Monday, February 07, 2005

if it can happen in iowa, then it can happen anywhere.

DesMoinesRegister.com: "Maybe that's what happened in the 1990s, when the Legislature slashed the state income tax amid rosy assurances that lower taxes on upper-income people would cause the Iowa economy to explode in growth. It didn't happen.

There were promises that the tax cuts would create tens of thousands of new jobs in Iowa and the cuts would pay for themselves by generating more state revenue. What followed was a loss of jobs and the state's worst fiscal crisis since the Depression.
Measured against the promises, the tax cuts of the '90s have to be one of the state's biggest policy flops of all time.

There is a contrary example from a couple of decades earlier. In the 1970s, the state income tax was increased to finance the newly devised school-aid formula. What followed was one of Iowa's most prosperous decades of modern times."

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