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Rule of Law: Damage Control
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Rule of Law: Damage Control

BY C. Boyden Gray

ABSTRACT: Citizens for a Sound Economy chairman C Boyden Gray article asserts Supreme Court hearing of arguments for Campbell v State Farm will have important implications for tort system reform; asserts case has 'promise of restoring a sense of rationality to the legal system' (M)

12/11/2002
CSX chief named to run Treasury
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CSX chief named to run Treasury

BY Sue Kirchhoff

WASHINGTON - President Bush moved on two fronts yesterday to demonstrate his concern about the flagging economy: nominating John W. Snow, chairman of railway conglomerate CSX Corp., as his Treasury secretary and promising a new package of tax breaks and other incentives to spur more vigorous business activity.

12/10/2002
Picking a New Economic Team With the Right Stuff
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Press Release

Picking a New Economic Team With the Right Stuff

© 2002 Copley News Service, 12/10/2002 When he fired Secretary Paul O’Neill and chief economic adviser Larry Lindsey last week, President George W. Bush once again demonstrated that he is not afraid to make the tough and bold choices. When he chose John Snow as O’Neill’s replacement, the president revealed how firm a grasp he has on the type of person required to move the economic-growth agenda forward.

12/10/2002
Meet Pat Herbold, Citizen Activist and Washington CSE Advisory Board Member
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Press Release

Meet Pat Herbold, Citizen Activist and Washington CSE Advisory Board Member

Washington CSE is building an Advisory Board within our state to support and advise us as we continue to work for lower taxes, less government and more freedom in both Washington State and Washington, DC. We are excited to have Pat Herbold as one of our Advisory Board members because of her long-time work as a citizen activist. Pat is a true believer in our cause, a long-time citizen activist and is currently a candidate for the chairmanship of the King County Republican Party.

12/10/2002
CSX Chief Named to Run Treasury
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CSX Chief Named to Run Treasury

