Mayberry Milton Friedmans

26 Jun 2009 02:28 pm
Posted by: Donna

OMG. Per this afternoon’s Guardian:

Senate President Bob Burns told his Republican caucus today that the agreement, reached at about 1 a.m., includes passage of the GOP budget bills with trailers that reflect compromises on budget cuts and other issues, a flat income tax rate that would replace the graduated income tax, and a temporary 1-cent sales tax increase on a special election ballot.

Legislative leaders will begin shopping the plan immediately to rank-and-file members.

The flat tax — reportedly at 3 percent — is a surprising twist in an already unusual session. It needs only a simple majority in both chambers to pass.

Burns said the plan could include exemptions for the lowest income earners so their income taxes don’t go up.

“The goal is to avoid that from happening,” he said.

Sen. John Huppenthal said the move is revenue neutral and puts Arizona in a better position to compete with other states for high paying jobs and industry.

“Perhaps the flat tax can offset completely the impact of the sales tax increase,” Huppenthal said.

Riiiight. Despite the flat tax notion’s broad appeal to the uninformed, it’s horrible policy. It’s among the dumbest economic ideas in the plethora of dimwitted and/or venally stupid concepts that come from conservatives and libertarians. The best known champion of the flat tax in the U.S is Steve Forbes, a man whose major accomplishment in life was inheriting a publishing empire from his dad.

So assuming that Hupp is right about it being revenue neutral, then what’s the point? They’re supposed to be getting us out of this hole, not using it as an opportunity to turn the state into a laboratory for the kind of wretched disaster capitalism that has nearly destroyed the economies of countries across the globe.

Edit to add: How can this “revenue neutral” flat tax pass with a simple majority if, in order to be revenue neutral, it has to raise some people’s taxes? Isn’t that a tax increase, thus necessitating a 2/3 majority or approval by the voters?


  1. Comment by Simon says: on June 26, 2009 9:51 pm

    I think the Governor settled here to save face and to continue to appear (for moderate voters) that she fought for something that a moderate would fight for (the tax increase to save cuts to education etc).
    Also, I had lunch with Steve Forbes about a year ago and he is still talking about the flat tax.
    I am afraid, though, that the Executive is not concerned, even as far as appearances are concerned, how she appears to the moderates with regard to social issues. The road map to win the general is becoming apparent.

  2. Comment by todd on June 27, 2009 9:58 am

    From what I am reading the flat tax is going to cost the state half a billion a year once implemented.

    Here’s what I don’t get. They are saying this won’t take affect until 2012. I guess they assume the GOP will still be in the majority by then.

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