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RANKING THE STATES ON FINANCIAL TRANSPARENCY

Every state except Idaho and Michigan requires its elected officials and other significant policymakers to submit annual public financial disclosures. In Massachusetts, these disclosure forms are called Statements of Financial Interest (“SFIs”). Such disclosures are an essential tool for the public and press to protect against the potential intrusion of conflicts of interest into public policymaking.

Pioneer developed this data application to compare how states make these financial disclosures public.  The goal of this project is to encourage the public to demand that their states institute practices that will lead to greater transparency.  We applaud the nine highly-transparent states with perfect scores: Alabama, Alaska, Iowa, Mississippi, Nevada, New Jersey, Oregon, South Carolina, Virginia.

Pioneer ranked each state based on attributes weighted as follows:

Attribute: Weight
Proof of Identification of Requestor Not Required 30%
Agency Not Required to Notify Filer of Requestor’s Name 30%
Posted Online 10%
Posted Online and Free Open to View Without Establishing Account 10%
Requestor’s Name and/or Personal Information Not Required 10%
Filer Must Submit Disclosures Electronically 5%
Electronically Searchable Disclosure Form Available 5%
TOTAL 100%

We used a color scale to compare state scores with dark green being highly transparent and red meaning inadequate public access. You can hover over each state to view the detail of the scoring

The data is as of April 2019. Pioneer Institute intends to update this data annually.

Transparency advocates push for campaign finance reform

From: Delaware Live

With weeks to go before the first votes are cast in Delaware’s 2022 election cycle, advocates for government transparency are pushing for better campaign finance reporting.

Common Cause Delaware, a nonprofit group that lobbies for open, honest and accountable government, has called for more frequent and detailed reporting of campaign funds collected when candidates run for office.

“It’s common knowledge that people work for the person who pays them,” said Claire Snyder-Hall, executive director of Common Cause Delaware. “That’s how it often works in politics as well. Studies show that elected officials are more likely to govern in accordance with what their donors want than with public opinion.”

Under current law, campaigns are only required to file three spending reports: at the end of each year, 30 days prior to an election, and eight days prior to an election. If the candidate has a primary election, they’d file five reports.

Snyder-Hall wants to keep those reports, but also require candidates to file four additional quarterly reports.

“When voters are trying to decide who to vote for, one thing they can do is look at campaign finance reports to see who’s funding the candidate,” she said. “If a candidate receives a lot of money from police unions, for example, or teachers unions, that can say a lot about what they stand for, and voters have a right to know that information.”

Because everyday voters don’t follow campaign finance reports closely, having additional data and more time to disseminate it before an election will go a long way in improving transparency, Snyder-Hall said.

“It’s only 30 days until the election, and so that doesn’t leave a lot of time for people to be able to learn and digest that information,” she said. “Whereas if it was quarterly reporting, they would know earlier.”

Having quarterly reports would also level the playing field between candidates who have primary elections and those who don’t, she said.

For example, in Delaware’s 6th Senate District, there are two Democratic candidates: Jack Bucchioni and Russ Huxtable.

They are required to file their reports 30 days and 8 days before the Sept. 13 primary election, but Republican candidate Rep. Steve Smyk, who doesn’t have a primary challenger, won’t have to file his reports until 30 days and 8 days before the Nov. 8 general election.

“So voters now know who’s funding Russ Huxtable and Jack Bucchioni, but they don’t have any idea who’s funding Steve Smyk, because he doesn’t have a primary opponent,” Snyder-Hall said. “That gives him an advantage.”

Another way to increase transparency in elections is by requiring campaign contributors to reveal their employer and occupation when they donate to a campaign, said John Flaherty, board member with the Delaware Coalition for Open Government.

That would increase transparency in two ways, Flaherty said. First, it would help identify instances where companies ask employees to donate to a particular candidate and reimburse them for their donation. That’s a way for companies to circumvent campaign finance laws that limit the amount one can donate to a campaign.

That’s not unprecedented in Delaware.

