No Taxes Taxes Is The Right Decision
M. Royce Van Tassell
February 24, 2010
This past week, House and Senate Republicans took caucus positions to balance the state’s budget without any tax increases, and Governor Herbert has repeated his long-standing support of balancing the budget without a tax increase. They prefer to cut spending.
Spending advocates wasted no time in offering heart-rending stories justifying a multitude of spending increases, and their necessarily accompanying tax increases. The House and Senate should reject those pleas for increased taxes and spending. It doesn’t matter how much the state spends; the advocates for greater spending will always have another program, cause or group that “must” be funded.
Less than 24 hours after House and Senate Republicans took caucus positions against a tax hike, spending advocates began warning of dire consequences. The Utah Education Network proclaimed a need for more state money to help serve rural Utah. Activists worried that the state may not be able to fully fund prenatal care programs for low-income mothers or that reductions to programs serving victims of domestic violence and child abuse might be necessary.
Such warnings arise during every budget process. When budgets are tight, and cuts must be made, the spending lobby has multiple sympathetic causes that demand priority and additional state funding. But when budgets are flush, and spending is up, the requests are just as abundant.
During the Huntsman Administration, the Legislature increased overall state spending by 9.1% annually, and public education spending by 14.6% annually. Nevertheless, various spending advocates pined that the state still wasn’t doing enough. The headline from a June 5, 2006 article in the Salt Lake Tribune read, “Dental loss may prove deadly” and criticized the legislature for not funding dental care for the homeless, despite having spent $20 million on Medicaid. In March 2007, low-income advocate Linda Hilton argued, “The crisis continues,” because the Legislature didn’t provide as much for the disability waiting list as she had hoped.
In August 2006, the State Tax Commission projected a $351 million surplus. In response, then-chair of the State Board of Education Kim Burningham infamously chastised the Legislature for not spending even more on education, even though the 2006 Legislature had just increased public education spending by over 10 percent. He cried, “Transportation, water development, prisons, state parks, and, most dear to my heart, public schools are all in need of additional funding. To call this money a surplus is to ignore the very real needs in most sectors of state government.”
There is no doubt that Utah faces unique and pressing challenges. Many poor Utahns faced real obstacles in obtaining dental care. Utahns with disabilities certainly do face exceptionally difficult circumstances. And despite the dramatic increase in public education spending, Utah’s public education system still spends less per student than any other state in the nation.
However, these experiences and appeals should bolster the Legislature in resisting calls for any number of “revenue enhancements,” as the spending lobby so delicately calls tax hikes. No matter how much money the state spends, no matter how many social ills the state tries to cure, there is ALWAYS another worthy problem.
In the midst of the spending advocates’ tears, it is easy to lose sight of why the Legislature and Governor Herbert want to balance the budget without spending or tax increases. A variety of independent groups have noted that Utah’s tax and spend policies make Utah one of the most business-friendly states in the nation and therefore one of the most stable and prosperous. From the Pew Center for the States to the American Legislative Exchange Council to the Tax Foundation to Governing magazine, Utah’s budget and tax policies have consistently been graded as among the best in the nation.
While the short-term solution of higher taxes and increased revenue might appease today’s spending advocates, there will always be another, equally sympathetic appeal tomorrow. And a “quick fix” solution that responds to the immediate pleas of the tax and spend lobby, as you see in California, New York, Arizona and New Jersey, negates the long-term stability that come from cutting spending and maintaining sound tax policy.
The House and Senate Republicans caucuses and Governor Herbert have shown courage in the face of difficult budget choices and should be congratulated for their choice to balance the state’s budget without any tax increases. Despite crocodile tears and pleas for more revenue and spending, fiscal responsibility is the tool that will return Utah to an environment of economic stability and prosperity.
M. Royce Van Tassell is vice president of the Utah Taxpayers Association, the only statewide organization dedicated full time to lower taxes and efficiency in state and local government.