I previously wrote about the state of Kansas and in particular its Governor Sam Brownback. When Brownback was elected he pushed a severe and radical tax cut plan that essentially cut taxes on all businesses in the state. He famously stated the tax cuts would be a shot of “adrenaline” into the Kansas economy.
Since Kansas enacted tax and spending cuts in 2012 and 2013, Brownback and his allies have argued that this fiscal potion would generate an explosion of economic growth. It didn’t. Overall growth and job creation in Kansas underperformed both the national economy and neighboring states. From January, 2014 (after both tax cuts passed) to April, 2017, Kansas gained only 28,000 net new non-farm jobs. By contrast, Nebraska, an economically similar state with a much smaller labor force, saw a net increase of 35,000 jobs.
What ended up happening is that individuals, not just business owners, began filing as corporations, starving the state of revenue.
Without revenue the state could no longer pay their bills. Kansas constitution has a balance budget amendment which forced the state to cut needed services in order to keep the lights on. The cuts were so draconian, it resulted in lawsuits and attempts to remove the Governor and his allies in the Republican dominated Senate and House. All proved futile.
So a stalemate ensued. Who would win? The Governor and his allies or the legislature/people of the state? Well score one for the people:
Tuesday night, the state’s Republican-held Legislature overrode Mr. Brownback’s veto of a bill that would undo some of the tax cuts he pushed. The state Senate and House moved swiftly, narrowly voting only hours apart to turn back Mr. Brownback’s rejection of a tax increase aimed at raising about $1.2 billion over two years.
It was a remarkable rejection of the state’s tax-cutting approach after years of mounting uncertainty and unhappiness in Kansas over whether the tax cuts were working.
Donald Trump and the Republicans are trying to push through a similar tax cut fiasco. Maybe someone should mention what’s going on in Kansas.