How Tea Party tax cuts are turning Kansas into a smoking ruin

gwb-trading said:
The Republican Party Must Answer for What It Did to Kansas and Louisiana
http://nymag.com/daily/intelligencer/2016/03/gop-must-answer-for-what-it-did-to-kansas.html

Over the course of 12 debates, the Republican presidential candidates were never asked to address the budget problems in Kansas. That may not sound like an odd omission but it is. To see why, let’s take a quick trip to a parallel political universe:

In Bizarro America, the tea party never happened. Instead, the Great Recession sparked a left-wing populist movement that swept democratic socialists into statehouses all across the country. In Vermont, these Denmark-worshippers took full control of state government and implemented their radical agenda. They raised income taxes to unprecedented heights, upped the minimum wage to $15 an hour, made all state universities tuition-free, and established a single-payer health-care system. As he signed the last of these programs into law, Governor Bernie Sanders declared that Vermont would serve as a blue-state model, one that the Democratic Party’s 2016 ticket could use to say, “See, we’ve got a different way, and it works.”

But by 2016, that model had collapsed. Every warning that conservatives had made about Sanders’s program proved prescient. The tax hikes chased all the job creators out of state. The new minimum wage didn’t raise low-income workers’ living standards; it raised their unemployment rate. The costs of free college and universal health care proved so onerous, the state was forced to raid its rainy-day funds and borrow at high interest rates just to keep the government running. Vermont now faced a billion-dollar deficit. Schools were shuttered. Pensions were cut. The state’s department of social services could no longer afford to investigate child abuse. The legal system could no longer provide indigent defendants with representation. Nonetheless, in the race for the White House, every Democratic candidate ran on some version of Sanders’s economic model.

Wouldn’t it be important for those candidates to explain why their program wouldn’t fail the country in the same way it had failed the Green Mountain State? If you think yes, then you should demand that Donald Trump, John Kasich, and Ted Cruz explain why their tax policies won’t fail America in the same way they’ve failed the people of Kansas.

In 2010, the tea-party wave put Sam Brownback into the Sunflower State’s governor’s mansion and Republican majorities in both houses of its legislature. Together, they implemented the conservative movement’s blueprint for Utopia: They passed massive tax breaks for the wealthy and repealed all income taxes on more than 100,000 businesses. They tightened welfare requirements, privatized the delivery of Medicaid, cut $200 million from the education budget, eliminated four state agencies and 2,000 government employees. In 2012, Brownback helped replace the few remaining moderate Republicans in the legislature with conservative true believers. The following January, after signing the largest tax cut in Kansas history, Brownback told the Wall Street Journal, “My focus is to create a red-state model that allows the Republican ticket to say, 'See, we've got a different way, and it works.' "

As you’ve probably guessed, that model collapsed. Like the budget plans of every Republican presidential candidate, Brownback’s “real live experiment” proceeded from the hypothesis that tax cuts for the wealthy are such a boon to economic growth, they actually end up paying for themselves (so long as you kick the undeserving poor out of their welfare hammocks). The Koch-backed Kansas Policy Institute predicted that Brownback’s 2013 tax plan would generate $323 million in new revenue. During its first full year in operation, the plan produced a $688 million loss. Meanwhile, Kansas’s job growth actually trailed that of its neighboring states. With that nearly $700 million deficit, the state had bought itself a 1.1 percent increase in jobs, just below Missouri’s 1.5 percent and Colorado’s 3.3.

Those numbers have hardly improved in the intervening years. In 2015, job growth in Kansas was a mere 0.1 percent, even as the nation’s economy grew 1.9 percent. Brownback pledged to bring 100,000* new jobs to the state in his second term; as of January, he has brought 700. What’s more, personal income growth slowed dramatically since the tax cuts went into effect. Between 2010 and 2012, Kansas saw income growth of 6.1 percent, good for 12th in the nation; from 2013 to 2015, that rate was 3.6 percent, good for 41st.