BY Sue Kirchhoff

WASHINGTON - President Bush moved on two fronts yesterday to demonstrate his concern about the flagging economy: nominating John W. Snow, chairman of railway conglomerate CSX Corp., as his Treasury secretary and promising a new package of tax breaks and other incentives to spur more vigorous business activity. "John Snow has excelled as a business leader, an expert on economic policy, an academic, and as a public servant. He'll be a superb member of my Cabinet," Bush said at a brief White House ceremony. "I'll be proposing specific steps to increase the momentum of our economic recovery. And the Treasury secretary will be at the center of this effort." If confirmed by the Senate, Snow will replace outspoken Treasury chief Paul O'Neill, who, along with White House economic adviser Lawrence Lindsey, was abruptly forced to resign Friday. Bush and other administration officials had lost confidence in the duo's ability to sell the White House tax-cutting agenda to the financial community and to Congress, a crucial task as the White House prepares for the 2004 election. Concerned at the slow pace of the economic recovery, administration officials have been pulling together a plan for hundreds of billions in new tax breaks for investors, businesses, and consumers. Possibilities include proposals to address the double taxation of stock dividends, expand business tax breaks for purchasing new buildings and equipment, and moving up some personal income tax cuts already scheduled to take effect in future years under Bush's $1.6 trillion tax cut law. Snow, 63, is in a good position to sell that plan, given his close ties to the Bush administration, business leaders, and Federal Reserve Board chairman Alan Greenspan. An attorney who holds a doctorate in economics, he was deputy undersecretary of transportation during the Ford administration and has served as chairman of the Business Roundtable, an influential group of chief executives of the nation's top companies. Snow has been chief executive and chairman of Richmond-based CSX Corp. since 1989. The firm, which runs one of the largest rail networks in the eastern half of the United States, and other transportation-related services, has been a major source of campaign donations to the Republican Party. Snow has been an advocate of more rigorous financial reporting for executives. "This is an important moment for the economy," Snow told Bush at the White House. "Thanks to your leadership, and this administration's stewardship of the economy during a tough time, the recession was one of the shortest and shallowest in modern economic history. Yet I strongly share your view that we cannot be satisfied until everyone - every single person who is unemployed and seeking a job has an opportunity to work." The White House attempted to quickly quash one potential source of controversy, announcing Snow planned to resign his membership in the males-only Augusta National Golf Club. Women's groups have been pressing for Augusta, host of the prestigious Master's tournament, to expand its membership. Bush was said to be close to naming Stephen Friedman, a former co-chairman of Goldman, Sachs & Co., to replace Lindsey, business sources said. But conservatives were upset about the choice. In a newspaper column that will run today, former Republican vice presidential candidate Jack Kemp said he was concerned that Friedman was a "deficit hawk" who might not strongly push the White House's aggressive tax policies. Others complained that Friedman had provided campaign contributions to Democrats, including New York Senator Charles Schumer. "The criticism one hears comes largely from Friedman's participation in the Concord Coalition . . . and the term 'deficit hawk,' " said Grover Norquist, head of the conservative Americans for Tax Reform. "But it's a little bit like getting mad at somebody for being in a club that doesn't let women in. I think he joined the club to play golf, not to make a statement on women," Norquist said. He said that Friedman has privately assured the White House that he is "a low-tax, spending restraint, progrowth guy who views it that's the way to eliminate deficits." Lawmakers and business officials welcomed Snow's selection as a pragmatic, if not dramatic, choice. While O'Neill was viewed by many as dismissive of Congress, Snow yesterday began calling lawmakers - including top Republicans and Democrats on the House and Senate tax-writing committees - to seek their input and answer any questions they might have. The Senate Finance Committee is expected to hold confirmation hearings early next month, which Democrats would like to turn into a forum not just about Snow's personal qualifications, but the economy's performance under the Bush administration. "I think it is encouraging that the president is reaching out to people of experience" said Senate Minority Leader Tom Daschle, a South Dakota Democrat. "But it isn't the names, but the plan that is of concern to us . . . Trickle-down economics doesn't work." During the November campaign Daschle, former Vice President Al Gore, and others tried to make the economy a dividing line, pointing to the sharp stock market decline, the loss of 1.5 million jobs and growing deficits since Bush took office. But Democrats failed to make much headway, mainly because of steep intraparty divisions over their own economic platform. The White House is hoping to form a coalition with moderate Democrats that will enable it to quickly move on new tax cuts. Democrats are hoping to keep their membership together by offering an alternative stimulus plan, focused on consumer and middle-class tax breaks such as a rebate of Social Security payroll taxes. Snow will be in the middle in terms of selling the tax policy. What is unknown at this point is whether he would like to reshape the White House plan, and Snow's views of a variety of topics including debt relief to developing nations, trade policy, and other issues. Manufacturers were already pressing the new nominee to move away from the White House's stated position of a strong dollar, which they say has hurt US exports. "The challenge now is to the Bush administration and Congress to work together on aggressive trade policies to help level the playing field for our exporters by bringing the dollar into equilibrium with market forces," said Jerry Jasinowski, president of the National Association of Manufacturers. Snow has a varied enough resume to where there was something to interest lobbyists and lawmakers from a variety of perspectives. For example, he was part of a business task force calling for tighter ethical standards for corporate executives. Budget hawks like the fact that Snow, as chairman of the Business Roundtable, advocated fiscal responsibility. Conservatives pointed to his support for a complete overhaul of the tax code. Snow was a member of a 1996 task force, headed by Kemp, that called for a flat tax, making federal payroll taxes fully deductible for workers, and requiring a two-thirds supermajority in Congress to increase tax rates. "We're delighted with Mr. Snow . . . it's hard to be better from a tax perspective," said Chris Kinnan, director of public affairs for Citizens for a Sound Economy, a conservative group that advocates tax and spending cuts. Snow was a board member for the group. Given the new attention to corporate ethics, Snow is nearly certain to face some grilling from the Finance Committee about his CSX compensation package, which was worth $18.1 million last year, according to Bloomberg News. Of that total, about $2.2 million was salary and bonus, while most of the rest came in stock as part of a contract extension to take Snow through his retirement in 2004.

