Colorado suspended the TABOR cap for five years because it doesn’t work.
I would like to set the record straight on several things former Colorado State Sen. John Andrews said while recently visiting Maine.
Mr. Andrews maintains, incorrectly, that Colorado’s economic growth during the ’90s was a result of TABOR. This is just not true. Economic growth in Colorado was due to a thriving high tech sector, in particular cable companies, and the state being well positioned on labor, housing, and commercial and industrial buildings costs relative to the nation. TABOR’s impact was negligible. The total refunds under TABOR have been less than 0.2 percent of state-wide personal income since TABOR was passed. It doesn’t make sense to assume that refunding two dollars per thousand dollars of income would create a 12 percent growth in the economy of a state.
The simple fact of TABOR, both in theory and in reality, is this: The economy grows at a rate that is generally about 2-to-3 percent faster than the TABOR cap of population growth plus inflation. That is true because of increasing productivity in the private sector.
TABOR, by its very nature, shrinks government relative to the economy, every year, year after year after year. Regardless of what Mr. Andrews thinks, at some point critical government services – highways, capital construction, higher education, prisons, schools, hospitals, etc., must be cut under the restrictions of the TABOR limit. Since only a vote of the people can change the limit, the inevitable result is a change from a representative form of government, as guaranteed in Article IV of the United States Constitution, to one of direct democracy. That is now happening in Colorado.
Last November, Colorado citizens voted to suspend the TABOR cap for five years. The vote was 52 percent to 48 percent in a very expensive campaign. The reason was simple: Under restrictions of the TABOR limit of population growth plus inflation, the state would have had to cut over $350 million from a $6.5 billion general fund budget. Higher education, which had already been cut by nearly 25 percent over the past four years in general funding, would have borne the brunt of the cuts. And there would have been no money for transportation or capital maintenance. More than 1,100 organizations endorsed the idea of suspending the limit, including most of the state’s business community.
Here is another way to think about it: Imagine TABOR had passed in 1913, the year the Consumer Price Index was introduced. Any new state or local government services would have required a vote of the people. State government would have been “frozen in time” with the economy as it existed prior to air travel, automobiles and highways, indoor plumbing, the agricultural chemical revolution, etc., except by a vote of the people. This may be some sort of Libertarian dream, but would it have created a better society?
That should be the TABOR debate, not the one John Andrews makes.
Brad Young is a former Colorado Republican state representative where he served as the chairman of the Joint-Budget Committee and House Appropriations Committee.