Tuesday, July 14, 2009

Colorado Springs March to Socialism

by The Lone Front Ranger

The City of Colorado Springs is at it again.   In a July 1 article in the Colorado Springs Gazette, reporter Daniel Chacon details the new fees that the Sub-committee of the “Sustainable Funding Committee” will be proposing at the July 27 City Council Meeting.  You can find Daniel’s entire story here.

 The alleged goal of these new fees is to balance the city budget in this recession.  Let me give you a small sampling of these “problem-solving” fees:

 - An employee head-tax levied on companies that employ people in the City of Colorado Springs

 - A $10-$20 annual vehicle registration fee – on top of the new registration fees enacted by the Democrat-controlled Legislature and the Democrat Governor

 - Extending the city’s sales tax to cell phones

 - Extending the city’s sales tax to cigarettes

 - Implementing a special sales tax on alcohol

 - Increasing car rental rates

 I’d like to provide a lesson to our city leaders.   This is a lesson that beginning economics students are certain to have studied.  There is a phenomenon called the Laffer Curve, named after Arthur Laffer.  Laffer is a famous supply-side economist who popularized this theory.  It states that increases in the rate of taxation do not necessarily increase tax revenue.  So to put it in terms that even my 16 year old understands:

 - If you tax employers for each employee, will they want to expand their business in Colorado Springs, or will they choose to expand elsewhere? 

 - If you tax alcohol and cigarettes, isn’t that an incentive for me to go outside of the city limits to buy those products? 

 - Is this really good for Colorado businesses who fund a portion of the city budget through their business taxes?

 Keep an eye on this one.  According to Mr. Chacon’s article, this issue is due to be heard at the July 27 City Council Meeting.  You can check on any agenda updates here.  And if this makes as little sense to you as it does to me, I hope to see you at this City Council meeting.

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