During the following summer, after trimming more than $200 million in state spending in his first six months in office, Governor Riley proposed the largest tax increase in the history of Alabama, 1.2 billion dollars, in order, first, to make up for a 675 million dollar projected deficit, particularly in education, and in order, second, to increase state services beyond the last place or nearly last place among the states that Alabama perennially inhabited in almost all categories. Governor Riley argued that if they were going to make the effort to increase taxes, it should be in order to make improvements in education and other state services and not just seek to keep services at the usual unsatisfactory level. 

The tax proposal was passed by the Alabama state legislature (which is democratically controlled, although in Alabama Republicans and non-minority Democrats tend to be conservative and sometimes indistinguishable), subject to a referendum vote by the people. On September 9, after an intense, contentious, three month campaign, citizens voted two to one against the so-called "tax and accountability" package. Governor Riley than immediately, on the evening of the referendum, in a surprisingly upbeat address after having campaigned long and hard throughout the state for passage of the proposal, said the vote showed that Alabamians wanted the state government to be leaner and to live within its means, and that he heard that message loud and clear. The legislature agreed the vote meant they themselves were not to raise taxes through other legislation either. 

The Riley interpretation of the tax referendum vote, delivered in the manner it was, along with the tax proposal itself which contained many obvious flaws, would lead a cynic to believe that the proposal was intended from the beginning to be defeated and doom any possibly proposed tax increase in the near future. On the other hand, many state services are now being drastically cut, some in ways that seem particularly painful or Draconian, and that has led other cynics to believe this is punishment for people so that they will beg for a tax increase next year. 

This essay is intended to point out some of the reasons the tax referendum may have failed -- reasons which have nothing to do with the governor's and the legislature's interpretation that the people do not want any tax increase for any reason. (Surely there are some people who will always vote against any tax or tax increase, but they do not normally control tax elections or legislative votes. I am presuming that their votes would have been overridden in this election if more typical voters would have been happier with the specifics of this tax increase plan. I do not believe voters were saying they want no tax increase no matter what the reason, the need, the purpose, the condition of the economy, or the benefits of the tax.) Since the ballot did not ask people to give reasons for their yes or no vote, we do not know from the vote itself what the reasons were for the rejection of the proposal. However, from what opposition leaders and opposition letters to the editor said prior to the vote, from what legislators said after the vote, from logical analysis of the proposal itself, and from voter rejection of arguments given in a myriad of supporting editorials in major newspapers throughout the state for a long period of time, a fairly educated guess can be made about what many voters found to be problematic with this proposal. 

Throughout the "tax and accountability" campaign, Governor Riley repeatedly, mistakenly, and alienatingly contended the choice was between believing the status quo is good enough for Alabama or choosing a path toward excellence. That was like saying that anyone who wouldn't marry Madonna or Ozzie Osbourne must want to stay single. Rejecting particular proposals is not to accept current circumstances, and no one should be painted as a reactionary because he does not embrace what he considers to be a change for the worse. Many of us want change, but not what was proposed.  The proposed change would have spent more money on Alabama's problems but would not have solved many of them, particularly in education.

The question now is whether the governor will see that and come up with more palatable proposals to solve current problems, or whether he will simply give up by implementing a punishing slash and burn policy, because we didn't accept his first solution -- one that might pressure people into accepting a future tax increase. Will he learn from his mistakes and overcome them or simply give up at the first defeat, or worse, try the same thing again because he will have more time to try to "sell it", especially after implementing budget cuts that are more Draconian than necessary. His twin complaints during the campaign were that opponents of the tax plan were lying to scare people and that the campaign time was too short to be able to let everyone know how important and how good this plan would be for Alabama. It is not clear at this point whether the governor will try to take more time to try to sell the plan again, whether he really believes the majority wants no tax increase or reform at all, or whether he never intended this package to pass in the first place, and wanted to make serious cuts in government services while alleging the responsibility for that to be "the will of the people." 

