Tag Archives: Alabama

If Taxes are the Solution, What’s the Problem?

by Cameron Smith

Alabama’s legislative leadership and Governor are under immense pressure in Montgomery to increase taxes to prevent cuts in state government funding. But is the real problem a lack of revenue?

The cuts themselves seem to be the most obvious source of consternation. So far, some Alabama agencies are engaging in spending reductions through attrition, not filling vacancies as current staff departs while others delay upgrades or capital purchases. In other words, state agencies seem to be doing what they can to prevent laying off employees. But, at some point, fewer employees tasked with administering the same government programs in the same manner may inevitably lead to reduction in state services or the elimination of state programs.

In many respects, these reductions create heartburn because the programs that may be eliminated are “good” programs. For example, Alabama’s Department of Human Resources will close an adult day-care program that enrolls about 380 people. The closure of the program will save taxpayers over two million dollars annually.

However, for the 380 people enrolled in the day-care program and their families, the elimination of the program means the removal of a substantial benefit. In a very real and meaningful sense, a good program is being terminated. But even if a thousand people are negatively impacted by the elimination of the program, how does their interest stack against the other 4.8 million Alabamians who would rather see those resources go in a different direction or remain in the pockets of taxpayers?

The immediate response that the adult day-care program and others like it should be preserved by increasing taxes makes two baseline assumptions worth challenging. First, it assumes that state government is as efficient at administering its programs and services as it could be. That is one bold assumption. Alabama has no statewide fleet management policy, antiquated payroll and time- keeping practices, and inadequate state-owned land and space management. And those are just a few issues on the internal administrative side of the equation before ever discussing efficiencies in delivering the actual services to the public.

The second assumption is that the majority of Alabamians actually want or need all of the programs and services the state currently provides. One common sentiment from those awestruck that Alabamians would want to reduce their own government is that most Alabamians are incapable of actually understanding what the “limited government” they are asking for actually requires.

But what if the people do understand? What if the people of Alabama actually intend to reduce the size and budgets of their government? Many Alabamians know that some services and programs currently provided by the government may need to be eliminated, but the tradeoff would be retaining lower taxes and prioritized government spending and services.

Maybe the pressure in Montgomery is coming directly from those with a direct financial interest in maintaining the current size and form of government. Most state employees, lobbyists, unions, and even the various agencies themselves stand to feel significant pain if government is reduced. While there are some easy cutbacks, such as eliminating unnecessary entities like the Interior Design Board, leaner government will eventually mean tougher choices.

Reducing the size of government will not, itself, lower the number of the poor and needy currently served by the state. Alabamians must be willing to open their hands and hearts to the poor and downtrodden in their midst in a reliable fashion if they want to cut programs serving those communities.

If Alabamians plan on reducing the size and budget of their government, revenue reductions provide the pressure necessary to force their legislators to prioritize. On the other hand, if they want higher taxes to pay for state programs and services, they had a funny way of showing it at the ballot box in 2010.

Cameron Smith is General Counsel and Policy Director for the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

How to Dig a Four Billion Dollar Hole

By Cameron Smith

Recently, Jefferson County, Alabama filed the largest municipal bankruptcy in U.S. history. However, the filing is only the latest chapter in a sad story for the county as well as the state. More importantly, many Alabamians have little idea how a county of less than 700,000 residents was able to accumulate more than $4 billion in debt.

In 1993, three Alabama citizens filed suit alleging that Jefferson County was polluting the Cahaba and Black Warrior Rivers in violation of the Clean Water Act. This case ultimately merged with a similar lawsuit filed by the EPA in 1994. In 1995, the judge in the case granted summary judgment for the EPA and plaintiffs because the facts, even viewed in a manner most favorable to Jefferson County, clearly demonstrated that the county had violated federal law. Instead of challenging the ruling further, Jefferson County agreed to negotiate a settlement known as a consent decree.

