Capitol Report – Voodoo economics revisited?
By State Representative, Leon D. Young
The state economy in Wisconsin is slowly showing signs of recovery.
The 2013 housing market was Wisconsin’s best since the recession.
In fact, statewide sales were up 10.8 percent, while the median price of homes rose 7.2 percent last year.
Another indicator of Wisconsin’s rebounding economy is the projected state surplus.
It’s believed that the state will take in hundreds of millions of dollars more than expected in tax collections through June 2015.
This, in turn, has prompted much speculation as to what will done with this unexpected windfall.
Governor Scott Walker has already intimated his desire to use this surplus to cut taxes.
Moreover, the governor’s state of the state address will undoubtedly provide greater insight into his thoughts concerning this new revenue.
It’s difficult to know, with absolute certainty, just how much money the state will take in through June 2015, but Capitol sources believe that it could approach $1 billion through mid-2015.
If this figure is accurate, this would be a considerable sum.
The governor has confirmed the overall tax cuts he’ll propose in his state address will go well beyond the $100 million property tax cut through 2015 that he and GOP lawmakers approved in October.
Interesting to note, there appears to be some division in the Republican ranks on this issue.
Assembly Republicans, led by Speaker Robin Vos (R-Rochester), are eager to cut taxes, but Senate Republicans in general are taking a more cautious approach.
Many in the Senate say they want to shore up the next state budget, which begins in July 2015, be erasing a starting deficit estimated by one measure at $725 million over two years.
It remains to be seen just how this projected state revenue will be divvied up ultimately.
True enough, changing the tax withholding tables would deliver more money to taxpayers more quickly.
But, in the final analysis, these proposed tax cuts invariably deliver the greater benefit to upper income earners.
Fact: Wisconsin ranks 37th in the nation in job growth, which creates a real economic hardship for low and middle income families.
It’s time to provide some real relief lower income working families in Wisconsin.