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Archive for Saturday, April 6, 2013

Opinion: Economic schemes likely to hurt Kansas

April 6, 2013

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Kansas has no mountains, great lakes, forests, deserts, sea coast, tropical climate or large cities to attract people. Kansas agriculture and energy sectors are far too efficient to support a large workforce. Manufacturing continues to decline in the U.S. and Kansas. We get some synergistic growth from Kansas City, Mo., but it is limited by fragmentation of the metro area. Consequently, for over a century, Kansas population has grown slower than the rest of nation.

Despite those disadvantages, our real standard of living has been well above average. How did we do it?

We did it with stable, effective, traditional, conservative economic development programs — we invested in people and infrastructure. We delivered those investments through a reasonably honest, efficient and frugal government. And we had a balanced tax structure to pay for it.

Until the frontier closed, the leading Kansas development program was federally supported homesteading. Ever since then, it’s been Kansas education funding. For close to a century, highway funding was second or third. More recently health care funding was second. Nowadays, scoring federal revenues and grants is a leading government enterprise. We’ve tried to mitigate poverty — important because poverty drags down the productivity of the next generation. We’ve supported family farms. Also, we do have a few development tax gimmicks of limited scope and uncertain effectiveness.

And that has always worked for us. We’ve even been able to weather some terrible droughts, dust bowls and depressions.

But now come Gov. Brownback and his movement-conservative supporters in the Legislature to surprise us with revolutionary economic development schemes they never campaigned on to fix what wasn’t broken.

First, they’re abolishing the income tax. Then to pay for it they’re making massive cuts in education, highways, health care and any other pot of money they can grab on to. According to their “Laffer curve” ideology, sooner or later, a spurt of growth is supposed to follow.

Next, adding direct injury to reckless experiment, Brownback keeps turning away federal dollars and jobs. He abolished the Arts Commission — goodbye $1.3 million a year in grants and perhaps 50 jobs. He rejected a $35 million health grant — goodbye 200 to 300 job-years.

Movement conservatives are also opposing federally funded Medicaid expansion, which would mean goodbye to an estimated $500 million a year and 4,000 jobs. That would be the biggest single Kansas economic development program — ever. Let’s pray Brownback doesn’t kill Medicaid expansion.

Not satisfied with defunding education, movement conservatives want to punish teachers by silencing their representatives, removing negotiation rights, politicizing curriculum, replacing public schools with private schools and imposing yet more outside testing

As to poor people, Brownback proposed abolishing the earned income tax credit and the food tax credit. He is also dismantling government service agencies by renting their functions out to profit-making companies — companies that, perhaps coincidentally, make large campaign contributions. Early reports speak of heavily degraded service delivery.

Leaving no economic niche undisturbed, movement conservatives want to abolish regulations that support family farms and ensure phone service in rural areas.

These radical and destructive plans are contrary to common sense. And they’re contrary to experience: Every high-income state makes large public investments in education and other services. And they’re dead opposite to mainstream economic theory.

Also they’re contrary to Kansas public opinion. For example, polls have consistently shown that Kansans oppose cuts in education and will even support tax increases if necessary to maintain education.

In addition, the education cuts are contrary to the Kansas Constitution, in the opinion of Kansas courts. Cuts in support for poor people could also face constitutional challenge. When it looked like he couldn’t amend the Constitution, Brownback’s response was a direct attack on the separation of powers. He wants to remove Supreme Court oversight of education, and he wants to pack the courts.

Sadly, we can’t do much to reverse the damage this year. If Kansans want to stop the economic hemorrhaging, we’ll need to send a message at the 2014 ballot box.

— David Burress is a retired KU economist and current president of the Kansas Progress Institute.

Comments

KU_cynic 1 year, 8 months ago

Kansas Progress Institute? El presidente?

It has almost no web presence save some references to Burress's home address.and a Twiiter account with a history of 86 tweets -- and none since November of last year.

Aren't we all presidents of our own personal one-person think-tanks?

Just write what you think without the posing and puffing.

just_another_bozo_on_this_bus 1 year, 8 months ago

That was weak even as an ad hominem attack.

Got any comments on the content of the piece?

just_another_bozo_on_this_bus 1 year, 8 months ago

He said nothing of the sort (but apparently such straw-man statements are considered constructive discussion around here.)

tomatogrower 1 year, 8 months ago

No, they were asking why the guv is changing our ways which have been working all along. We didn't no suffer in this last recession as badly as other places. We have always been a good, practical middle of the road, steady state, until now. Now we are a radical tea party experiment.

Liberty275 1 year, 8 months ago

Government takes money from working people and gives free stuff to people that don't want to get out of bed every morning and go to work. The left loves the government until they get someone like brownback that doesn't fill the troughs enough. The left's complaints about not paying enough state tax is music to my ears.

just_another_bozo_on_this_bus 1 year, 8 months ago

Actually, the vast preponderance of taxes collected go towards paying the salaries of people who do get out of the bed in the morning and go to work, or for the purchase of goods and services from private sector businesses. And the money government employees are paid doesn't just vanish into the ether-- they spend it, mostly in the private sector.

So you can complain about taxes all you want, but you don't get to make up fairy tales about what happens to taxes once they're collected.

voevoda 1 year, 8 months ago

So, Liberty275, you think that these people, who receive money from the government, don't "want to get out of bed every morning and go to work": firefighters, police, prosecutors, judges, soldiers, garbage collectors, teachers, school bus drivers, forest rangers, librarians, archivists, museum curators, VA physicians, public health nurses, social workers, air traffic controlers, airport security, food safety inspectors, bank regulators, city planners, snow plow operators, traffic engineers, diplomats--I could go on and on, but it's enough. Those people work as hard, maybe even harder, than you, Liberty275, and maybe for a lot less money. They aren't "takers," Liberty275, and they aren't getting "free stuff." The "takers," Liberty275, are the people who take advantage of public services ("free stuff") but begrudge every penny of tax money that pays for them.

Kookamooka 1 year, 8 months ago

I gotta get out of this state. I hate being treated like a guinea pig.

John McCoy 1 year, 8 months ago

Come to Texas. Our governor is just like yours. Only taller. And even more short sighted. And more venal. Just a destructive clown.

UneasyRider 1 year, 8 months ago

I've always said, Texas is a great state, if they'd just get rid of the Texans living there.

Richard Heckler 1 year, 8 months ago

The Lawrence real estate industry is about long term inflation. I guess Ben missed the "boom town real estate disaster" that began in about 2001 and burned up the economy by 2007 world wide.

Lawrence politicians also live in perpetual denial.

lucky_guy 1 year, 8 months ago

IKU57 what are you complaining about 12% in 6 years if you do the math...oh, what you right wingers don't do math, that is less that 2% inflation per year. Pretty good when you recall that Regan had 15% inflation till Volker killed it with high interest rates. Oh and gas prices have been coming down 11 cents in the last week. It isn't 1980. Get over it.

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