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Kansas - The News Just Keeps getting Worse

 
 
 
Cheerful Charlie

Cheerful Charlie

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http://www.msnbc.com/rachel-maddow-show/bad-worse-sam-brownbacks-kansas

Not long after he made the transition from senator to governor in late 2010, Kansas Republican Sam Brownback boasted about his grand ambitions. The far-right Kansan, working with a GOP-led legislature, would cut taxes far beyond what the state could afford, in what Brownback described at the time as “a real-live experiment.”
He was optimistic, though the Republican governor added at the time, “We’ll see how it works.”

We sure will. In his first term, Brownback’s “experiment” led to debt downgrades, weak growth, and state finances in shambles. Perhaps the jobs picture is more heartening? Guess again. The Kansas City Star’s Yael Abouhalkah reported today on the state’s latest job numbers.
Let this stunning news sink in: The Kansas jobs report released Friday shows the state lost another 1,900 jobs in February and now has 5,400 fewer jobs than it did one year ago.

That’s right: The Sunflower State had a “growth” rate of negative 0.4 percent from February 2015 to February 2016, the first time that’s happened in more than five years. That negative employment rate is one of the worst in the.





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Thanks, Obama.

What? All the other states have positive growth? Must be God punishing us for the gheys.

What? States that let the gheys get married have positive growth? Must be all the Muslim refugees we let into the state.

What? Brownback put us on the "no refugees" list? Must be ...

Whatever it is, we need to give Sam more time.
 
This indeed is the argument from a few supply side boosters, we need a little more time for the miracle of big tax cuts to start working. Some people have been suggesting that Kansas has in fact seen job growth. But no, not really. It was Brownback that called this a "real-live experiment". And so it is. Just not a real-live successful experiment. The lab rats all died.
 
But even as a failed experiment, the religious nature of the belief system will not allow them to call it such. Like all radical ideas that fail they will state that it failed because they did not far enough. Or will pick a scapegoat (banks? unions?) that caused it to fail.
 
Nice Squirrel said:
But even as a failed experiment, the religious nature of the belief system will not allow them to call it such. Like all radical ideas that fail they will state that it failed because they did not far enough. Or will pick a scapegoat (banks? unions?) that caused it to fail.
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True. I'd put my money on the "If every state did it then it would work" excuse.
 
Colonel Sanders said:
Nice Squirrel said:
But even as a failed experiment, the religious nature of the belief system will not allow them to call it such. Like all radical ideas that fail they will state that it failed because they did not far enough. Or will pick a scapegoat (banks? unions?) that caused it to fail.
Click to expand...

True. I'd put my money on the "If every state did it then it would work" excuse.
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If everybody eats fried KFC surely will succeed.
 
http://www.kansascity.com/opinion/opn-columns-blogs/steve-rose/article7024256.html

January 17, 2015 9:00 AM


Celebrity economist Arthur Laffer told me that he was not surprised by the huge deficits Kansas is facing due to massive tax cuts. “You have to view this over 10 years,” Laffer said. “It will work in Kansas.”

With all this horseshit, there has to be a pony under it somewhere.
Apparently, Maine is tempted to join in the big tax cut movement of the right.
 
Isn't it amazing how all those low tax states in the south are doing compared to those high tax states in the east and west coast? I especially like the comparison between Texas and California (How California bested Texas http://www.newyorker.com/business/currency/california-bested-texas )and the AI between Alabama and Massachusetts (Ten Richest and Ten poorest States http://parade.com/166996/viannguyen/what-are-the-10-richest-and-10-poorest-states-in-america/ ) Both CA and MA are high tax states while AL and TX are low tax states.

Where would you rather live?
 
What concerns me is that s many conservatives are suckers for supply side type economic snake oil. Analysis of Trump and Cruz's tax plans and economic ideas show both would sink us into vast deficits and a massive hole, all the while the right wing media rants and raves about deficits. The right dominated media cares more about Trmp's and companies quaint argument about dick size rather then what a sober analysis of what their economic plans will do to us.

Our GOP candidates have offered us, to date, weird economic thrashing around, massive supply side tax cuts, flat tax nostrums, VAT tax snake oil, the GOP self elected candidates haven't a lick of economic common sense to date.

Even with "real-live experiments" like Kansas and Louisiana going down in flames, there isn't a whole bunch of realism found in today's hard right political world that can drive them to common sense. So we have Laffer the idiot telling us we may have to wait 10 years for the economic miracle to show itself.

It's like idiot amateur gamblers with a "system" going dead broke at the casinos in Las Vegas. Laffer has been dead, absolutely totally wrong for decades and still finds suckers to listen to him. Amazing stupidity!

https://www.washingtonpost.com/busi...c61440-dec1-11e4-a1b8-2ed88bc190d2_story.html
 
Since, due to the minority party having control of both sides of Congress, the presidency and shortly the Supreme Court, we are slated to retry yet again the grand economic experiment in supply side economics, that is, massive tax cuts for the rich to enrich us all, it is best to update this thread on Kansas' experience with the same experiment. After all, we are constantly being reminded that our states are the hot houses of democracy, where we experiment with various propositions before enacting them nationwide.

Things are not going so well in Kansas. They are projecting a 350 million dollar budget deficit for this year. In fact, the Republican majority legislature has thrown in the towel on supply side economics and has passed a bill to increase the state income tax to produce a billion dollars in new revenue over two years to cover two years of revenue shortfall and to begin paying down part of the debt accumulated over the lifetime of Governor Brownback's tax cuts for prosperity.

It is not yet clear if the governor will sign the bill or if he will veto it. See here.
 
