1
I
NTRODUCTION
KEY FINDINGS
Colorado is in the midst of a political and policy pivot point of tremendous consequence
that is putting Colorado‘s fiscal and
economic future in serious jeopardy.
This is the heart of the policy transformation that has grippedColorado since 2005 and became more fully consummated in2009: a deference toward the individual, the entrepreneur, theinnovator and private citizens is increasingly being replaced by Governor Bill Ritter and the current Democrat legislature with amindset of government control
–
the notion that for every problem there must be a government solution, and thatgovernment knows better how to spend our money and decideour future than do private citizens
Studies show that Colorado‘s
heretofore reform-minded directionin tort reform, health care, and education and its limits on taxesand spending have treated Colorado well. With its relatively low and predictable rates of taxation, well-educated workforce,increasingly diverse economy and attractive quality of life,Colorado can still be positioned for success, if its leaders resolve
to tend to the state‘s real challenges.
The bottom line: Colorado needs to institute pro-entrepreneurialpolicies that inspire innovation and ingenuity.
Colorado in Transition: Killing the Golden Goose?
Colorado is in the midst of a political pivot point of tremendous consequence. Through
2004, Colorado‘s political leaders, both Democrat and Republican,
limited governmentintervention in the economy and focused government expenditures on core, mutually agreeable objectives: infrastructure, law enforcement, education, and a basic safety net.Policies such as tort reform were constructed with an eye toward promoting job growth.
The Taxpayers‘ Bill of Rights (TABOR) an
d Arveschoug-Bird spending limits provided astable and predictable fiscal environment. Special interest politics (e.g., union advocacy) and
2redistributionist government policies (e.g., excessive Medicaid benefits) were, as a generalrule, avoided. Then a political and policy transformation began. From 2005 through 2008, lawmakersbegan to back off long-held, philosophically held beliefs about the role of government. Aperiod of more interventionist government was contemplated, although not frequently embraced. For the first of these two years, then-Governor Owens continued to embrace apro-entrepreneurial, limited government vision, and vetoed proposals for a moreexpansionist government. Furthermore, a challenging fiscal environment limited the ability of lawmakers to expand the role of government.By 2009 a sea change had occurred, as Governor Ritter and lawmakers raised taxes,approved massive expansions in Medicaid, expanded the size of Colorado
‘s government,
threw out a spending limit on the gr
owth of the state‘s general fund, and imposed thenation‘s toughest regulations on the oil and gas industry.
The one-
time consensus behind smaller government, rooted in Colorado‘s sometimes
libertarian mindset, now seems like a distant memory. Historically known for its soundgovernance and polite political discourse, Colorado is increasingly plagued by nationalpolitical fault lines on issues such as taxes, spending, union rules, and regulatory environment.
Where do we go from Here?
Are the political and policy changes witnessed in Colorado a temporary flash or a permanentfixture? Only time will tell. Politically charged rhetoric on both sides of the aisle tends to
paint a dire picture of the consequences of one‘s opponent‘s political philosophy. Th
ere isno perfect crystal ball which allows policy-makers to make conclusions about policy outcomes with perfect certainty.But what policy-makers do have is a very clear rear-view mirror. Studies show that
Colorado‘s reform
-minded direction in tort reform, health care, and education and its limitson taxes and spending have treated Colorado well. Chapter one of this report examines
eight empirical studies which paint a generally positive picture of Colorado‘s policy
environment and its impact on job growth and its quality of life.But above average performance in Colorado is not a right. There is no guarantee of futureprosperity and success. Decisions have consequences. This report examines the policy transformations underway in Colorado in six crucial policy arenas. Before embracing many of the same policies which have led to fiscal and economic ruin in states such as Michiganand California, Colorado policy-makers would be wise to remember that entrepreneurs,private companies and Colorado citizens are the source of wealth and prosperity, not thegovernment. This is the heart of the policy transformation that has gripped Colorado since 2005 andbecame more fully consummated in 2009: a deference toward the individual, theentrepreneur, the innovator and private citizens is increasingly being replaced by GovernorRitter and this legislature with a mindset of government control -- that for every problem
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