Not that I don’t enjoy the latest propaganda piece from Skunk Politics, but …. let’s play. :-)
What is “Trickle Down Economics”? That’s actually a real question. Because that term is never used in a professional economic setting. It’s a political term only, used by critics of the low-tax model, to disparage the idea that a strong, vibrant economy can be created without the government in the middle organizing it all.
There is No Such Thing as Trickle-Down Economics | Steven Horwitz
Critics of liberalism and the market economy have made a long-standing habit of inventing terms we would never use to…
Trickle Down Economics Does Not Exist -- The Benefits of Capitalism Do
Which is older? The U.S. personal income tax code or the abuse of it by politicians? The answer, of course, is the…
Memo to liberals: There's no such thing as trickle down economics-you made it up
This week, the International Monetary Fund (IMF) released a study that many in the media are hailing as the nail in the…
And as Thomas Sowell wrote some years ago:
Years ago, this column challenged anybody to quote any economist outside of an insane asylum who had ever advocated this “trickle-down” theory. Some readers said that somebody said that somebody else had advocated a “trickle-down” policy. But they could never name that somebody else and quote them.
So, kudos to Mr. Constant for successfully refuting something that doesn’t exist. I look forward to his future articles on the deadly danger posed by Danerys’ dragons to the Oregon forests.
So, let’s cut to the chase. All agrarian states have been victims of slow economies over the last couple of years, with the prices farmers have received for their crops continuing to fall. Net farm income peaked in 2013, and has been dropping since (apparently leveling off in 2017 at a level HALF of the 2013 peak.
Dear readers, please imagine for the moment what it would be like for you, with fixed expenses such as cars and mortgages, if your income was cut in half over just a four year period. Farmers have mortgages and payments due on farm equipment too; you see the problem.
….and, since most ag states are run by the GOP, you have a perfect storm for the leftists to slam GOP state management, even though this dropoff in farm income has precisely nothing to do with any political party or any philosophy of governance.
Now, Kansas. Take a look at the chart, then the one above, remember that Kansas is an ag state, and you’ll see what the actual issue there is:
Yeppers. In real dollars, and despite Mr. Brownback’s scheme, Kansas tax receipts never fell. You can see where they fell in NOMINAL dollars, both in 09–10 (we all know what happened then) but then fell in 2014 because…….well, obviously, that’s when farm income dropped off the cliff. (Look above to the Net Farm Income chart, and overlay the two in your mind.)
So, yes, Kansas took a hit in nominal tax revenue, but (mostly) not because of anything Mr. Brownback did; they took a hit in tax revenues because their farmers were making half of what they were making previously; and if your income drops, a state that depends on its income tax……well, revenues drop as well.
(To be sure, I have some agreement with the suggestion that Mr. Brownback hamhanded his tax scheme, but that’s sort of beyond the scope of this article. Another day, perhaps.)
Hope that helps.