In this issue

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review July 21, 2005 / 14 Tammuz, 5765

Big tax giveaways facing legal battle

By Robert Robb

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http://www.JewishWorldReview.com | Arizona's economic development bureaucrats constantly complain that there are not enough tools in their toolbox. By that, they mean that they don't have the easy access to big tax giveaways that some other states provide.

This has been a chronic complaint from the economic development community for the nearly 30 years I've been an active observer and participant in Arizona politics. And for most of that time, Arizona nevertheless has had one of the most productive economies in the country.

That would suggest that tax giveaways aren't really all that vital to economic growth. Nor, for that matter, is the economic development bureaucracy.

There is, however, a sense that the tide may be changing. Advocates of an Arizona industrial policy are gaining strength. Gov. Napolitano is a clear advocate. And last session, the Arizona Legislature finally established a small state venture capital fund.

Interestingly, however, the big tax giveaways our economic development bureaucrats so envy in other states may be on their way to being declared illegal under federal and international law.

Last September, the Sixth Circuit U.S. Court of Appeals struck down a big investment tax credit Ohio had provided DaimlerChrysler to build a new assembly plant as violating the Commerce Clause of the U.S. Constitution. Now, as in so many areas, the U.S. Supreme Court has made a hopeless muddle of what states can and cannot do with their tax codes to promote economic growth.

Obviously states are free to decide what they want to tax and at what rate, provided the rate applies to all taxpayers equally. And the court has fairly clearly said that states cannot establish discriminatory tax treatment between in-state and out-of-state producers. Arizona ran afoul of the latter proscription when it enacted legislation taxing dividends from in-state companies at a lower rate than those from out-of-state firms. The state is still paying a refund bill of over $300 million. The new Sixth Circuit decision, Cuno vs. DaimlerChrysler, appears to stand for the proposition that states cannot make a lower rate of taxation contingent on new investment in the state.

That has economic development bureaucrats across the country terribly worried. Studies have indicated that they were generally getting fleeced in these deals. Companies were taking the tax breaks but not producing the promised jobs. So, increasingly these economic development tax break deals have performance clauses, requiring a certain level of investment or job creation. Arizona, for example, just passed a manufacturing income tax reduction contingent on significant new investment in the state.

But, according to the Sixth Circuit, it's such contingencies that interfere with interstate commerce.

There's been an outbreak of litigation making similar challenges to tax giveaways in other states. Ohio has appealed the decision to the U.S. Supreme Court, which hasn't yet decided whether to take it up.

Meanwhile, such state economic development tax breaks have become part of the global trade tussle between the United States and Europe over subsidies to Airbus and Boeing.

The United States filed a complaint with the World Trade Organization arguing that development aid provided by European governments to Airbus was an illegal subsidy under international trade agreements.

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The Europeans fired back with a complaint alleging illegal subsidies given to Boeing in the U.S., including $3.2 billion in tax breaks the state of Washington gave the company to lure production of its newest plane.

Washington gave Boeing a substantial break on its gross receipts liabilities, a healthy investment tax credit, and some sales and property tax relief — provided production of the new plane occurred there.

The Boeing new plane auction was one of the times Arizona's economic development bureaucrats cried the bitterest tears about not having enough tools in their toolbox to get into the game.

There's no telling how these challenges will play out. But they do suggest that relying on tax giveaways for big projects is an uncertain and unsteady approach to economic growth. A pretty solid body of research indicates that it's also a generally ineffective approach.

A sound tax and regulatory environment for all comers is a surer path. That puts more tools in everyone's toolbox, not just that of the economic development bureaucrats.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

JWR contributor Robert Robb is a columnist for The Arizona Republic. Comment by clicking here.

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