OUR VIEW: Republicans could go all out, but they won't

You know the old joke: Starting Tuesday, March 3, hold on to your wallets. Florida’s annual legislative session begins.

If truth be told, that joke pretty much has disappeared from most of the states, as well as from Florida. Republicans — alleged to be fiscally conservative — control 31 legislatures nationwide.

In Florida, we’re about as red as you can get in the capitol. We have our Republican governor, 80 of 120 Republican House members (66%) and soon-to-be 26 of 40 Republican state senators (65%), each house just one shy of the veto-proof supermajority.

Given this highly stacked deck, the fact the governor doesn’t have to worry about re-election and this is not an election year, the Republicans actually have a historic opportunity to go crazy with Tea Party-loving, freedom-loving, anti-government legislation.

Here’s your chance, boys and girls. Go for it. Do what you always say you’re going to do but never do: Get rid of waste, fraud and abuse. Cut the bureaucracy. Cut regulations. Cut taxes. Reduce the size of government. Legislate us to liberty-loving nirvana.

Of course, it’ll never happen.

They don’t have the pelotas.

Unlike our “transformative” president occupying the White House, Florida’s governors and Legislature mostly tend to hover and operate in the margins, predominantly enacting incremental change. That’s the nature of our republic form of representative government. It’s safest to operate in the margins.

Senate Majority Leader Bill Galvano, R-Bradenton, confirmed that reality last week when he told a group of business people: “You can either give up or recognize that incremental positive change can change the direction of the state.”

In other words, lawmaking is much the same as “Good to Great” Jim Collins’ “hedgehog” strategy: slow and steady and keep digging. 

There are plenty of explanations for why lawmakers cling to the margins.  

For one, elections. There is always another one coming up. As Gov. Rick Scott told us after working with lawmakers in his first year, he found the No. 1 priority on his fellow governors’ and lawmakers’ minds was “getting re-elected.” Not doing what’s best for taxpayers; getting re-elected.

In turn, that ever-present reminder inherently tempers how far lawmakers are willing to go. They are always mindful of the potential backlash back home if they get too daring.

On top of that are the two most important questions that hover over every piece of proposed legislation: Who wins? Who loses? The answers to these questions dictate a lot of behavior (and the size of campaign accounts).

The late Milton Friedman captured this as well as anyone with the pithy truism that “whatever government gives to one, it must take away from another.” Or: Lawmaking is all about well-intended politicians attempting to right perceived wrongs for his benefactors at the expense of others. 

And as Friedman also pointed out, there is no end to that process. As soon as lawmakers address a perceived wrong with a new law, inevitably there are unintended consequences that create more wrongs for someone else, which in turn requires another round of laws to correct the newest wrong. Ad infinitum.

No wonder, of course, every group, every industry, every special interest has lobbyists running the floors of the statehouse, attempting to hose down or extinguish brush fires before they become catastrophes for their clients.

But those lobbyists also inhibit bold ideas and assure marginal governing. The simple reason is all of them are negotiating trades. Everyone in Tallahassee is trading compromises and favors like baseball cards. And that takes a long time. The wording in a bill, or how one compromise might affect the future chairmanship of a committee all matter. Indeed, few of us know what gets traded in the process of a lawmaker rising to a leadership position.  

All of which brings us to the 2015 Florida legislative session. Here’s the headline: Don’t expect “transformative” legislation. Galvano, R-Bradenton, pretty much confirmed that last week in a preview of the session.

What’s in store?

• Medicaid expansion: This is likely to be the most dramatic, outside-the-margin legislation to be adopted. 

The Senate has favored expansion; the House heretofore has opposed it. But with Associated Industries and the Florida Chamber of Commerce lobbying in favor of a modified, more market-oriented version of the Obamacare Medicaid expansion, Rep. Richard Corcoran, R-Lutz, one of the architects last year of an alternative plan and opponent to Medicaid expansion, is showing a willingness to consider what is being called “A Healthy Florida Works.” 

Watch for lawmakers to give in on this. They can’t take the pressure of having the media painting them as cold, heartless Republicans who don’t care about the poor. 

It’s politically safe; never mind the $5 billion a year cost.

• Tax cuts: Galvano predicted there will be more tax cuts, although he didn’t altogether embrace Gov. Scott’s call for $650 million in reduced taxes. 

“That is just a proposal,” Galvano told a group of business executives. He said reductions are likely to come from the communications service tax; corporate income tax; and elimination of the sales tax on commercial leases.

• Corporate “incentives” (aka subsidies): They will continue to be dispensed. (Watch for Venice’s Sen. Nancy Detert to lead efforts to boost the subsidies for the movie industry.)

• Amendment 1 implementation: The daily media will be all over lawmakers figuring out where and how to spend one-third of documentary-stamp collections on environmental protection. It’s a leading “green” issue.

• Beer: Expect a conclusion full of compromises between major beer manufacturers and distributors and the craft brewers this year over the rules governing the sale and distribution of craft beers. This will consume a lot of ink and air time.

