Friday, July 18, 2003

Not yet ...

Nevada's federal district courts reject the lawsuit brought by 24 GOP lawmakers and a group of state taxpayers. (Read the decision here.)

I'll be fascinated by the legal pros' take on this, but the ruling appears sound to me. The judges said they lack jurisdiction to deal with the complaint of the lawmaker plaintiffs, who should have gone to the U.S. Supreme Court first.

In the second part of the ruling, the judges say the non-legislator plaintiffs "state no claim" against the defendants (the Legislature, Gov. Kenny Guinn, etc.), because there's nothing to claim. The Legislature has enacted no tax law; Guinn has signed nothing. The implication I take from this is that the judges were suggesting that if Guinn signs any bill that was passed with less than a two-thirds majority, the non-legislator plaintiffs may have grounds to sue after all.

An appeal to the 9th Circuit is imminent ... and the Legislature keeps working on a tax-and-spend deal.


On the wall of the office in our house is a framed poster commemorating 1995 -- the only year the Atlanta Braves have won a world championship during their current remarkable run -- and it includes the ticket stubs from the two postseason games I attended that year, the only two I've witnessed in my lifetime. I was in Cleveland twice, thanks to my buddy Al Dawson ... we saw a LCS game vs. Seattle (Randy Johnson pitched!) and one of the Braves' losses. Between the two ticket stubs is a Tom Glavine baseball card from that year. Glavine won the clinching game in the Series ... a brilliant, 1-0 victory in which the only run resulted from a David Justice home run. (I saw Justice play for the Durham Bulls way back when, long before Halle Berry, for instance.) Now Glavine is toiling for the hated Mets and he's got to be wondering what the hell he was thinking when he left Atlanta.

The Braves are 30 (soon to be 31) games above .500, the pitching is finally rounding into shape, the offense may finally be good enough to win in the postseason, and there are the Muts, dragging around in the cellar, unloading payroll, destined to spend the declining years of Glavine's likely Hall of Fame career rebuilding. On one level, I feel bad for Glavine. He's by all indications a standup guy, intelligent, an excellent representative of the MLB Players' Association, and a true pro ... a guy who's probably going to win 300 games on guile rather than a blazing fastball.

Had I my druthers, the Braves would have kept him and left Greg Maddux go, but Glavine had a lot to do with that. Things are shaping up nicely in the Chop Shop after all. Maddux will be gone after the season, and the Braves' rotation will be on average at least five years younger than it was at the end of last year, poised to play in the postseason for the rest of the decade. Too bad the guy who anchored the rotation when these good times started chose to not be around for the final years of his career.

Thursday, July 17, 2003

'Tax hater' shoots fish in a barrel

Eugene Volokh eviscerates Brian Greenspun, editor of the Las Vegas Sun (and graduate of Georgetown's School of Law, where he was a classmate of one Wm. J. Clinton) for today's column, which argues that the Nevada Supremes' decision was peachy keen. Consider this gem from the erudite editor:

Regardless how many "experts" the tax-hating Review-Journal could drag out to intimidate the jurists [referring in part to Eugene, who was quoted in several news stories],the fact remains that their reasoning was sound, however unusual it may have been. And, it did what most clear-thinking Nevadans wanted to be done. It ordered the Legislature to do its job and do it by majority rule, a concept that has served this republic remarkably well and Nevada extraordinarily so for the past 139 years.

And then there's this Greenspun classic:

Whoever heard of a minority of people telling the majority of the citizens in any state how they should live, spend their money and educate their children?

Well, Brian, there is that little think known as the Bill of Rights ... or the half-dozen of so provisions in the Nevada Constitution Eugene points out that must have eluded the journalist. I have another one: How about the provision in the constitution of your new home state of California (he owns a home there where he spends much of his time), which requires a two-thirds majority before the Legislature can pass a budget? Did I mention he's a law school graduate?

The column is classic Greenspun bluster, all invective, sadly lacking in logic. It also (typically) fails to disclose a personal conflict: Greenspun was hand-picked to serve on the Governor's Task Force on Tax Policy, the panel which drafted the outline for the tax proposal the Legislature failed to pass ... the tax plan that's now the subject of the current legal controversy. Your readers might appreciate knowing that ... or at least for you to acknowledge that you have an ax to grind.

