
The Kansas Experiment (2014) [audio] - __Joker
http://www.npr.org/sections/money/2017/01/11/509378842/episode-577-the-kansas-experiment
======
Empact
More context on Kansas economic policy:

"Kansas has made national news with its fiscal policy in 2013–14. The state’s
tax cuts were large, but we show that their projected outcome brings Kansas’s
state-level tax burden only slightly below the national average (5.0 percent
of income), while its local tax burden (4.1 percent of income) is a little
above the national average. Kansans have little choice among local
governments: only one jurisdiction for every 200 square miles across the
state. The state spends much less than average on business subsidies, but
government employment is much higher than average (15.0 percent of private
employment). Government debt peaked at 24 percent of income in 2008 and is now
down to about 21 percent."

[https://www.freedominthe50states.org/overall/kansas](https://www.freedominthe50states.org/overall/kansas)

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gumby
That link is from the Cato institute.

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digitalzombie
Reason why this is important is the Cato institute is funded by the Koch
brothers and they were the ones that push for those Tax reforms in Kansas.

Their headquarters is in Kansas.

So it's may just be suspect and an alternative source would be better.

~~~
cookiecaper
I would think that the Cato Institute indicating that the tax reforms had
little effect would make the argument _more_ credible. Their bias is to be in
favor of tax cuts.

~~~
mikeyouse
Parse it more closely; they're not arguing that the tax reforms had little
effect on the state, they're arguing that they had little effect on the tax
burden at the state level. Their only metric for measuring success is whether
or not taxes are lower -- which is fine since they're a partisan advocacy
group, but real humans live there too and they have to live with all of the
impacts that Cato doesn't concern themselves with.

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shireboy
I'm a big Planet Money fan, and remember this episode. As I listened, it
occurred to me that I really wished we had a non-partisan, uniform way to
measure "experiments" like this over time. Agree on measures of success (GDP,
per capita income post-tax, employment, education stats, etc.), visualize them
over time, and run 50 parallel experiments.
[http://usafacts.org/](http://usafacts.org/) comes close, though it doesn't
show state-level details. Also, one could argue it's not non-partisan behind
the scenes (or that non-partisan is impossible).

I understand that might be a bit naive, but in general we could be doing much
better at gathering and visualizing the data that are used to make policy
decisions. Give me cold, hard numbers and pretty graphs instead of our current
system of hotheads yelling that I'm a socialist if I believe in government
spending or hate poor people if I believe in tax cuts.

~~~
Analemma_
We _might_ be slowly starting to creak in that direction. The AEI recently
announced that they would start preregistering studies on the link between the
minimum wage and unemployment and fix the "success criteria" ahead of time.

The AEI is hardly my favorite institution, so it's actually especially
encouraging to see them "go first". Hopefully others will follow.

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vkat
There was nytimes article some time back comparing how CA and KS did after
former increased state taxes and the latter decreased. I am sure there are
other factors but the gist of it was cutting taxes does not necessarily result
in economic expansion. GDP of Kansas decreased over the period whereas CA's
increased.

~~~
AdamM12
I've seen this but I don't think it is fair. Look at the amount of VC $$ going
into CA vs. KS. Easy to create economic expansion when money is invested in
your state.

~~~
dragonwriter
Since part of the premise of the KS tax cuts and others like them is that they
will attract business investment, the fact that the imbalance you point to
continues to exist is not an excuse for the failure of KS tax cuts to produce
positive economic results, since that's exactly what they were sold as
changing.

~~~
AdamM12
Valid point. They should of went with tax free until disbursement like
Estonia. Would of kept the money in the business and given them more of an
incentive to reinvest.

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tvanantwerp
The pass-through exemption is a big part of what is wrong with Kansas' tax
reform and why it hasn't work. Here is testimony to the Kansas House from one
of my coworkers about it: [https://taxfoundation.org/kansas-pass-through-
carve-out-nati...](https://taxfoundation.org/kansas-pass-through-carve-out-
national-perspective/)

From his testimony:

> It’s important to note here that while decreasing taxes is generally
> associated with greater economic growth, the pass-through carve out is
> primarily incentivizing tax avoidance, not job creation.

> If they passed a provision like this in Washington, D.C., where I live and
> work, I would go to my employer the next day and ask them to start paying me
> as an independent contractor. I would still be doing the same job and
> contributing the same value to the economy, I just wouldn’t be paying any
> income taxes.

> The individual income tax is one of the largest instruments in the Kansas
> revenue toolkit. Exempting pass-through income substantially narrowed the
> tax base of that instrument, and in a haphazard and unpredictable way.

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frgtpsswrdlame
I've never much considered accelerationism to be a practical concern but
Kansas makes me wonder if perhaps it's the way forward. So many tax cuts and
now people are voting out extreme Republicans for more moderates and voting
for more taxes. Brownback still has the veto which is holding things back a
bit but the state has moved left.

~~~
chuchurocka
The constant threat of veto due to this has repeatedly shut down legislation
on this a number of times now. It's was overruled and vetoed once already.

Our main problem is that Brownback, refuses to budge on it. There are also
quite a few of our state legislators that own fill as Schedule S corps and
therefore pay no state income tax, they have no reason to even try and repeal
it.

Many of the staunch far right were ousted, but we have a long way to go. We
currently have 1 month to find $800m and Brownback refuses to even put the tax
exemption on the table, which would raise about half of our shortfall.

Most likely, we'll have higher regressive taxes (again) next year. For example
lookup Kansas' food tax rate, it's one of the highest in the nation.

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doener
[https://news.ycombinator.com/item?id=14245384](https://news.ycombinator.com/item?id=14245384)

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mehjk
The way she talks is interesting