There was flawed logic in the proposed legislation just defeated that needs to be addressed, not ignored. And neither abandoning efforts for reform nor simply having more time to sell this flawed plan with a better marketing scheme (possibly coupled with budget cuts that might be considered forms of extortion) are as desirable as taking the time, in consultation with citizens and legislators, to fix the plan and eliminate the flaws. There are ways to do that and find out whether one has an acceptable plan that will pass before going to the expense of a referendum. Neither legislators nor citizens outside of government were consulted to draft the first proposal, and after the vote some legislators said if they had been asked to help design a viable tax increase proposal, they would not have designed this one. And some of the leading opposition turned out to be members of the governor's own party, especially the state Republican Party chairman. Polls showed the tax proposal way behind from the beginning. There was no need for this plan to have been taken all the way to a referendum to see that it was doomed. A more likely acceptable proposal could have been drafted and submitted to the legislature and to the people. 

Then there is the persistent allegation and public perception that the wealthy do not pay their fair share of Alabama taxes. Property taxes in Alabama are some of lowest in the nation and much of the land is owned by large companies which pay property taxes based on current use of the land, rather than its market value. Hence, ostensibly land which is valuable but which currently does not yield much revenue is taxed very low. 

Therefore tax reform, and reform of the state's 1901 constitution which establishes the system that tends to make tax reform difficult, have been unsuccessfully sought by many for a long time. But this particular attempt at tax reform, at a time when perhaps reform would have been most likely to pass, seems to have been peculiarly inept, and virtually doomed to failure from the start. 

(2) Under the tax and accountability plan, the sales tax, said to be such an unfair burden to the poorest citizens of the state, was not going to be reduced or eliminated, not even for groceries or prescription drugs, but was going to be extended to include not only sales, but many services, such as repairs and installations. And although the low threshold for having to begin to pay income tax was going to be raised substantially, so that those who made less than $20,000 would not have to pay income tax, it seems quite likely that any savings for poorer residents would be likely substantially decreased, entirely wiped out, or even exceeded by the tax on repair bills. Poor people mostly voted against the tax plan. 

(Apart from the economic issues involved, many poor, black voters also opposed the plan even though they were alleged to be among the primary beneficiaries of it, because they felt the governor or the legislature reneged on a promise that if legislators from black districts supported passage of the governor's tax plan in the legislature, that a law they wanted passed would be passed also along with it. That law would have re-instated the voting rights of those felons who had served their time in prison and who had been convicted of certain non-violent crimes. The proposed tax and accountability plan had won legislative approval by being conjoined with the fate of the ex-felon voting rights bill, but something happened after black legislators supported the governor's tax plan and the voting rights bill was not passed. Many black legislators felt betrayed. Either the governor and/or legislative leaders should not have promise to pass the felon voting restoration law if black legislators supported the tax plan, or they should have kept that promise. Either way, it was handled poorly.) 

Moreover, while the poor may pay a higher percentage of their income for taxes than the wealthy, it is possible, and likely, that the wealthy pay far more in taxes than the poor to support those services the poor perhaps use far more than the wealthy, including public education. Poor people often get a disproportionate benefit from regressive taxes that more than makes up for the proportion of their incomes being taxed. The issue should not be whether disproportionate percentages of income are involved, but whether poor people are overburdened, whether they are unfairly overburdened, and whether their tax burden yields a reasonable or generous return to them or not. 

I am not arguing here that the Alabama taxes are currently fair, but that their merely being regressive is not what makes them unfair. There are a number of characteristics that contribute to the fairness or unfairness of taxes, and it is not generally helpful to single out one of them as being the problem or the only problem. Whether anyone or everyone is overtaxed, insufficiently taxed, or unfairly taxed depends on a number of factors that, unfortunately, are seldom raised together for a rational discussion about what constitutes fair and reasonable taxation. Instead, individual tax characteristics are dredged up in isolation during budget crises where everyone wants the solutions to be at the expense of everyone else. That tends to promote rancorous political power results rather than reasonable, respected, and amicable ones. All the discussion about sales taxes being regressive did not help the issue, especially when the regressive tax was going to be expanded anyway, rather than curtailed. 

The governor, of course, wanted to be sure that tax cuts would not be accepted without commensurate changes in other areas that would have increased revenues, but there could have been ways to do that in pairs or with multiple pairing options without combining nineteen measures into one. 

