Our Opinion: ‘Irrational exuberance’ resurfaces in Missouri

Thursday, January 31, 2013

Alan Greenspan’s caution against “irrational exuberance” remains relevant long after the former Federal Reserve Board chairman coined the phrase in 1996.

We have been reminded of it on multiple occasions this month as government officials and advocacy groups seek to capitalize on the state’s anticipated economic uptick.

Proposed wish lists in January include:

• Medicaid expansion to be funded largely by $5.7 million federal dollars available for three years through the Affordable Care Act.

• A 10-year, 1-cent statewide sales tax projected to generate $7.9 billion for transportation construction and maintenance.

• A $900 million-plus statewide bond issue proposed by Gov. Jay Nixon in Monday’s State of the State address. The revenue would finance: elementary and secondary education; higher education; state parks; and a new Fulton State Mental Hospital.

In Monday’s address he also proposed a payment plan when he said: “The way to pay for the bond issuance is to finally get our tax credit system under control.”

He pointed out that redemptions claimed last year through the state’s 61 tax credit programs grew to a “staggering” $629 million.

Comprehensive tax credit reform is a laudable goal, but one that has eluded legislative action.

Nixon reinvigorated the reform effort in earnest in 2010 when he created the 25-member Tax Credit Review Commission, which issued a 54-page report. The panel concluded the state could save $220 million in five years by eliminating 28 tax-credit programs and improving the operation of 30 others.

Our concerns are twofold.

First, the suggested $220 million savings falls far short of the $900 million-plus spending plan.

Second, the commission’s recommendation has languished for three legislative sessions: the regular sessions of 2011-12 and the 2011 special session.

Although the membership of the Legislature has changed significantly this year, a victory celebration for tax credit reform is not only premature, it would be an exercise in irrational exuberance.

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JCLifer 3 months, 2 weeks ago

All this talk about raising taxes and going into more debt because of an improving economy is very puzzling. The economy appears to be improving only for Wall Street bankers. I cannot find anyone who says things are improving for them. Wages are stagnant at best. Jobs are still being cut. No one has had a decent raise for years. Costs of gasoline, food, utilities, taxes, etc. are all contiuing to climb.

How can things be getting better when no one is experiencing them getting better? How can we pay more taxes when we are paying more for many other things, and when no one has gotten a raise? How can we say the unemployment rate is low when so many people are out of work, or are working very low pay or temp jobs?

Why would we raise taxes to build a multi-mega-million-dollar school when costs have gone up and wages have gone down?

The government leaders need to learn that most people are really hurting and they cannot afford to give any more. Sorry, but that is the truth.

Littleinvestor 3 months, 2 weeks ago

Ditto

asb 3 months, 2 weeks ago

Many can afford to pay a bit more taxes. There are some who can afford significantly higher taxes. There are many who can afford to pay what they owe but avoid it. There are some who figure out how to owe virtually nothing compared to their worth who can afford to pay an appropriate amount.

Taxes decrease, not increase, debt. Spending can increas debt, but careful spending can stimulate economic activity that ultimately decreases debt. Watch the government carefully, and participate actively in the financial processes. This is still a democracy in spite of fearful language from the FRight claiming the loss of freedom and rights to an imaginary boogeyman. Watch the wealthy very carefully, they have the means to control their obligations and they have, as do we all, their own interests at heart.

connor 3 months, 2 weeks ago

Unemployment up yet again, even by the government's "official" accounting. GDP dropped in the fourth quarter even with the government's "official" accounting. Another round of layoffs announced from the "Time" magazine publisher among many others. Unions now screaming wanting..... get this.... more waivers and subsidies from and for Obamacare (I had to chuckle at that one).

Obama's regime is sending 15 F-16 fighters and 200 M-1 Abrams to Egypt and the Muslim Brotherhood while he attempts and hopes to disarm American citizens. All the while screaming we need to add 30 million more democratic voting illegals to the mix.

So ya Missouri would be foolish to add more spending and taxes to the future Obama has created for us.

asb 3 months, 2 weeks ago

Yep, the economy has bumped down again, due mostly to a lack of stimulus. It'll be back. If "official" government figures aren't trusted enough not use quotes, they shouldn't be used, that's hypocrisy. Chuckling at unions doing all they can for their members, even asking for more than most think they need right now is wasted energy. Chuckle instead at corporate tax evaders scheming to cheat even more. Using tyrany-implying terms like "Obama's regime" is an insult to Americans and our democracy. At least he was elected. There has been no attempt by this, or any other, administration in history to disarm American citizens. that is propaganda from the FRight wing. It's nowhere near 30 million, but we should get used to it. Immigration is US. Careful spending and proportionate tax adjustments will indeed help Missouri keep up with America's future, created by hard working Americans, rather than slip into the southern third world.

connor 3 months, 2 weeks ago

Blaming corporations and claiming they are greedy while allowing Unions to pocket money and scalp the tax payer right and left is the epitome of hypocrisy.

Bussing in illegal voters, allowing and encouraging multiple voting and failing to prosecute poll intimidation along with campaigning inside the poll locations is not only an insult to Americans but a direct assault on democracy.

And this is an attempt to disarm Americans, plain and simple. A violation of our God Given rights no different than censorship of free speech.

We won't slip into the Southern Third World as people with Lefty Cleftwing delusions and lies are inviting the Third world in and handing them a democrat ballot with an EBT card as they shuffle past.

The propaganda is the same series of lies the Feminist/Liberals been spouting for years.

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