Kimberley Strassel writes about the great divide:
Wisconsin 1, Illinois 0
With Springfield raising taxes amidst its fiscal disaster, the new Republican governor of the Badger State is telling Illinoisans, “Escape to Wisconsin.” (h/t Betsy)
On one side are wide swathes of the country that this past midterm elected reformers intent on slashing spending and reviving growth. On the other are the holdout pockets—Illinois, California, Massachusetts, Connecticut—drifting further into the abyss of tax and spend. The chasm has huge implications, not just for local and regional politics but for Washington.
For instance (quoting from the article),
- Wisconsin is working to enact the total elimination of corporate income taxes for two years for firms that migrate
- In Ohio, John Kasich’s Republican legislature has already introduced legislation to kill the state death tax
- Michigan Gov. Rick Snyder’s first order of business will be to end the 22% surcharge on his state’s job-killing business tax
- Nevada’s Brian Sandoval has vowed to kill the tax hikes passed by Democrats in 2009
- In Iowa, South Carolina, Florida, you name it, new Republican governors have made top priorities of cutting or eliminating state corporate income taxes
This is good. However, all these governors must bear in mind that the problem is spending, not just deficits, a point lost on this WaPo headline,
Tax pledge hinders Obama’s plans to overhaul tax code, reduce deficit. No mention in the article of how Obama and the Democrat Congress have increased the deficit into stratospheric numbers.
Meanwhile, on the front page of today’s Wall Street Journal,
New Hit to Strapped States
Borrowing Costs Up as Bond Flops; Refinancing Crunch Nears.
As Strassel points out,
No state has taxed and spent itself to prosperity.
No country has, either.