Wednesday, February 28, 2018

Let's Talk Taxes

Look, I get it. The GOP is going to cut taxes. That's how they do. But here is what I think the GOP doesn't get sometimes: while people might not want a massive government, they don't want minimal government either. Finding the balance between the two, it seems to be me, would be the responsible and political beneficial move for a party really interested in constraining the size of government, But that's the problem with a lot of our politics today: nobody's interested in being responsible anymore.

That's why I can't believe that I'm about to type this: I agree with Governor Reynolds. Now, to be fair- the numbers cited in her plan seem pretty damn similar to what the Senate is tossing around (and I haven't seen an analysis on how it will impact state revenues either), but on paper at least the Governor's plan at least makes a head nod to protecting the state budget priorities. I'm assuming that some form of tax reform will be passed this session (one can hope for an outbreak of common sense down in Des Moines, but I'm not willing to do that) so if I have to choose, I'll stick with the Governor's plan rather than the slash and burn plan being tossed around in the Senate.

What I'm curious about though is this: why the sudden plunge toward tax reform madness? Maybe I need to go back and check my state tax returns a little bit, because I feel like my Federal taxes bite harder than any of my state taxes. All of these Republicans down in Des Moines are pushing the notion that Iowa is high tax state all of a sudden and I'm sitting here like, 'since when?'

If Iowa's corporate tax rate is the highest in the region, I'm willing to listen to arguments to cut that, especially if it makes Iowa more competitive and business friendly. However, any such discussion on corporate taxes needs to be coupled to reform of the corporate tax incentives we seem to have going on in the state. I was not crazy about $200 million in tax breaks to land Apple when at the end of the day there's only going to be 50 permanent jobs created. Cedar Rapids is nervous about Rockwell Collins, Iowa City is losing a product line at Proctor and Gamble and we lost out on a Toyota plant to the Southeast. But sure, spend $200 million in corporate welfare to land Apple- because that's a good use of incentives to bring jobs to the state. All 50 of them.

Up until recently, I've always been comforted by the fact that Iowans are, at their core, farmers and farmers tend to be pretty sensible I've noticed. We've been remarkably immune to the radical shifts in the political pendulum and whether it's Republicans or Democrats running the show down in Des Moines, we've always seemed to have a solid credit rating, a good sized rainy day fund and leaders that aren't willing to get drunk, go to the casino and bet all the state's money on red. That common sense approach to state politics has taken a beating these last few years and I'm really hoping that voters start to get tired of it this November and send a message that we need to get back to 'slow and steady wins the race.'

Kansas and Oklahoma are having hard conversations right now because they went all in tax cuts and it didn't work out. 20 percent of schools in Oklahoma are only holding classes four days a week. Their highway patrol has mileage limits because the state couldn't afford to put gas in their tanks- and they're a state with a healthy petroleum industry. Kansas is straight up telling people, 'don't do what we did.' Whatever you feel about the changes to Iowa's collective bargaining laws, they stopped short of what Wisconsin did with theirs. One can only hope a similar sense of prudence stops us short of following Kansas and Oklahoma down a ruinous rabbit hole.

The real talk about taxes shouldn't be how much do we cut? It should be: how much government do the people want? Because some things people are willing to pay for- and expect to function regardless of who's in charge.

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