Category Archives: State government

Math beats myth, this time

By Steve Brawner
© 2017 by Steve Brawner Communications, Inc.

Wednesday saw the triumph of math over myth, in one state.

That would be Kansas, where the Legislature overrode Gov. Sam Brownback’s veto of tax increases made necessary by his previous tax cuts. We’ll see how this applies to Arkansas later in the column.

What happened in Kansas was in 2012, Brownback pushed through the Legislature huge tax cuts that weren’t accompanied by sufficient spending decreases. He said the tax cuts would spur big economic growth. They didn’t.

The state ever since has been a fiscal mess, and a cautionary tale for other governors. This year it faced a $900 million budget deficit along with an order by its state Supreme Court to increase funding for public schools.

Kansas’ previous policies were based on a commonly believed myth – that if you cut taxes, the economy will grow and the tax cuts will pay for themselves. Thus, you don’t really have to cut spending.

The math is quite different, as proven time and again. Tax cuts can spur economic growth, but not enough to make up for the lost revenue. A minus sign doesn’t become a plus sign just because a politician says it’s so. To make the equation work, it’s very simple – just cut spending too. If you don’t have the courage to do that, don’t cut taxes.

The easy decision is to cut taxes without cutting spending. That makes everyone happy until the bills come due, which can take a while. The easy decisions of the Kansas Legislature of 2012 left the Kansas Legislature of 2017 with hard choices – more taxes, less spending, more debt, and/or violating a court order. So after the 2012 Legislature played Santa Claus, today’s legislators had to be Scrooge.

The result was the Legislature passed a $1.2 billion tax increase that Brownback, still determined to be Santa Claus, vetoed. On Wednesday, legislators overrode that veto knowing they’ll have to tell their primary voters that they voted for a tax increase.

It’s ironic this all happened in Kansas, the state that produced President Eisenhower, under whose administration the federal budget was balanced three times in eight years and almost balanced every other year.

If you’re wondering why this is relevant to Arkansas, it’s because your elected officials at the state and national levels will be spending a lot of time talking about taxes and tax cuts.

At the state level, taxes were cut in 2015 and 2017, and now Gov. Asa Hutchinson and other elected officials want to further reduce rates and simplify the tax code to make the state more competitive with its neighbors. A task force is meeting to craft legislation for 2019. For the math to work, the state must eliminate deductions, but each one will have its own constituency that will fight to protect it. On Wednesday, the task force hired a consultant to determine exactly what deductions are littered throughout the code.

Arkansas has a history of being fiscally responsible and has mechanisms in place through the Revenue Stabilization Act to produce a balanced budget. But mechanisms can be overridden or worked around. The Legislature is going to cut taxes. Hopefully, it will offset all of them by closing deductions and with spending cuts, lest Arkansas look like Kansas without the “Ar.”

More concerning is what’s happening at the federal level, where President Trump wants spending increases for the military and the border wall and has proposed spending cuts that largely won’t happen. He wants to leave untouched the government’s biggest programs, Social Security and Medicare.

Meanwhile, he and other Republican leaders have been promising tax cuts that they really, really want. Speaker of the House Paul Ryan was Brownback’s legislative director in the 1990s when Brownback was in Congress.

For a long time, Washington has behaved like Kansas, with much more disastrous results. Taxes have been cut under the theory that they would pay for themselves, spending has been increased, and the national debt has reached $20 trillion, or $62,000 for every American.

Arkansas’ six members of Congress could, as has happened so often, act like the 2012 Kansas Legislature and play Santa Claus, letting a future Congress somewhere down the line be Scrooge.

Let’s hope they instead base their decisions on math, not a myth. Santa Claus isn’t real, but the bills that come due after Christmas are.

Related: $23.33 less debt

The return of recess?

By Steve Brawner
© 2017 by Steve Brawner Communications, Inc.

Can more time in recess and less time in class help students learn better? That’s a question some schools in Arkansas will try to help answer.

Under state law, elementary students must have 40 minutes of physical education each week and 90 minutes of additional physical activity, such as recess. That’s 18 minutes per day.

Act 1062 sets up a pilot program for the 2018-19 school year that basically triples that amount in some schools. In addition to physical education, students in grades K-4 will get 60 minutes of “unstructured and undirected play” each day, while students in grades five and six will have 45 minutes. Two schools in each of the state’s 15 education service cooperatives – groups of school districts that share resources – will participate, along with two more schools not involved in cooperatives. The Arkansas Department of Education will write the rules. The results will be studied and used to enact future policy.

