Iowa Policy Project On The State Of The State

Image (1) ipp-logo-w.jpg for post 8986

It is hard to squeeze out time to listen to things like the State of the State address given by the governor last Tuesday. However, when a person can’t listen it is nice to know that someone with deep knowledge of how government is supposed to run is listening and is willing to share their thoughts with us all.

When it comes to happenings in the state government, especially where finances are concerned I usually go to the Iowa Policy Project for analysis. This year I accessed IPP a little quicker than normal after hearing in one of the headlines from the speech on IPR that the Governor proposed “raising state sales tax while reducing state income tax.”

When discussing types of taxes and their effects on the various constituents of a society sales tax is generally regarded as the most regressive – that is the tax that comes down hardest on those least able to pay. In contrast income tax when structured properly can be the least regressive – that is that those who have the best ability to pay will pay the most.

On hearing that headline I decided it was time to check in with IPP and see what their opinion was. My first question was – did I hear that right? Is that what the policy proposal advanced by the Governor really was. Well, sad to say, yes it was. From the IPP analysis of the Condition of the State:    

Tax policy — an imbalanced mix of a sales-tax increase and income-tax cuts

The Governor’s tax proposals appear to follow an all too familiar formula: Raise taxes on low and moderate income Iowans in order to provide tax cuts that would benefit mostly those at the top. The sales tax, known as a “regressive” tax because it takes a much larger share of the incomes of the poor than of the rich, would rise by 17 percent — boosting the state sales tax from 6 cents to 7 cents on the dollar, raising about $540 million. This would finance further income tax cuts, including a large cut in the top rate, benefiting upper income Iowans disproportionately. An already regressive tax system would become even more regressive. It should be noted that the Governor’s proposals come on top of 2018 tax cuts that — when passed — were shown to benefit the wealthiest the most. 

The Governor is following the discredited idea that tax cuts lead to prosperity. The failed experiment with drastic tax cutting in Kansas should have put an end to such wishful thinking {my bolding – ed.}. Piling more tax cuts on top of the massive cuts already in place will force reductions in the kinds of investments in education, infrastructure, health, and work supports that are actually the drivers of economic prosperity.

Well, there it is, the Republican wet dream – the state version of trickle down that never trickles down and eventually breaks the economy by putting too much money in too few hands rather than having it circulating and creating decent paying jobs.

 Will the Republican-led legislature follow the Governor’s lead? To answer such questions I pull out my brand spanking new Magic 8 Ball and give it a shake. “All signs point to ‘YES’” it says. 

Iowa Policy Project executive director Mike Owen gave this synopsis of the Governor’s speech:

“The Governor’s proposal was long on tax-cut rhetoric, short on substance to achieve clean water and educational goals, and desperately lacking in the theme of investment that she attempted to promote. Iowa will never cut its way to prosperity, but the Governor persists in this contradiction of reality,” said Mike Owen, executive director of the nonpartisan Iowa Policy Project in Iowa City. 

“She did offer a hopeful nod to an issue critical to the prosperity of Iowans — child care assistance — but left more to imagination than to a defined vision.”

No one can see the future, but the past is always prologue. The prologues indicate another good year for the rich in Iowa, another bad year for the poor, elderly and sick and more promises on education left wanting.

About Dave Bradley

retired in West Liberty
This entry was posted in Blog for Iowa, economic inequality, Economy, Iowa Policy Project, Republican Policy, tax cuts for the wealthy and tagged , , . Bookmark the permalink.

2 Responses to Iowa Policy Project On The State Of The State

  1. C.A. says:

    The prologues also predict another good year for the Iowa farmers and landowners whose water-action motto is “Pay me or I’ll do nothing, and I’ll probably do nothing anyway.” Iowa continues to have a system in which most of Iowa’s 86,000 farmers are doing little or nothing to protect water while they are comfortably hiding behind the very small group of good farmers who are taking serious action.

    Meanwhile, the Iowa Department of Agriculture and Land Stewardship (those last two words are largely a joke) wants more of our tax dollars to dump into the current nutrient-reduction “system” of no systematic testing, no accountability, no requirements, and telling the general Iowa public “just shut up and wait a hundred years, clean water takes time.” Yep, in Iowa, it most certainly does.


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