A consent decree is a judge’s order based on a voluntary agreement between parties in a lawsuit, which is enforceable by contempt and can be modified only by court order. In this case, the consent decree provided a mechanism for remedying flaws in the sewer system. The decree called for the county to provide the EPA with a series of evaluations of the sewer system which, in turn, resulted in an implementation plan to correct the offending features of the system.

Unfortunately, the decree also contained a provision that the county could, at its own discretion, make modifications to the implementation plan for “projects not specifically covered by [the] [c]onsent [d]ecree.” This provision permitted Jefferson County to add projects to their sewer improvement plans while giving the impression the improvements were necessitated by the initial consent decree.

In a comprehensive doctrinal dissertation at Auburn University entitled Jefferson County, Alabama: A Perfect Storm of Ethical, Financial, Political, and Market Failures, Louis Ray Morris, Jr. notes that Jefferson County’s 1997-1998 capital budget contained 50 projects required by the consent decree as well as 54 additional sewer-related projects, twice as many projects as actually necessary.

As the cost of the sewer system ballooned, Jefferson County engaged in the risky practice of municipal interest rate swaps as a means to protect against higher future interest rates on the county’s variable rate debt. These swaps were supposedly going to save the county more than $200 million. A Bloomberg Markets article released in 2008 noted that Jefferson County paid banks “$120 million in fees-six times the prevailing rate-for $5.8 billion in interest-rate swaps.” Instead, rates changed direction and the county piled on almost $300 million in additional debt.

The construction and financing of the sewer system were also fertile ground for criminal activity. The flexibility and lack of transparency afforded by the consent decree enabled more than two dozen Jefferson County commissioners, employees, and contractors to engage in a wide range of illegal activities.

To make matters worse, Jefferson County’s occupational tax, which accounted for around $66 million in fiscal year 2010, was struck down as unconstitutional. Legislators in Montgomery have been unable to reach an agreement to replace the lost tax revenue, in part because of concerns over the county’s recent history of poor management, lack of planning, and criminal activity. But even if those revenues remained consistent and were entirely allocated to paying Jefferson County’s debt obligation, it would take more than sixty years to pay off the principal owed without accounting for interest.

In the bankruptcy filing, Jefferson County acknowledged more than $3 billion in outstanding sewer warrants, more than $800 million in school capital improvement warrants, and more than $200 million in general obligation warrants. With accelerated payment and penalty interest provisions, the county’s debt could increase exponentially.

Jefferson County residents now face bankruptcy and a $4 billion hole that translates to more than $6,500 in debt for every resident of the county. Jefferson County leaders dug that hole the same way the federal government dug a $15 trillion one: nobody held government officials accountable for playing fast and loose with borrowed money. If this pattern continues in Alabama and across the country, Jefferson County’s fall will be just the beginning.

Cameron Smith is General Counsel for the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

Ohio Supreme Court endangers children, violates parental rights, and supports the violation of law and decency

On July 1, the Ohio Supreme Court upheld an earlier decision that allows Planned Parenthood of Southwestern Ohio (PP) to keep secret their reports documenting whether or not PP is notifying authorities of instances of statutory rape of pregnant minors seeking abortion services at the Cincinnati clinic.

The Ohio Supreme Court heard arguments last October on this issue after granting a Motion for Rehearing which was brought by attorneys for Jane Roe.

In Roe v. Planned Parenthood, the parents of Roe allege PP employees breached their legal duties when they failed to notify the proper authorities of the young girl’s sexual victimization by the 22-year-old male who brought her to the clinic. They further allege that PP violated Ohio’s parental involvement laws by failing to notify or get consent from them before performing the abortion on their 14-year-old daughter.