Meanwhile, revenue shortfalls have devastated the state’s public sector along with its most vulnerable citizens. Since Brownback’s inauguration, 1,414 Kansans with disabilities have been thrown off Medicaid. In 2015, six school districts in the state were forced to end their years early for lack of funding. Cuts to health and human services are expected to cause 65 preventable deaths this year in Sedgwick County alone. In February, tax receipts came in $53 million below estimates; Brownback immediately cut $17 million from the state’s university system. This data is not lost on the people of Kansas — as of November, Brownback’s approval rating was 26 percent, the lowest of any governor in the United States.

(More at above url)
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A great piece, and a good find. I hope theses questions have not been overlooked, and are being saved for the debates between the two nominees.
 
http://www.forbes.com/sites/rexsinq...hould-set-example-for-neighbors/#667dc1d52a94

If this is correct... Income tax revenues have gone up, since the income tax cuts.

Sales tax revenues are sluggish, mirroring a nationwide problem.

===


What’s more, state revenues continue to grow more than two years following the historic tax cuts. According to Secretary Jordan, the State of Kansas brought $70 million more in 2015 than it did in 2014. Jordan adds that, while sale-tax revenues are more sluggish than hoped in Kansas, this reality mirrors sales-tax declines nationwide. Still, according to the Kansas Department of Revenue, gross domestic product (GDP) growth in Kansas remains steady, as the Sunflower State outpaces all of its neighbors except Colorado, with a 1.8 percent GDP increase in 2014 and a nation-leading 3.4 percent GDP increase in the fourth quarter of 2014.

Plus, there’s more good news: Kansas’ unemployment rate is at 4.4 percent unemployment – well below the national average of 5.5 percent. Secretary Jordan pointed out that, in Southwest Kansas, unemployment rates are even lower and some communities are redoubling efforts to attract enough workers for all of the available jobs.

None of this, of course, is in keeping with the sky-is-falling rhetoric that tax-cut opponents love to tout. And, to be sure, Kansas will face struggles like the rest of the nation does – struggles to boost those flagging sales-tax revenues, struggles to fund pensions year after year. The blame for these challenges cannot, however, be laid at the feet of a tax-cut plan that is bringing more people to the state, growing GDP and state tax revenues, growing jobs, and offering increased opportunities. According to Secretary Jordan, the year the tax cut became law, Kansas welcomed 8,666 first-time tax filers and AGI increased by $486 million. That is progress – and it’s one of the main reasons why Missourians are going to keep seeing our friends and neighbors head westward across State Line Road.
 
The Wichita Eagle
February 6, 2016 6:06 PM

How well is state economy performing?

Phillip Brownlee
Eagle Editorial Board

"Gov. Sam Brownback complained recently that the media don’t report how well his tax policies are performing, that they “don’t cover the results.”

"So what would be a fair, objective way to gauge the results of those policies? How about the benchmarks that Brownback himself established?

In 2012, the Governor’s Council of Economic Advisors, which Brownback leads, agreed on key indicators to monitor the state’s economy.

“These economic metrics will allow us to determine the state’s relative economic position as it relates to the six-state region and the nation, and to monitor in a timely manner if our policies and initiatives are having the desired economic effect,” Brownback said at the time.

"In other words, these should be the measures to judge the success or failure of his policies.

"So how is Kansas doing on those measures? Not that well.

"The council’s November “Indicators of the Kansas Economy” report showed Kansas trailing the region and nation in nearly every measure. This includes growth in population, gross state product, personal income, building permits, nonfarm employment, private-sector employment, private industry wage level, and private business establishment.

"For example, at the time of the report, Kansas’ nonfarm employment was up 0.8 percent from the previous 12 months, compared with 1.3 percent growth for the region and 1.9 percent for the nation. (Kansas finished the year with 0.5 percent job growth, the ninth worst rate in the nation.)