Channeling William Jennings Bryan

Nevada Senate Minority Leader Dina Titus, a Las Vegas Democrat who moonlights as a political science professor at UNLV, has gotten increasingly shrill as the tax impasse has dragged on. As the Senate rejected yet another attempt to pass a record-setting tax increase, Titus became unhinged because the plan didn't sufficiently bludgeon Nevada banks:

Titus complained that banks would be let off too easily by the Raggio bill because they would pay only a $430 per employee payroll tax [other employees would be assessed a $200 per worker tax]. She said banks in Nevada earned $12 billion in profits last year.

What a wonderful message to send to entrepreneurs considering a a move to Nevada: If you even think about making a profit, the government will expropriate it.

BTW, if a newly launched ballot initiative drive succeeds, Ms. Titus will have to give up her day job, er, return to the university full-time. The ballot measure would prohibit public employees from serving in the Legislature ... a provision that should be covered in Article III, Section 1 of the state constitution:

1. The powers of the Government of the State of Nevada shall be divided into three separate departments,—the Legislative,—the Executive and the Judicial; and no persons charged with the exercise of powers properly belonging to one of these departments shall exercise any functions, appertaining to either of the others, except in the cases expressly directed or permitted in this constitution.

Sadly, state policy-makers refuse to enforce this.

Vintage news

My friend Virginia Postrel's latest NYT column (reg required) speaks to an issue near and dear to my heart: wine shipments. Virginia cites an ongoing Federal Trade Commission study into the potential for mischief that takes place when states impose trade barriers on one another. It's a legacy of the end of Prohibition, one of the few instances Congress has allowed states to engage directly in protectionist policies.

This restraint of trade has affected us personally. We had to drop membership in the club from Laetitia in Arroyo Grande, Calif., when we moved to Nevada. The Silver State allows some limited shipments of wine directly from the producer to the consumer (an individual can receive a total of 12 cases from all out-of-state shippers a year), but this winery didn't want to subject itself to potential prosecution in case one of its customers bought large quantities of wine from a number of sources. So we had to stop receiving the half-dozen or so bottles we had purchased by mail from this winery each year. The Institute for Justice has gone to court in a bunch of states, trying to get these odious restrictions repealed, with some success. They can't move quickly enough.

Wednesday, July 16, 2003

Ding dong?

The gross receipts tax is dead. Senate Majority Leader Bill Raggio notified Assembly Speaker Richard Perkins (for the umpteenth time) there's no way the Senate can pass a broad, revenue- or profit-based business tax this session. Perkins conceded, "At this point in time, the funding of education is so important that we need to get our work done. The folks who are holding things up have successfully protected business to the detriment of our children."

Meaning? Gaming Inc. and its minions in the Legislature lost.

But so did the state's burgeoning financial services industry, not to mention Nevada's taxpayers and the state's favorable climate for business and capital formation (up 'til now). It appears that some form of revenue-based "franchise fee" on banks will be in the final package, which overall will raise more than $800 million ... more than doubling the previous record tax increase.

Still waiting

The hearing before seven federal district judges (not eight, as previously reported) took place this morning. No word yet on any ruling, but stay tuned.

Update ...

The decision is apparently due sometime Thursday.

Fan mail and fast fingers

Got a nice e-mail today from a local couple (40-year LV residents) who say they found out about Deregulator from Instapundit (though I'm guessing that was also via The Volokh Conspiracy). Anyway, they said they were surprised to hear of a Vegas-based blog, particularly one on their same wavelength, and said many gracious and insightful things.

I was ready to reply, when I hit "Delete" rather than "Reply." Then when I tried to retrieve the message from the trash, I accidentally emptied the trash.

I just want to say to them, thanks for the kind words. Yes it is hot here (110+ for eight days in a row ... two shy of the record for consecutive insane scorchers), please don't think I'm rude for not responding personally -- and please keep reading!

