The state of Kansas is a cautionary tale for Arizona. Kansas under Governor Sam Brownback turned hard right, purging the moderate Republicans out of the GOP in order to enact the most extreme radical right agenda in the country. As Paul Waldman notes at the Washington Post, GOP governor implements GOP economics, disaster ensues.
Something remarkable happened in Kansas on Tuesday. Over 100 Republicans endorsed the Democratic challenger for the 2014 race, citing budget and tax cuts that sent the state’s revenues plummeting under the Republican incumbent. Democrat Is Governor Pick of G.O.P. Group in Kansas:
In a stark challenge to the re-election prospects of Gov. Sam Brownback of Kansas, more than 100 Republican politicians and former elected officials on Tuesday endorsed Paul Davis, his Democratic challenger.
Governor Brownback, who swept into office with more than 60 percent of the vote in 2010, faces an unexpectedly tough re-election this fall after spending much of his term pushing sharply conservative policies that have unsettled some members of his own party. Mr. Davis, a state legislator, has criticized Governor Brownback for his support of the largest income tax cuts in state history, cuts that sent revenues plummeting.
The group of 104 Republicans, which took the name Republicans for Kansas Values, included former mayors, a member of Congress and state representatives. They cited budget cuts to education and the income tax cuts as failed policies enacted by Mr. Brownback that have upset Kansas’ long history of cautious moderation.
“I think Sam’s experiment, as he’s called it, is backfiring on us,” Wint Winter, a banker and former state senator, said in an interview on Tuesday. “It’s gone way too far. We’re all very alarmed by the damage to our public schools, very alarmed by the damage to the state’s financial responsibility and very alarmed about the credit downgrade that Wall Street is paying attention to.”
Large income tax cuts signed into law in 2012 and 2013, with the support of a Republican-controlled Legislature, have caused deep concern among Kansans about the state’s financial stability. Since the cuts, state revenues have plummeted: In April and May, the state collected only $369 million from personal income tax, far short of the $651 million it had anticipated.
In May, Kansas’ credit rating was downgraded by Moody’s Investors Service, citing concern about the tax cuts and the state’s slow recovery from the recession.
Arizona has a state budget with a structural revenue deficit built in due to 22 years of GOP tax cuts. There are several tax cuts currently being phased in until 2018 that will further reduce tax revenue. And then there is last week’s court ruling on Prop. 301 and school funding. The Arizona Capitol Times (subscription required) reports, Analysis shows state could face big deficit in wake of school inflation ruling:
A state budget analysis shows that Friday’s decision on school inflationary funding by Maricopa County Superior Court Judge Katherine Cooper could send the state into a severe fiscal jam at a time when revenue collections are falling short of expectations.
If her opinion stands, the state will be compelled to spend an additional $316.8 million on K-12 public education this fiscal year.
That could rise steadily over the following four years, for a total increase of $1.6 billion in the base level for public education spending. Add in back payments of $252.6 million each year to make up for previous inflationary costs, and the total could reach $2.9 billion over five years, roughly a third of the state’s budget for the period.
In an analysis of the impact of the decision, the Joint Legislative Budget Committee noted that general fund revenue collections have lagged behind the forecast over the past several months. Through the end of May, they were $55 million less than had been estimated in January.
This year’s budget had predicted an ending balance of $130 million. If the July 11 ruling stands, the balance “would become a shortfall of between $187 million and $220 million,’’ the JLBC reported, adding, “If the court were ultimately to concur with the plaintiff’s back payment proposal, the FY 2015 shortfall would further increase to a range of $440 million to $473 million.
After the second year, the state’s shortfall would be between $874 million and $932 million without the back payments and up to $1.44 billion with those payments.
This matters because most of the Tea-Publican candidates for governor are running on a platform of eliminating the state income tax, and replacing it with an expanded state sales tax. (The sales tax is volatile, and responds to economic conditions). They do not explain how they are going to make up for the lost tax revenue at a time when we are already facing budget shortfalls in future budget years.
Most of the Tea-Publican candidates for governor are also promising to spend boatloads of money to put the national guard on the border, invest in high-tech security, and to “build the dang fence!” But none of them has a credible plan for how they are going to pay for it when the state cannot even meet its basic obligations for health, safety and education.
Arizona faces a crisis of our Tea-Publican controlled Legislature’s making. Even the Arizona Republic editorialized against the border nonsense from the Tea-Publican candidates for governor. Forget border: Budget is next governor’s challenge.
When the GOP establishment’s hand-picked candidate Scott Smith loses the GOP primary, and he will, the GOP establishment will be left with one of the reckless and fiscally irresponsible candidates who is espousing economic and border policies that will financially devastate the state of Arizona.
So will the GOP establishment, the chambers of commerce and other business groups step up to endorse Democrat Fred DuVal after the GOP primary? Will they demonstrate the political courage to say no to a reckless and fiscally irresponsible GOP candidate, like more than 100 Republicans did in Kansas on Tuesday?