12/10/2002
CSE Cheers John Snow Appointment to Treasury
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Press Release

CSE Cheers John Snow Appointment to Treasury

Citizens for a Sound Economy (CSE) applauds the nomination of tax reform advocate John Snow as Secretary of Treasury. Snow served on the CSE's Board of Directors in 1988 and 1989, where he advised CSE's grassroots campaigns in support of lower taxes and free market economic policy. Snow's commitment to pro-growth tax policy also includes his work as a member of the National Commission on Economic Growth and Tax Reform, also known as the Kemp Commission, which in 1996 recommended a scrapping the tax code and replacing it with a flat tax.

12/09/2002
Tiernan Ends Up Top Money-Raiser Despite Loss
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Tiernan Ends Up Top Money-Raiser Despite Loss

BY Rick Bella

Summary: In the Southwest suburbs, Jim Zupancic failed in his House bid despite raising more than his opponent The race for Senate District 19, including portions of Lake Oswego, West Linn and Tualatin, was the second-most expensive in Oregon, racking up total expenditures of $937,305, according to reports filed last week. Republican Bob Tiernan, 47, a Lake Oswego attorney and former state representative, remained the biggest money-raiser among Southwest suburban candidates on the Nov. 5 ballot, followed by Democrat Richard Devlin, 50, a former three-term representative and legal investigator from Tualatin. Despite the money edge, Devlin emerged the winner. During the final campaign reporting period, Tiernan raised $130,571, bringing his overall total to $483,832. He reported total expenditures of $479,656. Tiernan received contributions from several sources, raising his overall totals to $121,297 from the Leadership Fund; $40,000 from Oregon Victory Committee; $30,000 from Associated Oregon Industries Center for Citizen Leadership; $20,970 from Oregon Restaurant Association; $12,826 from Citizens for a Sound Economy; $11,000 from Friends of David Nelson; $7,000 from the Association of Oregon Loggers; and $5,000 apiece from Oregon Business Leadership Council and Rod Aycox, a Salem title loan salesman. Devlin reported contributions of $74,860, raising his overall total to $427,656. His overall expenditures were $457,649. Devlin received contributions that raised his overall totals to $98,344 from the Senate Democratic Leadership Fund; $74,500 from the Oregon Education Association; $17,793 from the Oregon League of Conservation Voters; $9,133 from Oregon Beverage PAC; $5,000 from Basic Rights of Oregon PAC; $4,722 from 21st Century Democrats; $3,500 from Oregon Nurses PAC; and $2,500 apiece from Oregon State Firefighters Council and Oregonians to Maintain Community Standards. Other races and totals: House District 38 Republican Jim Zupancic, 50, a Lake Oswego attorney, was the money-raising leader but lost to Democrat Greg Macpherson. Zupancic reported new contributions of $103,650, raising his overall total to $318,248. He reported total expenditures of $329,270. Zupancic's contributions included $43,156 from Majority 2002; $40,000 from Oregon Victory PAC; $18,500 from Oregon Restaurant Association PAC; $13,900 from Friends of Karen Minnis; $9,000 from Oregon Auto Dealers Association; $7,000 apiece