"Private-sector job growth was better, up 1.2 percent per the report, but it still trailed the regional average (1.4 percent) and nation (2.2 percent).

"Another measure: Kansas had a 29.7 percent drop in building permits, compared with a 9.4 percent drop for the region and 7.2 percent growth for the nation.

"There were a few bright spots. Kansas had a lower unemployment rate than the regional and national averages (though this has been the case since 2008). It also had higher per capita income than the region. Also, its manufacturing sector lost a smaller percentage of jobs from the previous year than the regional average (though the nation added manufacturing jobs last year).

"Kansas’ economy is improving, as Brownback notes. But as his indicators show, the economies of most other states in the region and nation are improving faster – and they didn’t pass major income tax cuts that left their states with large budget shortfalls.

"Brownback and his economic advisers decided in 2012 that the IKE report would be issued quarterly and serve “as the leading document” for evaluating economic progress. After publishing nine consecutive reports online, the council stopped posting them on its website after the March 2014 report – about the same time Brownback was facing a difficult re-election campaign.

"Apparently those aren’t the results Brownback wants covered."

Read more here: http://www.kansas.com/opinion/editorials/article58776263.html#storylink=cpy
 
Last edited:
Ricter said:
The Wichita Eagle
February 6, 2016 6:06 PM

How well is state economy performing?

Phillip Brownlee
Eagle Editorial Board

"Gov. Sam Brownback complained recently that the media don’t report how well his tax policies are performing, that they “don’t cover the results.”

"So what would be a fair, objective way to gauge the results of those policies? How about the benchmarks that Brownback himself established?

In 2012, the Governor’s Council of Economic Advisors, which Brownback leads, agreed on key indicators to monitor the state’s economy.

“These economic metrics will allow us to determine the state’s relative economic position as it relates to the six-state region and the nation, and to monitor in a timely manner if our policies and initiatives are having the desired economic effect,” Brownback said at the time.

"In other words, these should be the measures to judge the success or failure of his policies.

"So how is Kansas doing on those measures? Not that well.

"The council’s November “Indicators of the Kansas Economy” report showed Kansas trailing the region and nation in nearly every measure. This includes growth in population, gross state product, personal income, building permits, nonfarm employment, private-sector employment, private industry wage level, and private business establishment.

"For example, at the time of the report, Kansas’ nonfarm employment was up 0.8 percent from the previous 12 months, compared with 1.3 percent growth for the region and 1.9 percent for the nation. (Kansas finished the year with 0.5 percent job growth, the ninth worst rate in the nation.)

"Private-sector job growth was better, up 1.2 percent per the report, but it still trailed the regional average (1.4 percent) and nation (2.2 percent).

"Another measure: Kansas had a 29.7 percent drop in building permits, compared with a 9.4 percent drop for the region and 7.2 percent growth for the nation.

"There were a few bright spots. Kansas had a lower unemployment rate than the regional and national averages (though this has been the case since 2008). It also had higher per capita income than the region. Also, its manufacturing sector lost a smaller percentage of jobs from the previous year than the regional average (though the nation added manufacturing jobs last year).

"Kansas’ economy is improving, as Brownback notes. But as his indicators show, the economies of most other states in the region and nation are improving faster – and they didn’t pass major income tax cuts that left their states with large budget shortfalls.

"Brownback and his economic advisers decided in 2012 that the IKE report would be issued quarterly and serve “as the leading document” for evaluating economic progress. After publishing nine consecutive reports online, the council stopped posting them on its website after the March 2014 report – about the same time Brownback was facing a difficult re-election campaign.

"Apparently those aren’t the results Brownback wants covered."

Read more here: http://www.kansas.com/opinion/editorials/article58776263.html#storylink=cpy
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The above analysis brings to mind the old Milton Friedman saying of figures lie and liars figure.

