Taming Leviathan: Do tax and expenditure limits work?

Video

Event Summary

Many Americans believe that the states have a spending problem. But are the formal tax and expenditure limits (TELs) that many states use to restrict spending effective? At an AEI event on Wednesday, economists and policy elites joined AEI's Benjamin Zycher to discuss the impact of these measures on state spending.

Zycher highlighted the results of his most recent paper, which found that TELs are rarely an effective tool for limiting state spending despite their national popularity. Zycher noted that TELs do not address any of the fundamental causes of government growth. He instead called for a renewed emphasis on federalism and a return to the basic principles of limited government.

Michael New of the Cato Institute suggested that TELs may be effective if they are designed properly. He pointed to the Colorado Taxpayer Bill of Rights as a TEL that helped to significantly rein in spending.

Nicholas Johnson of the Center on Budget and Policy Priorities agreed with Zycher's conclusions that TELs are ineffective, but rejected the assumption that states have an underlying spending problem that needs to be controlled. Matthew Mitchell of the Mercatus Center concluded that states may be better off pursuing balanced budget amendments and other institutional changes as mechanisms to help control spending.
--Luke Carter

Event Description

Watch live and join the discussion on tax and expenditure limits ►

For many years, US states and localities have confronted pressures for ever-greater spending. In pursuit of enhanced fiscal discipline, 30 states since 1978 have enacted formal limitations on taxes, budgets, or outlays. Current fiscal pressures, driven largely by pension and health care costs, have renewed policymakers’ interest in such tax and expenditure limits (TELs).

Despite the substantial time, resources, and effort that have been devoted to the enactment of TELs, new research conducted by AEI’s Benjamin Zycher finds that the fiscal outcomes stemming from such tools have largely failed to live up to their promises.

Exactly how effective have TELs been in constraining state and local spending, and how can state and local officials curb budget growth more effectively? Why have TELs failed to live up to their expectations? And what lessons might these findings hold for policymakers at the national level?

Join Zycher and a panel of TELs experts to discuss the local and national implications of this new research.

If you are unable to attend, we welcome you to watch the event live on this page. Full video will be posted within 24 hours.

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

Mark J.
Perry
  • Mark J. Perry is concurrently a scholar at AEI and a professor of economics and finance at the University of Michigan's Flint campus. He is best known as the creator and editor of the popular economics blog Carpe Diem. At AEI, Perry writes about economic and financial issues for American.com and the AEIdeas blog.

    Follow Mark Perry on Twitter.


  • Phone: 202.419.5207
    Email: mark.perry@aei.org

 

Benjamin
Zycher
  • Benjamin Zycher is the John G. Searle Chair and a resident scholar at the American Enterprise Institute (AEI), where he works on energy and environmental policy. He is also a senior fellow at the Pacific Research Institute.

    Before joining AEI, Zycher conducted a broad research program in his public policy research firm, and was an intelligence community associate of the Office of Economic Analysis, Bureau of Intelligence and Research, US Department of State.  He is a former senior economist at the RAND Corporation, a former adjunct professor of economics at the University of California, Los Angeles (UCLA) and at the California State University Channel Islands, and is a former senior economist at the Jet Propulsion Laboratory, California Institute of Technology.  He served as a senior staff economist for the President's Council of Economic Advisers, with responsibility for energy and environmental policy issues.

    Zycher has a doctorate in economics from UCLA, a Master in Public Policy from the University of California, Berkeley, and a Bachelor of Arts in political science from UCLA.

  • Email: benjamin.zycher@aei.org
  • Assistant Info

    Name: Regan Kuchan
    Phone: 202.862.5903
    Email: regan.kuchan@aei.org

What's new on AEI

image The Census Bureau and Obamacare: Dumb decision? Yes. Conspiracy? No.
image A 'three-state solution' for Middle East peace
image Give the CBO long-range tools
image The coming collapse of India's communists
AEI on Facebook
Events Calendar
  • 21
    MON
  • 22
    TUE
  • 23
    WED
  • 24
    THU
  • 25
    FRI
Wednesday, April 23, 2014 | 12:00 p.m. – 1:30 p.m.
Graduation day: How dads’ involvement impacts higher education success

Join a diverse group of panelists — including sociologists, education experts, and students — for a discussion of how public policy and culture can help families lay a firmer foundation for their children’s educational success, and of how the effects of paternal involvement vary by socioeconomic background.

Thursday, April 24, 2014 | 12:00 p.m. – 1:30 p.m.
Getting it right: A better strategy to defeat al Qaeda

This event will coincide with the release of a new report by AEI’s Mary Habeck, which analyzes why current national security policy is failing to stop the advancement of al Qaeda and its affiliates and what the US can do to develop a successful strategy to defeat this enemy.

Friday, April 25, 2014 | 9:15 a.m. – 1:15 p.m.
Obamacare’s rocky start and uncertain future

During this event, experts with many different views on the ACA will offer their predictions for the future.   

No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled today.
No events scheduled this day.