This movie has been shown before.
Fiscally ignorant Republicans, worshiping the altar of trickle down-supply side Reaganomics enact massive tax cuts for the wealthy, claiming the resulting cuts will be made up for in revenues brought about by people spending more money that will produce more jobs and higher sales tax and working/middle-class tax receipts as a result.
The problem is it does not work and history has shown many examples of how this economic philosophy has fallen short.
Look at Kansas under the Governorship of Sam Brownback.
Look at the United States under the Reagan, Bush II, and Trump Administrations.
Time and time again, the idea of reducing taxes on the wealthy to generate greater economic growth has never achieved its desired results.
All it has done is increase state and federal budget deficits and cut vital services to schools, aid to the poor, infrastructure, and public safety (except national defense but that is another article.)
The question should be, with history’s verdict clear, why have Arizona Republicans in the Governor’s office and the State Legislature decided to take the state over the fiscal cliff with its irresponsible proposals to enact the zombie idea of a flat tax system in Arizona where everyone would pay 2.5 percent after two years.
Is this to thwart the Invest in Ed movement and the full surcharge effect on Arizona’s most affluent?
Do Republicans think that Arizona will grow its population forever to compensate for any revenue shortfalls?
Is this just plain economic stupidity?
If passed, the rich in Arizona will get richer and vital services everyone else depends on like public schools, KidsCare, food stamps, infrastructure, and public safety would be in jeopardy.
Currently, according to the 5/18 issue of Yellow Sheet, the Republicans do not have the votes to pass this proposal as is.
However, one source at the State Capitol, speaking on background, said that Republicans may be willing to increase the dollar amount of state revenues shared with local governments that help fund public safety to secure Senator Paul Boyers’s support.
Boyer apparently is not thrilled with the proposed funds for Universities in the Republican plan either.
The problem with that is if Republicans shift funds to the state revenue sharing with local governments and universities that Boyer wants, what are they cutting in other areas to balance the budget with $1.5 billion in revenues disappearing if this poorly conceived tax measure is enacted?
Again, would it be K-12 Education? Kids Care? Food stamps? Infrastructure like broadband and telehealth? Police and Firefighters?
Reaction from Democratic Leaders to this Republican Fiscally Irresponsible Proposal
It did not take long for Democrats to react to this fiscal bad idea.
Arizona Superintendent of Public Instruction Kathy Hoffman wrote:
“Defunding public schools after a pandemic and an election where voters approved a tax increase on top earners to pay for public education is breathtakingly out of touch.”
Please see the whole Hoffman statement below.
My statement on the proposed budget: pic.twitter.com/NamAtEHqKM
— Kathy Hoffman (@Supt_Hoffman) May 18, 2021
Pima County Democratic Chair Bonnie Heidler relayed:
“What I do know is that a flat tax does not help middle and low-income people. It does, of course, help the rich to continue to pay no tax. A progressive tax, like we have, allows people making less to pay less, and people making more to pay more. It is more equitable. This agreement that Ducey reached with the Republicans is only going to help people who make a lot of money.
Again, although I don’t completely understand all the impacts that this flat tax will have, however, it seems like a way to stop the Red for Ed initiative, Prop 208, from taking effect, even though it was passed by the electorate. The description of what money is coming from whereas it relates to the flat tax seems like a shell game.”
Tucson Mayor Regina Romero condemned the flat tax proposal and what it could mean for education and law enforcement if enacted as is. She issued the below two statements on social media:
The #FlatTax proposal is a direct attack on the funding strategy for Arizona schools approved by voters under #Prop208.
Instead of cutting taxes for the wealthiest Arizonans, we should be increasing teacher pay and supporting our students. #InvestInEd
— Regina Romero (@TucsonRomero) May 19, 2021
Who knew that Governor @dougducey and his colleagues would champion defunding the police?
That's EXACTLY what this proposal does by jeopardizing state-shared revenue that funds public safety, transportation, and other critical municipal services. https://t.co/zznoe15Nsq
— Regina Romero (@TucsonRomero) May 19, 2021
Arizona House Leader Reginald Bolding also tweeted:
"Giving away $1.5 billion in long-term permanent tax cuts is something that we would not support" said @reginaldbolding. “We believe that those dollars could be re-invested in teacher salary. Let’s make AZ teachers Top-25 in the nation & add a $7K increase https://t.co/aJK3PxgKnI
— Reginald Bolding Ed.D. (@reginaldbolding) May 19, 2021
Legislative District 18 Representative and Ways and Means Ranking Member Mitzi Epstein first issued a response to the flat tax proposal on social media.
