Weaver: The Insanity Of Crisis

By Don Weaver

For the past two decades I have watched legislators come and go. Without fail, most of these men and woman who come to Columbia have a true desire and commitment to serve the people who elect them. Most of them stay close to home and listen to what their voters are saying about the economy, schools, and our quality of life in South Carolina. And most of them understand that our people here in the Palmetto state are fiercely focused on working, raising their families and keeping government of out their lives and their pockets.

The real insanity in our state legislature starts to take hold, however, when crisis hits. We are all well aware that our state, nation and the world are in an economic crisis that affects all of us. How our elected officials act during this crisis will have a serious impact on how long it lasts and how hard it hits our state’s taxpayers. Unfortunately, too many irrational policy proposals are gaining steam at the State House.

We have the second highest jobless rate in the country. Legislators must understand that this is our real crisis facing South Carolina. If workers don’t work, they have no taxes for income tax revenues, no buying power for sales tax revenues, and no money to pay the mortgage. It is a cycle that impacts every part of our lives. That should be cause enough to force our legislators to analyze and comprehend the impact of policy changes they propose.

The reality is that several major proposals being pushed in the General Assembly will affect our people so badly that they will cause thousands of jobs to be lost in our state. A look at three of these proposals helps us understand how the General Assembly could potentially devastate our economy and taxpayers.

First, we have nearly 5,000 direct and indirect jobs that come from the payday loan industry. South Carolina is home headquarters for Spartanburg based Advance America, one of our few publicly traded headquarters in the Palmetto State.

With thousands of jobs being created by this industry, not to mention the thousands in our state who need their services during an economic downturn, some shortsighted politicians have worked for regulations that would clearly shut down this industry, and throw 5,000 more South Carolinians out of work.

Never mind the inhumanity of such action. The fiscal hit to our state in unemployment compensation alone would be tens of millions of dollars. And don’t forget that our jobless rate is so high now that we’re having to borrow money from the feds to provide unemployment compensation.

That argument gets taken a step further, when we hear about the attempts to create whole new government welfare programs with a 740% increase in the cigarette tax. We all know cigarettes are unpopular, but between convenience store workers, growers, transporters and others, there are thousands of jobs that rely on these sales which will decline substantially as smokers move to the internet and other low cost avenues for cigarettes purchases.

The folly of fast cash through a cigarette tax has proved to fail in state after state over the past decade as states raised cigarette taxes to pay for specific government programs. In short order, end result is clear– cigarette taxes never pay for the programs, so new tax sources must be tapped to pay for the ever growing expenses. Again, in a crisis, politicians look for the quick fix and history has proved raising this tax will cause massive layoffs and unemployment.

Another serious policy proposal that adds to the insanity in Columbia is the idea that while gas prices are lower, now is the time to raise the gas tax. Yes, I am sure your legislator didn’t raise this great idea while they asked for your vote last November, but there is a growing chorus in Columbia that is actually arguing for higher gas taxes. How quick we forget that $4.00 per gallon gas was only months ago…this gas tax, if in place months ago, would have devastated families and low income workers. During a recession, policy makers should know the cardinal rule is NEVER raise taxes unless you want to prolong the misery.

While these three examples of the insanity in Columbia are a serious threat to further unemployment and misery during our recession, there are many others being talked about. There are also many quality leaders who are working to stop these proposals. They understand that raising taxes, regulating existing business further, and eliminating financial options for South Carolinians are devastatingly bad choices. This is a time for legislators to understand that their actions have serious consequences…often very bad consequences.

With that in mind, its time to let your legislator know that those actions are being watched and remembered because we can’t afford insanity in this crisis.

The author is President of the S.C. Taxpayers Association.