March 2, 2016
The latest disastrous Kansas revenue report immediately spelled trouble for colleges, universities and other state services.
Yet Gov. Sam Brownback stubbornly defended his wrongheaded income tax cuts and tried unconvincingly to use the national economy as a scapegoat.
“This is an economic problem, not a tax policy problem,” the GOP governor said in a statement Tuesday, after the state fell almost $54 million short of overall revenue expectations in February, a huge 15 percent miss.
“These numbers reflect a declining national and regional economy,” Brownback asserted.
No, they don’t.
His tax cuts, far from acting like “a shot of adrenaline into the heart of the Kansas economy” as promised by the governor in 2012, are causing some of the state’s economic woes. To suggest that tax policy is somehow separate from economic activity, as Brownback implies, is highly selective if not ridiculous.
Moreover, the facts show Kansas is lagging the rest of the United States in important categories.
▪ Start with job growth, a favorite measuring metric of Brownback’s.
Kansas has had a total employment gain of 5.5 percent since the governor took office in January 2011. However, that’s far below the U.S. growth of 9.4 percent over that span, according to the federal Bureau of Labor Statistics. And when the tax-cut “adrenaline” should be at full strength, Kansas in 2015 tied for the ninth worst employment growth rate in the nation.
On Tuesday, Brownback blithely boasted, “Our tax policy has been instrumental in creating more than 80,000 jobs since we took office.”
That number is factually wrong, pointing to another Brownback blind spot.
Kansas actually has added 73,100 total jobs since January 2011. Yes, it has gained 80,800 private-sector jobs — but it has lost 7,700 government jobs at the state, county and local levels. It’s painful to see Brownback’s continued ignorance of the importance of government workers, including school teachers, who provide valuable services.
No one supports government bloat. However, the Kansas Legislature must stop tumbling from one economic crisis to another — diverting road funds, cutting money for education, draining other agencies’ revenues — while slashing resources used for the public good.
▪ Despite Brownback’s complaint about national economic woes, the most recent report from the Nelson A. Rockefeller Institute of Government showed what it called “strong” fiscal growth in the nation overall in the first nine months of 2015.
Kansas was one of only four states that reported declines in personal income tax withholding in the second quarter of 2015. And Kansas was one of only six reporting declines in preliminary figures for the third quarter, through Sept. 30.
▪ On Wednesday, the state of Missouri released its February revenue figures. They were more positive, undermining Brownback’s argument that his neighbors are going under water, too.
Missouri’s total tax revenues were up 0.8 percent over February 2015. That compares to the 9 percent reduction in Kansas revenues in February vs. 2015 — and that’s even after taking into account the fact that Kansas lawmakers hiked sales and cigarette taxes last year.
For the fiscal year, Missouri is up 4.4 percent in total revenues. Kansas has seen only a 1.2 percent growth.
▪ Also on Wednesday, the Kansas Center for Economic Growth released figures for the personal income growth of Kansans before and after the income tax cuts, which took effect in January 2013.
The bottom line: Kansas slipped from fifth out of seven states in the region to sixth after the tax cuts took effect. And in that nearly three-year period after the cuts, Kansas has tumbled to 41st in the nation in personal income growth.
In reaction to the dismal economic news, Brownback said Tuesday he would slice $17 million from institutions of higher learning. That set off a chain reaction of downbeat comments from the leaders of the University of Kansas, Kansas State University and others.
How long will Brownback’s tax cuts be allowed to ruin the state’s economy and harm Kansas’ long-term assets, especially in public education?
Enough Republican legislators must take the state’s financial crisis more seriously and start to reverse the 2012 income tax cuts.
Kansans deserve a fairer system of taxation. And state government needs more money to produce high quality public services for all Kansans.
Only the Legislature has the power to rescind some or all of the income tax cuts that are causing Kansas to sink under a misguided governor.
Read more from the Kansas City Star here.