I missed this when it came out a few weeks ago, but with the proposed Arizona state budget being revealed in dribs and drabs this week, it seems like a good time to talk about the assessment by ALEC (American Legislative Exchange Council) regarding Arizona’s economic outlook. It’s excellent! We’re Number 5! We’re Number 5! We’re Number 5! You can read all about it in the ALEC-Laffer, 2016 Rich States, Poor States publication. It’s called the ALEC-Laffer report, by the way, because the lead researcher is Arthur B. Laffer, who, according to his bio in the report, has often been called “The Father of Supply-Side Economics.” You know, trickle down economics, and the Laffer curve that explains it all. The co-authors: Stephen Moore, who was “the founder and president of the Club for Growth and founded the Free Enterprise Fund”; and Jonathan Williams, “the vice president for the Center for State Fiscal Reform at the American Legislative Exchange Council.” It’s a like-minded group.
The top magic pony states, the ones that most closely adhere to the doctrine that low taxes and minimal regulations bring prosperity, are, in order, Utah, North Carolina, North Dakota, Wyoming and Arizona: the world beaters driving our national economy. The bottom states — I guess all you’ll find there is magic pony poop — are California, Connecticut, New Jersey, Vermont and New York: the loser states where nothing much ever happens economically. I remember Ducey talking about California’s imminent economic demise in his State of the State address, which I guess is why Arizona’s U Haul lots are full to bursting with trailers and trucks from California carrying businesses from that “economic outlook” loser to this “economic outlook” winner. Oh, the lots aren’t full? Maybe all those businesses just hopped a ride on a magic pony heading our way.
From what I’ve seen of our governor’s budget proposals, ALEC would be delighted with Arizona’s stinginess and its proposed business tax cuts. It might not be too happy with the state proposing a $32 million raise for our universities, which takes a bite out of last year’s $100 million cut. But I’m sure it’s delighted with the state spending $5 million of that raise to support the universities’ “Economic Freedom Centers” which were set up with Charles Koch Foundation money. Because spending government money in the service of cutting government is no vice. And ALEC certainly loves our regulation cutting, limited government Republican governor and legislators who believe in their right to regulate what city and country governments can decide to do within their boundaries.
Our economic outlook is so bright, I have to wear shades.
This article appears in Apr 21-27, 2016.
Very funny piece….so why am I crying? Everyone this year is caught up in the National elections for President and Congress. Don’t look now; but thats not where dark money is being spent. Koch money is going to local campaigns and to shore up right wing Republican legislatures and their tone deaf Governors; all of whom are bought and paid for by Koch money and kept in line by ALEC. Koch runs states like Burghers used to run their fiefdoms in Poland. This Country is heading for a government of fiefdoms, cantons, states…call them whatever you will……but they no longer low tow to anything that the Federal Government legislates. In fact; these fiefdoms don;t even necessarily act according to Supreme Court decisions. Bernie Sanders was right. A revolution starts from the bottom up. Koch knew that to nbe true years ago or why even start a group like ALEC? Unless the Democratic Party invests a helleva lot of money into State and local elections; their winning the White House will not affect the continuation of the loss of freedom in every Republican run State. Arizona is a perfect example of how one can regress to another era in time even as the national electorate elects progressives to National offices.
Borin has his head so far up the Democrats tunnel of misinformation that even a miners’s helmet will not shed him any light. The Dems have far more dark $ than anyone–Unions, Soros and the Trial Lawyers, Wall St types and Celebrities to name a few. They are the ones that support removing our freedoms of speech, assembly, sovereign borders, academic thought is already gone at UA and property rights to name a few rights the Dems are actively working to limit or deny to the rest of us!
Amen Joe, Amen.
Laffer wasn’t the father of supply side economics, Calvin Coolidge was. He reduced taxes from 73% to 25% and boom! the roaring 20’s! His treasurer, JP Morgan, called it scientific taxation.
In 1980, the top 1% paid 138 billion in taxes ($2007). In 2007, that 1% paid $500 billion in taxes at a much lower average tax rate. Exactly as supply side theory predicted.
This isn’t trickle down, it isn’t gusher down, it is Tsunami down.
Since we began tax cutting at the state level in Arizona in 1992, Arizona ranks 5th in the nation in economic growth and job growth. That is despite the crater created by the housing crisis of the last 9 years. You can sneer all you want at being in the top 10% of the most prosperous nation on earth but that is a huge accomplishment.
This is despite that fact that we have very inefficient cities in Arizona who began aggressively increasing taxes while the state was cutting taxes. Our cities are living proof that more spending doesn’t yield higher results. Only 7% of Tucson citizens rate Tucson an excellent place to raise a child.
John Huppenthal
Joe Bloom what you say is simply untrue. You can look it up. Unions are pretty much dead. Corporations have all the money and they give virtually all of it to Republicans.
Careful I John they hate facts here. They would rather dream about Bernie and unicorns.
Not to worry about all the positive economic opportunities in Arizona. Under liberal rule for decades, Tucson has secured its place among the poorest in the country. And with the strategy of no growth (except illegals), there will be no jobs or future. Tucson is assured to bask in its white guilt for decades to come.
Well, actually they are both right, if you believe that Hillary is a Democrat. Look at the race the 1% has bought for us this year. We are looking at a choice between two people that the vast majority of people worldwide hate, fear and mistrust. And it is no coincidence that AZ is in the top 10 for ALEC and the Most Corrupt States list at the same time. It is about the money flowing up, not trickling down.