And trying to increase property tax at a time when the economy has contracted and is very weak, is particularly difficult because many voters are apprehensive about making "ends meet" even without a tax increase of uncertain amount. Moreover, property values are being assessed more frequently in Alabama now, which means they will likely rise each year instead of every five or ten years, and the amount of increase in home value will be based on inflation and market demand for a neighborhood. These factors can make a paid off home unaffordable for the people who own them. 

If large land owners are making sufficient money from their land to reasonably pay more in taxes, they should do so as part of their income tax. But it should not simply be argued that because one owns land (or other business property), one should be expected to pay more tax or be forced to sell the property. That may not be true or fair. 

(6) People didn't trust a legislature that had not shown themselves in the past to be very trustworthy. Pork projects are a source of contention in Alabama politics, for good reason. And although the referendum proposal would eliminate one source of "hidden" pork, often called "pass through pork" (in which funds are given to state agencies but the agencies have to distribute it as a lawmaker designates, which often goes to friends and political supporters of lawmakers), the proposal did nothing to eliminate normal, "transparent," pork barrel funding, a very common legislative practice by which legislators vote sufficient money for each other's districts for projects that make the representatives from those districts look like they are doing a good job for the district and need to be re-elected. 

The governor said he would not allow money to be misspent, but the governor of Alabama has very weak veto powers, easily overridden by legislative vote. Legislators would not even promise outside of the bill itself, how they would spend the money; not even after people objected there was no designation of how money would be spent. 

Most of Alabama's current taxes are earmarked, and that, it is argued by proponents of the tax increase, is what causes many of the budgetary problems because money is not able to be used where it is needed while it goes instead to unnecessary areas. Earmarking creates an inflexibility that does not allow legislators to spend revenues where they are most needed or most beneficial. The governor argued that earmarking was a mistake and that is why he did not want designations included in the bill for where the new tax revenue would be spent. But opponents raised this lack of designation as one of the major flaws in the bill, stating that if voters consented to give the government an additional 1.2 billion dollars in revenue, it might not go to remedy the problems for which the money was allegedly being raised in the first place. 

One would think that if the governor and legislature really wanted the proposal to pass, they would have countered all the objections they could, particularly this one, which could have, it seems, been fairly easily solved either in the original wording of the referendum proposal or in a legislative bill or resolution stating how the money would be spent. At the very least, legislators could have promised or pledged in writing how they would spend the money. 

(6a) But more importantly, there is no reason to contend that the only choice for designating tax money for current problems is to earmark it in perpetuity whether those problems are solved by that money or not. The problem with earmarking is that it writes into laws that are difficult to change how permanent tax revenues will be spent forever, whether there is a future legitimate need for that money or not. There are ways to designate spending for at least a year or two, or for as long as certain problems remain to be solved and are being solved, without imposing permanent taxes with permanent earmarking. Alabama legislators were not likely to be given carte blanche flexibility to solve problems not yet known when they had for a long time continually demonstrated they have no understanding of the concept of "excess revenue" when they often raised their own salaries as their first order of business in new sessions, and when they demonstrated difficulty distinguishing reasonable from unreasonable priorities in the past. 

(6b) They should have drawn a plan that was designed to remedy specific problems, not one that simply collects more money. The bill should have been written so that if and when those problems were solved, the tax would end or be reduced. Also, if the problems were not solved nor reasonable progress made using the money, the tax should have been required by law to end. Something to that effect should have been included in the proposed law. At the very least, funds should have been designated to have been spent to try to remedy certain specific problems and budget deficiencies for the first year or two or three. 

(9) Nor did it help when the state superintendent of education said that if the proposal did not pass, the state would have to close down some school systems. Many people felt that was an implied, false threat, rather than a reasonable economic forecast. 

(10) But more importantly, there are a number of known problems in education that seem to have little to do with money, and state school officials have shown little willingness or ability to remedy those or even show they recognize them, so people are justifiably suspicious that additional money for education would not be spent wisely, even if the legislature were to use the money collected from the new taxes for education. Educational leaders have not shown they can distinguish good educational goals from bad, good teachers from bad, and good administrators from bad, or that they have the will to remove the bad ones. For example, while the referendum campaign was in full swing, school test scores were released for the state. The state superintendent said that he doesn't have sufficient money to put good administrators in schools that are not performing up to standard. Does he have sufficient money just to pay poor administrators he already has in place there? Or when the state department "takes over" a school, does he just add administrators, to make two sets, instead of replacing the bad ones. 

