Wednesday, April 25, 2007

Free Market Enterprise???

For the three readers of mine that aren't from the great state of Wisconsin, let me introduce you to our Governor, Jim Doyle.

I don't even know where to start, but I wanted to touch on one major topic. Before we get to that, I'd like to take this opportunity to discuss his budget plan for 2007. Doyle's budget calls for an increase of TWO BILLION dollars in revenue by 2008.

Not a total revenue... but an INCREASE of two billllllllllllion dollars. ( tell me those two pictures don't look alike ) In just two years. He has also vowed to raise this money without placing additional burdens on the Wisconsin public. We're already one of the highest taxed states in the nation. For years, Wisconsin ranked as the fourth highest taxed state in the country, only behind Maine, New York, and Hawaii. This past year, we've slipped to seventh, and apparently, Doyle can't pay his bills on that low of an income.

An increase of two billion dollars in revenue to the Wisconsin public means that there will be an average out of pocket cost of $400 per Wisconsinite. That's in addition to the taxes we're already paying!

How is he going to get this money you ask? Well, in a deft political move, he's going to tax, and surcharge various things that are politically unpopular. There's going to be a dollar increase in the cigarette tax. Everyone likes that, smokers pay more, so maybe they quit - and those that can't quit will keep funding the tax. There's increases on hunting and fishing fees, the drivers license fee is going up, the car registration fee is going up, and there's going to be a tax on oil companies. This we'll get to.

Nick had a good article about when is a tax not a tax..... but I'm still staggered at a billion dollar a year increase for two years. Where does the money go? As of 2005, Wisconsin was spending over 1.34 billion dollars a year already to run the state. We need to double that by 2008? To pay for what????

And while you can argue forever on what government SHOULD spend our money on, or how much they should spend...... I can't get over how they choose where the money comes from. A tax on smokers. Think the smokers feel that's fair? Smoking is not good for you, but it's not illegal. Too much alcohol isn't good for you, but there's no 'drinking' tax. ( I really hope I didn't give Doyle another idea there, cuz a 'drinking' tax would suck ballz ) Or the tax on oil companies. Doyle says he's doing that because the oil companies had 'record' profits over the last few years. He's trying to insist that he can legislate that the tax won't be passed onto the consumer. A new report says that won't be that easy.

Being in the transportation industry, I'd like to see that the tax won't get passed on to my company, or the general public... but the larger issue for me is WHY the oil companies? Think of how many companies had 'record' profits last year. All that means is that you had a higher profit than in the past. Oil companies are showing record profits, largely because we're consuming ALOT more gas. That's not their fault, so why are they going to be penalized over that?

My company is young, but if we stay on track, we'll post a record profit for 2007. And it would seem inconceivable to not post a record profit for 2008. It's a silly example, because we didn't set up shop until 2006, but an example none-the-less. How is my taking advantage of a free market, and trying to make as much profit as I can, any different than what the oil companies are doing?

We're in the transportation industry, and the short version is that we ship stuff. Currently, 70% of our business is transporting medical specimens. Over 90% of our business comes from the medical fields ( the 20% comes from x-rays, medical records, non-stat/non bio stuff ). We found a niche here in the area that other companies were avoiding. And we're doing really well with it. June will be one year into it, and we're ahead of schedule. We've got more vehicles and employees than we'd thought we'd have at this point, and no intention of slowing down.

So do I have to worry that down the road, Doyle will give me a tax that I can't pass on to my customers, just because I'm posting record profits? ( maybe I should work for Doyle, and just keep giving him all these bad ideas ). If you do it to Big Oil, then don't you have to tax the tech industry? Or how about the banking industry that is doing pretty well these days? ( the Dow just passed 13,000 today. seems like some hedge fund managers are making record profits these days too ) It's a friggin joke. People don't like high gas prices, so that makes Big Oil 'evil'. But they're not evil, they're a business. Period.

Here's an idea for Doyle. How bout you forget the extra $2 billion dollars over the next few years... and even cut down on the $1.4 billion we're already spending in the state? If Doyle can get us down to around the middle of the pack of tax rates for the states... maybe my company can hire some more employees, and help out the economy. We'd be able to buy more vehicles, and contribute to the economy, and help a car dealership hire more employees. Maybe if the existing gas tax ( and the stupid fact that we have to have reformulated gas here ) were lessened, we could charge a little less for routes, and we'd see a large increase in new business. New business would allow us to hire more employees, thus helping the economy...... and so on.

But silly me. I think that government should try to spend as LITTLE as possible. Most of the time, politics really makes me want to puke.


At 6:22 AM, Blogger Nort said...

No 'drinking' tax? Seriously?

Ever heard of the liquor tax?

At 11:55 AM, Blogger Kuflax said...

The liquor tax is assessed at the manufacturing or distribution level of the alcohol industry. Companies, not individuals directly pay this tax. Like any other tax, it affects retail prices, but it's transparent to the consumer.

It's no different than say for Big Oil, where they have tarriffs (tax ) on the oil they import, and pass that cost on to the consumer.

My 'drinking' tax example was along the lines of the gas tax, where in addition to paying sales tax on the gas you purchase, you also pay an additional tax because you purchased gasoline. This then is extra money out of our pockets at the time of the gas purchase.

If you buy a video game, you only pay sales tax, no additional taxes. But because Big Oil is unpopular ( and an almost certain necessity ), the government sticks an extra tax on it to increase revenue.

I was trying to illustrate how they feel they can just pick and choose who gets taxed, and who doesn't. The consumer doesn't have to pay an ADDITIONAL tax on a beer when I buy one at a bar, I don't pay excise tax on video games or football spikes. But I do for gas, and it's stupid to think that it's okay to charge oil companies another tax ( especially one you tell them they CAN'T pass on to the consumer ), just because they're in an industry that is doing well.

At 5:57 PM, Anonymous Becky said...

Have you heard about the situation in New Jersey???? The entire state shut down this past summer for about a week! I think you have it pretty easy there in Wisconsin.... I can't wait to get back :)

At 12:43 AM, Blogger Kuflax said...

Well, while we may have some pretty stupid politicians, they've come up with a nice plan to not shut down the gov't here.

If they ever can't come to an agreement on a budget ( which is what is going to happen this year, and has happened several of the past few years ), they just use the previous year's budget until the new one is passed.

Gov't doesn't shut down, but everyone with their hand out throws a fit, because they don't see any increases in the subsidy amount they get.


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