In 2011, Christopher Tigani, the former president of a major Delaware beer distributor, pleaded guilty to illegally funneling more than $200,000 in campaign donations by compelling employees, family members and friends to make donations, then reimbursing them.

The other way it would increase transparency, Flaherty said, is by showing donor trends. If a candidate has numerous donations from workers in the fossil fuel industry, for example, one could deduce that those employees feel that candidate is more friendly to fossil fuels.

“The public can then decide for themselves whether, in fact, that donation was meant for the candidate, or whether it was meant to help propel the interests of the company,” Flaherty said. “I think the more disclosure we have, the better it is when it comes to campaign finances here in Delaware.”

Donors are already required to reveal their employer and occupation when they donate to candidates for federal office and in 38 states across the country.

When a bipartisan bill was introduced in Delaware’s General Assembly this year that would have required just that, it died in the House Administration Committee after House Speaker Pete Schwartzkopf, D-Rehoboth Beach, raised objections.

“I don’t support this bill and I’ll tell you why,” Schwartzkopf said. “I don’t know what the problem you’re trying to solve is.”

He said pass-through donations like the ones Tigani pleaded guilty to are already illegal and House Bill 366 wouldn’t have stopped them from happening.

The bill’s sponsor, Rep. Eric Morrison, D-Glasgow, disagreed.

“I think it quite possibly could have helped catch that,” Morrison said. “When you’re looking through these reports, you will be able to see that, ‘Hey, this one employer, people from their company are donating over and over again, especially in $600 checks,’ which we don’t often see.”

Schwartzkopf said he also worries that in such a divisive political climate, employers could seek retribution against employees “because they donated to the wrong candidates.”

“There’s no protection for those people,” Schwartzkopf said. “They could be fired the very next day.”

Flaherty, Snyder-Hall and Morrison all say that’s bupkis.

“That doesn’t really make sense because you can already do that,” Snyder-Hall said. “If you were a business owner and you wanted to see who your employees were donating to, you know who they are, so you could just put their names in and search to see if they donated.”

Snyder-Hall said it’s no surprise the bill didn’t make it across the finish line.

“I believe it’s the wealthy interests that want to maintain their advantage and candidates who are receiving big money from certain industries that they don’t want publicized,” she said.

Rep. Danny Short, R-Seaford, agreed with Schwartzkopf.

“There’s a whole host of issues you have to follow up on with regard to the checks so you can make sure you comply with the current situation,” Short said. “I don’t know that it helps the cause of those that are trying to run any election, irrespective of who they are, irrespective of the party, to publish that information.”

Rep. Tim Dukes, R-Laurel, said he thinks it would be intrusive to have donors include their employer information.

“On the other hand, the person who challenges [that donation] could remain anonymous,” Dukes said. “I don’t think you should have it both ways, in my opinion.”

The bill was tabled in committee and never brought back for a vote. Because the legislative session ended June 30, the bill will need to be reintroduced in 2023.

“We’ll have to bring it up again next year,” Flaherty said.

