, rather than raising taxes or "fees", our focus
should be on scaling back or eliminating non-essential functions.  I
am willing to pay only a small price (to the government) for
civilization because other than providing police and a court system to
protect us against others who violate our rights, and a military to
defend our territory against invaders (*not* to go around the world
meddling in the business of other nations :( , in other words, other
than *defending* our civilization, government has, or should have,
very little to do with our existence as "civilized" people.  Churches,
charities, the arts, etc., all those civilizing influences in society,
should exist without the fiat or intervention of government.

To put it in economic terms:  anything not essential for government to
do should be left to the private sector which invariably does a better
job for less money.  Private schools, for example, almost invariably
spend less money per student than do public schools, yet most private
schools somehow manage to provide students with a better education
than most public schools.  (If they *didn't* do a better job with
students, private schools would die out because not many people would
be willing to pay money for an inferior education when they could get
a better one for "free".  ("Free" of course is in quotes because
public schools are not free, they are supported by the tax dollars of
all citizens whether or not they have children in the public
schools.))  Private delivery services such as FedEx and UPS do a
better job of package delivery than the federal post office and would
probably do a better job of letter delivery as well if they were not
barred by law from competing with USPS in that arena.  Any economist
will tell you that when you have competition on a level playing field,
it tends to encourage efficiency and keep prices down.  Government
programs tend to have no competition or to have an unfair advantage
over the competition, are therefore not efficient and waste taxpayer
money.

> Taxes back home in New York are too high; here they are too low.

I think taxes here are already too high.  By the "transitive property
of taxation" (hey, I coined a new axiom ;) taxes in New York are *way*
too high.  No wonder so many New Yorkers eventually give up and move
to Florida (which, by the way, has a lottery but no state income
tax).  And all this time I thought it was just the weather.  :)

> Dumas is correct that purchases tend to be regressive.  I don't think
> taxes should be.  Probably the poor do benefit more from government than
> do the better off.  I think this is reasonable. It is not clear that the
> working poor benefit more than do the wealthy.  The latter may pay more
> for home owners private insurance but they pay no more for public fire
> protection nor to attend public schools nor to use the roads.

I don't think it is reasonable that anyone should *benefit* from
government other than by having his or her rights and property
protected against those who would violate them.  I don't believe the
proper function of the government is to redistribute wealth; that is
socialism and I am not a socialist.  Government should not be Robin
Hood, robbing from the rich and giving to the poor.  (In practice,
there are never enough rich people to support all the poor people
anyway, so what really happens is robbing from the middle class to
give to the poor, who then come to expect the gift as an
"entitlement".)  Robbing from the rich (or middle class) is still
robbing regardless of who receives the proceeds.

We have strayed far enough from the original subject, which itself is
only peripheral to our day-to-day struggles at UTC, that I intend for
this to be my last public post on the subject for a while.  (You can
all sigh with relief now. :)  I will confine further discussion to
private e-mail or (since Jim's office is no more than 25 feet from
mine) face-to-face discussion.  A productive "finals week" to all.

Joe Dumas