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Kansas Liberty: 07 June 2008

A projected state financial crisis looms, but voters say raising taxes isn't the answer.

As budget woes grow, state runs out of options

Things are looking up, for pessimists. The projected state debt? Up. Unemployment? Up. Inflation? Up. The cost of oil? Way up. 

Taxes? Not so fast.

With the economy sputtering and the state entering a tax revenue shortfall, the one thing Kansans said they don't want, according to a new poll, is more taxes.

Taxes are always popular with politicians. The presumptive presidential nominee for the Democrats, Barack Obama, said corporations should pay more taxes, even as they lay off workers, and private investors should pay more capital gains taxes, even though increased investment is what most economists see as a way out of the current economic downturn.

Obama has already promised to raise capital gains taxes by 13 percent, back to levels not seen since the mid-'90s.

When the economy is flush, increasing "public investment" (as politicians like to call taxes) is always popular. Schools, health-care, roads, bridges, even eco-penalties for industry, all of these become no-brainers when everybody's rich.

But the times are changing and simply raising taxes may be an old-fashioned idea whose time has passed. Now that the economy is faltering and unemployment is rising, even John McCain, who twice voted against President George W. Bush administration tax cuts, said that if he's elected there'll be no new taxes.

Those who don't believe him can read his lips.

This changing attitude toward taxes takes on even greater urgency in Kansas, where, according to the state labor department, poverty is increasing at a far faster rate than elsewhere in America, and where, according to an AP report, the state collected more than $50 million less in May than what had been projected.

"We're somewhat in a free-fall," Senate Ways and Means Committee Chairman Dwayne Umbarger, R-Thayer, told the wire service.

Soon, the choice faced by Gov. Kathleen Sebelius will be to cut some of her most cherished - and expensive - programs or to raise taxes. If a survey released last week by the Kansas chapter of the national grassroots group Americans for Prosperity is anything to go by, Kansans hope she'll choose to reduce state spending. 

In a Research 2000 poll, 67 percent of Kansans would prefer reductions in state spending over raising taxes in times of state revenue shortfalls. A majority of voters in all age groups preferred reduced spending to increased taxes, according to the survey. Voters surveyed in the 30-to-44 age group overwhelmingly chose reductions in state spending, with 71 percent saying they would prioritize spending cuts over tax increases.

“Helping rein in state spending, and increasing government transparency and accountability were key components of Americans for Prosperity’s 2008 Legislative Agenda,” AFP-Kansas State Director Alan Cobb said in a statement released with the poll findings.

“This survey validates our efforts by demonstrating that Kansans want government to be more responsible with its spending, not more expansive with its taxation," Cobb said. "The findings make it clear that in difficult budget times, Kansas voters think it best for their elected officials to reduce state spending rather than to place additional taxes on the people."

Conducted June 2-4, the poll found 72 percent of Kansas voters also don't think their tax dollars should be used by school districts, local governments and state agencies to hire lobbyists, a common practice in Kansas.

The survey of 600 registered voters was conducted for Americans for Prosperity by the Kensington, Maryland-based firm Research 2000 and has a margin of error of +/- 4%.

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