Loose ends: Tax reform, population bomb, Article V

Expect cuts in federal funding. Here’s another good reason that the Legislature needs to focus on tax reform: Utah, along with other states, is going to need to get used to less federal money and rely more on internal tax revenues.

While Utah’s economy is strong, the nation’s economic climate is fragile, and state revenue from several sources, especially from the federal government, is shaky. The federal government is flat broke, deeply in debt, and the new administration seems willing to cut domestic spending.

Utah’s budget is about one-third federal money. When the cuts start, Utah’s tax system should be broad-based enough to absorb the shock.  

Population bomb. One of Utah’s most challenging problems is population growth – it’s very expensive to expand the highways, build the schools, hire teachers, and provide services for an expanding population.

But much worse than rapid growth is the reverse – a declining population, as is being experienced in Germany and many other countries.  An April 15 Article in The Economist magazine notes:

“Despite an influx of 1.2 million refugees over the past two years, Germany’s population faces near-irreversible decline. According to predictions from the UN in 2015, two in five Germans will be over 60 by 2050 and Europe’s oldest country will have shrunk to 75m from 82m. Since the 1970s, more Germans have been dying than are born. “

In east Germany, the city of Bitterfeld-Wolfen “has seen its population plummet from 75,000 in 1989 to 40,500 today. Even after administrators tore down blocks of flats, and cut floors off others, skeletal remains of buildings still await the wrecking ball. Nearly one building in five is empty. A grand Stalinist-era building, once the town’s cultural palace, now stands deserted. Two-thirds of kindergartens and over half the schools have closed since 1990. The number of pupils finishing secondary school has fallen by half. Employers struggle to fill vacancies.

“Across many parts of rural Europe mayors struggle with similar problems, wondering when to turn their school into a care home. By 2050 Greece, Italy, Poland, Portugal and Spain—which, unlike Germany, have all suffered net brain-drains—will be older than Germany by median age and will have shrunk substantially, according to the UN. Ageing and emigration are likely further to dampen growth in central and southern European countries, says the IMF.” 

While population growth in Utah is challenging, it is also one of the state’s greatest assets. A young, well-educated workforce will attract good jobs and produce a strong economy.

Liberal groups unite against Article V convention. You know that something must be picking up steam when nearly every liberal/leftist group in the country opposes it. I recently received a press release and lengthy letter signed by more than 200 liberal groups opposing calls for an Article V amendments convention.

Most states favoring an amendments convention are supporting an amendment requiring that the federal government balance its budget, except in certain circumstances. Enough states are passing resolutions supporting such an amendment that the liberal groups are becoming very nervous. 

The letter says such a convention would be a “threat to every American’s constitutional rights and civil liberties.” It notes that states are “dangerously close to forcing the calling of a constitutional amendment to enact a federal balanced budget amendment” which would be “a dangerous threat to the U.S. constitution, our democracy, and our civil rights and liberties.”

Nowhere amid their hand-wringing and fake anguish do these liberal groups say that the U.S. Congress sits as a constitutional convention every day it is in session. It can propose any amendment it wants. They also don’t say that three-fourths of states would have to ratify any amendment emerging from the convention.

The truth is, the Founders provided an Article V amendment process so the states would have a tool to push back against an ever-encroaching federal government. They built in plenty of safety mechanisms. No one needs to fear an Article V convention.