Trolley plan highlights latest legislative lunacy

Clang, clang, clang!, went the trolley.

Ding, ding, ding!, went the taxes.

All right, I changed the lyrics. But when you get an opportunity to highlight how out of touch politicians and their spending have become with a project that recalls a show tune, you have to go with it.

And the proposal to resurrect a trolley on Colfax Avenue in Denver fits that bill.

As all of you who read The Daily Sentinel know, our state Legislature is busily grappling to resolve a budget shortfall brought on by that eternal triangle of politics: what politicians want, what we want and what we can afford.

If this were a horse race, what they want would be in the lead, with what we want trailing badly. What we can afford was injured during the race and had to be put down.

All this gloomy news does not mean that a few rays of financial lunacy can’t peek through to highlight how we arrived at this mess.

In a state that is projected to have an $800 million shortfall in meeting its unemployment insurance obligations, we have a state senator who wants to take part of the recently increased vehicle registration fees (one of last year’s fixes for our economic doldrums) and build a trolley line on Colfax Avenue in Denver.

Sen. Chris Romer, D-Denver, who grew up near Colfax, said it had always been a dream of his to restore streetcars to the area because, “they change the way people live.” It’s not just state tax dollars he’d like to get involved in the project. He’s hoping for federal stimulus money as well.

The Colorado News Agency reports that Romer said, “If the feds are giving away money, I’d get to the candy store fast.”

There are so many things wrong with this idea and the attitude behind it that criticizing it is a little like dynamiting fish in a barrel. It’s just not sporting.

In the meantime, Romer and the Legislature are considering such job-creating initiatives as removing the tax exemption on soft drinks, software products used by business and energy expenses used in the manufacturing industry.

The beverage industry alone estimates that imposing the state sales tax on soft drinks could reduce wages paid to Colorado workers by $13 million to $28 million per year.

Qwest has testified that removing exemptions for electricity and software and capping the write-off for net operating losses at $250,000 (another pending revenue bill) would cost the communications company 100 jobs, each with an annual salary of $50,000.

Animating these dangerous ideas is the fanciful notion that production and consumption of goods and services will remain constant or grow, despite increased costs imposed by government taxation and regulation.

Each time that costs for goods are increased due to enlarged taxation, there is an almost inevitable shortfall in the predicted revenue put forth by politicians, as consumption and purchasing decrease due to the escalating costs.

This number is separate from the loss of wages as workers are idled by lower production, which further damages government revenue.

When this happens, there is an inevitable panic in government offices, as the voting public, now suffering even more and growing restive, raises the possibility of expelling representatives back into the private sector that they have been hamstringing.

The next phase is usually a series of panicked tax credits and enterprise zones cooked up by the same people who didn’t understand business concepts to begin with.

The answer is not tax credits, tax incentives or even tax reform. It’s tax relief, plain and simple.

Oh, and Sen. Romer: 1923 called — your trolley is ready.

Rick Wagner offers more thoughts on politics at his blog, The War on Wrong, which can be reached through the blogs entry at GJSentinel.com.


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