POISON PILL: CNS News reports on state governments and raising taxes:
As new governors take office and state legislatures return to work in the first days of 2003, many states are considering tax increases in order to balance their budgets. But a study just released by the National Taxpayers Union Foundation (NTUF) concludes that higher taxes are the wrong solution for states to balance their books.
John Berthoud, president of the NTUF and author of the study, believes “a review of the last state budget crisis clearly shows that resorting to tax hikes will slow economic recovery and thus prolong the budget agonies that many states are experiencing.”
The study said states that enacted tax hikes in the early 1990s experienced slower income, less employment and less population growth during the ensuing decade.
“The message of history is clear,” Berthoud observed. “Ratcheting up taxes is a devastating poison pill for state economies.
Of course. But that isn’t stopping his Gray-ness from raising California’s taxes, to bail him out of the mess that he created.