It never works. Republicans cannot point to an instance in which this prescription has led to the promised Valhalla of skyrocketing growth. Before Kansas, they could at least argue that the program had only been attempted partially and piecemeal, never in full and unadulterated form. After Kansas, that excuse is gone.
Eliminating business income taxes for owner-operated companies was supposed to induce entrepreneurs to move to Kansas from other states. It didn’t. It turned out that business owners take more than taxes into account when they decide where to locate. They want good health care and first-rate schools for themselves and their employees. They want modern, well-maintained infrastructure. In short, they want a healthy, functioning public sector.
It also turns out that business owners do not decide whether to expand capacity or add employees based solely on the tax rate they must pay. Much more important is whether there is enough demand to justify such growth. If there is not — and the Kansas economy under Brownback was woefully sluggish — then tax savings will not be put to productive use.