from Oregon Grocery Industry PAC, ABC State PAC and Re-Elect Susan Morgan Committee of Myrtle Creek; $6,000 from Tim Knopp for State Representative of Bend; $5,500 from Oregon Concrete & Aggregate Producers Association; $5,500 from Oregon Realtors PAC; and $5,000 apiece from Oregon Forest Industries PAC, Oregon Business Leadership Council and Rod Aycox, a Salem title salesman. Macpherson, 52, also a Lake Oswego attorney, reported new contributions of $50,371, boosting his cumulative total to $242,800. He reported total expenditures of $258,510. Macpherson received contributions boosting his overall totals to $50,742 from Future PAC; $17,714 from Oregon League of Conservation Voters; $8,409 from himself; and $4,685 from 21st Century Democrats. House District 37 Sen. Randy Miller, R-West Linn, won election to the House after serving two terms in the Senate and five previous terms in the House. He reported new contributions of $14,705 , raising his cumulative total to $32,905. He reported overall expenditures of $37,822. Miller, 55, an attorney, reported new contributions of $1,205 from Kessler Knutsen & Co. of Portland and $1,000 apiece from Health PAC, Kroger, Safeway and Natural Gas PAC. Tualatin Democrat Bill Gleason, 76, a former Tualatin city councilor, did not submit financial reports, indicating his totals would not reach $300. House District 35 Rep. Max Williams, R-Tigard, a two-term incumbent, cruised to re-election while reporting new contributions of $12,700, boosting his overall total to $51,373. He reported cumulative expenditures of $57,343. Williams, 39, an attorney, reported latest contributions of $1,000 apiece from Hewlett Packard, Natural Gas PAC, Oregon Realtors PAC and Kroger. Democrat Geoff Sinclair of Tigard, 28, a insurance claims consultant, reported new contributions of $170, raising his cumulative total to $2,090. He reported total expenditures of $4,253. House District 26 Rep. Jerry Krummel, R-Wilsonville, reported new contributions of $13,525, boosting his overall total to $39,432 in his successful run for re-election. He reported cumulative expenditures of $33,398. Krummel, 49, a small-business owner, listed contributions of $1,500 from Kroger; $1,250 from Oregon Manufactured Housing PAC; and $1,000 apiece from Safeway, Anheuser Busch Cos., ORPAC, Liberty Northwest, Philip Morris Inc. and Natural Gas PAC. Democrat Rick Ross, 65, of Sherwood, a farm business owner and chairman of the Washington County Democratic Party, reported new contributions of $400, raising his overall total to $5,552 against expenditures of $5,333. Ross reported a $1,000 contribution from Charles Philpot, retired, from Sherwood. Senate District 13 Sen. Charles Starr, R-Hillsboro, a first-term Senate incumbent after serving three terms in the House, won re-election while reporting new contributions of $13,008. His overall total was $52,525 against cumulative expenditures of $25,918. Starr, 70, a farmer, reported contributions of $2,500 from Philip Morris Inc. and $1,000 apiece from Health Insurance PAC, Natural Gas PAC, McDonald's Owners-Operators of Oregon and Oregon Truck PAC. Democrat Ken Crowley, 40, a Wilsonville attorney, reported new contributions of $1,500, which increased his cumulative total of $17,449. Crowley reported overall expenditures of $18,733.