For example, per the charts linked in the article's analysis, growth in gross state product in Kansas was tanking before the tax cuts. After the tax cuts, Kansas gsp has turned around and headed back up. It was far below the other states before the tax cuts. Now it is almost even. The author of the articles grand conclusion from such statistics is that Kansas trails the other states avg, and is a proof that the tax cuts had no effect.

It's really a shame that fraudulent analysis from the left has to continually be rebutted.
If I was governor of Kansas, I'd just cut taxes and when anyone complained, I would start lining up legislation for tax cut #2. You know, like qe2 and qe3, for example. After eight years of continual qe's and economic stimulus packages, we're told that the US economy never quite reached escape velocity, but their economic policies are a success. And along with it, we have to read opinion pieces with fantasy analysis about Kansas tax cuts.

How about taking a meat ax to school funding? That's my conclusion. One of the biggest wastes in the US is funding for teachers union members. Their pay has no bearing on test scores. They attempt to persuade that they need higher pay for better teaching, and at the same time refuse to allow for incentive pay for better pupil test score outcomes, complaining that other factors prevent test scores from rising. They hope that nobody will notice that gross inconsistency. If higher pay will not raise test scores, then the taxpayer is being bilked and teachers should get what the mkt provides. Not what their union bosses can extract from the taxpayer. If they can make more money elsewhere, then leave. Fat chance a union slob will ever find a job making more money in the free market where he's actually accountable for his production outcome.
 
fhl said:
The above analysis brings to mind the old Milton Friedman saying of figures lie and liars figure.

For example, per the charts linked in the article's analysis, growth in gross state product in Kansas was tanking before the tax cuts. After the tax cuts, Kansas gsp has turned around and headed back up. It was far below the other states before the tax cuts. Now it is almost even. The author of the articles grand conclusion from such statistics is that Kansas trails the other states avg, and is a proof that the tax cuts had no effect.

It's really a shame that fraudulent analysis from the left has to continually be rebutted.
If I was governor of Kansas, I'd just cut taxes and when anyone complained, I would start lining up legislation for tax cut #2. You know, like qe2 and qe3, for example. After eight years of continual qe's and economic stimulus packages, we're told that the US economy never quite reached escape velocity, but their economic policies are a success. And along with it, we have to read opinion pieces with fantasy analysis about Kansas tax cuts.

How about taking a meat ax to school funding? That's my conclusion. One of the biggest wastes in the US is funding for teachers union members. Their pay has no bearing on test scores. They attempt to persuade that they need higher pay for better teaching, and at the same time refuse to allow for incentive pay for better pupil test score outcomes, complaining that other factors prevent test scores from rising. They hope that nobody will notice that gross inconsistency. If higher pay will not raise test scores, then the taxpayer is being bilked and teachers should get what the mkt provides. Not what their union bosses can extract from the taxpayer. If they can make more money elsewhere, then leave. Fat chance a union slob will ever find a job making more money in the free market where he's actually accountable for his production outcome.
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Actually there is no rebuttal here. Kansas is a complete trainwreck. The Kansas economy only recovered slightly because the national economy recovered. However Kansas lagged (and still lags) in every measurement compared to it neighbors and other similar states.
 
You're ignoring his major point, which is that they were lagging before the tax cuts. Correlation is not causation.

I don't know enough about Kansas to get into this, and I don't care enough to research it. I am immediately skeptical of arguments along the lines of tax cuts are starving state government and wrecking education however. I've heard that line too many times.
 
gwb-trading said:
Actually there is no rebuttal here. Kansas is a complete trainwreck. The Kansas economy only recovered slightly because the national economy recovered. However Kansas lagged (and still lags) in every measurement compared to it neighbors and other similar states.
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There is only one group of people who think Kansas is a trainwreck. The same people who think the keynesian economics the Federal government is using is a sterling success. You are showing your true colors.
 
fhl said:
There is only one group of people who think Kansas is a trainwreck. The same people who think the keynesian economics the Federal government is using is a sterling success. You are showing your true colors.
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Then go move there and live the dream, John Galt.
 
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