9 December—All over the country, state legislatures are facing a situation they very rarely experience: budgets that are flush with cash after a year of often record-setting surpluses. The new money comes from a fairly quick economic recovery from the novel coronavirus panic and billions upon billions in federal handouts to state and local governments.
The problem to the legislatures is, what to do with the windfall? The obvious solution to the problem is to cut taxes. And that’s precisely what legislators and governors in so-called red and blue states are doing—just in time for midterm elections, as it happens.
A dozen states have already cut corporate or personal income taxes. Another half-dozen have added tax exemptions for federal stimulus largess and unemployment benefits or reduced property and service taxes. Kansas Gov. Laura Kelly, a Democrat, and Virginia Gov.-elect Glenn Youngkin, a Republican, have proposed cutting taxes on groceries.
The governors of Minnesota and Wisconsin wanted to raise taxes, but both signed budgets with tax reductions. Florida, Washington, Missouri, New York, and New Jersey bucked the trend and actually raised or created new income or sales taxes. Doesn’t make Florida’s Republican Gov. Ron DeSantis look good for a presidential run in 2024. And, surprisingly, Connecticut hasn’t raised taxes yet, though Gov. Lamont tried. Yet is the operative word.
Other states, like Arizona (Republican) and North Carolina (Democrat governor, Republican legislature), have deals in place to gradually reduce various taxes over a number of years. That sort of rational and fiscally sound tax cutting makes sense and is being considered in several states.
The Flake State, a.k.a. California, is looking forward to a $31 billion surplus, which existing law may just force the state to return directly to taxpayers. Of course, flaky Democrat Gov. Gavin Newsom is typically noncommittal on giving money back to taxpayers, boasting that the surplus “allows us to do things unprecedented in California’s history, and that is, invest in you.” Jesus, save me!
So what about Connecticut, the legendary Land of Steady Habits? Well, the state’s ledger has done quite well in the credit column, thanks to significant business and stock-market upticks, COVID immigrants, and—most of all—federal handouts.
Unhappily, one of Connecticut’s steady habits of late has been to spend spend spend every bloody penny it gets—and more—on employee benefits and so-called entitlements that are guaranteed to keep getting irresponsible big-spending Democrats (and Republicans, truth be told) elected so they can keep up the inexcusable plunder of the state’s taxpayers . . .