Tuesday, October 30, 2007

Family Budget

First a little personal disclosure -- I do indeed have our monthly family budget in an Excel spreadsheet so we have some sense of where our money goes which allows us to reflect on our spending priorities.

I was reminded of that tonight when I attend a town hall meeting hosted by a local state legislator in Minnesota. One of the documents supplied for meeting attendees to review was an overview of the State of Minnesota's sources of revenue and spending.

Here are the biggest slices of the state budget pie that I wish to discuss in this posting:


Individual Income Taxes -- 46.1%
Sales Tax -- 27.9%
Corporate Income Tax -6.5%

Since "corporate income tax" is merely a tax on consumers passed through by companies let's call it what it actually is -- "yet another form of sales tax" -- which gives us these new groupings:

Individual Income Taxes -- 46.1%
Sales Taxes -- 34.4%

Now that gives us a clearer picture of the tax burden on Minnesota taxpayers.


Education -- 49%
Health and Human Services - 28.1%

Since "spending" drives "taxation" let me now focus on these spending categories. In the typical family budget we are told that no more than 30% of household income should be spent on housing making it the largest monthly expense item for most families.

So if we look at our state government budget as a "family budget" we would see that our largest monthly expense is "education" at 49%. Let me pose this very simple question -- "if your family was spending a full one half - one half I said!! -- of its budget on just one item wouldn't you have very high expectations in terms of results/satisfaction you would derive from this expense?

Sadly though in terms of Minnesota's education system's (taking 49% of our budget!) performance we are not getting our money's worth based on the recent student achievement test results which were published (and posted on here) in early October.

I have to believe that 50% of our state budget is enough for the education machine -- instead we should have at least 50% of our households/parents having a choice of where to send their children to school by increasing the number and geographic distribution of charter schools which compete for students (and the revenues associated with students) via an open market not via today's education monopoly/plantation system.

Simply demanding more money does not work anymore,


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