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Knight's Job is Taxing and Oil is a Gas 
by Vice President Knight Allen
Originally published on September 10, 2015 - reprinted with permission

    All through the tax debates in the 2015 legislative session I tried to point out that working people and retirees were having a tough time and if taxes were going to be raised they should not be raised on the necessities of life which is the core principle of taxation articulated by Adam Smith in "Wealth of Nations." I tried to drive this point home to the legislators more than once including my testimony on SB 252 (see the 4/9/15 "Foghorn) all to no avail.  It was frustrating beyond words to watch those legislators sit like puppy dogs at the feet of Nevada's capitalist elite who droned on and on about how they understood their responsibility to Nevada's children and to the future of the state and how they were there to support the billion dollar plus permanent tax increase including the gross receipts-oops, sorry, "commerce" tax. It was, and is, hypocrisy institutionalized.

    I was most upset not with Governor Sandoval or his water carriers but rather with the "no tax" so-called conservatives none of whom even once challenged the capitalist fakers about the cruelty and economic injustice rooted in the tax proposal especially in the commerce tax. Today's conservatives seem to have no understanding at all they are supposed to be "conserving" the most radically liberal system of government ever devised. They couldn't or wouldn't attack the commerce tax. Either way they are poor excuses for political leaders of a free people.

    Tax increases have consequences. The "temporary" billion dollar tax increase was imposed in 2011. From the end of that year to the end of 2014 the average wage in Nevada skyrocketed (excuse the hyperbole) from $43,105 to $44,718 an increase of 3.7%*. On the other hand, the S&P 500 Index where Nevada's capitalist elite has the bulk of their money invested went from 1258 to 2059 an increase of 63%.
     *State of Nevada Dept. of Employment Payroll Report 2011 to 2014.

    Let's get it straight: 
                                  CAPITAL DOESN'T PAY TAXES. 
                                          LABOR PAYS TAXES. 
                                       THE PEOPLE PAY TAXES. 
   The political and economic leadership of Nevada should be ashamed of what they did (which they are not) and they most assuredly should not be proud of what they did (which, pathetically, they are).

    The collapse of oil prices is providing another great economics lesson about markets and their overpowering influence on governments and people. Those states that were riding high on $80-$100 bbl. oil have had a rude awakening since June of last year. Texas, North Dakota, Oklahoma, New Mexico, Louisiana, Arkansas and Alaska have all taken brutal hits as oil has sunk to $40-$45. Alaska's revenue forecast is down by $2 billion creating a budget deficit of $3.4 billion. As for workers, there have been over 155,000 layoffs.

    Make no mistake, the oil boom played a huge role in the US recovery not to mention making us almost energy independent. This oil bust can cut both ways, helping some areas but dragging down the overall growth rate which is anemic a best.

    Watching the oil market do its thing can be entertaining even to seniors who are probably far more interested in the price of gas than they are the price of Exxon-Mobil stock.

Contact Vice-President Knight Allen

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