Lockdowns Should Never be Allowed Again

From: Caesar Rodney Institute 

In the early days of COVID-19, Delaware’s Governor John Carney expressed his desire to avoid a legacy of being an example of “What NOT to do.” With New York Governor Andrew Cuomo as his guidestar, he proceeded to do just that. Delaware’s economy has suffered some sectors deeply, particularly its students, small businesses, the healthcare sector, and the hospitality industry.
Delaware’s COVID-19 response began with an Emergency Order on July 24, 2020, fully three months following the peak of COVID-19 deaths, which has since been extended 26 times, some as “modifications.”
Despite there being no emergency, the Governor just renewed the order. Each renewal is time-limited, but no consequence for repetition. For the last year and a half, a “bill” requiring the Governor to get legislative approval to renew the Emergency Order stayed idle. The Legislature still has not considered this “bill.”
The original intent of a lockdown was to limit the spread of disease in order to keep the hospitals from being overwhelmed, in particular, beds and intensive care unit utilization.
Neither problem happened. Neither the mask mandate nor the lockdown decreased the spread of COVID-19, as CRI’s Health Policy Center predicted.
Cloth masks are useless and have become a fashion statement, while paper masks merely collect bacteria from the wearer. Masks are the angstrom particulate equivalent of trying to stop a mosquito with a chain link fence.
Lockdowns to prevent the spread of disease were discredited in the 7th Century with the Justinian Plague. The resurgence of these techniques is simply epidemiologic malpractice. However, the adverse consequences of these policies are undeniable.
For two years, our school-age children were denied an education and the socialization that accompanies in-person schooling.
This disproportionately injures those who cannot read, which would usually be 1st grade and below but in Delaware, that extends up to half of the third graders. Socialization of behavior defaulted to internet games, replete with violence and pornography. Marijuana, alcohol, drug use, and suicide attempts increased shockingly. Parents without childcare at home were relegated to computer babysitters and supervision.
The feared shortage of hospital beds never occurred.
The Christiana Care Center for Advanced Joint Replacement 30 beds specialty unit was commandeered for COVID-19 and never used. The population was terrified to seek medical care in a hospital for fear of contracting COVID-19. This attitude was widely prevalent among the disadvantaged and older population. People deferred routine medical care and are now sicker. The backlog of people waiting for elective treatment has risen.
The economy now broadly suffers from lockdown-induced supply chain issues severely hamstringing building and construction.
Both new and used automobiles are simply not available as inventories of many goods have dried up. When the government picks winners and losers, like you’re “essential” and “non-essential,” things go badly. How do the people feel about being told you’re “non-essential?”
Small businesses closed in droves. The hospitality industry and tourism simply disappeared. Restaurants closed or barely limped along with draconian ineffective regulations about masks, social distancing, and outdoor dining or takeout. Regulations on top of regulations is madness.
In short, there was no justification for a lockdown, and the desired result of slowing the spread and ‘bending the curve’ simply did not happen.
The health experts driving the policies focused on the number of new cases instead of the number of hospitalizations and their disparate impacts on older patients. The proven notion of herd immunity and natural immunity was laughed at. It was and still is an uninformed policy that yielded predictably bad results, however well intended.
Lockdowns should never be allowed again, and a thoughtful Legislature should temper the authoritarian mandate from a chief executive going forward in a timely fashion to prevent ongoing harm.

Tennessee will now fund students, not systems

From: Beacon Center of Tennessee

Last week, the Tennessee General Assembly adjourned for the year. In one of their final actions, legislators passed Gov. Bill Lee’s Tennessee Investment in Student Achievement Act, or TISA. The proposal completely overhauls our state’s education funding formula for the first time in three decades. I was honored to be part of the effort, having chaired one of the subcommittees created to study the issue and offer recommendations, and having testified in support of the bill on behalf of our advocacy partner Beacon Impact.

TISA replaces what was possibly the nation’s most convoluted funding formula with a student-based approach. In short, going forward, Tennessee will begin to fund students, not systems. This alone is a huge improvement over the way we’ve funded education in Tennessee for generations. It means more money will make its way into the classroom where it belongs, something that’s sorely needed. Our research shows that just 53% of education funding makes it into the classroom now, far less than the national average.

There are other key benefits to a student-based funding formula. Here are three in particular:

It will bring increased transparency for taxpayers and parents. By simplifying the formula, parents can better understand how much we spend on their child, why their child generated that amount, and what that money is spent on. Beacon has in past years attempted to make education spending understandable, pulling all the available data together from dozens of Excel spreadsheets. It takes us—a think tank with full-time employees—months to do this. Now it will virtually be at everyone’s fingertips.

This increased transparency alone will lead to greater accountability, the second benefit of a student-based formula. By tying results to dollars spent, we can more easily draw a line when it comes to the effective use of those dollars. TISA also adds outcomes-based funding to the mix, rewarding districts that boost student achievement, incentivizing them to invest tax dollars in the right way to get results.

