So how’s that trickle-down working out for Arizona?

The Arizona Capitol Times (subscription required) reports that Arizona Legislature’s budget analysts predict 2018 shortfall:

The Arizona Legislature’s budget analysts last Thursday predicted a budget shortfall that could top $100 million in the current and coming year as the impact of corporate tax cuts continues to overwhelm increases in sales, insurance premium and personal income tax collections.

Whaaa? You mean tax cuts don’t pay for themselves and are revenue neutral? (sarcasm).

Chief budget analyst Richard Stavneak told economists and state officials who make up the Legislature’s Finance Advisory Committee that the shortfall will hit $104 million. That’s out of an expected $10 billion in spending for the budget year that begins next July 1. A panel of state lawmakers also attended the meeting.

Excluded from that projection is $90 million in current spending that is labeled one-time but appears to be an ongoing commitment by the Legislature and Gov. Doug Ducey, Stavneak said. That puts the expected shortfall next year close to $200 million if that spending isn’t cut. The revenue picture could also brighten, but signals are mixed, he said.

Phased-in corporate tax cuts enacted under former Gov. Jan Brewer in 2011 have cut more than $600 million in yearly revenue since 2014. Rep. Don Shooter, R-Yuma, said it may be time to revisit the corporate tax cuts and predicted a budget battle next year.

“It’s going to be a free-for-all. We’re back to the cutting, I don’t see any other way,” Shooter said. “It’s going to come down to who’s going to bleed the least, what’s going to be the least painful, I guess.”

Of the corporate tax cuts, Shooter said: “Maybe we should postpone them for a year or two until we get out of the woods.”

That’s unlikely to be a solution that will pass muster, though, because the 2017 tax year completes the four-year phase-in of the tax cuts. On top of that, Ducey spokesman Daniel Scarpinato all but ruled out any change.

“The governor does not believe in raising taxes and I think he’s made that very clear,” Scarpinato said Thursday, noting that Ducey’s priority is ensuring a competitive tax environment so companies expand in the state.

* * *

Overall, state revenues for the 2017 budget year that ended June 30 came in $19 million below forecast, with sales and individual income tax ahead of projections and corporate income tax collections $52 million below forecast. This budget year’s overall revenue projections were revised downward, and corporate income tax collections are predicted to be the lowest since 1993.

This is how the trickle-down tax fraud works. The legislature cuts taxes for corporations and the wealthy promising that the tax cuts will result in economic expansion and new tax revenue that will pay for the tax cuts. In reality, the tax cuts add to a structural revenue deficit that leaves Arizona short of revenue to pay for education, health care, and other vital public services. The revenue shortfall leads to calls from the governor and legislature for more budget cuts from essential public services and, yet again, another tax cut they promise will magically produce economic expansion and new tax revenue that will pay for the tax cuts. Rinse, lather, repeat, over and over again, since 1992.

The truly amazing part is that Arizonans continue to fall for this obvious con job and fraud every two years. What a bunch of simps. After 25 years one would think you would learn. But nooo!

Linda Valdez of The Republic explains How trickle-down drivel hurts Arizona:

Arizona’s decades-long effort to stimulate economic growth by starving government only succeeded in starving government.

They cut taxes. They reduced revenue. They didn’t deliver prosperity.

Now our K-12 schools are shamefully underfunded. The Board of Regents is being sued for university tuition hikes that defy the state constitutional mandate to provide “nearly free” education.

Arizona can’t afford the services people expect.

And it’s going to get worse unless reason overtakes the cut-and-bleed dogma that rules this state.

* * *

Arizona has more needs than revenue. Yet under the prevailing GOP philosophy, Arizona will not raise taxes to meet the state’s needs.

“We’re back to cutting,” Republican Rep. Don Shooter told AP’s Bob Christie. “It’s going to come down to who’s going to bleed the least, what’s going to be the least painful, I guess.”

You already know who won’t suffer.

Recession-era corporate tax cuts championed by GOP former Gov. Jan Brewer have kicked in as planned, costing our starving state more than $600 million in yearly revenue since 2014, according to AP. The 2017 tax year will complete the phased-in corporate subsidy.

Today’s revenue shortfall is the predictable result of a tax-cut frenzy that began in the 1990s.

Trickle-down, supply side Republicans told us the way to prosperity was to cut taxes. Again. And again.

They keep saying it. Again. And again. GOP Gov. Doug Ducey got elected promising more of the same.

So where’s the prosperity?

Twenty-five percent of Arizona’s children live in poverty. That’s four points higher than the national average, according to the Annie E. Casey 2017 Kids Count Data Book.

Thirty percent of kids in Arizona have parents who lack secure employment, Casey found. That, too, is higher than the national average.

Arizona faces one lawsuit over its failure to properly care for children in foster care and another over its failure to provide adequate funding for school repairs and construction.

Arizona now has only $3 for every $4 it had 10 years ago, according to a report this year by the Grand Canyon Institute, an independent think tank. The figure takes population and inflation into account.

Yet “Arizona ranks last in economic performance among the 50 states over last two business cycles,” according to a study the institute released in January.

Some prosperity.

Why does trickle-down keep selling among those who bother to vote?

One reason is the GOP propaganda campaign that relentlessly tags “government” as some alien and hostile force. You know, the enemy, the problem.

