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Archive for Monday, March 8, 2010

Budget crisis stirs ghosts of politics past

March 8, 2010

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— Budget problems have revived a political debate in Kansas about protecting working families and building prosperity that’s more than a century old.

Last week, Democratic Gov. Mark Parkinson sounded like a Populist of old. He publicly castigated legislators for a two-decade tax-cutting “binge,” saying it benefited mostly wealthy businesses and special interests and endangered government programs that help ordinary Kansans.

Prominent Republicans were left to play the role of a young William Allen White, the famed Emporia Gazette editor who earned national fame with a blistering 1896 editorial, “What’s the Matter with Kansas?” in which he derided the Populists. The GOP response was more temperate than White’s, of course, but Republicans still suggested Kansas has a lot to lose if it decides to, as White put it, “Give the prosperous man the dickens!”

The stirring up of old political ghosts comes as the Democratic governor and Republican-controlled Legislature face a projected $467 million budget shortfall for the fiscal year beginning July 1. The question is who’s going to pay to fill that shortfall — through cuts or higher taxes — and where Kansas stands afterward.

Parkinson, legislators, educators, advocates for the poor, businesses, trade associations and anti-tax groups are expending some of their energy arguing about how the state got into its present mess, factoring out the recession. Parkinson and others who want to avoid future budget cuts blame it on generous tax breaks, particularly for businesses. Republican legislators and others who want to avoid higher taxes contend the culprit is out-of-control spending.

And, as House Speaker Mike O’Neal, a Hutchinson Republican noted, “We can debate that all day.”

Revenue ideas

The state went through five rounds of budget cuts and other adjustments last year to keep its current budget balanced, and Parkinson announced a half-dozen new proposals Friday to avoid a deficit on June 30, in the wake of lower-than-anticipated tax collections in February. His proposals included canceling highway maintenance projects.

That still leaves a gap to fill for the fiscal year beginning July 1, and Parkinson and fellow Democrats generally oppose further cuts. Top Senate Republicans, agreeing that the gap can’t be closed only with cuts, are working on a plan to increase taxes $300 million.

Senate President Steve Morris, a Hugoton Republican, and Vice President John Vratil, a Leawood Republican, said they’re looking at proposals to raise sales, tobacco and alcohol excise tax rates and eliminate sales tax exemptions.

Such increases historically have been easier to sell than, say, an income tax increase, because the taxes are paid incrementally, as people buy groceries, clothes, beer and cigarettes. Tobacco tax increases also are often justified as public health measures, discouraging young people from smoking.

But such tax increases also fall heaviest on poor and working-class families by raising the price of consumer goods. As for sales tax exemptions, a bill before the House to raise nearly $170 million during the next fiscal year does it largely by forcing home owners and apartment-dwellers to pay the sales tax on water, electric and natural gas bills.

Populism with a twist

Parkinson said he’s enough of a realist to understand that such proposals have a far better chance of passing that ideas he now favors, such as reversing tax breaks for businesses, resurrecting the now-repealed Kansas estate tax and keeping the corporate franchise tax on the books rather than phasing it out as planned.

He might seem an unlikely Populist spokesman. He’s a Johnson County businessman, trained as a lawyer, a former Kansas Republican Party chairman who became a Democrat only four years ago.

But last week, he channeled the late Democratic Gov. Joan Finney, a Populist who made eliminating special interest tax breaks a key issue in her successful 1990 campaign. Or, perhaps, he was taking advice that Populist orator Mary Elizabeth Lease gave in the 1890s to raise less corn and more hell.

He also was trying to appeal to the Tea Party movement as well, saying in his Statehouse news conference that its adherents have every right to feel that ordinary people have gotten the shaft.

“The average working man and woman in this state has been left out,” Parkinson said. “Special interest groups have been rewarded time after time in this building.”

In the early 1990s, conservative Republicans, like the Tea Party movement of this decade, sounded Populist themes as they sought to wrest control of the GOP from what many saw as a country-club crowd.

Neither group quite fits the classic Populist mold because both are upset with what they view as too much government intrusion, a perceived drift toward socialism. Populists of old actively sought government intervention in the economy to protect farmers and working families.

White’s 1896 editorial is best remembered for its invective against now-forgotten Populist politicians, deriding one as a “rattle-brained fanatic” and another as “an old human hoop skirt.” But his main point was that Kansas had created such a bad environment for merchants that they and their capital were fleeing to other states.

GOP economic gospel now is that Kansas will prosper — and eventually have plenty of tax revenue for its programs — if it doesn’t tighten restraints on business. O’Neal not only defends past tax breaks for businesses but suggests the state should eliminate its corporate income tax to attract more firms and more jobs.

Comments

SettingTheRecordStraight 4 years, 9 months ago

It only makes sense that the wealthy will benefit most from tax relief since they pay the vast, vast majority of taxes.

JHOK32 4 years, 9 months ago

Other nations apparently do not have a hoard of greedy Republicans in their congresses who only care about taking care of the very rich & could care less about the average citizens in their respective countries who need the most help. Just look at the mess our country is in right now from this very problem: School districts closing schools & laying off teachers, millions of Americans out of work, lost their homes, their life savings, their retirements, not to mention their health insurance.

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