It will give school-level leadership greater flexibility. On average, individual principals across the state currently have control over just 8% of their budgets. The rest is already claimed by the time the money gets to the school level. Local leaders can use the flexibility provided by TISA to innovate and structure an education that reflects the needs and opportunities of their own students. We can then see what works and what doesn’t; just like federalism makes states the laboratories of democracy, a student-funding approach allows individual schools and districts to be laboratories of education.

We applaud Gov. Lee for championing funding students and not systems. Every single public school student in Tennessee will benefit from this much-needed reform.

Increased Tax-Free Benefits for Military Retired: Too Little, Too Late?

From: Kathleen Rutherford, Executive Director, A Better Delaware

On July 21, 2022, Governor Carney signed SB 188-1 into law before a roomful of National Guard who will not benefit from it.

Amending Delaware Code, Title 30 will exclude an additional $10.5K of military pensions from taxable income. Lawmakers in Dover say it’s “an incentive for military retirees under age 60 to locate in Delaware,” ignoring three dozen other states where military pensions are 100% tax-free.

Many others, like Virginia, are working to phase in tax exemptions in progressive $10K increments to a maximum of $40K in 2025.

In 2004, when advocates first began beating the 100%-military-pension-exemption-drum, about 20 States were income tax-free. SB 95 was born in 2005, SB 48 followed two years later. Both ended up in desk drawers.

Senator Mantzavinos introduced SB 188 (originally 100% tax-free) in January 2022 when there were 26 tax-free states. While Delaware struggled to whittle SB 188 down to an amended $10.5K benefit immediately upon retirement, two more States came on line. On the day SB 188-1 became law, Delaware trailed 75% of America.

Furthermore, the bill excludes National Guard even though the Reserve Component (RC) was in previous versions. One “grey zone retiree” –an RC member with “20 good years,” vested for retirement but not yet 60, the age at which they draw their pension–told me he will leave Delaware so he can keep all his military pension.

Delaware’s new law is unlikely to entice anyone unless they were already coming for other reasons. Our Governor points to our excellent retiree tax benefits. Kiplinger Newsletter agrees: Delaware is the most tax-friendly place to retire.

And that is precisely the problem! With so many retirees flocking to Delaware, who will provide goods and services to this aging population? Veterans and Military Retirees (MR) provide a solution since they tend to be community-minded, physically fit, and with solid work ethics in skill sets employers seek.

Delaware ranks 15% in the nation based on the percentage of veterans (in 2019, 66,896 of them –8.8%– were veterans.) But working-age veterans only make up 18% of that total (12,053 are Gulf War II era vets). The same is true for our 9,000 MR; less than 2,000 are of “working age.”

Veteran v. Retiree. According to USC Title 38, a veteran is anyone who served on active duty for as little as 180 days and was not dishonorably discharged. The majority of veterans (81%) never reach retirement, either by their own choice or the military’s up or out system. While 85% of veterans receive Honorable discharges, a veteran may be homeless or have been terminated for medical problems or needs of the service. On the other hand, MR stood the test of time, proven worthy in the knowledge of the job, of dedication to duty, and leadership.

Civilian v Military Retirees:  Whereas retired civilians cease working, the MR is just beginning a new career. The average MR is a 38-year-old sergeant with a working spouse and college-aged kids. Officers might be 52 because they entered after college. Enlisted or officers, most MR are college educated. Eighty percent of the force are enlisted, so 80% of retirees are enlisted. The average enlisted military pension is < $35K per year, <$46K for officers.

Unlike civilians, MR earns more in their second careers than the amount of their military pension. Hence, a tax-free MR pension is a “loss leader” to attract highly skilled talent to Delaware, whose civilian income (and that of their spouse) remains 100% taxable.

Military skills are needed. Most MR excel in highly technical jobs that are in demand. Any job you can think of, there is a military MOS equivalent. But we cannot attract these skills because Delaware ranks middling to worst as a place for RM.

Kiplinger Newsletter ranks Delaware as worst in “The Ten Least Tax-Friendly States for Military Retirees”.  According to Kiplinger, our $12,500 tax-free pensions “is smaller than similar exemptions available in other states that do not fully exclude military pension.”  Our new bill does not change this fact. It only makes it available sooner.