So, Hupp, tell us the rest of the story – how , under Silent Cal and his replacement (Hoover) the stock market bubble grew and grew until it burst burst with a vengeance in 1929. If that’s your idea of growth, you can have it – and keep it. Oh – nice to see you posting under your own name for a change. Too bad you haven’t learned from your past experiences
That is overly simplistic Mike. Greed is more attributed to the underlying cause as the market climbed, investors borrowed money to get in, hoping to pay expenses with profits. When the market corrected they defaulted on loans.
Sound like the collapse of real estate in 2008? It is to be expected.
Funny you didn’t blame tax cuts in the 20s.
Ah, huppenthal, you commit the typical crime of the trickle-on zealots — you cite ONE misleading number in a vacuum to “prove” the entirely laughable…
————————————————
The top 1% of income “earners” received approximately 20% of the pre-tax income in 2013…versus approximately 10% from 1950 to 1980
GDP 1980: 6.5T
GDP 2015: 16.47T
Since 1980, the GDP has increased 250%.
The income of the top 1% has increased 100%
The 1% derive a large proportion of their income from capital gains which are taxed at a LOWER rate than middle-class taxpayers pay on their income…
The Stock Market, where the REAL income gains primarily for the 1% have been realized are therefore taxed at a much lower rate (if the rich allow the money to be taxed at all!)…
The DOW was 1000 in 1980 (YOUR base year) and is currently hovering around 18,000 – An 1800% increase in wealth in the market…
Inflation alone makes that 138B 1% paid = 400B in today’s dollars…an EIGHTY PERCENT INCREASE in constant dollars…
So let’s do some REAL math, huppenthal…
If we ONLY look at basic income, the 1% got a 100% raise and only an 80% tax increase…
BUT, if we add in the real income producer for the 1% which is the lion’s share of capital gains, they got at least a 900 to 1000% increase in gains but STILL only paid 80% more in taxes on income AND gains…
But, folks, it’s even worse!
The 1% pays 27% of Federal Income Tax while the middle class pays 60% of Federal taxes…on their ONE THOUSAND ONE HUNDRED PERCENT RAISE!
==============================================
HERE’S THE REALITY (AND ARIZONA IS AMONG THE WORST)…
Income inequality in the United States has increased significantly since the 1970s…
The U.S. ranks around the 30th percentile in income inequality globally, meaning 70% of countries have a more equal income distribution…
The U.S. consistently exhibits higher rates of income inequality than most developed nations due to the nation’s enhanced support of free market capitalism and less progressive spending on social services…
News flash!
Taco Bell employees will never earn attorney’s wages. This is a fact. The best way to improve your lot in life is to make yourself more valuable through experience or education. Self improvement. Invest in you.
The fraudsters would have you believe it will just be handed to you. If you have been working at minimum wage for more than a year….it’s time to take a good look at yourself.
Chet, most impressive. I’m sure Hup knows these numbers (and aint telling), but the rest of us are very happy to see you pee on that fire. Good to see someone besides the devils quoting scripture (econ101) on here once in a while…Hup & Co have been feeding us that line for going on 40 years all the while they shipping our jobs overseas, we ain’t buying it anymore, we slow but not stupid, that’s why Trump or Bernie is gonna win this election…
Tax Cuts and the Economy
Tax cuts, when used properly, have stimulated the economy. Many credit President George W. Bush’s tax cuts for moving the economy out of recession. Similarly, in 1964, Congress enacted an 18% cut in personal taxes to spur growth. The legislation was designed to encourage consumer spending – many believe that it succeeded admirably as consumers delivered a textbook reaction.
Read more: Do Tax Cuts Stimulate The Economy? | Investopedia http://www.investopedia.com/articles/07/tax_cuts.asp#ixzz474bXUThF
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But, for some unknown reason there are still those that can’t grasp basic economic principles. They believe that you can tax your way to prosperity. So now after 8 years we are $20T in debt and Obama’s economic recovery is a failure.
Solar companies funded by hard working American’s tax dollars are still “turning out the lights” on failed business ventures. But given a dollar the government will spend three and borrow five more, so here we are.
The $138 Billion is already adjusted for inflation.
In 1980, the top 1% had an adjusted gross income of $80,000 and paid 19% of all income taxes or $47 billion.
Adjusted for inflation, $80,000 in 1980 is $235,000 in 2007.
In 2007, returns with an agi of $235,000 or more paid 56% of all taxes or $468 billion.
That $468 billion was paid at an average tax rate much lower than the $47 billion- exactly as supply side theory predicted.
That isn’t trickle down, that isn’t gusher down, that is tsunami down.
The economy didn’t burst under Coolidge, it burst under Hoover. Hoover was a hard charging hugely successful businessman who was going to bring jobs back to America. He signed a big tax increase on imports and the resulting downturn led to the election of Roosevelt. Roosevelt increased Coolidge’s 25% tax rate to 93% and boom – Great Depression. It didn’t stop there, the National Recovery Act is now estimated to have reduced economic output by 25% with its stifling regulation of business output.
We now have another hard charging businessman who disrespects Reagan the way Hoover disrespected Coolidge. He also wants to start a trade war the way Hoover did. Think our economy can’t get worse? It can get much worse. The GDP fell 50% in the great depression.
John, who is that ” hard charging businessman who disrespects Reagan the way Hoover disrespected Coolidge”? Is that, by chance, a Trump reference, or are you referring to someone else?
Yes, that would be Trump.