The law was sponsored by two legislators on opposite sides of the political spectrum – Sen. Gary Stubblefield, R-Branch, a conservative farmer, and Sen. Joyce Elliott, D-Little Rock, a former teacher and one of the Senate’s most liberal members.

The background for this is when the federal No Child Left Behind law was passed in 2001, schools were held more accountable for their students’ test scores, and as a result, they began to focus more on core academic subjects. With the stakes raised higher, recess was considered an expendable part of the day and reduced.

In recent years, many have questioned the wisdom of that philosophy, for several reasons, the obvious one being health. One in five school-aged children is now obese – triple the percentage of the 1970s, according to the federal Centers for Disease Control and Prevention. Spending more time sitting and less time playing certainly doesn’t help.

But there are also potential academic and social benefits to recess, which may help explain why students who get more breaks elsewhere, like Finland, outperform American students. According to a 2013 paper by the American Academy of Pediatrics, children benefit when concentrated learning is followed by unstructured play. Research by Anthony Pellegrini and Catherine Bohn found that recess made students more attentive and productive in class whether they were outdoors or indoors. Moreover, students learn important social skills when engaged in unsupervised play away from adults.

It’s unclear how many schools will volunteer to participate. Sixty minutes a day is a lot of time to take kids away from the classroom. Not only will it require a major reconfiguration of the school day – for a one-year program – but it also will require schools to take the risk that the reduced instruction time won’t hurt test scores.

Moreover, much has changed in the past couple of decades. Americans don’t do “unstructured and undirected” very well anymore when it comes to children. We’ve become a more risk-averse, less playful society, so what’s the response if more recess means more kids get injured or bullied or suffer some other bad outcome? What happens if we give the kids time to play and develop their social skills, and all they do is stare at their phones?

The way these things work is that the Legislature passes a law with broad goals, the agency sets the specific rules, and school districts implement them based on their local situations.

So here’s a couple of suggestions. First, the research shows that kids need a lot of short breaks to recharge their minds, not hours sitting in class and then an hour on the playground. In Finland, it’s 45 minutes of learning followed by 15 minutes off. Let’s do something like that. Second, the Department of Education should interpret “unstructured and undirected play” loosely so that teachers still can offer helpful guidance when appropriate – maybe show the kids how to play kickball, and then get out of the way.

The question isn’t going to be whether recess is beneficial for students. That one’s already been answered. The real questions are, how much recess is best, and how best can it be implemented?

Can those questions be answered with a one-year pilot program? Don’t ask me. I’ve been working on this column for hours, and I need a break. Kickball, anyone?

For foster parents, mercy triumphs over judgment

Andrew and May Baker were name Foster Family of the Year.

By Steve Brawner
© 2017 by Steve Brawner Communications, Inc.

On May 16, an awards banquet was held where no one really cared who won.

That was the day the Arkansas Foster Family of the Year and 10 regional winners were honored by the state Division of Children and Family Services (DCFS). They were honored for doing what foster families do: giving loving homes to children removed from their biological families, giving those biological families a helping hand during difficult times, and giving the taxpayers a heck of a good deal.

Foster families temporarily take care of many of the 5,200 children whom the state has removed from their homes because of abuse, neglect and other reasons. The arrangements can last from days to years. Sometimes the foster child is ultimately adopted by the foster parents, and sometimes the child is adopted by another family, but in most cases that’s not the goal. The goal is to provide support services to the children’s biological families so they can be reunited.

Here are some of the ones who “only” won regional awards. Ben and Lora Yother from Greenwood, two nurses, have cared for 13 foster children, including medically fragile ones. Steve and Ruth Hale from Conway started fostering in 2012 after they already had eight grandchildren. They’ve fostered 53 children and adopted their first one, seeing her through a teenage pregnancy that produced their ninth grandchild. Charles and Ginger Blue of Nashville have opened their home to 75 foster children in seven years. Terra Cobb of Texarkana, a single mother, has fostered 66 children since 2012. Meanwhile, she’s adopted three children ages 3,4 and 5 and cares for her 80-year-old grandmother in her home. Shantel Moore of Sherwood, another single mother, specializes in fostering teens and teen girls. Tate and Tammy Pfaffenberger of DeWitt have fostered 20 children since 2014. Last year, Tammy continued to care for two foster children – along with her own – despite undergoing radiation treatments for breast cancer. Then, while still undergoing the treatments, she accepted a third foster child.

