Education business tax bid nothing but bad timing

Look at Tuesday’s election results in Wisconsin and California.

Gov. Scott Walker handily survived a recall as Wisconsin voters supported his "let’s rein in union benefits" effort in which public employees lost bargaining rights. Police and firefighters were exempt.

In San Diego, voters approved Proposition B, which reduces pension benefits for new public employees, except police.

In San Jose, voters said it’s time for city workers’ pension benefits to be cut back. San Jose voters went even further. By a 70 percent margin, they approved cutting the benefits of current public employees.

News flash for anyone hiding in a cave: An anti-public employee union sentiment is spreading across the nation. Where’s Sally Field/Norma Rae when you need her?

Yet on Wednesday in Nevada, one day after three different elections sent the message that this is not a popular time for unions, the state AFL-CIO and the Nevada State Education Association filed a petition to place a margins tax of 2 percent on businesses with annual revenues of $1 million or more. It would raise about $800,000 a year, according to its proponents.

While a business tax sought by unions and reforms of public employee benefits aren’t directly parallel issues, the anti-union sentiment applies to both. It would have been smart to wait a while until these fresh union defeats weren’t uppermost in people’s minds before filing the Education Initiative.

For those who believe businesses don’t pay enough, this initiative would be the first corporate tax on businesses, which now don’t pay a direct business tax with the exception of the payroll tax.

If the initiative goes through the entire process and becomes law, it would pull in more businesses to share the tax burden. Gaming would be exempt because it already pays a gaming tax. Yet even the gaming industry, which has long wanted other businesses to feel the pain of higher taxes, hasn’t signed on to this initiative.

Gov. Brian Sandoval opposes the initiative on the basis that setting tax policy through initiatives is a bad idea. He also wants to keep Nevada a low-tax state to encourage businesses to come here.

While it’s a valid position that plenty of businesses don’t chip in their fair share to Nevada’s tax coffers, I think Sandoval is right in opposing this initiative, particularly now.

Gubernatorial spokeswoman Mary-Sarah Kinner said it was premature for her boss to discuss Tuesday’s election results publicly, but the union issues are being discussed privately.

"The governor is reviewing all the collective bargaining laws and continues thinking about PERS reforms," she said Wednesday.

Anybody remember when Gov. Kenny Guinn sought reforms of the Nevada Public Employees Retirement System in 2005? Legislators refused to back him up, even though the debt burden has done nothing but increase since then.

Obviously, Walker’s survival has bolstered Republican governors, including Mitch Daniels of Indiana and Chris Christie of New Jersey, who have taken on unions publicly. A Walker defeat would have had the exact opposite effect, frightening governors from taking the political risk of fighting politically active public employee unions.

Five years into a recession is not the time for the teachers union and the AFL-CIO to tax businesses, not even for the sake of the little children.

Those children’s parents may sign the Education Initiative, but will they regret that if they are laid off?

The unions should have stuck to their efforts in 1990, the last time the teachers union qualified an initiative for a business tax. Instead, the teachers union caved in to never-fulfilled promises about reforming a tax system, which admittedly relies too heavily on unstable taxes such as sales and gaming.

Now is not the right time. And a 26-page initiative that is bound to include unintended consequences is not the right way.

Jane Ann Morrison’s column appears Monday, Thursday and Saturday. Email her at Jane@reviewjournal.com or call her at (702) 383-0275. She also blogs at lvrj.com/blogs/Morrison