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Thank you. My name is Wayne Brough and I’m the chief economist for FreedomWorks. I want to thank you for the opportunity to discuss this important issue.
Wendell Phillips said, “Eternal vigilance is the price of liberty.” And it is important to note that such vigilance begins at home. That means state and local governments deserve the same scrutiny that we apply to the federal government. Everything the federal government does, state governments do, too: taxes, regulations, property rights, and judicial reform are all important issues at the state level.
Consider, for example, taxes. After the federal tax bite, state and local governments take—on average—another 10 percent of our income. All told, state and local taxes take just over a trillion dollars ($1.148 trillion), which is a close second to the $1.9 trillion ($1,880.1) collected by the federal government. Yet states continue to look for new revenues rather than impose spending restraints.
At the same time the regulatory burden at the state and local level can be just as onerous as the federal burden, and most states have comparatively weak regulatory oversight. Consequently outdated telecommunications regulations are holding back job creation, environmental regulations are taking property and imposing costs without necessarily generating benefits.
And the problem is getting worse. After we’ve successfully stopped excessive regulations at the federal level, environmental groups are doing an end-run around us and getting the states to pass their regulations and restrictions.
Consider, for instance, the Kyoto Protocol, the greenhouse gas treaty that would impose significant costs on the country with very little, if any, benefits in return. It was shut down by Congress and the administration at the federal level due to the costs and its questionable benefits. So when the rest of the developed world started to implement the treaty this week, Australia and the United States did not. (And our developing competitors like China and India were never part of Kyoto).
But we’re not out of the woods, because the fight is now at the state level, with California pressing for greenhouse gas regulations out west and New York and the Northeast states pushing for tighter standards on the east coast. Texas and other states have also looked at backdoor Kyoto-style regulations that would impose huge costs on consumers.
Whether the regulations are federal or state-based, the cost to the economy and the cost to consumers is the same, and it’s something our nation cannot afford.
One final area of critical importance at the state level is lawsuit abuse and liability reform. State courts are some of the worst offenders, with trial lawyers racking up millions and crowding the courts with frivolous lawsuits.
Federal class action reform just passed, but much of the problem remains in state courts, which means reforms must take place at the state level. We need to return the courts to real people with real grievances and put an end to frivolous lawsuits.
FreedomWorks is a grassroots organization with 700,000 members nationwide, and our mission is to fight for lower taxes, less government and more freedom. We led the charge in Alabama against a billion dollar tax increase. We led the charge in Oregon against a billion dollar tax increase. We led the charge in Washington State against a billion dollar tax increase. And in every case we were victorious. Today we are fighting regulatory battles, tax battles, and legal reform battles in at least 10 states, and given the appetite for government to grow, our job is not finished
But we are successful because of our activists. People like you who a rightfully concerned about the size of government and the threat to our economic freedom. Our activists get involved. They write letters, attend town hall meetings, and, most importantly, they vote.
The good news is that we are winning and we are growing. Not long ago we opened an office in Vermont, and our newest office is in Colorado, where the Taxpayer’s Bill of Rights (TABOR) will be our biggest issue.
If you want more information about FreedomWorks, we have a booth here and I encourage you to stop by. But for us, the growth of state and local government is every bit as dangerous as the growth of the federal government.
Tip O’Neill once said, “All politics are local.” If that’s true, then those of us who believe in liberty and limited government ignore state and local governments at our own peril.