(10a) At best, the state seems to want to implement the latest educational methodology fad, or, if they find something that actually works in one school, they try to use it everywhere, even if the conditions are so different in other schools that the program will not succeed in them. For example, the Alabama Reading Initiative has helped some schools -- those whose principals and staff have embraced with enthusiasm, energy, and dedication knowledgeable and well-prepared reading coaches who come to their schools. But it does not work where reading coaches are not capable or where they are ignored by principals or staff who do not intend to implement their advice. The word "Initiative" in the title of the program ought to mean something. 

(10b) Additionally there seem to be problems with the concept and implementation of "professional development" whereby teachers supposedly keep current in their professional teaching techniques. Often "professional development" just means teachers sign in to a workshop and then read a beach novel or go shopping while the course they are supposedly attending goes on without their attention. And it is not clear why the state should fund professional development for teachers anyway or even require it. The state does not pay for teachers to go to college in the first place or for them to go to graduate school. In most professions, the burden is on individuals to keep up with their fields, not on the government or on their employers. While some employers may want to pay for upgraded education of particular employees under particular circumstances, normally employers do not do that for all employees as a matter of general practice unless they have good reason to believe it will substantially improve their business. 

(10c) It is true that the referendum proposal would have made it potentially easier, or at least somewhat faster, to remove tenured teachers, but the state (and the federal government) do not seem to have a reasonable plan for distinguishing good teachers from bad. So while tenure laws often protect bad teachers, they are sometimes necessary to protect good teachers. Until the state has a viable plan to eliminate politics and cronyism from teacher hiring and retention practices, and until the state and federal government quit punishing teachers in culturally impoverished districts for the scores of their students on the kinds of artificial tests that seem to count as demonstrating educational ability, while rewarding teachers in culturally advantaged districts whose kids would score well no matter what, voters will tend to be suspicious of mere tinkering with the tenure laws. 

(11) In addition, a problem for wealthier school districts came to light after the referendum was set up. Because state law sets a limit on the total property tax local districts and the state can levy, those schools in the districts with higher local property taxes -- typically the higher scoring schools in the state -- would end up losing money if the tax proposal passed. The governor said they would change state law (through a necessary constitutional amendment) afterward to remedy that. Not everyone was convinced that would be able to be done, and the suspicion became that good schools would lose money under this referendum proposal and that local districts that either did not support schools or that did not have a good tax base of their own, would be given that money. In other words, the tax plan had the potential to be a reallocation plan to take money away from successful districts and give it to districts which have always been unsuccessful. Many worried that would harm the currently successful schools without necessarily benefitting the perennially lowest performing ones. 

(12) Moreover, the federal government gives a great deal of money to more impoverished schools in the state, based on the number of students eligible for the free and reduced price lunch program. That money is not necessarily taken into account in school officials' description of state education budgets. (13) Nor does the state normally consider school needs for allocating its budget at any time. Money is distributed on the basis of average daily attendance, so that in any given district, higher performing schools get roughly the same amount of state money per students as schools with lower performing students who have arguably greater educational needs. If the state department of education really believed that money would somehow solve educational problems, it seems they might have worked to be able to allocate resources somewhat more on the basis of need. Some principals of schools in more impoverished areas felt that if the tax proposal passed, the money would go to bigger schools that actually needed it less. 

(13) But perhaps one of the biggest obstacles to people's voting to put a lot more money into education is the notion that a good education is demonstrated somehow by standardized test scores. Most people outside of schools understand it is not educating students when one merely rehearses them to pass arbitrary, irrelevant, and idiotic, multiple-guess, standardized tests. Putting more money into that endeavor is not going to help children become better thinkers, better speakers and writers, better readers and listeners, better citizens, or better parents. It will not help them become more knowledgeable in math, or science, more productive in the economy, or more ethical and more fulfilled individuals. What is probably needed is a mass infusion of educated volunteers who can bring into schools a richness of wisdom and experience into the lives students, particularly economically and culturally disadvantaged students who do not come from home environments where parents stress the importance of learning, foster the discipline of studying, or provide the academic assistance that is desirable. We do not need schools to be increasingly more the restrictive province of narrowly educated teachers chained to a stultifyingly state course of study that sucks all the life out of the subject matter it purports to teach. Maybe if we had better schools with more voluntary community involvement across class lines we would not need more or bigger prisons. 

