On Wednesday, September 4th, the state title board met to consider our appeal regarding its previous ruling that 2013-2014 Initiative #45 ("Establishment of a State-owned Bank") violates the single subject rule [Article V, § 1 (5.5) of the Colorado constitution].
While the board's culminating 2-to-1 vote that blocked the initiative from going forward was not surprising--this split has been consistent through the past couple of rounds--the arguments offered by Dan Domenico and Jason Gelander in support of their position (that the initiative violates single subject) have grown more specious.
Here's a sampling:
Argument #1: "The second topic is the clause that exempts the bank's revenues from TABOR."
Rebuttal: All ballot issues since the advent of TABOR that involve revenues (including taxes, bonds, and certain changes in appropriations)--whether initiatives of the people or referrals from the General Assembly--have such a clause. Therefore, in and of itself, this clause cannot be considered a second topic.
Argument #2: "The transfer of funds from the bank to the state is a second topic, because a bank is not the same as a tax or bond issue."
Rebuttal: As the proposed amendment describes it, the bank is a d/b/a of the state, so this is simply an interdepartmental transfer, no different than the transfer of funds from the Department of Revenue, the treasury, or any other account of the state.
Argument #3: "The bank could use the proceeds from bonds to finance deficit spending by the state."
Rebuttal: (1) This is a political objection, not a second subject; (2) this mischaracterizes what capitalization of a bank means, and does not account for the so-called "stress test" reserve requirements for all banks that limit the outlay of loans based on reserves; (3) deficit financing is not a "sound banking practice" as defined by the proposed amendment, which cites the Bank of North Dakota (BND) as an example; the BND only transfers profits (surplus funds) to state's general fund, not bond proceeds that apply to capitalization, or taxes, for that matter. It should also be noted that the so-called "too big to fail" (privately owned) banks are in violation of the stress test.
Argument #4: "The proposed amendment is potentially confusing to the electorate because it does not state a specific amount for the capitalization of the bank."
Rebuttal: This is an incredible stretch of the meaning of the "confusion clause" in the title board's marching orders. Confusion is not the issue. The issue is who the electorate trusts with their money: publicly owned state bank officials, or privately owned banks, whose only allegiance is to increasing short-term profits, and whose business model is fraud, as detailed in our previous blog posts here and here. Further, there have been a number of ballot issues concerning taxes and revenues in which the dollar amounts are unspecified, including: Amendment 61 (2010), an initiative concerning limitations on government borrowing, which proposed reducing tax rates by an unspecified amount; and, Referendum C (2005), a referred referendum from the General Assembly, which proposed authorizing the state to spend an unspecified amount of revenues in excess of constitutional limitations for five fiscal years.
Summary: As we noted in a previous post, the purpose of the arguments proposed by the title board and the representatives of the Colorado Bankers Association and the Independent Bankers of Colorado is nothing more than to feign a seemingly legitimate concern for the citizens of the state, while allowing the banks to privatize state services and use taxpayers funds to expand their criminal activities.
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