12/09/2002
Legislature has eye on half-cent sales tax
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Press Release

Legislature has eye on half-cent sales tax

When state legislators adopted a half-cent sales tax for the state in 2001, it was supposed to be temporary.

12/08/2002
Legislature Has Eye of Half-Cent Sales Tax
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Legislature Has Eye of Half-Cent Sales Tax

BY David Rice

When state legislators adopted a half-cent sales tax for the state in 2001, it was supposed to be temporary. "It's not a permanent tax," House Speaker Jim Black said at the time. As a result, the state's half-cent tax is scheduled to expire in June 2003. But as a new legislature prepares to tackle a budget shortfall for 2003-04 that is already projected at $1.8 billion, some are already questioning whether legislators can afford to give up a tax that raises almost $400million a year for the state. One of the first - and most fundamental - questions for the 2003 General Assembly will be whether to lift the "sunset" on the half-cent sales tax. "It's the first thing you have to figure out," said Kim Cartron, an analyst at the nonprofit N.C. Budget & Tax Center, who says that sales taxes place a disproportionate burden on poor and middle-income workers. "We think the sales tax isn't the right tax to use to dig out of a recession," Cartron said. "But obviously you're going to have to have some kind of alternative revenue source. You're not going to be able to cut your way out." Opponents at Citizens for a Sound Economy, an anti-tax group in Raleigh, are already organizing to make sure that legislators understand that the group will consider a vote to extend the tax beyond its scheduled demise a tax increase. "If it doesn't sunset, any way you count it, it's a tax increase," said Jonathan Hill, the group's state director. Though some might argue that extending the tax isn't technically a tax increase because the sales-tax rate won't increase, Hill said, "From our perspective, it means that the tax burden will increase, because it was supposed to go down." In campaigns this year, Citizens for a Sound Economy persuaded 47 members of the new N.C. House and 20 members of the N.C. Senate to sign a pledge that they will not vote to increase taxes. Hill said that his group plans to score any vote to extend the tax as a tax increase on the scorecards that it sends to its voter members. CSE targeted members who broke a similar pledge in 2001, and at least two of those members - Reps. David Redwine, D-Brunswick, and Andy Dedmon, D-Cleveland - lost in November. Hill compared the situation about the "temporary" sales tax to one that developed with a state sales tax on food that was imposed as a "temporary" measure in 1961 but not repealed until the mid-1990s. "The problem I see is that every time you add on a half-cent sales tax, they say they're going to take it away, and then they don't take it away," he said. "If you're going to do that, then nothing they do is real.... You can't do business that way. "Somebody's got to deal with the real problem, which is cutting the size of government." New members say they know about the approaching budget challenge. Rep.-elect Patrick McHenry, a newly elected Republican from Gastonia, said he expects freshmen to resist all tax increases, including the extension of the sales tax. "If you look at the freshmen in the House, our feet are to the fire," McHenry said. "We're in swing districts, and we ran on job creation and no tax increases. We'll resist all tax increases." Rep. Leo Daughtry, R-Johnston, the Republican nominee for speaker of the House, said that few members want to extend the sales tax. But Daughtry stopped short of saying that it won't happen. "I think people are going to try to live by what they said they would do. But whether they can or not remains to be seen," he said. But Cartron said that there might be hope in a recommendation this week from a commission appointed by Gov. Mike Easley that is expected to recommend broadening the sales tax to include services ranging from legal, accounting and consulting services to lawn and diaper services. "We would like to see the sales-tax base broadened to include services, in an attempt to lower the rate," she said. "That seems like a move that would revive a tax that we feel is clearly eroding." Currently, Cartron said, "You wouldn't pay a tax on a diaper service, but you would pay a tax on Pampers."

12/08/2002
Into the Gray Fray
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Into the Gray Fray

BY Julie Kosterlitz

Although they rule both ends of Pennsylvania Avenue, Republicans are divided over whether to seize this moment and seek a dramatic overhaul of Social Security or merely to lay the groundwork for action in 2005. The business, libertarian, and fiscal conservatives who lead the "just-do-it" faction believe the midterm elections proved that Social Security is no longer a toxic issue for Republicans and that delay only raises the cost of reform. Their goal: Follow through on the president's vow to let younger workers steer some of their payroll taxes into privately owned investment accounts. Investing through private accounts, they contend, will help solve Social Security's long- term financing problems while raising national savings and retirement incomes, as well as family wealth. But partial privatization will likely continue to be a tough sell on Capitol Hill. Any reform will require politically explosive cuts in traditional benefits, and private accounts would likely entail deeper cuts. Most Democrats are unalterably opposed to private account "carve-outs." Partial privatization, they warn, would doom the promise of guaranteed lifelong benefits, erode subsidies for the poor, women, and the disabled, and squander money on high administrative costs, among other things. If President Bush does decide to make Social Security reform a domestic priority, the sort and level of interest-group activity will depend on whether he aims to corral just enough Democratic votes for passage or seeks a more broadly bipartisan compromise with Democratic leaders. Even if the administration decides to defer action, it has indicated that it is counting on like-minded advocacy groups to help advance the cause over the next two years.

12/07/2002

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