As taxpayers feel the hangover of yet another tax day, a history lesson on the tax system is in order. One hundred years ago this year, the states ratified the 16th Amendment allowing the federal government to "have power to lay and collect taxes on incomes." Within months, Americans were filling out the first income tax forms. In the 1913 tax year, no one who made less than $20,000 -- the equivalent of $458,000 in today's dollars -- paid a dime in income tax. Now Americans earning $458,000 typically fork over $181,368 in federal income taxes. A century ago, the federal income tax brackets ranged from 1 percent to 6 percent, and that 6 percent top tax rate only applied to those fortunate enough to earn $500,000, or $11.4 million in 2013 dollars. Now, marginal tax rates range all the way up to 39.6 percent and the lowest tax bracket is 10 percent. Some low-income Americans today pay a higher percentage of taxes than the wealthiest taxpayers in 1913. In today's dollars, the first Tax Day -- the deadline for filing federal income tax returns -- after the implementation of the national income tax brought in $16.6 billion. This year, the income tax will take $2.7 trillion from hard-working Americans.
One year ago today, the Taxpayers Protection Alliance (TPA) and the Nevada Policy Research Institute held a press conference in the shadow of the National Museum of Organized Crime and Law Enforcement (aka The Mob Museum) as it opened its doors calling the expenditure of tax dollars to build the museum a complete waste of money. TPA first alerted folks to the taxpayer boondoggle in September 2011 with the release of the report "Top Five Most Ridiculous Taxpayer Tourist Traps” in America. In that report, TPA cited the Mob Museum as THE top taxpayer-funded tourist trap. “Sin City residents have already been shaken down for $7.1 million to install more than 30 exhibits in the former courthouse and post office that houses the museum. Another $200,000 was slipped to the Mob Museum from the Las Vegas Convention and Visitors Authority, which hands out money snagged from a steep hotel tax to provide funding. According to City of Las Vegas budget documents, local taxpayers aren’t done shelling out money for the museum. Completing the $42 million museum will cost Vegas residents at least another $8.7 million, and possibly much more.” The museum features many strange macabre “attractions” such as the barber’s chair that mob boss Albert Anastasia was sitting in when he was gunned down in New York and parts of the bullet-riddled wall from the St. Valentines Day Massacre (hence the reason for opening the museum on Valentines Day). Despite promises from former Mayor Oscar Goodman (and former mob lawyer) that the museum would generate 800,000 visitors in its inaugural year alone, that promise like so many others governments make, has fallen far short of reality. Far from a sweetheart deal, this museum has failed to even meet its “breakeven” point, which was to see 300,000 visitors in the first year. According to the museum staff at the completion of their first year, they’ve only had 250,000 visitors walk through the front door. It’s worth noting that just a few months back in October 2012 the museum had only welcomed its 100,000 visitor.
Taxpayers and consumers won an important victory as the fifth session of the Conference of the Parties to the World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC) [COP5] finished their meeting without raising tobacco taxes. The Taxpayers Protection Alliance (TPA) has long been critical and concerned about tobacco taxes pushed by the WHO and led an international effort to stop these taxes. The WHO, an agency of the United Nations, proposed a $.05, $.03, or $.01 cent tax on tobacco products, depending on the wealth of the country where the products are being sold. This tax increase was aggressively pursued with no regard to the potential economic impacts of such a policy. According to the WHO, “Do not allow concerns about employment impact to prevent tobacco tax increases,” and “Do not allow concerns about the inflationary impact of higher tobacco taxes to deter tax increases.” Click here to see TPA’s work and read the petition that was circulated. TPA Senior Fellow Drew Johnson has been in Seoul, South Korea, reporting on the meeting. The following is an account of Drew’s work (click here for a previous blog posting from Drew on the meeting).
On Tuesday, the United Nations gave Americans yet another reason not to trust their tax dollars, policy decisions or military forces with the increasingly outlandish international organization. The World Health Organization – the UN’s public health policy arm – kicked the public and the media out of a discussion of a proposed international tobacco tax during its biennial tobacco control meeting. The WHO’s Framework Convention on Tobacco Control, which is meeting this week in the South Korean capital of Seoul, began on a high note. The convention’s member countries on Monday ratified an agreement to fight smuggled and pirated tobacco products. That goodwill was quickly destroyed when delegates of the member countries of the conference stripped the media of the ability to cover the meeting and escorted public onlookers from the premises. The decision to meet behind closed doors occurred when a discussion began about efforts to decrease tobacco use by increasing the price of tobacco products. As the session began, the session’s chairwoman expressed concern that there was a “large presence” of tobacco growers and industry representatives in the public gallery. That would be unsurprising since the discussion has a significant impact on the livelihood of the tens of millions of people employed by tobacco farming and production. The countries then agreed to make the rest of the meeting private.
