Wrong recipe


Here we go again. Another month, another left-leaning think tank condemning Nevada as a bottom-feeding badland in desperate need of more and higher taxes.

On Wednesday, the Pew Center on the States unveiled its list of the 10 most financially troubled states. The national report went so far as to predict that Nevada will be the last of the 50 states to emerge from the recession.

There's no sugar-coating Nevada's economic woes. But the Pew report isn't overly concerned with free enterprise, investment and policies that allow businesses to grow and workers to prosper. It ties each state's prosperity to growth in government budgets.

No state government budget grew faster than Nevada's from 1990 to 2007 -- spending increases vastly outstripped the state's nation-leading population growth and inflation combined. Now, with almost no population growth and significantly less economic activity, Nevada's general fund is still growing.

Caterwauling about "cuts" notwithstanding, the current biennium's $6.9 billion budget is about 10 percent bigger than the modified spending plan of 2007-09, which was about 8 percent bigger than the budget of 2005-07.

Nevertheless, the Pew report bemoans state officials' inability to enact a new, job-killing broad-based business tax. It laments that Nevada voters placed limits on the Legislature's ability to create and raise taxes by requiring two-thirds supermajorities in both the Assembly and Senate.

Because Nevadans have resisted the creation of a crippling tax burden, they've thus far prevented the Silver State from descending into the kind of borrow-and-spend black hole that has swallowed the California Capitol. But the folks at Pew don't make that connection.

"The level of dysfunction is as severe as in California, if on a smaller scale," the report says of Nevada. "Its revenue from taxes does not keep pace with the rising cost of services."

Hogwash. At one point in 2005, when Nevada was leading the nation in job growth, lawmakers had so much surplus revenue they had to rebate taxpayers. Pew takes the position that even when the economy is contracting, government spending must grow, even if it requires tax increases.

And who drives "the rising cost of services"? Not the taxpayers. It's our free-spending elected officials, who in the summer of 2008 saw fit to preserve 4 percent raises for all state employees at a time when private-sector workers were suffering job losses and income reductions.

These kinds of arguments are nothing new from Pew, which supports economy-crushing government interventions to address the bogeyman of climate change and massive increases in taxpayer-funded "early education" (that's code for universal preschool, pre-kindergarten and full-day kindergarten).

If Nevada politicians follow Pew's advice and jack up taxes in this economy, the report will become a self-fulfilling prophecy. Billions of dollars in tax increases amid record unemployment will guarantee we're last out of the recession.

That's a future we can't afford.

 

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