Monday, December 08, 2008

Herald Leader suffers from R.I.D.S.

Revenue Increase Derangement Syndrome is bad stuff. And the Lexington Herald Leader has a bad case.

Evidence of the malady piled up this weekend with a wild claim that low taxes cause crime and reached Intervention Time with a Larry Dale Keeling column advocating higher taxes and casinos that glosses over two very important points.

First, there's this:
"Over the course of a full year, a 70-cent increase per pack would produce about a third of the revenue needed to offset the current $456.1 million shortfall."

This questionable assertion ignores the loss of economic activity from out-of-state consumers no longer crossing into Kentucky to buy cigarettes. Leap-frogging Tennessee, Indiana, West Virginia, Virginia, and Illinois in the cigarette tax increase race will have an impact we can hardly ignore and spend at the same time.

And then, an old favorite:
"... the two compelling arguments for legalizing casino gambling: to capture for our own treasury the hundreds of millions of dollars in revenue Kentuckians are contributing to bordering states by gambling at their casinos and racinos, and to keep Kentucky's signature racing industry competitive with its counterparts in states where purses and breeders' incentives are supplemented with the profits from expanded gambling."

Here they are ignoring the simple fact that casino revenue will be very hard-pressed to fund state spending and save the horse industry while also covering the increased costs associated with casinos leading to more impoverished families.

Big government has run its course in Kentucky and has failed. The tax increase nattering and revenue increase derangement syndrome will get much louder before it goes away.

Stay tuned...