• Marijuana: To head off another constitutional amendment attempt by John Morgan, lawmakers will expand what’s permitted in dispensing of medical marijuana. There’s no chance whatsoever for recreational marijuana.

Matt Walsh is editor and CEO of Observer Media Group Inc., parent company of the West Orange Times & Observer.

A REAL REPUBLICAN AGENDA

IF FLORIDA REPUBLICAN LEGISLATORS WERE REALLY FREE-MARKET REPUBLICANS, THEY WOULD …

• Adopt “loser-pays” tort reform.

• Eliminate mandated workers’ compensation insurance.

• Convert the Florida Retirement System to a defined contribution plan (401(k) plans) from defined benefit plans for all new state employees.

• Eliminate the certificate-of-need system for health care facilities.

• Create block grants for high-performing school districts — to eliminate the micromanaging that comes from Tallahassee.

• Convert public-school financing entirely to an Education Savings Account System, giving parents ultimate choice and creating a competitive education system (See Arizona and Mississippi). State funding for education should be for the students, not the districts, schools or bureaucracies.

• Allow school districts to adopt their own standards. Competition will result in higher standards overall. 

• Reduce the amount of mandated testing in the schools; let districts decide.

• Eliminate the limit on class size.

• Eliminate the state’s portion of the required school property tax and replace it with a higher, broader sales tax.

• Eliminate the corporate income tax (in the end, corporations don’t pay taxes, they pass on the taxes to their customers).

• Eliminate Citizens Property Insurance Co. and deregulate property insurance. 

• Not expand Medicaid. See former Speaker Will Weatherford and Rep. Richard Corcoran’s Florida Health Choices Plus or Indiana’s Healthy Indiana Plan.

• Expand medical marijuana, and begin exploring how to create a marijuana market that mirrors the regulated alcoholic beverage industry — whereby every step of production and distribution comes under strict regulation.

• Phase out the homestead exemption; quit penalizing part-time property owners, thereby allowing lower and broadened property taxes.

• Eliminate the sales tax on commercial leases, thereby lowering the cost of business and increasing Florida as a business destination.

• Eliminate the state-mandated comprehensive planning process for counties and municipalities.

• Let individual communities decide whether to allow casino gambling.

• Eliminate the Department of Professional Regulation. It’s protectionism.

RAISE THE GAS TAX?

Chatting recently with longtime Florida economist Hank Fishkind, we asked for three bold moves he would enact if he had the proverbial magic wand in Tallahassee.

Economically, they make sense. Politically? Well, two of the three (1 and 3) will never happen.

1) Raise the gas tax and use that money to improve Florida’s roads and highways. No high-speed rail trains, but build roads, bridges and ports. As Fishkind has said for more than 30 years as a watcher of Florida’s economy: When you build roads, Florida’s economy grows — with more people, more businesses, more jobs, more wealth.  

2) Take the federal Medicaid money and do what Indiana has done — create Florida’s own version of Obamacare, albeit more palatable. “If you don’t take that money, you still have to bear the cost of all those uninsured people,” he says. 

3) Eliminate the state portion of the school property tax and broaden and raise the sales tax. Fishkind teamed up with former House Speaker Marco Rubio and pushed this as far as being placed on the state ballot, only to have the courts reject it.

But the effect of that bold move would be to increase the net operating income on commercial buildings, as well as the cash flow and net worth for homeowners. In turn, this would make investing in Florida much more attractive, drawing companies and jobs.

As for the higher sales tax, implemented to offset the lost school-tax revenues, Fishkind argues Floridians would only have to make up 80% of the lost property-tax revenues; tourists would pay the other 20%.

“Unfortunately,” Fishkind said, “Tallahassee is all driven by ideology and not by economics.”

MORAL DILEMMA 

OF MEDICAID

The chorus is rising louder and louder for Florida to accept $5 billion a year in federal taxpayer money to pay for the health care costs of nearly a million Floridians who are uninsured.

When reminded that taking federal money is borrowed money that just adds to the national debt that is burdening future generations, economist Hank Fishkind acknowledged the dilemma. Then he said: “That’s a structural problem at the national level. We need to raise the eligibility levels for Social Security and Medicare.”

It’s more than a structural problem. It’s a moral problem, too.

All of us would be imprisoned if we took money from our children’s trust funds for our own consumption today.

But this is what more and more state governments are doing. Governors and lawmakers are succumbing to the political pressure to “insure” the uninsured.

And then you hear Floridians say: “If we’re paying taxes, we should get some of that money back. Everybody else is doing it. If it’s there, we should take it, too.”

But it’s not there. Every state and American that is expanding the Medicaid rolls is stealing. It’s a Faustian bargain.

The better bargain could and should go like this: If insuring Florida’s uninsured is a national and state priority, then credit the $5 billion Floridians send to Washington every year. Don’t send it to Washington. Keep it here, and cut federal expenditures elsewhere. Do that in every state. Quit robbing our children and grandchildren.          

— MW