Delaware fares better in WalletHub, ranking 26th because WalletHub included non-financial comparisons, one of which is Delaware’s low homeless vet population. This factor may apply to veterans but rarely to MR.

Too little, too late. Delaware needs 100% tax relief on military pensions now, not just an additional $10.5 tax-free advantage for those under 60.

“Inflation Reduction Act”: Tax Burden to Fall Heaviest on the Poor

From: John Locke Foundation

A newly-released analysis from the bipartisan Joint Committee on Taxation (JCT) shows that the negative impacts of the tax hikes in the “Inflation Reduction Act” would fall hardest on low-income households.

My colleague Paige Terryberry earlier this week exposed how the bill would actually increase inflation, a burden that falls hardest on low-income households.

Adding onto this burden, the JCT analysis estimates that the tax burden would fall disproportionately on the poorest households. Specifically, households with less than $10,000 in income would see their tax burden rise by 3.1%, compared to just 0.4% for those earning above $200,000 in the bill’s first year. Estimates of future burdens yield similar results, with the lowest income households seeing the largest percentage increase in tax burden.

Indeed, taxpayers of all levels would see an increase in their burdens under this bill.

The JCT report most likely attempts to estimate the tax incidence of the bill’s provisions, rather than just a static look at who the new taxes are directly levied on.

The tax incidence evaluates who bears the actual burden of a tax. For instance, the corporate tax increase’s burden will fall on workers in the form of suppressed wages and lost jobs. The tax on crude oil will be passed along to customers in higher gas prices.

At a time when the low income communities are being mercilessly hammered by inflation, the so-called Inflation Reduction Act would both make inflation worse and increase the tax burden borne by those who can least afford it.

 

Rhode Island governor signs legislation benefiting military veterans

From: The Center Square

Through signing a package of veteran-focused legislation Thursday, Rhode Island will no longer tax military pensions, Gov. Dan McKee said.

The Democratic governor announced he has signed legislation designed to support and benefit veterans through a series of budget initiatives.

“As I travel the state, talking with veterans, active duty, guard and reservists, and military families is always a highpoint,” McKee said in the release. “Veterans want to continue to make the Ocean State their home and remain a part of the communities and places that matter to them. Now, when military retirees look at where they want to move after service, Rhode Island will be at the top of that list.”

According to the release, the U.S. Department of Veterans Affairs reports there are 5,252 military retirees making their permanent home in Rhode Island, and 4,845 were paid by the U.S. Department of Defense.

“Ending taxation of military service pensions is not only the right thing to in recognition of the many Rhode Islanders who fought courageously for our freedom, but it’s also an investment in our state’s workforce,” Office of Veterans Services Director Kasim Yarn said in the release. “This change will allow us to retain top-tier talent which can drive Rhode Island’s economy forward. Military retirees bring a wealth of knowledge and backgrounds, benefitting Rhode Island in innumerable ways.”

According to the release, the taxation on military service pension will end with tax year 2023, and is a result of House Bill 7338, sponsored by Rep. Camille F.J. Vella-Wilkinson, D-Warwick, and Senate Bill 2268A, sponsored by Sen. Walter S. Felag, D-Bristol.

House Bill 7714A, sponsored by Rep. Samuel A. Azzinaro, D-Westerly, and Senate Bill 2425A, sponsored by Sen. Roger A. Picard, D-Woonsocket, will make “stolen valor” a crime in Rhode Island, according to the release.

The law, according to the release, makes it illegal to “fraudulently represent oneself as an active or veteran member of the miliary” to obtain money, property, or other benefits.

Reminder that Corporate Taxes Are the Most Economically Damaging Way to Raise Revenue

From: Tax Institute

In the rush to pass the Inflation Reduction Act, which features an ill-conceived tax on the book income of U.S. corporations, it is worth reminding policymakers of a well-established finding in the economic literature: that among all the major ways to raise revenue, increasing the corporate tax is the most economically destructive due to its impact on incentives to invest.

