Kansas Republicans raise taxes, ending their GOP governor’s ‘real live experiment’ in conservative policy – Washington Post
Republicans in Kansasbroke ranks with the state's conservative governor Tuesday night, voting to raise tax rates and put an end to a series of cuts.
TheGOPrevolt isa defeat for Gov. Sam Brownback, who overhauled the state's tax system beginning in 2012,part of whatcalled a "real-live experiment" in conservative governance. Yet the economic boom Brownback promised has not materialized, leavingthe state government perennially short on money and forcedto reduce basic services.
Kansas's legislature is overwhelmingly Republican, but moderate GOP lawmakers joined with Democratsto override Brownback's veto of the bill to increase taxes. Eighteen of the state's 31 GOP senators and 49 of the 85 Republican members of the House voted against the governor.
Tuesday's vote was a rebuke not only for Brownback, but also for Republicansin Washington who have advocated similar cuts in taxes at the national level -- includingPresident Trump. Although Republicans in Kansas are giving up on the experiment, Trump and his alliesare hoping totry again.
The principles Trump endorsed during the campaignand in the early stages of his presidency arebroadly similar to those enacted in Kansas.As Brownback did, Trump has proposed bringing down marginal rates, getting rid of brackets andgiving a new break to small businesses.
That is no coincidence, since Brownbackis well connected to the Republican policymaking establishment in Washington.Trump and Brownback have shared economic advisers, andwhen Brownback was a U.S. senator, Rep. Paul D. Ryan (R-Wis.), now the speaker of the House,served as his legislative director.
The victory for Brownback's opponents resulted in part from their gains in last year's election. Voters -- frustrated that public schools were closing early and the state's highways were in visible disrepair -- rejected Brownback's allies in favor of more moderate Republicans or Democrats.
"It was a hard vote for a lot of people to make last night," said Rep. Melissa Rooker, a moderate Republican who represents a suburb of Kansas City. "Kansas has had a turn to the far right, and we seem to be centering ourselves."
The legislationundoes the essentialcomponents of Brownback's reforms. The governor had reduced the number ofbrackets for the state's marginalrates on income from three to two. The legislature will restore the third bracket, increasing taxes on the state's wealthiest residents from 4.6 percent to 5.2 percentthis year and 5.7 percent next year.
Marginal rates on less affluent Kansanhouseholds will increase as well, from 4.6 percent to 5.25 percent by next year for married taxpayers makingbetween $30,000 and $60,000 a year and from 2.7 percent to 3.1 percent for those earning less than that.
Kansas Gov. Sam Brownback (R) spoke at the 2017 Conservative Political Action Conference on Feb. 23, and pushed for less government regulations. "When have we added more government anywhere that's taken more taxes and you end up with a product that's more efficient that costs you less?" he asked. "What's your example?" (The Washington Post)
The legislationalso scraps a plan to bring those rates down even more in future years,one of Brownback's promises to conservative supporters.
Finally, the legislatureeliminated a cut Brownback had put in place to help small businesses. Analysts said thatthe provision had becomea loophole, as many Kansans were able to avoid paying taxes entirely by pretending to be small businesses.
Initially, the state forecast thatabout 200,000 small businesseswould take advantage of the break. As it turned out, about 330,000entities would useKansas's new rule. Thatdiscrepancysuggests that tens of thousands ofworkers claimed that their incomes were from businesses they owned rather than from salaries.
State budget analysts project the tax increase will raise an additional $600 million annually.
"What we were able to do in the last 24 hours can allow us to start down that road, to begin repairing all the damage done after living with Gov. Brownback's failed tax experiment for five years," said Annie McKay, who is the president of Kansas Action for Children, anadvocacy group in Topeka.
The Trump administration unveiled their proposal to overhaul the tax code on April 26, outlining sharply lower tax rates but fewer tax breaks. (Jenny Starrs/The Washington Post)
Proponents argued that reducing taxes would stimulate the state's economy. "We have worked hard in Kansas to move our tax policy to a pro-growth orientation," Brownback said in a statement on vetoing the legislation. "This bill undoes much of that progress. It will substantially damage job creation and leave our citizens poorer in the future."
Since 2012, however, the pace of economic expansion in Kansas has consistently lagged behind that of the rest of the country.
Last year,Kansas's gross domestic product increased just 0.2 percent, federal data show, compared to 1.6 percent nationally. That was an improvementfor Kansas, though:At the end of2015, the state was in what many economists would describe as a recession, with the economycontracting two quarters in a row.
Last year's election substantially weakened Brownback's support in the legislature. In November, Democrats picked upa seat in the Senate, which has 40 members, and 12 seats in the House, which has 125. In primary elections in August, Republican voters had forced out 14incumbent alliesof the governor, replacing them with more moderate candidates.
OtherGOP lawmakers who supported Brownback retired last year, and moderate Republicans won a few of those seats as well. Rooker, the GOP legislator, said her former colleagues werenot eager to confront frustrated voters in another campaign, or to deal with the fiscalheadaches Brownback's policies had created if they did win reelection.
The legislature began this year's session with the government in a deficit of $350 million.
"People expect us to take care of business efficiently and appropriately," Rooker said. "I just think it was the pressure building. Something had to be done."
"The elections reflected a mood in Kansas that possibly Kansas politics had shifted too far to the right," said Rep. Don Hineman, a moderate Republican who represents a rural district in western Kansas. "It was time to return to a more centrist position, which is where Kansas has traditionally been governed from."
For the past several years, legislative sessions have been protracted as lawmakers have struggled to find solutions to the state's fiscal woes. That pattern continued this year, and Hineman hopes that with the tax increase enacted, lawmakers can finally leave Topeka this weekend.
On Saturday, he hopes to head back to hisfamily's farm, which his son operates. This week, they are putting in grain sorghum. "Im anxious to get back home, and my son is anxious for me to be home, because he would like to have me on the tractor," Hineman said.
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Kansas Republicans raise taxes, ending their GOP governor's 'real live experiment' in conservative policy - Washington Post