From the state’s drained highway fund to its beleaguered pension system for state workers, Kansas taxpayers now have a lot of fiscal ground to make up. In fact, the total reaches into the billions. Our advice to taxpayers: Grab a shovel and start digging. Escaping from this fiscal mess is going to take a lot of work — and possibly still more tax increases, as we’ve pointed out. “For a small Midwestern state, it’s a massive hole,” said Senate Minority Leader Anthony Hensley, a Topeka Democrat. “And it’s going to take years to recover.” At this point, there’s no excuse for anybody to be surprised by the aftermath of Brownback’s sweeping tax cuts. Media reports far and wide have chronicled the steps the state has taken in recent years to fill in the resulting revenue gaps. On the day in 2012 when Brownback signed the tax-cut bill, critics were already forecasting fiscal doomsday. The measure slashed state income taxes by roughly $3.7 billion over five years. State financial analysts were predicting budget deficits totaling $2.5 billion in 2018. Undaunted, Brownback insisted that the improved business climate would benefit all. “We’re going to move this forward and make it work and take care of our fundamental services,” Brownback said that day. But new figures from the Legislative Services Department in Topeka suggest a vastly different story. They show that since Brownback’s first year in office, the state has raided various funds or delayed payments to the tune of $3.1 billion. That includes about $2.5 billion in payments to the state highway fund that were diverted elsewhere. In other words, instead of depositing funds into the highway account to maintain roads, the money was diverted to the general fund and other accounts. Essentially, Brownback and lawmakers figured that the only way to finance basic services following those massive tax cuts was to dip into piggy banks. Critics suggest that as highways deteriorate, the state will be hard-pressed to maintain them given all the ongoing highway-fund raids. Brownback and lawmakers also delayed payments totaling more than $407 million from the employee retirement system, or KPERS. Economic development programs were raided to the tune of $125 million. About $47 million intended for children’s programs was diverted. That’s only part of it. The state borrowed $1 billion and deposited it into the retirement account for needed stability. That money will have to be repaid, and so will the $407 million to make pension payments. Likewise, we’ll never know what was lost in terms of progress for kids via those early childhood programs. Years from now, taxpayers will still be footing the Brownback bill. http://www.kansascity.com/opinion/editorials/article164297657.html
Many Republicans, and some Democrats too, believe that economic growth rates can be made independent of the state of maturity and overall size of an economy. Thus they believe that a 4 or 5% economic growth rate in a large, mature economy is not only briefly achievable, which it may be, but is actually sustainable. Even a brief reflection on this idea will show growth at rates higher than the inflation rate to be tenuous at best, and sustaining abnormally high growth rates to be ridiculously impossible. The Brownback approach is one based on a fallacy, the belief that an economy can be best stimulated into abnormal rates of growth by moving money from the public sector to the private. This is a dangerous fallacy; one that has infected a substantial wing of the Republican party not only at the State level, but the Federal as well. The fatal flaw in what we my term the 'Brownback mentality' is that its success depends far to heavily on money being the rate limiting barrier to business success. It is the belief that if you put more money in the businessman's/woman's pocket, jobs and profits will expand accordingly, and the tax base will grow sufficiently to make up for a legislated revenue shortfall. This is a fallacy and the Achilles heel of an entire wing of the Republican party. Although everyone wants low taxes and efficient, effective government, a little reflection will bring us to the inevitable conclusion that starving government will not achieve our goal. We have to have well considered measures to improve government and to sustain a healthy private sector.
By all means, let's tax! http://www.zerohedge.com/news/2017-...rst-pesonal-income-growth-us-over-past-decade