In short, people would possibly welcome an actually viable education plan without the usual exaggerations and the obvious insincere salesmanship. They need to see the government has the ability to know what is right to do and the backbone to do it. They need to see how government intends to use the money they want, and for how long, and they need to see that written into the tax law on which they are voting, not just left to the discretion of the legislature after the money is collected. They also need some choices for funding, some of which may even be voluntary, some of which may even allow for borrowing when the economy is weak and interest rates low, to be repaid when the economy is stronger. At present state government is constitutionally prevented from deficit spending. But it is precisely when trade is weaker than potential supply and actual need warrant, that governmental means of stimulating trade and boosting consumer confidence is perhaps most justified. But whether government is the right mechanism for that or not, people are not as likely to pass a tax increase on themselves at a time when they have low confidence in their earning power or are suffering from difficult economic conditions. 

The government should also propose solutions before they are submitted to the legislature, in order to see how they fly or how people want them changed before legislation is presented that voters simply have to take or leave. And voters should not be told that if they don't accept the governor's or the legislature's solutions, they don't care about Alabama's problems, that they do not want government to try to solve them, that they want smaller government, or that they are happy with the status quo condition of state services. Then maybe people will vote for a tax increase. 

(14a) But regardless of who the scholarship program might have helped, it pitted those who thought they might benefit against those who thought they might not. It did not come across so much as an investment in Alabama's youth as it appeared to be an incentive for people to vote to pass the referendum who thought they could get free college tuition for their children. This turned out to be a component of the proposal that alienated voters because it seemed to be a sinister ploy to buy votes with the promise of a potential college scholarship. 

(14b) And it also harmed the argument that a tax increase was necessary to fill the projected deficit and to improve the quality of education, particularly in K-12. It was a brand new program that had nothing directly to do with improving education, but had to do with paying for college tuition for people, who may or may not be the people who were likely to go to college anyway. 

(15) Another politically divisive feature of the bill, which ironically failed to work anyway, was that senior citizens would not pay property tax, at least under certain conditions. The conditions were not easy to determine because there were some opposing interpretations or statements of this element of the proposal. As to rationale, the charitable reading of that feature is that it was to ameliorate the problem above of having retired people on fixed incomes having to pay perennial taxes on paid off property in which they lived. But the cynical reading is that this was an attempt to buy the votes of older citizens who no longer had children, or even grandchildren, in schools and who are the ones who tend to oppose education tax increases in general. If it was such an attempt, it failed. Many seniors either did not know they would be exempted from property tax or felt they would still end up paying more in other taxes and higher prices than whatever they saved, if anything, in property tax. 

1) Legislators and a cross-section of citizens should be part of the drafting process, either by numerous committees or by polling survey results. It is silly to come up with a proposal that polls and consultation show to be unacceptable to a substantial majority of the public and then go to the time and expense to verify that in an election. Measures should be proposed which at least have a fighting chance to win voter approval. 

1a) It is probably a good idea to make certain that the electorate agrees that a problem exists which requires additional revenues to solve. It is possible that some problems could be remedied without additional revenue, but with an entirely different kind of emphasis or program.

3) Attempts should not be made to divide the electorate in order to "buy off" or "bribe" sufficient groups to vote for it. It is bad enough that natural consequences in most elections pit the self interest of one group of voters against the self-interest of others, without making matters worse by constructing unnecessary and artificial rewards to entice yes votes in a way that polarizes citizens and alienates them from each other even further. 

4) Proposed solutions should be fair, and should certainly not make unfair taxes even more extensive. 

5) Proposed solutions should be economically viable, reasonable, and realistic, and there should be solid evidence that they are. 

6) Alternative solutions can be chosen from a ballot list, rather than offering one way to solve any given alleged problem. 

7) There should be forums available for full discussion of issues, not just question and answer sessions where proponents come to argue for their cases without taking seriously voters' concerns and objections or without answering them in a sincere, open, and honest way.