Later, she commented to Blog for Arizona that:
“The flat income tax scheme will cut billions. It’s unfair and it’s irresponsible. The Arizona legislature has kicked the can down the road for too long. It’s time to actually repair the roads, pay educators and caregivers a worthy wage, help seniors get affordable housing, and generally undo the harm done by years and years of cuts. I led the work to develop a Democratic budget proposal in the House and Senate that restores and rebuilds. We can do it without raising taxes, and still have a cushion in the bottom line.”
LD 26 State Representative Athena Salman tweeted:
Buckle in. Republicans in #azleg are preparing to ram through a massive transference of wealth to the richest Arizonans at the expense of our children, people with disabilities, seniors, and other crucial public services. They know no shame. #azbudget https://t.co/qzSnwEM9eh
— Rep. Athena Salman (@AthenaSalman) May 18, 2021
LD 28 State Representative Kelli Butler, a leading proponent of expanding KidsCare for impoverished Arizona children, also posted:
Infuriating. Unfortunately, Arizona’s GOP majority seems focused on their irresponsible flat tax scheme, instead of meaningful investment in public education. #azbudget https://t.co/QI197jB4pg
— Kelli Butler (@KelliButlerAZ) May 19, 2021
Joe Thomas, the head of the Arizona Education Association released a statement that read:
“Our state’s leaders have an opportunity to invest billions of dollars into our public schools over the next decade without additional taxes. We could ensure every student has access to nurses, librarians, counselors, and still hire enough teachers to reduce class size. Instead, Republican leadership proposes eliminating those critical student supports by cutting up to $1.5 billion from future school budgets and giving those dollars to the wealthiest Arizonans through new tax cuts.”
“The voters passed INVESTinED because they want to increase funding in our schools, specifically to address the state’s teacher shortage crisis,” says Thomas. “By undermining the funding INVESTinED was created to build upon, we erase all the gains we made for our students. This proposed budget is a slap in the face to educators and voters.” Also today, the U.S. Census Bureau released a report ranking Arizona nearly dead last in per-pupil spending in the United States. While Arizona sits on billions of dollars in surplus and a rainy day fund, the poorest state in the country, Mississippi, spends $659 more per student than Arizona.
This short-sighted budget deal includes a regressive flat income tax that will permanently drain billions from state revenue and tip the scales in favor of the 1%. Arizona’s lower-income families will be hit hardest by this budget by placing the tax burden on them. Fewer state resources mean fewer educational opportunities for our students.”
Former Democratic Legislative Leader and current head of the Children’s Action Alliance David Lujan commented:
“I don’t think they could come up with a more short-sighted, elitist budget proposal if they tried. They are proposing the largest tax cut for the rich in state history at a time when thousands of low- and middle-income Arizonans are still struggling from the impacts of the pandemic. 53 percent of the tax cuts going to the top 1 percent while the bottom 80 percent receive only 8 percent of the cuts. It will cut state revenues by $2 billion each year making it virtually impossible to provide needed investments in public education, universities, resources to make housing and child care more affordable, job training, and other things that will boost the economic opportunities for all Arizonans.”
Former Arizona Democratic Party spokesperson and current Vice President/Director of Public Affairs for Matters of State Strategies Matt Grodsky relayed:
“This is just another attempt to undermine Prop 208, which Arizonans voted to pass in 2020. The GOP can not legitimately claim they care about Arizona teachers or schools when they continually work to underfund them and deprive them of the resources they need to thrive.”
Moving Forward
Arizona needs a fully-funded Pre-K through Post Secondary Education System.
Arizona needs a fully-funded social safety net that helps those in need.
Arizona needs a fully funded and forward-looking infrastructure and sustainability program.
Arizona needs a fully funded public safety system.
Arizona does not need a budget crippling flat tax system that makes the rich richer and everyone else scavengers for what revenue crumbs remain in the state coffers.
There is actually a budget plan at the Arizona State Capitol that addresses the needs of all Arizonans and the state.
It is the Democratic one.
But you do not have to take my word for it.
Read the Democrats and Republican budget ideas listed below and judge for yourself.
It will not be hard to figure out which political party is actually producing a budget that helps all the people and which one whose policies will lead to long-term economic disaster.
Discover more from Blog for Arizona
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I have no problem with a flat tax. So long as it’s set at 90% for annual incomes over five million and President Biden’s tax plan is applicable to everyone else.