As someone wrote about her, “Through chemo, losing her hair, staying up all night with babies, going to sporting events, you name it, she never complained.”

That’s some tough competition.

That said, somebody had to “win,” so the Foster Family of the Year was Andrew and Amy Baker of Searcy. He’s a leadership in ministry professor at Harding University, while she’s a speech pathology professor there. They were selected not because of the number of children they’ve fostered (nine long-term over three years) but because of their efforts to reunify the children with their biological parents or other relatives.

The Bakers learned to care about these kids during their own upbringings. When Amy was a child, her parents hosted weekend visits for young people living at the Southern Christian Children’s Home in Morrilton. Andrew’s parents in the state of New York opened their home to what he called “pretty hard core” teenage detainees, some barely avoiding prison and some being loved for the first time in their lives.

Like all foster parents, the Bakers experience grief when the foster children they’ve grown to love leave their home and return to their families. As Andrew explained, “If it doesn’t hurt, you didn’t do it right.”

But reunification is still their goal, as it is the system’s, and so they work with those families throughout the process and stay close to them afterwards. No one wants to be a bad parent, they say, and if circumstances had been reversed, maybe they would have made the same mistakes. If for whatever reason their children were removed from their home, they would want the foster parents to be striving for reunification, too.

“Mercy triumphs over judgment, and I think that’s our role is to be a voice of mercy in a very complicated system,” he said.

Want to try to beat out Terra Cobb or Tammy Pfaffenberger for next year’s title? Contact DCFS at http://www.fosterarkansas.org or 501.682.8770. Another avenue is The CALL in Arkansas (thecallinarkansas.org, 501.907.1048), a ministry focused on recruiting and training foster and adoptive families. Project Zero (theprojectzero.org) helps foster children who are eligible for adoption find permanent homes.

Related: This family’s really super.

Tax cuts and rosy scenarios

By Steve Brawner
© 2017 by Steve Brawner Communications, Inc.

Let’s say you’re planning next year’s family budget.

Should you (A) be honest about what you’ll probably spend and as realistic as possible about your likely income, taking into account there could be an unexpected downturn? Or (B) assure yourself you’ll get a big raise, tell yourself prices will fall, increase your spending, and obligate yourself based on a rosy scenario?

I hope you answered (A). Otherwise, I didn’t do a very good job writing that first paragraph. If you’re the architects of President Trump’s first budget outline, you instead chose (B).

The budget, released tellingly while Trump is out of the country, promises to transform the annual budget deficit that will be $559 billion this year into a $16 billion surplus by 2027. We’d still have the national debt – currently $20 trillion and growing – but at least we wouldn’t be adding to it.

Unfortunately, the budget relies on that aforementioned rosy scenario to get there.

On the spending side, it increasing money for defense while proposing cuts to spending programs, including popular ones such as Meals on Wheels, that are so deep that even conservative Republicans in Congress won’t support them. Meanwhile, it leaves untouched the primary drivers of the increasing national debt, Social Security and Medicare.

Meanwhile, Trump is promising tax cuts he says will spur so much growth they’ll pay for themselves – a promise that won’t come true, according to the nonpartisan Committee for a Responsible Federal Budget. Moreover, Trump’s budget relies on projections of 3 percent economic growth per year – an unrealistic number, considering the Congressional Budget Office expects the economy instead to grow 1.8 percent annually over the next decade.

I said “unrealistic,” not “impossible.” According to the Committee for a Responsible Federal Budget, the economy has averaged 3.2 percent growth since 1950, and there have been times when it grew even faster – 4.3 percent in the 1960s and 3.5 percent in the 1990s.

The difference between now and then is us, says the Committee. We’re now an older country, and certain to grow older. The baby boomers are now retiring, and retired people produce less than working people. Meanwhile, as the number of older Americans increases, so does the number of people accessing Medicare and Social Security, which, you’ll recall, President Trump’s budget doesn’t touch.

Given the fact that 70-year-olds don’t usually have children, the fastest way to reduce the age of the workforce is to import workers from the outside. But even that would be only a partial solution causing other problems. Besides, as you may have noticed, increasing immigration is not exactly a priority of the president’s, or of Arkansas’ Sen. Tom Cotton, for that matter, who argues that immigrants compete with Americans for lower-wage jobs.

