Following a national debate over the Bush tax cuts that saw federal income tax rates go up on the wealthiest Americans this January, state legislatures continue to diverge sharply on their approach toward taxes in the first few months of 2013. Anti-tax conservatives in some states, looking to hold fast to a Norquistian vision of tax cuts for the wealthy, are running into opposition. Meanwhile, other states are moving in the opposite direction on revenue for the first time in years. Reports this week show this divergence continuing, even as new research revealed the inefficacy of personal income tax cuts as a strategy for economic growth:
It's already March, but it felt a bit like Groundhog Day this week as U.S. Rep. Paul Ryan (R-WI) unveiled — for the third straight year — a conservative House budget proposal steeped in austerity, divorced from reality, and as unpopular as ever. But another budget proposal was released this week that actually does redirect the debate away from austerity and toward job creation.
In contrast to the conservative policies we've seen move in the states over the past two years, 2013 has so far seen at least a handful of states where progressive policies are being introduced and enacted across a range of issue areas. With legislative sessions about midway through, here's a roundup of the policies moving in a couple of those states -- Minnesota and Colorado:
On Friday, the across-the-board cuts of the federal budget sequester started to kick in. While planes have hopefully not fallen out of the sky (yet), as President Obama noted in a press conference on Friday, the pain will be felt incrementally, and it will be real to millions of Americans. What's worse, the self-inflicted damage to the economy predicted to result from the sequester is entirely avoidable, and in fact does little to reduce the deficit. State legislators from 46 states this week urged Congress to avert the sequester and make sure that "significant revenues" were included in any new deal. Here's more on that, and on how the cuts are set to hit the states in the coming weeks:
State legislators from 46 states are sending a clear a message to Congress: if the federal budget sequester is allowed to take effect as scheduled later this week, the results would be devastating for state economies.
With the across-the-board cuts in the federal budget sequester set to go into effect starting Friday, the White House is releasing a series of fact sheets outlining exactly how hard the cuts would hit state economies.
The "sequestration" cuts to domestic and defense programs still loom in the not-to-distant future. The latest noises from Washington, D.C. are that, thanks to conservative opposition to including additional revenues, the draconian cuts may very well come into effect on March 1st. Here's the current state of play in D.C. — and how some are predicting it might affect the states.
As goes California, so goes the nation? The conservative anti-tax revolt that began in the Golden State over 30 years ago was rebuked by voters this past November when they approved Prop 30. Early in sessions in 2013, other states are showing signs of following a similar path and refusing to rely on economically destructive cuts:
Governors and lawmakers who call themselves "anti-tax" are kicking off new state legislative sessions by proposing drastic cuts or even the elimination of state income taxes — offset by increases in sales taxes that would hit the middle class and low-income families and which would do nothing to boost state economies:
The nation let out a collective sigh last week when a deal was made just hours before the country went toppling over the so-called “fiscal cliff.” Although the agreement passed by Congress and signed by President Obama provides temporary reprieve, it also left much to be desired. While the agreement ultimately reflected the public’s mandate to raise taxes on the super-rich, it also failed to define those who make between $250,000 and $400,000 as “wealthy,” extending all of their Bush-era tax rates permanently. This misclassification contradicts public opinion and will result in a dramatic loss in revenue, setting a dangerous precedent. Perhaps the most threatening decision made was to make no decision at all on across-the-board spending cuts, known as sequester, for another two months. These automatic spending cuts pose a serious threat to states and localities.