Economists have found in more than two dozen published studies that corporate taxes harm economic growth. An OECD study examining data from 63 countries concluded that corporate income taxes are the most economically damaging way to raise revenue, followed by individual income taxes, consumption taxes, and property taxes. A study on taxes in the United Kingdom found that taxes on consumption are less economically damaging than taxes on corporate and individual income. A study of U.S. tax changes since World War II found that a 1 percentage point cut in the average corporate tax rate raises real GDP per capita by 0.6 percent after one year, a somewhat larger impact than a similarly sized cut in individual income taxes. Based on U.S. state taxes, a study found that a 1 percentage point cut in the corporate tax rate leads to a 0.2 percent increase in employment and a 0.3 percent increase in wages.

While the Inflation Reduction Act book tax is an unconventional way to raise corporate taxes, that doesn’t make it any less economically destructive. In fact, it falls particularly heavy on companies using accelerated depreciation provisions, especially bonus depreciation, that are shown to be very effective at stimulating investment. Economists Eric Zwick and James Mahon found that the bonus depreciation policies in the early 2000s raised qualifying capital investment by 10 percent in the years they were in effect, and then increased investment by 16 percent near the end of the decade when the policy was reinstated and expanded. Economist Eric Ohrn and coauthors came to similar conclusions when looking at the impact of bonus depreciation on the manufacturing sector, finding that the policy increased capital formation by about 8 percent and employment by almost 10 percent, with gains concentrated among production workers.

Furthermore, several studies demonstrate that the corporate tax is borne in part by workers. For instance, a study of corporate taxes in Germany found that workers bear about half of the tax burden in the form of lower wages, with low-skilled, young, and female employees disproportionately harmed.

The corporate tax is also borne by owners of shares, including retirees and others earning considerably less than $400,000. In the short run, the Joint Committee on Taxation (JCT) assumes owners of capital bear all of the corporate tax, yet that includes more than 90 million tax filers earning less than $200,000. In the long run, JCT assumes workers bear a portion of the corporate tax, such that the burden falls on more than 150 million tax filers earning less than $200,000.

While there is always a populist appeal to raising corporate taxes, based on the misunderstanding that the burden is somehow only felt by a small number of rich people, it is the job of economists to remind people of the facts and resist political efforts that have no basis in economic reality. Corporate taxes do not come freely but rather at the expense of more investment, more job opportunities, and higher wages. Raising corporate taxes now at a time of economic uncertainty and a slowing economy as the Inflation Reduction Act does would be particularly irresponsible.

INFLATION CRISIS IS VEXING, BUT TAX CUTS CAN HELP

From: Oklahoma Council of Public Affairs

There’s no easy answer for solving the inflation crisis. It is time for policymakers to admit that and to take a humble approach.

Major economic shocks are rarely predicted. When the housing bubble burst in 2008 it caught most of us by surprise (aside from Christian Bale). No one was anticipating a worldwide pandemic in 2020. Russia’s invasion of Ukraine wasn’t a part of the Federal Reserve’s economic outlook beginning in 2022. There is a reason we describe these as economic “shocks”—they shock the system because no one saw them coming.

Oklahoma is no stranger to these types of events. When OPEC refused to cut production in 2015 oil prices continued to fall, declining from more than $100 a barrel to just under $30. This was the primary driver in the budget shortfalls plaguing the state over the next few years.

The point is that as the world economy becomes more intertwined, the more complicated and harder to predict it becomes. This was highlighted at the federal level with officials backpedaling on “transitory inflation.” Egos in D.C. are legendarily large, but Oklahoma lawmakers have a chance to show they’re different.

An economy grows by entrepreneurs taking risks, investors trying to make wise decisions, and consumers deciding how to spend or not spend their money. Targeted tax breaks and short-term rebates are misguided solutions that imply the government is the guiding hand for the economy. Rather than assume that they know best how to run Oklahoma’s economy, politicians should trust that their constituents know what is best for themselves. Broad income tax cuts put dollars back in families’ pockets and allow them to make their own decisions. Trusting in free markets isn’t about trusting an ideology. It’s about believing in people and admitting that we can’t know everything.

