Your Opinion: Don't follow failed model

Dear Editor:

Here is an idea capturing the enthusiasm of our Legislature: Cut income taxes for Missouri citizens. Sounds good, doesn't it? We do hate paying income taxes. After all, it is our money. Also, our western neighbor, Kansas, cut its income taxes, and we need to compete with that state and benefit Missouri businesses.

That should create more jobs, we have been told. This sounds good until we consider some realities.

First, the experience in Kansas following its 2012 massive tax cuts has not been positive: State revenues were slashed, state support for public education and other social services has taken a serious hit, and an official report from the Kansas Council of Economic Advisers revealed that that state's economy is lagging behind its surrounding states since income taxes were cut.

Second, the tax cuts will amount to little for most Missourians. Missouri Budget Project found that people with incomes between $33,000 and $52,000 will receive barely enough additional money to buy one hamburger per month (less than $5), and those with incomes below $6,000 would only average a tax cut of $6 per year as they will face increased costs when state services are cut. The ones who would benefit most are high income earners, who would be able to keep thousands of dollars, who could choose to spend their money outside of Missouri. Hence, the tax cuts might do little to raise Missouri's aggregate demand.

Third, estimated revenue losses could be as high as $800 million per year. That would mean the state commitment to funding fully the school foundation program will be out of reach, future university tuition will likely rise, and it will become even more likely that the state will be unlikely to address serious health problems faced by many of Missouri's low income working people. Aside from the fact that people in this state who need but cannot get Medicaid are suffering unnecessarily, long term effects of underfunded public schools would likely hold back future economic growth, and rising university tuition will likely increase student debt, which will prevent many young people from entering the housing market for years to come.

Such developments likely to follow the proposed income tax cuts do not bode well for Missouri's future. As the Show-Me State we should study what's happening in Kansas before mindlessly following that state's example.

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