Why Are We Having This Conversation?

Nancy Dembowski states in her column, published in the December 29 issue of The Leader that businesses need to pay their "fair share" in Indiana, in an attempt to weaken the burden carried by middle class Hoosier families. Does Dembowski propose lowering taxes of Hoosier families and simply shifting that burden onto Hoosier business? Most likely, Hoosier families were simply being used as prop and an excuse to berate the hand that feeds those Hoosier families.
Yes, Indiana's future (like the future of all states in the union) is looking uncertain, making the budget issue incredibly important-an issue with foreseen or unforeseen consequences that will certainly affect each of us in some way. State revenues have plummeted, and while we've been waiting for things to just "turn around," that is probably wishful thinking.

Back in September Gov. Mitch Daniels said in The Wall Street Journal, "It's much more likely that we're facing a near permanent reduction in state tax revenues that will require us to reduce the size and scope of our state governments."

The solution to tax revenues is not to simply tap into the limited resources of our job creators by forcing them to pay up. We don't need to experiment with this idea; states like California and New York have already done so and how has that worked out for them? Businesses have fled such unfriendly locales and headed to states like Indiana where they are encouraged to invest, thrive, and inevitably provide jobs and tax revenue.

Why are we still having this conversation? The effects of marginal tax rates throughout history should have taught us this lesson by now. During the Great Depression President Hoover raised taxes and then Roosevelt multiplied the problem with a whopping 90% rate on the rich. When President Kennedy slashed the rate across the board, the economy grew, and tax revenues and the standard of living rose. Kennedy himself saw the fact of the matter: "It is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now."

The fact was lost in the Nixon administration when the tax brackets crept back up to an astonishing rate, due to inflation that didn't match the non-inflated incomes of tax payers. When Reagan came to office with broad tax cuts, revenues rose by 99.4% during that decade.

Nancy Dembowski should be looking for ways to reduce the size and scope of government and encourage business-Big Business, Small Business-to grow and prosper. It takes real courage for an elected official to reduce the hand-of-government to mouth-of-voters budgets, to seek out and eliminate duplicated and wasteful bureaucracy. Someone's got to do-and do it now.