Halloween is here. That means a fun day of candy, costumes, jack-o-lanterns and cute trick-or-treaters filling neighborhood sidewalks across America. Also for taxpayers, Halloween is also an excuse for government to waste a terrifying amount of tax dollars on some pretty ridiculous projects. Agricultural subsidies for products like peanuts, dairy and sugar are fairly well known. Most taxpayers aren’t aware that the federal government also carved out subsidies for jack-o-lanterns. In fact, federal taxpayers spent more than $1.74 million to underwrite pumpkin growers and subsidize the cost of federal pumpkin crop insurance programs between 1995 and 2011. Many of taxpayers would be horrified to learn that the Tennessee Department of Agriculture blows tax dollars subsidizing corn mazes, pumpkin patches, hayrides and other businesses that make money hand over first this time of year without government handouts. Yet, that’s exactly what is happening, thanks to an ghastly $1.2 million grant scheme intended to boost agritourism, and encourage diversification and innovation in farming. The Denver suburb of Aurora, Colorado, celebrates fall by shooting pumpkins hundreds of feet through the air at the expense of taxpayers. Much of the town’s $315,569 “special events” budget is blown on staging and promoting the event each October. The Visit Aurora Promotion Board, the local tourism agency, also uses a chunk of its $550,000 taxpayer-funded budget to underwrite the expense of smashing pumpkins over great distances.
President Barack Obama has spent much of the campaign touting his “all of the above” energy strategy — a proposal which, to hear him explain it, will reduce America’s reliance on foreign oil, save families and businesses money at the pump and position the United States as the global leader in clean energy.” Sounds great, right? Almost too good to be true? That’s because it is. Obama’s “all of the above” energy scheme will actually pump billions of tax dollars into economically unjustifiable green energy schemes, attacks America’s coal industry, limit domestic energy exploration, and raises the cost of products and services through a series of mandates and taxes. Worst of all, Obama’s plan to tinker with fuel mileage regulations would actually kill thousands of Americans.
(WARNING: This blog post contains graphic language) Over the past two weeks, the eyes of the entertainment world have focused on Canada and the 37th annual Toronto International Film Festival. The eyes of American taxpayers, however, should've been fixed on wasteful lawmakers who are busy robbing them blind to subsidize outlandish film festivals here at home. The National Endowment for the Arts (NEA) received $146.2 million from federal taxpayers this year to bankroll a myriad of artists and arts projects. A major emphasis of the NEA's spending in recent years has been subsidizing film festivals. Judging by the long list of film festivals that taxpayers funded this year, it seems like no film festival is too small or too bizarre to receive a government handout.
(Drew Johnson is a Senior Fellow with the Taxpayers Protection Alliance) Congress returned to Washington this week for what will likely be a short session focused on doing as little as possible besides ensuring that government doesn't shut down when the federal fiscal year ends on Sept. 30. Doing as little as possible has become a common theme for this Congress. Congress has failed to pass any of the 12 required appropriations bills necessary to keep government open for business. Lawmakers have also failed to pass a budget since 2009 and done little to meaningfully addressed entitlement reform or the debt. Perhaps worst of all, Congress failed to make the spending cuts required by the Joint Select Committee on Deficit Reduction -- a.k.a. the Supercommittee -- before the deadline to prevent automatic cuts. (Those automatic spending cuts will also likely never take place if this do-nothing attitude continues into the next session.) This lack of action has led many pundits to use words such as, "lazy," "pathetic" and "failed" to describe the gridlocked Congress. Perhaps not surprisingly, Congress' job approval ratings are reaching all-time lows. In poll conducted jointly by NBC News and the Wall Street Journal in August, only 12 percent of Americans approved of the job Congress was doing. Despite doing next to nothing in recent months, United States senators and representative receive a salary of $174,000 per year -- a pay that puts members of Congress among the top 5 percent of wage earners in the United States. But that hefty income is only the beginning.
The Corn Palace is one of South Dakota's most famous tourist attractions, and easily the corniest waste of tax dollars anywhere in America. Located just off I-90 in the town of Mitchell, the Corn Palace is a 43,000-square-foot exhibition hall that houses concerts, proms, basketball games, rodeos, craft shows, graduations and a polka festival. What draws tourists to the Corn Palace, however, is the massive corn mural covering the building that is decorated annually with 275,000 ears of corn and tons of other colorful grains. The mural is unveiled at an annual Corn Palace Festival. This year's festival wrapped up its five-day run on Aug. 26. Despite the Corn Palace's kitsch appeal, the city-owned facility never turns a profit. As a result, approximately a third of the Corn Palace's $1.7 million operating budget comes from the pockets of taxpayers every year -- whether they visit the facility or not. This year, taxpayers will chip in roughly half a million dollars just to underwrite the financial flop. Over the past five years, Mitchell shucked $3 million in taxpayer money from residents and visitors to subsidize the operation of the 90-year-old corn-covered convention hall.
Environmental activists regularly scare Americans about our domestic energy resources — and urge us to abandon development of them. Witness the various efforts to stop hydraulic fracturing, offshore and onshore drilling, and the like. What life would look like in this new green world, though, rarely gets coverage. Considering environmental activists aren't very secretive about their agenda, it's worth looking at the dramatically different lifestyle they envision for all of us.