Attorney for Jane Roe, Brian Hurley, states about the decision, “We respectfully disagree with and are disappointed in the decision. It allows Planned Parenthood, under the pretext of protecting privacy rights, to prevent anyone from reviewing its redacted records to determine the truth of what many people believe is Planned Parenthood’s policy and practice of violating its duty to report suspected or known sexual abuse of minors. We believe that the protection Ohio provides to its sexually abused children has been significantly weakened and parents’ rights to protect their children from abuse have been undermined. We agree with Judge Donovan’s assessment that the decision is neither just nor reasonable.1

I agree with Fr. Frank Pavone, National Director of Priests for Life, who said,

“It’s hypocritical for the Ohio Supreme Court to be concerned about the privacy of girls receiving abortions at Planned Parenthood when, by keeping the redacted, anonymous records secret, it is in fact protecting the privacy of older men who abuse underage teens. The Court, by its decision, is enabling and perpetuating injustice.”2

Lila Rose, 20-year-old UCLA student and president of the non-profit Live Action, caught on tape Planned Parenthood workers breaking state laws requiring prompt reporting of statutory rape and parental consent laws.

Lila Rose went undercover at a Planned Parenthood clinic in Birmingham and told a counselor that she was 14-years-old, pregnant by her 31-year-old “boyfriend.” Rose said she needed a secret abortion so her parents would not find out about her sexual relationship with the older man.

After telling the counselor that her “boyfriend” is 31, Rose asks, “Is it a problem about my boyfriend?” The counselor, identified as “Tanisha” in the video, responds, “As long as you consented to having sex with him, there’s nothing we can truly do about that.” Rose then says that her boyfriend “said he could get in big trouble,” and Tanisha acknowledges that “he could, especially if your parents find out that he’s 31.” She then tells Rose that the clinic manager, OB/GYN Dr. Desiree Bates, “sometimes does bend the rules a little bit” and states that “whatever you tell us stays within these walls” and “we can’t disclose any information to anybody.”

Alabama code 26-14-3 requires health professionals to disclose suspected cases of sexual abuse to state officials immediately.

“The law is explicit about a healthcare provider’s duty to report, yet Planned Parenthood pretends they cannot say anything,” Rose notes of the investigation. “Planned Parenthood increases its business and influence by circumventing state reporting laws, but inflicts terrible harm upon the vulnerable young girls sent back to statutory rapists.”

In the video, Tanisha also seems to tell Rose that a signature from an “older sister that’s over the age of 18” or someone “with the same last name” could function as a substitute for parental consent so Planned Parenthood could perform an abortion on a minor. Alabama Code 26-21-3 specifies that the written permission of either a parent or legal guardian is necessary before a minor may obtain an abortion.

The new video is sixth in Live Action’s Mona Lisa Project, a nationwide undercover investigation that documents Planned Parenthood’s repeated noncompliance with state mandatory reporting laws for sexual abuse of minors. Alabama is the fourth state to be implicated in the controversy, along with Arizona, Indiana, and Tennessee.3

While Alabama's Attorney General is taking legal action, YouTube is banning this public evidence of Planned Parenthood's crimes. Are YouTube executives politically correct leftists or are they being strong armed by the Left's politicians and corporate members who are leading the drive help PP regain taxpayer funding for its baby-killing services? Because they are owned by Google, the ban on Rose's video is without a doubt politically motivated. Another reason for YouTube censorship is their executives partnership with billionaire George Soros, the global fund raiser for all thing Left like anti-Catholicism and abortion-on-demand.

Breaking state or federal laws is not limited to organizations like Planned Parenthood. Members of the Left seem to always break the law in order to achieve their agendas. It is no surprise that leftist politicians-at-law draped with black robes sitting high at the bar of justice collude with their associates. The false high wall doctrine of church-state separation was the beginning upon which all of the Left's goals have been achieved. Roe v Wade and all similar court decision– Roe v. Planned Parenthood–is merely one lethal example. Parents killing their unborn children is not a privacy right found in the US Constitution, but protecting life is.


1   Christian Newswire, July 2, 2009.
2   Christian Newswire, July 3, 2009.
3   Live Action, June 30, 2009.

Lila Rose’s video can be viewed online at liveaction.org/alabama