What? Services attract businesses?

What is clear is that you cannot have tax cuts and have the services, too.

Mike Owen
Mike Owen

Why is it that the mantra in real estate is “location, location, location,” and the political mantra in economic growth is “taxes, taxes, taxes”?

The political mantra, which crumbles regularly when put to serious analysis, also takes hits when the benefits of Iowa’s “location, location, location” are seriously put in jeopardy. Case in point: the drive to gut Iowa’s universal voluntary preschool program.

On Monday in the Iowa Senate Education Committee, Elliott Smith of the Iowa Business Council told lawmakers that the preschool program helps attract companies and employees, and will pay off in increased productivity by students.

Now, no one is under any illusions here. The business lobby will also keep pushing for tax cuts. Its influence is the fundamental reason corporate tax giveaways are out of control. The Legislature has not cracked down on them, and has rejected serious attempts to do so, cheered on by the business lobby. This fiscal negligence is costing Iowa tens of millions of dollars every year, shaking the foundations of  critical public structures such as education that support economic growth and opportunity for all Iowans.

What is clear, however, is that you cannot have tax cuts and have the services, too. And if research, and common sense — as illustrated by Mr. Smith’s support of Iowa’s preschool program — make a clear case for services, then tax cuts should simply be off the table. We cannot afford new tax cuts, let alone the gigantic giveaways already in place, and they don’t really improve the Iowa economy even if we could.

Posted by Mike Owen, Assistant Director

‘Shared sacrifice’ — for real?

Will “shared sacrifice” include the kind of balance we need in sustainable budget decisions that reflect Iowa values?

Mike Owen
Mike Owen

Our incoming governor is talking about “shared sacrifice.” It’s an interesting choice of words, because it implies “balance” in the tough choices, disappointing people across the board, or more positively, expecting much from all.

But will that happen? As we saw with 10 percent state budget cuts back in 2009, “across the board” is not always as advertised. Spending on clearly stated priorities, such as education, law enforcement and environmental quality, is cut, while spending in the shadows is not.

Too easily left out of the equation is the spending Iowa does through the tax code. This kind of spending is in the form of tax credits, and also money lost through tax loopholes, the loose seams in the tax code through which big corporations shield profits from rightful taxation in our state. It is spending on autopilot, often behind a veil of secrecy, with little or no oversight — let alone review and approval — by our elected lawmakers.

So, will “shared sacrifice” in 2011 include that kind of spending — the kind of spending that actually reduces resources before elected officials get a chance to make decisions on whether, or how, to spend the funds?

This is one of the most critical decisions to be made as a new General Assembly convenes and the new governor is inaugurated.

Posted by Mike Owen, Assistant Director