Thoughts on the special session

Victor Joecks

By now I’m sure you know the highlights, err, low lights, of last week’s special session, so I’m just going to add some random thoughts throughout the next week.

Bad assumptions lead to bad conclusions. There are three bad assumptions that Nevada liberals believe and are actively pushing.

Bad Assumption One: Nevada’s tax system is too volatile, and this created the need for a special session. This assumption is sometimes stated as: Nevada needing a “broader and fairer” tax structure.

Truth: Since 2003, Nevada has increased inflation-adjusted, per-capita spending by more than 25 percent (this includes the $300 million in reductions made in the special session). Growing government at an unsustainable rate caused the special session. The special session and Nevada’s projected fiscal woes in 2011 should come as no surprise – they are the natural result of unsustainable spending. Giving Nevada’s government more money will only lead to higher spending in the good times and larger budget holes in the bad times.

Nevada's spending has exploded over the last six years
(Note: This graph has not yet been adjusted to reflect the $300 million in cuts made in the special session. I will update it once Geoff has the new figures).

Bad Assumption Two: Nevada doesn’t spend enough on K-12 education.

Truth: In the last 50 years, Nevada has nearly tripled inflation-adjusted, per-pupil spending while results have been stagnant. For more, read Patrick’s excellent post titled, A monetary history of Nevada public education.

Nevada's education spending over the last 50 years

Bad Assumption Three: Mining/gaming/businesses aren’t paying their fair share.

Truth: The very idea of “paying your fair share” assumes that the government or the public is entitled to a portion of your finances. This idea, however, contradicts our country’s founding principles – life, liberty and the pursuit of happiness (property rights).

You can either have freedom or accept the idea that government has a right to other people’s – and your – property.

Aside from being morally just, freedom has another big advantage – it creates wealth and betters the lives of everyone (albeit at different rates). The socialist mindset, on the other hand, destroys wealth and wealth creation by having the government pick the winners and losers in an economy.

These are the three big ideas that are going to dominate the debate over Nevada’s spending for the next year. When you read reports on Nevada’s tax structure or have conversations with your friends about Nevada’s budget, challenge these assumptions. That’s where the argument is going to be won or lost.

Anyway, keep reading for more thoughts on the special session throughout the week.

Update: I missed it last Thursday, but Ron Knecht, a member of the Nevada Board of Regents, had an absolutely dynamite op-ed in RJ on this issue, Budget myths of the tax-and-spend crowd needs correcting.