Memo to Voters: There's No Free Lunch

The line to get a driver’s license at one Houston location is so long, according to Tommy Williams, that a guy called in a pizza order, got it delivered to him, and finished eating before he got to the front of the line.

Williams, R-The Woodlands, uses the line in a speech, so it might or might not be precisely accurate. But it sets up his point: "How many of you in this audience would pay an additional $8 every six years (the current price is $24) to hire enough people to get rid of those two-hour lines?"

That got a nice show of hands, even at the Texas Taxpayers and Research Association's annual gathering in Austin, where lobbyists are trained to keep their opinions to themselves and their hands in their pockets.

Senate Finance Chairman Steve Ogden, R-Bryan, talking to that same group, pointed out three big problems facing the state — school finance, the business margins tax and transportation infrastructure — and suggested the only way to solve them is to ask the voters whether they want to spend the money to fix those things or not. Do they want to spend more money on public schools? Would it be alright to extend the state's business tax to partnerships, even if that's construed as an unconstitutional personal income tax on the partners? Would voters accept a higher gasoline tax to build roads?

"It's not important whether they say yes or no — it's just important that they answer the question," he said. 

Ogden is on his way out — he's not seeking another term next year. He's a conservative Republican. He represents a district that stretches from Williamson County, north of Austin, to Bryan and College Station. With suburbs full of state employees, Texas A&M University and a smattering of prisons, his district has more state employees than any other. "Yet they elected me," he said.

The first two of his big issues — money for public schools and the state's business tax — are tangled up in court. The courts might give lawmakers the guidance they're not getting — at least not clearly — from voters.

"School finance litigation will have an effect on what everybody is going to do about tax reform," said Comptroller Susan Combs.

The cases are in front of judges now. The Legislature will be back for a regular session in January 2013 to deal with whatever the courts order.

Meanwhile, Ogden, Williams and other Republicans are searching for a good reading on what the voters really want. Republican candidates run against taxes and in favor of smaller government; having done so, they're often locked in to a particular set of answers when they reach Austin. And their voters don't, as a group, make much distinction between Austin and Washington. Disdain for the federal government increases disdain for the state government.

What's a legislator to do? "We have to have some honest conversations about what it costs to run government," Williams said. He takes care to say he's not for a general tax increase, and there's nothing in his record to suggest otherwise. But he points out that line of drivers awaiting their licenses. He's got another query along the same lines. "How come the fastest-growing state in the United States has no money to expand its highway system?" he asked. Increasing the state's automobile registration fee to $110 per year — it's now $62 per year — would raise $15 billion for new highway construction. 

Politicians have to be careful how they talk about such things for fear of setting off activists and voters tuned to anything that sounds like a new tax or spending plan, a violation of the current Republican orthodoxies in Texas.

House Speaker Joe Straus has been testing that. He told the El Paso Times that the state has to address its budget problems, including the business tax: "We have no choice, unless we want to continue to try to grow our population and continue to shrink spending significantly. I think at some point you can't cut your way to prosperity."

The no-tax-small-government contingent twittered and emailed and spoke out, attacking him as an apostate. He's used to that; they campaigned against his re-election bid earlier this year and he owes them no loyalty.

For others, it's more difficult. They're playing with the old Milton Friedman line: There is no such thing as a free lunch. Voters clearly want good schools and nice roads and low taxes. It's a political and policy question straight out of a business textbook: What's the right balance of price and quality?