More than half a dozen states have already cut taxes this year. The current special legislative session gives Oklahoma a chance to join that group and not get left behind.

Inflation makes the case for lowering Colorado’s income tax

From: Independence Institute

Inflation hit another 40-year high in June, according to federal inflation data released yesterday. Coloradans have taken the fight against rising costs into their own hands with a citizens’ initiative to lower the income tax rate and put the state on a path to zero.

Last July, as high CPI began to rear its ugly head, CNBC prophetically reported, “Inflation is the silent killer.”

Coloradans have certainly felt its sting.

Someone earning $70,000 per year in January of 2020, would now need to earn over $80,000 to maintain the same standard of living today as then. Many Colorado households and businesses have struggled to keep up.

According to the Bureau of Labor Statistics’ Consumer Price Index (CPI) report, inflation last month increased by 9.1% from a year prior. That’s up from 8.6% in May, reaching the highest level since November 1981.

An astounding $6.3 trillion increase in the U.S. money supply, combined with supply shocks induced by government-mandated economic lockdowns, has largely driven the record CPI print.

The Fed is now combating inflation by crushing consumer demand through higher interest rates and tight money—a move likely to trigger a recession. State lawmakers can do their part to help bring down prices in the Centennial State by rolling back many of their recent policies, which have pushed prices up.

These remedies, however, will take time to work their way through the economy. Meanwhile, the dark clouds of high (and rising) CPI have already brought financial storms over Colorado households and small businesses.

Coloradans need immediate relief.

They can take matters into their own hands with Initiative 31.

The citizen ballot measure will appear before voters this November and if adopted will reduce the state income tax rate from 4.55% to 4.40% starting this year. State analysts estimate the decrease would save Coloradans $382 million or an average of about $120 per taxpayer in year one.

The rate reduction would directly increase household budgets, helping Coloradans to afford the rising costs imposed on them by government, and provide a more effective reprieve than direct government aid.

When the federal government deployed stimulus during the pandemic, they effectively had to print new money. The decision devalued the dollar and created massive inflation.

Like federal stimulus, an income tax cut would put more money in Coloradans’ pockets. But rather than printing new money, the policy simply allows Coloradans to keep more of their own money.

This is the way forward.

The policy will increase incomes and allow families and businesses to absorb increased costs, but its benefits go much further.

More money remaining in the private sector means more investment in our communities and local economies. With it, the economy will grow and catch up with the expansion in the money supply, making it easier for everyday Coloradans to afford the “new normal” prices brought on by government.

The last couple of years have demonstrated that when politicians and bureaucrats have more money and power, they botch it.

As inflation began to exceed historic norms last spring, the Biden Administration and the alleged experts at the Federal Reserve refused to address the problem, calling it “transitory.”

Echoing those faulty conclusions, Colorado’s Legislative Council Staff economists concluded in their June 2021 economic forecast, “Inflation shoots above Federal Reserve target, but is expected to moderate throughout 2021.”

The experts and central planners, with all their wisdom and PhDs in economics, failed to understand that their policies would bring about historic and persistent inflation. And yet they still do not learn.

In response to yesterday’s inflation announcement, the White House’s chief economic advisor, Brian Deese, called on Congress to print and spend more money to bring down inflation.

Policymakers created the mess we find ourselves in now. Reducing the income tax will equip hardworking Americans to clean up after them.

Allow Colorado families and businesses to keep more of what they earn, and they will strengthen the economy.

But we will not get there with Initiative 31 alone.

Denver-based think tank Independence Institute has proposed a Path to Zero, which would gradually reduce Colorado’s income tax rate until we have joined the nine other states that have eliminated their income tax entirely.

This November, voters will have a chance to ease the burden of inflation with Initiative 31. After that, it will be up to all of us to put Colorado on the path to zero.