There are two distinct mindsets in the Kansas Statehouse. The first is that the Legislature must contain runaway spending and cut its way out of the budget deficit. The second is that a mix of budget cuts and about $350 million in tax increases are necessary to balance the budget. The latter approach could not be further from reality or necessity.
For fiscal year 2011, many claim an estimated $470 million budget deficit. But what most Kansans may not realize is that Gov. Mark Parkinson actually proposes to increase state general-fund spending $380 million over 2010 spending levels. His 2010 budget is 7 percent higher than this year's and $1 billion more than the state spent in 2005.
That $470 million shortfall would get a lot smaller if we froze general-fund spending at current levels.
Between 1993 and 2009, state spending grew an astonishing 250 percent, while inflation over the same period was 43 percent. This kind of budget growth and pressure on taxpayers is unsustainable. Kansas very clearly has a spending problem.
The governor and his allies in the Legislature actually have the audacity to claim that recent tax cuts are to blame for the state's budget deficit. But when the Legislature cut taxes earlier this decade, revenues to the state skyrocketed. The problem occurred when the state showed zero fiscal restraint and committed to spending more than it was taking in, erasing more than a $950 million budget surplus in just two years. Kansas most definitely does not have a tax-cutting or revenue problem.
If the Legislature adopts what will amount to the largest tax increase in the state's history, states more competitive than Kansas will no doubt take advantage of our resulting anti-growth climate and lure our employers and workers out of the state. Raising taxes in a down economy will further jeopardize Kansas jobs, as every tax increase negatively affects our competitive position relative to our region and even globally.
According to the Kansas Chamber of Commerce's annual CEO poll, nearly two-thirds of employers surveyed believe "reducing the cost of doing business" is the best growth strategy for the state. Raising taxes is exactly the opposite.
Since day one of the 2010 legislative session, the Kansas Chamber of Commerce has urged the Legislature to live within its means, just like Kansas families and employers do. The chamber has suggested the state adopt policies such as implementing priority or performance-based budgeting at all levels of state government, establishing transparency in budgeting at all levels of government, setting aside "rainy-day" funds for economic downturns, establishing a "BRAC-like" process for closure or realignment of government functions and agencies, exploring public-private partnerships that maintain needed state services while also lowering the cost of doing business in Kansas, and establishing a framework to encourage consolidation of local units of government and school districts.
We urge Wichita Eagle readers to contact their legislators while they are back in their districts. Urge lawmakers to oppose anti-competitive tax increases and instead focus on reducing state spending.