Editorial: Grim future

Two economists had a sobering message for Kansas and its leaders on Thursday — the state faces a grim economic future if current trends continue.

Let that be another call to Gov. Sam Brownback and the Legislature to, once the 2016 elections are finished, go into the 2017 legislative session with a singular commitment to work together to do what’s necessary to get Kansas’s economy on pace with the rest of the nation, even if that means admitting that some of the fiscal policies enacted since 2010 aren’t working.

Jeremy Hill, director of the Center for Economic and Business Research at Wichita State University, and Chris Courtwright, principal economist for the Kansas Legislative Research Department, were featured speakers at Thursday’s Kansas Economic Policy Conference at the University of Kansas.

Hill, who studies demographics, said if current trends continue over the next 50 years, 80 percent of the state’s population will be concentrated in urban areas, and the rural population could shrink to 700,000 people.

He said many young people who grow up in Kansas leave after graduating high school, and the state is not attracting enough people to make up the difference. He said by 2066, Kansas could have a retirement population that outnumbers working-age youth. The consequences of such trends are higher costs for delivering services such as health care and education to shrinking rural areas, costs that will have to be borne by the smaller working-age population.

Courtwright, who analyzes tax policy for the Legislature, said the challenges that face Kansas are made more difficult by the state’s tax structure, including the income tax cuts that lawmakers approved in 2012 and 2013 lowering income tax rates and eliminating taxes altogether for certain kinds of business income. It was based on the trickle-down theory that reducing income taxes would put more money into people’s pockets, and that would stimulate the economy. But by 2014, Courtwright said, it was clear the Kansas economy was not responding the way tax-cut advocates hoped. Kansas’ economy and personal income were growing slower than the national average. And little has changed in those trends in the nearly two years since.

Had the Legislature left the tax code as it was in 2012, Courtwright said, Kansas would be taking in an estimated $920 million a year more than it is now. Imagine the investments in infrastructure, transportation and higher education that might have been made with such funds. Imagine how different the 2016 elections and the 2017 legislative session might look.

When Brownback assumed the governorship, the state was coming out of the great recession. And it’s not the governor’s fault that the state’s most important industries — agriculture, aviation, and oil and gas — have struggled throughout his tenure. Perhaps, absent such issues, Kansas’s economy might have thrived under the tax cuts.

But that’s not the reality today. Rather, as Hill and Courtwright point out, reality is a lagging state economy likely to fall further behind nationally unless the state’s leaders have the courage to make changes to policies that aren’t working. For the sake of future Kansans, let’s hope they do.