The Laffer Curve illustrates a simple idea - that there is a tax rate which will lead to maximum tax revenues, and that any other tax rate will lead to lower tax revenues. It is an appealing idea in the abstract. However, in the real world, there is not ONE tax rate - there are many different tax rates on income, profits, etc..... Moreover, assuming there is a tax rate that maximizes tax revenue does not help one identify whether the current tax rate is higher or lower than that "optimal" tax rate. I find it ironic that conservatives, who generally wish to reduce the size of government, wish to set a tax rate that will maximize the tax revenue (and expand the size of government).
 
Well, the adage is you have to give it some time, then the magic happens. But they cut the taxes in 2010, and they had the entire recovery to work with... and it still didn't work.

Meanwhile in Ohio, revenues are dropping... because well... duh!
 
laughing dog said:
The Laffer Curve illustrates a simple idea - that there is a tax rate which will lead to maximum tax revenues, and that any other tax rate will lead to lower tax revenues. It is an appealing idea in the abstract. However, in the real world, there is not ONE tax rate - there are many different tax rates on income, profits, etc..... Moreover, assuming there is a tax rate that maximizes tax revenue does not help one identify whether the current tax rate is higher or lower than that "optimal" tax rate. I find it ironic that conservatives, who generally wish to reduce the size of government, wish to set a tax rate that will maximize the tax revenue (and expand the size of government).
Click to expand...

If you start thinking about all of the inconstancies in the conservative dogma you will consume all available time. Preservation of the status quo and fear of change is a reasonable way to govern in a feudalistic society, but not in a dynamic society and an industrial economy like ours.

The Laffer curve is based on the premise that at both 0% tax rate and at 100% tax rate that no revenue will be collected. But isn't this wrong at a 100%? At 100% tax rate everyone works for the government. If everyone works for the government then we have an extreme form of socialism, communism, and the government has to pay the workers a salary at the very least allows them to survive. And revenue from taxes becomes a mute subject because the government is the economy and collects all of the economic surplus, i.e. profits. Then the curve would be at zero revenue at 0% tax rate but at least at the substance rate for the population at the 100% tax rate? With no guarantee that there is an maximum tax revenue tax rate between these points?

Am I over thinking a bad idea and making it worse?

Also, as we have talked about before, it matters whose taxes are cut. If you cut the taxes of the 1% then the money from the tax cut goes largely into the savings of the 1%, reducing the demand in the economy. They are already earning enough to survive and to satisfy their wants. But if you lower the taxes of the lower 90% of earners most of the money will go to consumption, and will boost the economy.

This is the greater flaw of supply side economics than the simplistic Laffer curve. Stating the obvious, that they assume the economy is supply side driven, Say's law writ large. That when we cut the taxes of the rich they will save the money and that this extra savings will turn into extra investment.

But the economy is demand driven. No investment is made without demand existing for the additional production of an existing product or the anticipated demand for a new product. So when the rich receive the extra money from a tax cut that money doesn't turn into new investment, it stays out of the economy as savings.
 
SimpleDon said:
The Laffer curve is based on the premise that at both 0% tax rate and at 100% tax rate that no revenue will be collected. But isn't this wrong at a 100%? At 100% tax rate everyone works for the government. If everyone works for the government then we have an extreme form of socialism, communism, and the government has to pay the workers a salary at the very least allows them to survive. And revenue from taxes becomes a mute subject because the government is the economy and collects all of the economic surplus, i.e. profits. Then the curve would be at zero revenue at 0% tax rate but at least at the substance rate for the population at the 100% tax rate? With no guarantee that there is an maximum tax revenue tax rate between these points?

Am I over thinking a bad idea and making it worse?
Click to expand...

You're not overthinking, you're misthinking. You say 100% tax would mean everyone working for the government but that's not what it means. A 100% tax means your take-home pay would be $0. Obviously nobody would bother to work in such a situation.

The Laffer curve is obviously correct--just meaningless. The problem is the lack of any units--the right takes it as a matter of faith that we are on the right side of the peak when in reality we have no data as to where we lie compared to the peak.

Also, as we have talked about before, it matters whose taxes are cut. If you cut the taxes of the 1% then the money from the tax cut goes largely into the savings of the 1%, reducing the demand in the economy. They are already earning enough to survive and to satisfy their wants. But if you lower the taxes of the lower 90% of earners most of the money will go to consumption, and will boost the economy.
Click to expand...

You continue to believe that somehow savings and investment are disjoint. In practice savings becomes investment, the only question being how many layers you have to dig through to reach that point.
 
Loren Pechtel said:
You're not overthinking, you're misthinking. You say 100% tax would mean everyone working for the government but that's not what it means. A 100% tax means your take-home pay would be $0. Obviously nobody would bother to work in such a situation.
Click to expand...
It may be obvious to you, but it's far from obvious to the millions of volunteer workers worldwide who do exactly that.
 
bilby said:
Loren Pechtel said:
You're not overthinking, you're misthinking. You say 100% tax would mean everyone working for the government but that's not what it means. A 100% tax means your take-home pay would be $0. Obviously nobody would bother to work in such a situation.
Click to expand...
It may be obvious to you, but it's far from obvious to the millions of volunteer workers worldwide who do exactly that.
Click to expand...

I dislike the term "volunteer workers". They're simply volunteers. They're giving their time to do something they value.
 
bilby said:
It may be obvious to you, but it's far from obvious to the millions of volunteer workers worldwide who do exactly that.
Click to expand...

Most (if not all) of them have, or have had, a paying job that keeps or has kept them fed, clothed and healthy enough to be able to do something useful as a volunteer...
 
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