June 7, 2017
The stark shift in policy was months, if not years, in the making. Lawmakers in the GOP-controlled House and Senate came within a few votes of undoing the tax cuts in February as lawmakers searched for revenue to plug a nearly $900 million two-year budget gap and meet a court order demanding more funding for education.
For Brownback, a former senator and one-time presidential hopeful, the vote was nothing less than a humiliation. He had hailed his tax cuts as “a real live experiment” in conservative governance and offered them up as a model for other states and the Trump administration. Instead, they left him as the most unpopular governor in the country, who was reportedly casting about for a federal posting that would allow him to escape Topeka before the legislature could eviscerate his legacy. “The Brownback experiment didn’t work. We saw that loud and clear,” said Heidi Holliday, executive director of the Kansas Center for Economic Growth.
The move will reverberate in Washington, where the Trump administration is asking Republicans in Congress to enact a tax plan with the same basic structure as the one Brownback put in place in Kansas: sharp reductions in income tax rates as well as a large drop in the rate paid by small business owners that file their taxes individually, known as “pass-through” entities. “It’s a great day in Kansas and a blow to the myth of trickle-down taxation,” said Jared Bernstein, a liberal economist who served as a top adviser in the Obama White House. “Whether D.C. Republicans will learn from the Kansas legislature is very much another question.”
Indeed, conservatives took a very different lesson from the Brownback experience. The goal of conservative economic philosophy is to reduce the size of government—to shrink it down so small that you could “drown it in a bathtub,” in Grover Norquist’s famous description. Kansas only followed one half of the plan. “Don’t cut taxes and increase spending,” said Dave Trabert, president of the right-leaning Kansas Policy Institute. “That’s what Kansas did. That’s a bad plan, and it’s the root of all of Kansas’s problems.”
Yet where advocates on both the right and the left agreed is that Kansas, despite its decades-long tradition of Republican governance, simply did not want to go as far to the right economically as Brownback tried to push the state. While job growth did increase following enactment of the tax cuts, bipartisan coalitions rebelled against cuts to the schools. “Education actually matters to people in Kansas,” Bernstein said. “The lesson is that when it comes to things government provides, people value that more than conservative ideology admits.”
In an interview on Wednesday, Norquist was unbowed by the result of Brownback’s experiment. “This is nothing new,” he told me. “You had a legislature unwilling to do the spending restraint necessary.”
Norquist said that although voters elected Brownback as a “Reagan Republican” in 2010, the state had always had “an inverted Republican Party” that was more vulnerable to the influence of teachers’ unions and other interest groups dependent on government spending. “Kansas is an outlier,” he said, pointing to Republican-led states like Texas, Florida, and Arizona as better examples of places where conservative leaders had cut both taxes and spending. “If you’re a Republican looking for a model, Kansas is not the model,” Norquist said.
On the morning after his signature policies met their demise, Brownback was not so sanguine. “Things sometime don’t go as well as they should,” he said of the legislative rebuke. He warned that the tax increases lawmakers approved over his veto would stunt business expansion and cause companies to flee to other states. “It’s a bad way to go,” Brownback told reporters at the state capitol. “We’re going to have longterm negative consequences for the economy of this state and for the people of Kansas going this route. I regret that.”
He had stood by the tax cuts to the end, insisting that they had indeed unleashed a new wave of growth and job creation but that external economic forces—low wheat and oil prices, a downturn in aircraft sales—had held the state back. It was an argument the conservative governor had made many times before, to decreasing avail.
Despite his pleas for patience, the state’s legislators—including many in his own party—wanted to move on. And when they cast their final votes on Tuesday, they turned Brownback’s grand experiment from national model into a cautionary tale.
Read more from The Atlantic here.