State Policy Favoritism and Corruption

Chris EdwardsCalifornia leaders are in the news for passing a  misguided law that requires most independent contractors to be treated as employees, and then realizing how harmful that is and passing another law exempting dozens of politically important industries from the mandate.Lee Ohanian describes the law ’s damagehere.Last year, “Assembly Bill 5  included exemptions for many politically‐​connected occupations like real estate agents and doctors, but ensnared many others, drawing particular criticism from musicians, independent truck drivers, franchise business owners and freelance writers.” Then in response to the public backlash, the California legislature passed Assembly Bill 2257,which exempts “many occupations in media, music and other industries from AB 5 ’s requirements.”Unneeded laws, such as this, that impose unequal justice generate endless lobbying, litigation, campaign contributions, and corruption as companies and labor unions jockey for special treatment from politicians.State tax policy is rife with similar favoritism. Politicians impose ill ‐​conceived and damaging taxes that induce affected businesses to howl in protest and lobby for relief, and then the politicians pass an array of “exemptions,” “incentives,” “abatements,” and “credits” for the lucky few. Politicians also use state tax codes to flex their central‐ ​planning impulses, passing breaks for sexy and high‐​profile industries such as solar power, da...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs