Policy Documents

The Leaflet - The Income Tax Rebellion

February 23, 2012

Earlier this week our friends at the Oklahoma Council of Public Affairs (OCPA) graciously hosted me and Heartland’s senior fellow for budget and entitlement policy, Peter Ferrara. We went to Oklahoma City to speak about why the state should consider phasing out its income tax. Peter explained that any state could eliminate its income tax in ten years by simply limiting the growth in spending and making the state a more-attractive place for jobs and high-quality workers.

A recent Wall Street Journal editorial points out that the nine states without an income tax have “recorded faster revenue growth to pay for government services over the past two decades than states with income taxes. That’s because growth in the economy from attracting jobs and capital has meant greater tax collections.”

Oklahoma is not the only state trying to become the first since Alaska (in 1980) to get rid of its income tax; both Missouri and Kansas are considering proposals to do the same. If even one state can zero out its income tax, we’ll likely see momentum and pressure on other states to follow suit.

If you would like a Heartland expert to come to your state to talk about eliminating your state’s income tax, please contact me at 312/377-4000 or jnothdurft@heartland.org.

This week’s edition of The Leaflet features research and commentary addressing single-payer health care, Maryland Internet taxes, flood insurance, Pennsylvania fracking, Florida parent trigger, and Michigan post-pay gas stations.


John Nothdurft
Director - Government Relations
The Heartland Institute



Lead Story

Research & Commentary: The Dangers of a Single-Payer Health System
Health Care

A common proposal for remedying the increasing cost of health care in the United States has been the call for a single-payer health care system. In such a system, the financing of both health services and health insurance coverage originates from one single source: the government. Single-payer advocates say all Americans have a natural right to health insurance and that this system would extend coverage and quality health care to all.

Pointing to the experiences of nations that have tried it, opponents say single-payer does not result in better health care. Instead, access to health care diminishes under single-payer systems, and the overall quality of care suffers. Single-payer systems cause shortages of general physicians and specialists and reduce access to medical technology. As an example, Heartland Institute Senior Fellow Peter Ferrara has noted only one-quarter of women in the United States diagnosed with breast cancer die of it, whereas the corresponding death rates are 35 percent in France and 46 percent in Britain, two nations with single-payer health-care systems.

Single-payer systems are notorious for long waiting lines and limited access to care. Grace-Marie Turner of the Galen Institute notes, “Forty percent of the population in Canada does not have a general practitioner because there are so few doctors. Even though they have theoretical entitlement [to health care], they can’t get it.” Such long queues force citizens in single-payer systems to seek care in the United States.

A single-payer system does not benefit patients but instead places them under government discretion while subjecting them to inferior health care. Louisiana Gov. Bobby Jindal observed, “No state or nation should consider implementing a system that individuals from other countries come here to escape from.”


What We're Working On

Maryland Governor Calls for Sweeping New Internet Taxes
Budget & Tax

Maryland Gov. Martin O’Malley’s (D) 2012 budget would impose taxes on digitally delivered goods and services and tax purchases made from out-of-state online retailers that rely on referrals from affiliates.

The proposed budget is in bills introduced in the Maryland Senate and House in January. Under the governor’s proposal, digitally delivered goods and services would be subject to the state’s general 6 percent sales tax. The proposal would also tax digitally delivered goods and services such as music downloads on iTunes, ringtones, smart-phone applications, and blogs that charge for their services.


Research & Commentary: National Catastrophe 'Backstop' Update
Finance, Insurance, and Real Estate

For more than a decade, members of Congress have proposed various bills to establish a federal “backstop,” “catastrophe fund,” or “guarantee mechanism” for private losses in cases of disaster. Most recently, several members of Congress from California, including Sen. Dianne Feinstein (D-CA), Sen. Barbara Boxer (D-CA), and Rep. John Campbell (R-CA), announced another iteration: federal backing for the privately financed but publicly run California Earthquake Authority (CEA), the state’s dominant seller of earthquake insurance. The bill doesn’t specify CEA by name, but no other state has an entity that would qualify. In this Commentary, Matthew Glans examines several proposals for a national catastrophe fund and the possible consequences of the addition of earthquake coverage to a national backstop.


Podcast: Fracking Legislation in Pennsylvania

Heartland Senior Fellow James M. Taylor speaks to Katrina Currie of the Pennsylvania-based Commonwealth Foundation on the state’s recently passed hydraulic fracturing legislation. The law includes a new tax on natural gas, local zoning restrictions, and corporate welfare programs.


Research & Commentary: Florida Parent Trigger

Florida legislators have proposed an education reform that is garnering significant national attention: the Parent Trigger. The legislation, first passed in California, is currently being drafted in more than a dozen other states. The Florida Parent Trigger would allow a simple majority of parents at a school to “trigger” one of three reform options: close the school and allow the students to transfer to better-performing public schools, convert the school into a charter school, or contract with an outside firm to run the school.


Michigan Gas Stations Introduce Drivers' License Swipes for Cash Purchases

A Saginaw, Michigan business owner says requiring customers to swipe their drivers’ licenses when topping off their tanks could stop drive-offs—clients leaving gas stations without paying. Privacy advocates, however, say the new “Post-Pay” method subjects innocent customers to potential identity theft.



Legislative Forum

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Heartland's Emerging Issues Call

Topic: Hydraulic Fracturing

Wednesday, March 7, 2012 at 1:00 pm EST

Phone number: 218/936-6581

Pin: 37661

RSVP by emailing Robin Knox at rknox@heartland.org

Minnesota Capitol Forum
Topic: Health Insurance Exchanges
Monday, March 12, 2012 

12:00 noon - 2:00 pm CST
SOB, 100 Rev. Dr. Martin Luther King Jr. Blvd.
Saint Paul, MN 55155

RSVP by contacting Kendall Antekeier at kantekeier@heartland.org or 312/377-4000.



Policy Newspaper 

FIRE Policy News

The March issue of FIRE (Finance, Insurance, and Real Estate) Policy News reports on Louisiana’s unusually expensive automobile insurance rates, symptomatic, author Kevin Mooney writes, “of public policy favored by trial lawyers that typically results in anti-business settlements.”



Quick Hits

Overcoming the Climate: The Case of Malaria 

Telematics Are the Future of Auto Insurance

Teaching Skills Trump Tenure