Stop the Tax! Newsletter


Riley Speaks to Rotarians Again


Hugh McInnish

My previous message included a report of a Riley speech to a Rotary club in South Alabama. Now Riley has come north and talked to the Rotarians again. And once again we have a report from one who attended. Our correspondent, T. N. Long, has distributed his comments by internet and invited us to pass them along. His report is quite compelling and we think that he gives important points unlikely to be found in the run-of-the-mill media.

Republicans are trying hard to separate their brother Republican, Bob Riley, from his tax plan. That was tricky from the outset, and is getting no easier. Based on what Mr. Long has to say, our governor is using some pretty questionable rhetoric. Note especially his use of the haircut example to claim that there would be no tax on services.

Today, I attended Bob Riley's "new taxes" sales pitch to a number of northern Alabama Rotary Clubs. Although I was leaning toward voting "no" on the issue, I honestly listened giving him the chance to change my opinion on the subject. After listening to his presentation, my position is now "not no, but hell no!". Here's why.

He structured his presentation to follow Rotary's "Four Way Test". The first tenet is "Is it the truth?". He accused tax opponents of lying when they say that there will be a tax on services. He then used an example of barbers being concerned about a tax on haircuts and proceeded to say that there would be absolutely no tax on such services. Although that statement is not a lie, his use of that example and his failure to elaborate on that subject is extremely deceptive. Page 33 of his "new tax sales brochure" (NTSB) addresses "Transactional Taxes". It states "Repair and installation services for items of tangible personal property will be added to the sales tax base." This can include car repair, plumbing, computer repair, painting, air conditioning installation and repair, etc. Given the manner in which he presented this deception, one has to wonder about what other deceptions are hidden in his sales pitch.

One of his major points was comparison of Alabama to neighboring states and touting the revival of education systems in many of those states. Yes, much of the funding for those revivals has come from lotteries. Georgia's lottery funds a system where every high school graduate with a B average can obtain funding for college. It makes no sense to ignore a $300-million source of revenue when each of our neighboring states has a lottery. If Alabama must prove that it is more righteous than Tennessee, Mississippi, Georgia, and Florida, not having a lottery is not the way to do it. Bob Riley's plan leaves the most regressive tax known to mankind still on the books; that is sales tax on food. His plan to raise massive new tax dollars without reforming that most regressive of all taxes is simply unacceptable.

Another aspect of Bob Riley's plan that fails to address one the state's largest inequities is the tax on "timber land". We have "timber land" in both Alabama and Tennessee. Our tax rate in Alabama is less than a fourth of what it is in Tennessee. His plan will in fact double the Alabama rate over the next five years, but it will still be less than half of what it is in Tennessee.

A final aspect of Bob Riley's plan that is terribly flawed is his "Accountability Reform". Much of it follows (from page 9 of his NTSB): "Every new dollar raised will go into the Alabama Excellence Initiative Fund (AEIF). This fund will be reserved for targeted investments to improve education, protect our senior citizens, and adequately fund essential state services such as corrections, mental health, child welfare, and public safety. This new fund will provide the flexibility to direct funds where they are most needed each year." More follows (from page 40 of his NTSB): "Most notably, Governor Riley has, through Executive Order, named a Citizens Oversight Task Force, made up of business leaders and financial experts from across the state, who will monitor the AEIF and report expenditures every month." When considering how governments function, absolutely nothing is protected by the above part of his plan. It simply promotes a "shell game". If "essential" programs are removed from general fund funding to make room for other programs, then the "essential" programs can then be funded through the AEIF. This is the same principle governments often use to get citizens to vote for tax increases. "Essential" programs are cut before other programs in order to get the citizenry's attention to support new taxes.

I might now understand Bob Riley's master plan. If successful, he will generate one of the most powerful political machines in state history. His Citizens Oversight Task Force (made up of his chosen "business leaders" and "financial experts") will be "protectors" of one huge pot of money. If not successful, he will be able to blame the electorate on the mess that we will have when his plan fails passage.

One thing that I learned today is that Bob Riley is indeed a smooth politician/preacher. His manner of presentation definitely makes one want to believe him and makes it difficult to detect the flaws and deceptions in his words.

"Anger" is one emotion that I try to avoid, but I must say that I left today's presentation "angry" at Bob Riley. I'm "angry" at the predicament he's creating for us when his plan fails passage. He had the opportunity to put together a moderate tax package with meaningful reforms that could have solved many of Alabama's problems if enacted along with a lottery. Instead, he's wasting his time, my time, and Alabama's time with a plan destined for failure that ignores major revenue sources that should be tapped and that fails to address some of the biggest inequities in our current tax system.

T. N. Long
12 August 2003

14 Aug 03