It’s possible that some kind of private sector advance could spur the economy, much as the dot-com bubble helped make the 1990s boom possible. But remember, we call that a “bubble” for a reason. Anyway, we’re already in the middle of one of those advancements. Technological innovations have let the United States approach energy independence, and gasoline is cheap right now. Nevertheless, the economy’s been plodding along for years – not terrible, but not great.

Because of all these factors, the Committee for a Responsible Federal Budget says Trump’s plan will reduce revenues by $5.5 trillion. This would occur at a time when government expenditures for Social Security and Medicare are destined to increase, as will interest payments on the debt. And let’s face it, Congress isn’t going to cut spending drastically for Meals on Wheels.

Instead, the U.S. government should do what a prudent family does: Base its budgeting on what’s likely to happen – actually, worse than that – and on the basic math principle that subtracting from your income does not add to it. It doesn’t have to expect the worst-case scenario, but at least it shouldn’t depend on a rosy one.

Related: $23.33 less debt

State tax cuts: First answer ‘How?’ and then ‘How much?’

By Steve Brawner
© 2017 by Steve Brawner Communications, Inc.

Your state taxes were cut by $100 million in 2015 and about half that much this year. In 2019, Gov. Asa Hutchinson and state legislators intend to cut them again.

But with state budgets growing tighter, “How?” is a more important question than “How much?”

To answer both questions, and others, legislators during this past session created a task force that will study the state’s tax code before producing proposed legislation by September 2018, 16 months from now.

The Tax Reform and Relief Legislative Task Force met for the first time Monday and elected two level-headed and practical-minded co-chairmen, Rep. Lane Jean, R-Magnolia, and Sen. Jim Hendren, R-Gravette. Jean is co-chairman of the Joint Budget Committee, while Hendren, Hutchinson’s nephew, has co-chaired two other task forces, one for school employees’ health insurance and one for health care.

Hutchinson likes to use these task forces to form a consensus on tough issues, to create a forum for discussion, or, if nothing else, to buy time. So far, they’ve mostly resulted in the policies he wants or, in the case of highway funding, provided a convenient back burner on which to place subjects he’d rather address later. They tend to lead to considered, incremental change so that radical legislation doesn’t slip through during legislative sessions, when things happen fast and can get crazy. Looking back, he might wish he’d created one for guns on college campuses.

The tax cuts enacted so far have benefited mostly the middle class (in 2015) and lower-income Arkansans (in 2017), so some legislators believe it’s time to help out Arkansans earning $75,000 a year or more in taxable income.

But simply cutting taxes will be difficult in an era of tight budgets. Hutchinson in April cut spending by more than $100 million over the next two years because sales and corporate income taxes aren’t meeting projections. These were not devastating cuts because they occurred in the so-called “category B” funding, which is the kind agencies know beforehand may not be available. But the timing, occurring after the latest tax cuts, was a little concerning.

There’s fat in any government budget, of course, and state government is no exception, but certain expenses are hard if not impossible to cut. Health care costs rise regardless of what the state does. The state is locked into always providing at least a token increase in public school funding lest it be sued again for failing to follow its own Constitution. Those highways don’t fix or build themselves.

So while legislators certainly will want to cut taxes, they’ll be spending a lot of time on tax reform – making the tax code simpler and more competitive with neighboring states such as Texas, which doesn’t have an income tax.

The only way to cut taxes much without blowing a hole in the budget is by ending some of the deductions that litter the tax code, but those politics will be challenging. Sitting in those committee meetings will be lobbyists whose clients benefit from those deductions. They will make persuasive cases through logical arguments and through past and future campaign donations. And when their clients’ members are mobilized and vocal – for example, all the farmers in a legislator’s district – they can be hard to vote against.

Meanwhile, legislators will seek to avoid the experiences of Kansas. Five years ago, Gov. Sam Brownback slashed taxes but not enough spending, saying that the resulting economic growth would create sufficient new revenues, because money grows on trees. Those revenues didn’t materialize, the state has been a mess ever since, and now legislators there are arguing about what to do about a huge budget deficit.

Brownback called his tax cut plan in Kansas an “experiment.” Arkansas’ tax task force has 16 months to apply the lessons learned – hopefully, by answering first “how” before considering “how much.”

Steve Brawner is an independent journalist in Arkansas. Email him at brawnersteve@mac.com. Follow him on Twitter at @stevebrawner.