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Thursday, September 11, 2008

Special Interests Line Up for 59

Recently I criticized Amendment 59, the measure that would forever direct refunds from the Taxpayer's Bill of Rights to Colorado politicians. I wrote:

Don't be fooled by claims that the new measure is just about education. As one representative of the "yes" campaign noted in a September 1 e-mail, the measure (which advocates are calling Savings Accounts for Education) would "relieve pressure on higher education, health care, transportation and other core services." In other words, because the new taxes go to education, the legislature can transfer other funds from education to whatever it wants.


Today Peter Blake makes the same point for the Rocky Mountain News:

Although it is nominally designed to provide money for P-12 (formerly K-12) education, and the Colorado Education Association has kicked in $85,000, the ballot issue is drawing support from a wide variety of groups.

The Colorado Bar Association has contributed $25,000, Colorado AARP $15,000, the Colorado Medical Society $5,000. Even Newmont USA, a gold mining firm, gave $15,000.

But the biggest giver has been the Denver Foundation, with $280,000 to date. That's just a fraction of what it's prepared to invest. It deposited $1 million into its own issue committee in July, and $720,000 remains to be transferred.

Why? Said foundation chief David Miller: "As I understand it, SAFE does more than just support education. If it passes, it would free up general fund dollars for health care, which is why the Colorado Health Foundation is a big supporter."

It's kicked in $200,000.

[Carol] Hedges [of the Colorado Fiscal Policy Institute] confirmed the broader, less advertised, purpose of SAFE. "A dedicated source of funding for schools could reduce the pressure on the general fund, and in turn allow legislators more opportunity for investing in other priorities, such as health care, higher education and transportation."

Hedges' organization has set up its own issue committee to help promote SAFE.


SAFE is a lie. SAFE stands for "Savings Accounts for Education," but the measure would boost funding for whatever programs the legislature wants.

It is also a typical example of "concentrated benefits, dispersed costs." Blake notes that SAFE's "promoters have piles of money and endorsements." Much of this money is coming from people who want a piece of the tax revenues or other political favors. The recipients of the tax dollars -- for whom benefits are concentrated -- have a big incentive to fool Colorado voters into approving it. The funders -- among whom the costs are dispersed -- have little incentive to spend time or money opposing the measure.

Of course a big problem with special-interest warfare is that it promotes ever-higher wealth transfers. Such forcible transfers of wealth benefit some at the expense of others and waste resources in the process. But eventually, to the extent that the policy reaches its logical conclusions, everyone is forced to fund everyone else in a battle to consume the pie.

The alternative is liberty, in which people interact voluntarily, trade to mutual advantage, and focus on producing a bigger pie, rather than fighting over the crumbs.

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posted by Ari at

1 Comments:

Anonymous Anonymous said...

Ari, you have summed up this head fake beautifully.

September 11, 2008 3:42 PM  

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