This is full-fat baloney. That idea is utterly alien to the spirit of unity and shared purpose on which the United States was founded.

The U.S. Constitution starts with the words “We the people.” Not “Me first!”

We are more than a random collection of self-interested individuals. We are in this together.

Government – state or federal – is meant to be an effective and efficient servant for all of us.

State and local governments exist to provide the things we need to live well in communities. Law enforcement. Fire protection. Roads. Schools. Urban planning. Universities. Water management in a desert state. Public health safeguards. Protections for the vulnerable.

It makes no sense to starve the entity that provides those and other needed services.

Except in Arizona – where the failed trickle-down experiment remains the highest calling of the party in power.

So come next January, our Koch-bot governor and lawless Tea-Publican legislature are going to propose budget cuts to essential government services, and will begin sweeping stealing money out of the budget for cities and counties and shifting the tax burden to local governments in order to “balance” the state budget with gimmicks again. What you will not hear is a call to forestall planned tax cuts (kudos to Rep. Don Shooter for doing so), or to close tax loopholes, or to — heresy! — raise taxes.

Our Koch-bot governor is a true believer in the false religion of trickle-down economics, and its First Commandment that “Thou shalt never raise taxes.

This false religion of trickle-down economics and its GOP adherents are ruining this state.

12 Responses to So how’s that trickle-down working out for Arizona?

  1. Since we started cutting tax rates at the state level in 1992, Arizona employment has increased from 1.48 million to 2.72, an 86% increase while the nation as a whole, one of the world’s top performers in this regard, increased from 109.5 million to 146.7, a 34% increase.

    Your beloved hi-tax, carbon worshipping France, increased 16%, 72 percentile points behind Arizona.

    Your beloved top ten hi-tax, carbon worshipping Minnesota, increased by 32%, 54 percentile points behind us.

    Unfortunately, not every governmental unit in Arizona has been nearly as frugal as state government. Our large city governments stand a living monuments to the fact that lots of money does not produce results in government.

    So, despite our results at the state level, we are barely modestly low tax overall. And, where cities are influential, we are decidedly high tax. Because of our profligate cities, we sport essentially the highest sales tax burden in the nation.

    But, while taxes are an important element of growth, they are not decisive.

    The final factor has to do with immigration. We defeated Texas in the growth sweepstakes every year for 17 straight years until E- Verify. Low taxes only position you to take advantage of growth opportunities. It appears that, as a result of E-Verify, we will never again return to the top ten in growth again.

    Outside entities, it appears, are just passing on the opportunity to invest in Arizona. They have better opportunities in Nevada, California and Texas.

    • Frances Perkins

      What a load of nonsense. For the vast majority of businesses, state and local taxes, are way down the ladder of reasons they move to a certain locations. Transportation infrastructure, market proximity, work force capability, education systems, health care availability, and utility costs are way up there. Run your history from 1978 to 1992. The state just was crumbling during that time frame? Nonsense. There is no data that supports the “tax cuts spur development” dogma.

      • You keep waxing poetic about French policies, find some number that shows French outcomes deserve the benefit of your ardor.

        We have forty years of tax data for every state in the nation. The consistently low tax states hugely outgrow the consistently high tax states. By huge amounts. But, its not quick. Kansas is real. A tax cut of a few percentile points at the state level is not going to show a dividend in a year or two and is dwarfed by Reagan’s tax cut of 42 percentile points, or 60%.

        But, you take a 300 billion dollar gdp state and move 6 billion from the government to the private sector every year, it starts accelerating the economy as long as you continue to create value and that is the key.

        What value has been created by Kansas keeping all that money in their government? Arizona Blacks outscore Kansas Blacks, Arizona whites outscore Kansas whites, Arizona Asians outscore Kansas Asians. Our Hispanics are tied.

        In government, money is heroin. A distraction from the mission.

    • For Sure Not Tom

      Learn it. Know it. Live it.

    • For Sure Not Tom

  2. For Sure Not Tom

  3. For Sure Not Tom

    There must be 20 channels in my satellite TV package with phony preachers on 24 hours a day telling people that if they send them “seed” money, Jesus will reward them with riches beyond their dreams.

    “Send what you can, 100 dollars, 1,000 dollars, 10,000 dollars, the more you send the more you’ll be rewarded by God”.

    Trickle down is as phony as the prosperity gospel, give money to rich people who don’t need anymore money and it will rain millions back down on you, and the same people fall for it.

    We already see a 100 million dollar budget shortfall after years of the AZGOP giving tax breaks to corporations.

    When is the trickling gonna’ start? I want my trickle!

    Between the two scams, I prefer trickle down. You don’t need to work Sunday’s or learn all them ‘begats’.

  4. bruce.desertrat

    I wonder about that. By federal law sales taxes on purchases from companies without a physical presence in a state are on the state to collect from the consumer. (yes, I believe legally you are required to calculate and pay to the state the state and local sales taxes on your Amazon purchases)

    Companies with both a internet and physical presence such as stores, on the other hand, ARE required to collect sales taxes on all sales.

    Amazon just bought a sizeable physical footprint in all 50 states with their acquisition of Whole Foods ….

    Hmmmmm….

  5. how about taxing amazon and the other internet companies driving retail stores out of business? arizona would gain revenue from both.