Wednesday, November 10, 2021


Don’t Start A Discussion With Tax Cuts
Nicholas Johnson
The Gazette, November 10, 2021, p. 6A

Random thoughts about taxes.

1. Years ago I researched what political campaign donors get for their money. It turns out to be 1,000 or more to one.

An example: The Department of Agriculture sets milk prices. Imagine it refuses producers’ request for an increase. The industry makes a $200,000 “contribution” to the president. The milk price is increased. Next year Americans pay $200 million more for their milk. That’s a 1,000-to-one return on their “investment.”

You needn’t imagine. It happened. Except we paid $500-$700 million more.

Returns can include government contracts, tariffs, merger approvals, tax cuts and more.

This is an example of when increasing our taxes — to pay millions for publicly funded campaigns — could save us billions in family expenses.

2. Don’t mess with the tax code. If a business is to get taxpayer money make it a transparent appropriation on the table, not a hidden, manipulation of the tax code.

3. There are 12 or more categories of reasons why TIFs are objectionable.

For example, it’s backward. If a city or school board wants to spend tax money for legitimate public purposes, it needs voters’ approval. If it wants to distribute taxpayers’ money to for-profit private ventures, voters have no say.

We shouldn’t have different standards. But if we’re going to, aren’t taxpayers’ gifts to private businesses the ones requiring voter approval?

4. Our conversations should begin, not with taxes, but with the kind of life we want for ourselves and others. What our founders called “life, liberty and the pursuit of happiness.” Let’s pursue why the citizens of Finland and Denmark are number one and two on the worldwide happiness index while Americans are 18th. (Photo credit: Tiia Monto, Happy People road sign, Muuratsalo, Muurame, Finland, commons,

Only the most hardhearted among us will bad-mouth Jesus’ appeal for food, water, shelter, clothing, and health care for the poor (and prison visits). Matthew 25.

What to do? Economist Milton Friedman once told me, “There’s nothing wrong with poverty that money can’t cure.”

Money, yes. And taxes are one source. President Richard Nixon joined Friedman in the negative income tax idea. In 2019 Stockton tried a guaranteed basic income experiment. Forty cities followed, including Los Angeles and now Chicago.

5. But taxes aren’t the only source.

Some employers have voluntarily provided employees what Democrats are proposing: full health care, retirement packages, family leave, on-premises child care — and company housing or wages that can cover rent.

Foundations such as Bill Gates’ fund social programs. So do churches and nonprofits. And consider the economic value of volunteers’ efforts. It’s estimated to be the equivalent of all cash contributions and major philanthropy combined.

6. Public policy discussions should progress through: What do we want? What are the alternative ways of accomplishing it? What is the most efficient and effective way to do it? If personnel and funding are needed, what are the alternative sources of both? What are their pros and cons?

Fiscal responsibility? Of course. But please, no more starting off backing up with talk about “taxes.”

Nicholas Johnson, Iowa City, maintains Comments:

Nixon & Milk Producers.
See heading and three relevant pages of notes on these events below.

Nicholas Johnson, “TIFs: Links to Blog Essays (2006-2015),

Nicholas Johnson, “Talking TIF: Costs Outweigh Possible Benefits,” The Gazette, April 13, 2014, pp. A9, A12,

TIFs often unnecessary. Dave DeWitte, “Ft. Madison Picked for Wind Turbine Blade Plant,” The Gazette, August 18, 2006, p. 7B (Of interest to rain forest followers because it involves “Earthpark’s corporate partner” (having declared its love but offered no dowery), Siemens (from whom nothing has been reported as having been heard since the “partnership” was announced) mentioned only one factor in its selection of Iowa for manufacturing these 146-foot-long, 11 ton blades. “Siemens conducted a nationwide site search . . . [and] the Iowa site’s proximity to the more northerly year-around navigation port on the Mississippi River at Keokuk was critical to its success.” Nonetheless, $5 million was provided by the state, county, city, and a community college.

Happiness index.
“Finland ranked happiest country in the world – again,” BBC,, and “Happiness report:

“Finland is world’s ‘happiest country’ – UN,” BBC, March 15, 2018, (includes US at 18th place)

Nicholas Johnson, “World Happiness Index 2021; We're Number One?” April 19, 2021, -- provides links to our Declaration of Independence assertion “among these (unalienable rights is) “the pursuit of happiness” and to: Thomas Jefferson wrote the Maryland Republicans, “the care of human life and happiness … is the only legitimate object of good government.”

“Why are Danish people so happy?” Denmark Ministry of Foreign Affairs, (“Denmark citizens pay some of the world’s highest taxes – up to 56% of their income, plus a 25% value added tax and up to 150% on automobiles. Yet most think it a bargain for what they get in return.”)

Nikolaj Skydsgaard, “Denmark’s high tax consensus wobbles as Danes told to spend,” Reuters, June 23, 2020, (“Denmark rivals France among advanced economies for the heaviest tax burden on its citizens – who by and large accept it as the price to be paid for their cradle-to-grave welfare state.”)