In other news

I had successful arthroscopic surgery to repair torn meniscus in my right knee July 2. Everything has been great so far -- little swelling or pain, complete mobility (so long as I use a crutch for stability). I started physical therapy today and in a few weeks, I should return to normal activity. Lola's doing fine as well. For those of you who've asked how we're doing, thanks for your concern.

Tuesday, July 15, 2003

Do two wrongs make a right?

Two dozen Nevada legislators and a group of state taxpayers file federal lawsuits alleging that the state Supreme Court's decision violated their federal due process rights. (The brief filed by the plaintiffs is here; other legal info, provided by the Claremont Institute, which is working on behalf of the plaintiffs, is here.) An en banc hearing of all eight federal district judges in Nevada will take place Wednesday morning by teleconference, a procedure Eugene Volokh believes may be unprecedented.

The plaintiffs' brief cites Coleman v. Miller, a 1939 Supreme Court decision which ruled that, in a legislative vote to ratify a federal constitutional amendment, when the vote to ratify ended in a tie, the lieutenant governor was qualified (as the state constitution allowed) to cast the tie-breaking vote. The court said: Had the LG's vote been disallowed, the votes of the representatives who sided with him would have been diluted, violating their federal due process rights. The plaintiffs argue the Coleman ruling applies here:

Although Coleman involved a federal constitutional amendment, several courts, including the Ninth Circuit, have recognized that a State legislature's failure to comply with its own procedures may violate federal Due Process.

At least the federal judges may entertain oral arguments, something the Nevada Supremes failed to do.

Eugene remains unconvinced that there's a federal constitutional issue here, and I'm somewhat inclined to agree with him. As he notes, the remedy should be political -- remove the justices from office, vote out the representatives who support a decision that violates the state constitution, get a referendum on the ballot that would repeal the taxes, etc. I tend to agree. While it would be satisfying on one level to see these judicial jerks taken down a peg or 12, a successful suit could invite all sorts of federal meddling down the road ... here or somewhere else.

Speaking of recalls ...

A place on the list might need to be reserved for the recently elected attorney general of Nevada, Brian Sandoval. Sandoval filed a brief on behalf of Kenny Guinn before the state supremes, and may well argue on behalf of the state before the federal court. As with most Nevada AGs, Sandoval is a shill for the bureaucracy and the ruling elites, rather than the citizens of Nevada. For instance, when antitax activist Dan Burdish asked the AG to enforce a provision in state law which requires the governor to submit a state budget which "sets forth separately the cost of continuing each program at the same level of service as the current year," Sandoval ruled that Burdish had no standing to make such a request (correct), but then he went all weaselly, saying that governors have great leeway on issues related to taxes and budgeting anyway. Guess they don't have to obey the law. So is Mr. Sandoval's client the governor, the Legislature, or the state constitution and the voters who live under its jurisdication?

The Wall Street Journal also weighed in on the Nevada Supreme Court today (reg. required), saying our justices would make Florida's proud.

Ending the impasse

No matter what happens in federal court, it's now clearer than ever that one thing and one thing alone is preventing the Legislature from passing a budget and a tax plan: The hidebound insistence of Assembly Speaker Richard Perkins, D-Mandalay Bay, and his patrons in the gaming industry on imposing a gross-receipts tax on non-gaming businesses in Nevada. My friend and colleague Steve Sebelius, the Review-Journal's unabashedly left-wing political columnist, would dearly love to see the GRT enacted. But Steve thinks the Supreme Court's decision sucks, and has said he'd rather see no new taxes at all than a tax plan passed by an unconstitutional margin.

The Assembly tax bill that led to the federal lawsuit included a 0.1 percent GRT. The Senate defeated a proposal that would have mirrored the Assembly tax bill Monday, 19-1. Message sent.

But not received? Senate Majority Leader Bill Raggio and Assembly Minority Leader Lynn Hettrick have said for months that a tax bill which raises record-setting levels of new revenues could get a two-thirds vote in both houses if it included no GRT. That point has been proved, what, a zillion times now? Until Perkins (and the casinos, and Guinn) cave, we'll be deadlocked from now till Kingdom Come. Get used to it.