High-tax states choose the hard way. | Plus: School choice, public unions, net neutrality, and tariffs.

 
 
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January 27, 2018

Cutting taxes would be the easy way to limit the impact of reforms to the state and local tax deduction, but that's not what some high-tax states are doing. The dark history of the Blaine amendments are revealed in a new documentary. A major new case on forced union dues goes to the Supreme Court soon. Burger King whiffs trying to explain net neutrality. Trade restrictions are just another kind of crony capitalism.

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Why not just cut taxes instead? Lawmakers in high tax states are working hard to help their high-income taxpayers avoid the crunch of the new federal limits on state tax deductibility. The results of those efforts, writes Rachel Greszler, will inevitably be more complicated state tax codes that discourage new business investment. Plus, they probably won't work anyway. Read Greszler's article at The Daily Signal.

 

From where do state laws against public funding for private schools come? Bigotry. A new documentary from the Pioneer Institute explores the history of the Know Nothing movement and the Blaine amendments. See the documentary on YouTube.

 

Will the Supreme Court knock out a major prop supporting big government? Get ready for another big case challenging the power of public employee unions to force public employees to pay union dues. In February, the Supreme Court will hear Janus v. American Federation of State, County and Municipal Employee. Writes Michael Reitz:

Over time, organized labor has shifted its core function away from serving its members and to consolidating its political power, acting as a financial pipeline for a single political party. As AFSCME 36 of Los Angeles says: "Politics is the union's business." Or the Michigan Education Association: "Every education decision is a political decision." 

Political intersectionality led unions, particularly the National Education Association, to embrace causes that have little to do with the workplace.

Labor's shift to politics is the logical result of relying on government employees to sustain membership rolls. Unions are self-motivated to grow government: More government programs lead to more employees who pay more in union dues.

Read the rest of Reitz's article in The Hill.

 

We're all thankful Burger King isn't a monopolist. Burger King tried to promote net neutrality this week with a commercial that imagined the consequences of Whopper Neutrality—$26 to get your Whopper hyperfast. Of course, if that happened, even more people would opt for McDonalds instead of Burger King. Competition works, and, as Nick Gillespie points out, that's how it is in internet service, too:

[I]n fact, the average speed and number of internet connections kept growing regardless of the regulatory regime. The FCC's most recent Internet Access Services Report counted 104 million fixed internet connections, a new high. That number doesn't count mobile or satellite connections. Eighty percent of census tracts had at three or more ISPs offering connections of 10 Mbps downstream and 1 Mbps upstream and another 17 percent had two ISPs doing the same (figure 4). So 97 percent of America can go elsewhere when it comes to basic internet connections that allow the sort of streaming, surfing, and gaming we want.

Read the rest of Gillespie's article at Reason.

 

Trade restrictions are another type of crony capitalism. The Trump administration's punitive duties on imported solar panels and washing machines is, as tariffs always are, a tax on American consumers. National Review's editors point out some of the other ill effects of the policy, including:

[F]loating exchange rates essentially make an end run around tariffs, rebalancing in the foreign-exchange markets what politicians distorted with the tariff. What's worse in this scenario is that the depressed Japanese yen and reduced exports to the United States leave Japanese consumers with less money with which to buy American goods, which are now more expensive to Japanese buyers because of the falling yen. That's why the most significant development in the markets after Trump's announcement wasn't a crash in Chinese washing-machine stocks — investors had been expecting the move for some time — but a steep drop (1 percent in a few hours' worth of trading) in the value of the Mexican peso.

Read the rest of the editorial at National Review.

 
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