Kansas’ Trickle-Down Flood of Red Ink

http://www.nytimes.com/2017/02/27/opinion/kansas-trickle-down-flood-of-red-ink.html

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It was five years ago that Gov. Sam Brownback proudly engineered the biggest tax cuts in the history of Kansas. He put all his political chips on the trickle-down fantasy that personal and corporate tax cuts for rich business owners would produce higher state revenues.

In the process, he made his state an experimental showcase for the driving philosophy of supply-side theorists like Paul Ryan, the House speaker, who served as a staff acolyte when Mr. Brownback was in the Senate. “See, we’ve got a different way and it works,” Mr. Brownback promised.

Er, not really. The multibillion-dollar cuts have not moved employers to invest and hire more; the state budget is now flooded with red ink. Kansans have become alarmed at years of deep deficits, shrinking state support for education, two downgrades in the state’s credit rating and enough regret among legislators to prompt an extraordinary uprising last week by Statehouse Republicans.

Braced by a dozen newly elected moderates, the Republican Legislature dared to try to reverse the governor’s course, by approving a $1 billion tax increase over two years. An aim was to kill the Brownback exemption that allowed more than 330,000 business owners to pay no state taxes at all on their income.

Far from chastened, the governor was offended that his party would drop his grand experiment, even as the experiment did serious harm. He vetoed the tax increase; the Legislature tried to override his veto. Mr. Brownback lost in the House, shocking his loyalists, and he barely prevailed in the Senate, which fell three votes short of overriding the veto.

The result was less a victory for Mr. Brownback than a rebuke to his leadership, in particular his near-suicidal clinging to his trickle-down obsession when he should be engineering a compromise with the Legislature. Kansas faces a $1.2 billion budget gap across the next two years that must be dealt with. There is talk of further cuts in education, which would deepen the crisis in poorer districts that have already suffered reductions in staff and school days.

Mr. Brownback’s veto may pass as creative politics in Tea Party circles, but the governor can claim only one achievement — one he surely did not wish for. His real-life test of the economic theories so warmly embraced by the likes of Mr. Ryan has provided indisputable proof that no miraculous free lunch will result from his party’s tax-cut delusions.

The fiction remains alluring as a campaign con, and it will undoubtedly be invoked as the Republican Congress and the Trump administration embroider the next federal budget with grand tax-cut schemes. But if they dare to look, there slumps Kansas, a supply-side casualty, bleeding red ink.