A caller to my last radio appearance did not understand my issue with the North Dakota Legacy. For readers unfamiliar, this fund takes thirty percent of collections from oil and gas taxes and has some limitations on its use as far as spending purposes, such as no more than 15 percent of principal expended during a biennium and so on.
My issue is not so much with the specifics of the Legacy Fund but with these types of funds in general. I find "rainy day" funds subject to all types of problems, not least among them they become generic slush funds if easily accessed ( in this case I say everyone is an umbrella salesperson) or they are too difficult to get at because of unrealistic support levels required to access funds. It is a very difficult balance to strike.
The caller's confusion centered on whether or not I saved funds on my own. The answer is yes, and I listed the various things for which I save, such as retirement and college for my children and so on. Why then, the caller asked, did I object to the government saving?
This is where attempts to compare household and government budgets break down, in my opinion. My saving is for specific purposes. Most of these government funds are not specified nearly clearly enough. The lack of purpose is especially irksome when the fund stands at $4 billion.
While it would be nice, I do not insist that I agree with the purpose. If it was for infrastructure development, such as infrastructure development bank, program development or enhancement, or tax reform, whether I agreed with the specifics or not it would be less bothersome than no plan at all.
This is also an area where government and the household budget constraints start to work against each other. This is not a simple anti-government rant, but without a plan, and when they acquire $4 billion in funds, you do wonder why you pay income taxes for example.
On the radio with JT, I consistently discuss/advocate tax reform, not temporary cuts like we had in the recent past. I think a forward looking plan about Legacy Fund uses, and maybe better forecasts about future revenue streams and expenditures would go a long way to helping households and government make better budgeting decisions, but we really cannot equate a household budget and related decisions to government budgets. There are too many differences and distinctions with how they operate.
