Kansas' controversial tax cuts will get the Washington spotlight Wednesday as Senate Democrats conduct a partisan hearing to draw national attention to the political and financial mess they say the "Kansas Experiment" created in the state.
Congressional Republicans plan to unveil their own national tax cut proposal Wednesday. Democrats want to show that Kansas Gov. Sam Brownback’s controversial experiment in supply-side tax cuts should serve as a cautionary tale. They’ll argue that the cuts will bring the same sort of budget shortfalls and political upheaval Kansas experiences to Washington.
Brownback, now awaiting confirmation as U.S. ambassador at large for international religious freedom, championed cuts that eliminated income taxes in Kansas for owners of limited liability companies and partnerships, including lawyers, doctors, farmers and the owners of some of the biggest companies in the state. The state also reduced income tax rates across the board.
The governor promised an economic boom and job growth would follow. Instead job growth lagged both the nation and neighboring states. The state was forced to delay highway projects, make cuts to higher education and other state services and keep K-12 funding levels flat as it struggled to balance its books.
Moderate Republican lawmakers joined with Democrats in the Kansas legislature earlier this year to override a Brownback veto and repeal the tax cuts.
Brownback’s office did not immediately reply to request for comment. But other Kansas Republicans have pushed back on Democrats’ efforts to draw comparison’s between Brownback’s tax cuts and the new GOP plan in Congress.
“I’m glad to hear the Democrats have scheduled this hearing before they’ve even read the yet to be released bill,” said Michael Byerly, a spokesman for Republican Rep. Lynn Jenkins of Kansas, in an email. “Now we can officially dispense with the pretense that this ‘hearing’ and their opposition to tax reform has anything to do with the actual policy and is nothing more than blatant political obstructionism.”
Byerly criticized Democrats for bringing in Ward, “a liberal, partisan politician, who knows nothing about the reforms we are discussing on the federal level for the sole purpose of raising his name recognition for his gubernatorial candidacy.”
He said Republicans will “build in strong guard posts to keep people from gaming the system,” as some did in Kansas.
Democrats plan to argue otherwise. Sen. Debbie Stabenow, D-Mich. who heads the Senate Democratic Policy and Communications Committee, will chair Wednesday’s hearing. Other senators from around the country, including Sen. Ron Wyden, D-Ore. top Democrat on the tax-writing Senate Finance Committee, will participate.
Since Democrats are the minority in the Senate, they cannot convene real hearings on the GOP tax proposal.
Among those testifying on Wednesday will be one of the Kansas Democrats who helped lead that repeal effort, Rep. Jim Ward, the minority leader in the Kansas House of Representatives. Ward is running for governor next year.
Ward said his involvement in the hearing was triggered by the GOP tax plan’s resemblance to the Brownback tax experiment.
“Here’s the dirty little secret. Our job growth was stagnant,” Ward said. “We lost jobs one year and we gained a very small amount one year. The economic growth was stagnant. You didn’t see businesses flocking to Kansas.
“You did see larger class sizes in Kansas school, teachers leaving Kansas, riots in the prisons,” he said.
Ward wants Washington lawmakers to understand understand the fallout of the Kansas Experiment so that they won’t make the same mistakes. Among the proposals Republicans have discussed are a tax cut for limited liability companies, partnerships and other businesses, a cap on 401 (k) retirement account contributions and changes to the mortgage interest deduction.
“Maybe slow it down a little so it’s more thoughtful and maybe avoid some of those bad results,” Ward said. “All indications are that it would be the same kind of impact on the U.S. economy (as on the Kansas economy) and we drive the world economy so that is very concerning.”
Also testifying at the mock hearing will be Sarah LaFrenz, a public employee at the Kansas Department of Health and Environment and mother of three elementary school children in Topeka.
She is expected to talk about “the impact of the Brownback tax cuts on public services for Kansas families,” according to Stabenow’s office.
Other senators who will participate include Sens. Bill Nelson, D-Fla., Elizabeth Warren, D-Massachusetts, Ben Cardin, D-Md., Maggie Hassan, D-N.H. Patty Murray, D-Wash. and Chris Van Hollen, D-Md.
Bryan Lowry of The Kansas City Star contributed from Kansas City, Mo.