Legislators Should Hold the Line Against the Brewer Tax

Legislators Should Hold the Line Against the Brewer Tax
By Tom Jenney

Down at the Arizona Legislature, several otherwise conservative legislators are right now thinking very hard about capitulating to Governor Brewer’s scheme to put an 18-percent increase in Arizona’s sales tax rate on the ballot.

Those legislators have previously argued that they could wring more spending reductions out of the governor by allowing the sales tax referendum go to the ballot. But with the education and health budgets that passed this week, conservatives appear to have given up on significant spending reductions. So, those legislators are left to argue that if the Brewer Tax goes to the ballot, it will probably fail, thereby giving the Legislature a “mandate” to cut spending.

There are several grave problems with that argument.

For starters, the sales tax might actually win at the ballot. In a low-turnout election, the sky-is-falling propaganda from public employee unions and other spending interests could be persuasive.

If the sales tax does win at the ballot, Arizona will set itself up for short-run and longer-run fiscal distress. In the short run–assuming that the Brewer Tax is actually temporary–we will merely postpone a billion-dollar structural deficit crisis into the year 2012. We will also do damage to our economy at a time when we’re already hurting. The San Francisco Federal Reserve office estimated recently that a dollar taken from the private sector for government spending reduces economic activity anywhere from 60 cents to $2.30.

In the longer run, by resorting to a tax increase, and by failing to reduce spending, we will tell potential investors, businesses, workers, and retirees that Arizona is the next California: we are stuck in a cycle in which the government spends too much money in boom years, goes into deficit crises, raises taxes to keep government spending at high levels, and then repeats the process until it hits bankruptcy.

Even if the sales tax fails at the ballot, voters are not likely to give politicians a mandate to cut spending. Voters are often schizophrenic on fiscal issues. Even if they shoot down a sales tax in 2009, they could easily turn around in 2010 and punish legislators who vote for large spending cuts in popular programs.

Further, even with a “mandate,” Brewer and a majority of legislators may prove unwilling to cut much spending—especially because cutting spending will be harder to do in January, when the fiscal year is already half over and the money is half spent. At that point, the deficit fixes will be dominated by short-term borrowing and other financial gimmickry.

If conservatives keep the Brewer Tax from going to the ballot, that will force the state government to an earlier reckoning. Revenues will soon fall short of paying for the bloated education and health budgets that passed this week, and the Legislature will have to go back to work, perhaps as soon as September. But it’s better to start cutting in September than to wait until January.

As a matter of political prudence, given the Tea Party fervor brewing among the grassroots in Arizona, legislators should avoid a tax referendum like the plague. Grassroots activists know that the job of a conservative legislator is to stop bad legislation, not punt the ball to voters. And if the Governor can muster a majority of legislators to refer her tax hike to the ballot, shrewd legislators would do well to keep their names off the bill.

If necessary, the Arizona chapter of Americans for Prosperity will work hard to defeat the Brewer Tax at the ballot. We will bring our gigantic inflatable ATM bank machine to every town in the state, and drive home the point that Arizona taxpayers should not be used as a cash machine when politicians have overspent their budgets and are short on revenue.

But having a ballot battle over a tax hike would be a deplorable waste of Arizona’s collective resources. Legislators would do much better to hold the line against tax hikes, and start working now to reduce government spending.

–Tom Jenney is Arizona Director for Americans for Prosperity (www.aztaxpayers.org).


  1. We shouldn’t ignore the fact that Brewer has already increased taxes on us by vetoing the portion of the budget bills that would have made the suspension of the state equalization property tax permanent. That means, the $250 million tax comes back next year by taking the money out of our wallets.

    She has become a tax and spend con-artist.

  2. Haha! Thanks for the Thursday afternoon funnies. “Don’t refer a tax increase because it might just pass!” Seriously, THAT’S your argument?

  3. PC- Nevermind the fact that the R’s also already raised taxes on us by raiding the cities funds and impact fees.

    Our “conservative” Reps have sold us up a river with accounting gimmicks and rollovers.

  4. Tom is trying to point out that the conservative force is starting to buckle under the pressure. I say, call their offices, write to the legislators and let them know to hold the line and not give in.

    Let’s allow the Governor to fix the problem by line iteming programs that do not deliver.

  5. The conservative force is buckling under pressure because their jobs are on the line and no one wants what you are peddling. They may just save themselves…but if they anything to do that…you will hang them.

    Welcome to permanent minority party status!

  6. Roger’s point #3,

    They have been passing taxes off as fees, fines, and as unfunded mandates for years now. They pass the buck down to the local level where only property taxes and bond measures can pay the bills…and this includes for public safety, which they speak out of both sides of their mouths about.

    We hate govt and govt spending and taxe are evil…uh oh…but for cops and firefighters!!!!

  7. If we continue to write the checks for these programs and the citizen taxpayers say “No More!” where do you all propose we get the money? And when the next budget comes around and it’s worse than 2010, where do we get the money? Do the public policy makers have to drive the ship of state into land before they realize the ship ain’t gonna go no more?

  8. I think the citizen taxpayers are not going to say “no more” to reasonable hikes in taxes. What they are also saying is that they don’t want schools, universities, and the like stripped down even more.

  9. Tom Jenney has a lot rhetoric, but none of his ideas to balance the budget will work.
    The budget is short between 3 and 4 billion dollars. The vast majority of the budget is MANDATED SPENDING passed by the VOTERS.
    How do you undo that in time for the budget deadlines ahead?
    Tom would have you believe we could sell off prisons, state land and rip down education expenditures.
    Great. What business comes to Arizona when it sees we rip down the dollars to educate the future work forces? Or who wants to bring their businesses with good paying jobs to Arizona if their employees don’t have access to decent public education?
    Do the school districts need to find a better way to do business. Yes, particularly the big districts, but there is no incentive in current law for them to do so.
    We would need to overhaul all the mandated spending laws – go back to the voters with a new consolidated package – but one that has incentives for the districts to do better in order to get state funding.
    But those items alone will not alleviate the budget.
    Gov. Brewer has been tossed the keys to a government that is in trouble.
    How do we make it better?
    By shutting down government?
    The rip and burn approach is short sighted. When you need the DPS crime lab, need an emergency road crew to put the freeway back together, need a CPS investigator to grab kids who are being harmed by others, need your truly indigent auntie to get help via AHCCCS for an emergency hospitalization or need the state registrar of contracts to go after another fly by night so called builder, who answers those calls for free?
    The Gov. needs to publish a complete budget of all agencies.
    Short sighted legislators who say “we cut the bottom line and then trust agency heads to find the economy” are lacking in depth – how do you know what you are cutting if you cannot see the depth of the budgets.
    The Legislature is awash in people who lack either the education or business experience to do budget work and strategic planning to that depth. Most all the legislative leaders with great sway over the budget lack either a college degree or business experience.
    Scarey as it may seem, more of the Democrats have either the education or business ownership behind them. And they sit watching while the Republicans blow themselves up with their own ignorance.
    Kicking out every illegal alien alone with not balance the budget. We don’t have either the local or Federal law enforcement to bulldoze them out. By the way, illegal or not, the ones that have left stopped spending money – thus, a drop in sales tax revenues. Go ask Mesa how it plans to continue police and fire services next year at the current levels with stretched out response times? They don’t know.
    Somewhere there is a balance, but Tom Jenny has neither the education nor business experience to do anything but be a shotgun bull horn leader.
    But he could be thoughtful instead of shooting from the hip, so I’ll give him that margin. Anyway, when is the last time the taxpayers group won an election?

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