Basic income.
Mark Guarino, “Chicago poised to create one of the nation’s largest ‘guaranteed basic income’ programs,” The Washington Post, Oct. 25, 2021, ritica-poised-create-one-nations-largest-guaranteed-basic-income-programs/ (Stockton; 40 cities; LA and Chicago)

Employee benefits.
Jillian D’Onfro and Lucy England, “An Inside Look at Google's Best Employee Perks,” Inc., Sept. 21, 2015 (free gourmet food; free fitness classes and gym (with showers); free transportation to and from work; free one-hour massages (rewards for good job); can bring dogs to work; matching 401Ks; post birth of child, moms get 18 weeks paid leave, dads 6 weeks (while continuing to receive stock and bonuses) and “baby bonding bucks” for supplies; on-site daycare; surviving spouse gets half the employee’s salary for 10 years plus $1000 a month for each child; 80/20 rule (80% of time for on primary job, 20% on “passion projects”); libraries and limited gifts of books; presentations and lectures; 3-month unpaid leaves (with healthcare up to 3 months)

Bill Gates Foundation. Bill and Melinda Gates Foundation,

Economic value of volunteers. Eleanor Brown, “Assessing the Value of Volunteer Activity,” Nonprofit and Voluntary Sector Quarterly, vol. 28, no. 1, March 1999, pp. 3-17, (“”there are estimates suggesting that its dollar value today is at least on par with personal gifts of money and financial assets”)

# # #
President Nixon and Milk Producers

Nicholas Johnson, “Campaigns: You Pay $4 or $4000,” Des Moines Register, July 21, 1996,

“Milk Price Support Program,” Farm Service Agency, U.S. Dept. of Agriculture, July 2004,

“Starting shortly after Richard Nixon took office, bad money began gushing into the Nixon coffers. It sometimes came to Washington in big bundles of cash. The Nixon impeachment charges included as supporting material references to payoffs from ITT and other large firms, and from special interests, including $2 million from milk producers, $200,000 from a criminal (Robert Vesco) to block legal action, and even $200,000 from McDonald’s in return for permission to charge more for a quarter-pounder at a time when wage and price controls were in effect. Item after item cites criminal fraud and conspiracy, bribery and extortion.” Barry Sussman, “A Watergate lesson: Secret money means payoffs, bribes and extortion,” Nieman Watchdog, October 19, 2010,

“Chronology of Watergate Developments in 1973,” Oct. 23, 1973, CQ Almanac 1973,

“Dairy Letter. A letter to Nixon promising a $2-million 1972 campaign contribution from a dairy industry group in return for action to curb dairy imports was leaked to the press. Signed by a representative of Associated Milk Producers Inc. of San Antonio, Texas, the letter was dated Dec. 16, 1970. Two weeks after that, Nixon imposed quotas on certain dairy products. The letter reportedly had fallen into the hands of Archibald Cox shortly before he was fired as special prosecutor. The dairy industry's financial support of Nixon's campaign had been linked previously to a 1971 increase in milk price supports.”

Ditto, Nov. 17, “ilk Prices. None of his interrogators asked Nixon about the milk price supports case, so the President brought up the subject himself. It had been alleged that in exchange for a $422,500 donation to the Nixon reelection campaign from the dairy industry, former Secretary of Agriculture Clifford Hardin reversed himself in March 1971 and ordered increased price supports for milk producers. The increase was estimated to add $500-million to $700-million in income for dairy farmers.

Nothing of the sort occurred, said the President. He related that he had accepted Hardin's original recommendation not to raise price supports, but that three weeks later, “Congress put a gun to our head.” He agreed to an increase when his legislative advisers told him that members of Congress, mostly Democrats, he said, wanted the increase and could override his veto if he tried to prevent it. (Earlier action, Oct. 23)

Ditto, Dec. 17, “Milk Tape. U.S. District Judge William B. Jones agreed to a Justice Department request to temporarily seal all subpoenaed documents and tapes related to a civil suit brought by consumer advocate Ralph Nader against the Nixon administration for alleged- favors to the milk industry. Jones acted after a Nader attorney, William A. Dobrovir, admitted in court that he had played one of the tapes at a party. Dobrovir apologized for what he called the “very foolish mistake.” The tape he played contained a March 31, 1971, conversation between Nixon and dairy industry representatives, which White House attorneys had turned over in response to a subpoena.”

Jan. 8 ITT and Milk Statements. The White House released two lengthy papers detailing the President's rebuttal of charges that he granted favors to the dairy industry and to the International Telephone and Telegraph Corporation (ITT) in exchange for large campaign contributions. The papers showed the allegations to be “utterly false,” said a statement accompanying them.

Political and national economic considerations, but not campaign financial needs, guided the administration's decision to approve higher milk price supports in March 1971, the White House contended in the milk background paper. The paper denied any connection between the milk support decision and the fact that dairy industry groups contributed $427,500 to the Nixon campaign in 1972.

The White House, however, acknowledged that Nixon knew as early as September 1970 that dairy groups planned to contribute large sums to his 1972 campaign. According to the White House, the President was informed in a 1970 memo of a $2-million campaign pledge from the Associated Milk Producers Inc., the largest dairy cooperative. But at no time, the statement added, did Nixon discuss the contributions with the dairy industry.

Jan. 11 Milk Case. Lawyers associated with consumer advocate Ralph Nader filed a motion in U.S. District Court in Washington, D.C., asking for access to more White House tapes and documents relating to their suit charging that the Nixon administration based a 1971 decision to raise milk price supports on political considerations, including campaign contributions from milk industry groups. The brief included a quotation from a White House recording of a March 23, 1971, discussion between Nixon and industry representatives, which the attorneys said brought into question Nixon's contention that he did not refer to campaign contributions during the meeting. According to the brief, Nixon said: “And I must say a lot of businessmen and others I get around this table, they yammer and talk a lot but they don't do anything about it. But you and I appreciate that. I don't need to spell it out.” (Nixon milk statement. Jan. 8.)

Jan. 23 More Hearings. The Senate select Watergate committee voted four to three along party lines to hold six days of additional hearings into the $100,000 given by billionaire Howard Hughes to Nixon's friend, Charles G. (Bebe) Rebozo, and the $427,500 given to the Nixon campaign in 1971 by milk producers. # # #

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