Forbes is not exactly known for it’s liberal view on anything, let alone economic factors like taxes and which states are well suited for business development and growth.
Looking at Forbes’ data, according to the anti-tax, anti-government crowd here in Colorado- we should lead the nation out of this recession. Well Colorado and Virginia. But Virginia’s economic strength is partly based on the expansion in suburban Washington, DC and that expansion is mostly based on a growing federal gov’t. So let’s ignore that.
With a little more digging, it’s possible to see that CO, Utah, Washington, and Virginia (the top 4 according to Forbes) have similar business tax climates.
Wait a minute!- why aren’t the lowest tax states the strongest economic growers? If the “taxes are bad for business and therefore citizens” crowd is right South Dakota, Alaska, Wyoming, Nevada,and Florida (the best 5 for “business tax environment”) should be growing best and leading us out of this recession.
SD, FL, and NV are getting killed. AK and WY are adding jobs and forecasts for them are better than most states. BUT – take energy extraction out of the mix and they are doing worse. So, they are doing better because of O&G extraction- but their severance taxes and regulatory environment are both “worse” than ours in CO. CO’s severance tax is less than 1/2 of WY’s and less than 1/3rd of AK’s.
How could this be? If other states’ have higher O&G severance taxes, production there should be getting killed,right?
If in general Colorado taxes are too high and regulations overall are too hard on business – we shouldn’t make the top 25 on Forbes’ list- let alone the top 4.
According to the Tax Foundation (source above) NY and CA are two of the “worst” tax environments for states. Yet, neither are in recession as bad as many states with “better” tax environments – based on current and forecast unemployment and GDP in the state. (Yes, CA’s budget is all screwed up- but the underlying fundamentals there are better than in most states.)
Could it be that taxes, regulations and overall gov’t activity and the relative impact on business and the local economy are a bit more complicated than we’ve been led to believe by the CO R’s and kneejerk voters in CO? That lower doesn’t always mean better? Could it be that, in fact, the better question is a complicated assessment of not only how much a state collects, but from what sources and how it is spent?
By which measure, at least according to Forbes (those socialist wannabe-Boulderliberal bastards) Colorado does well.
Personally, I would prefer to see more home grown, local production in Colorado. In the Forbes measure, we score high on having an educated work force. But most of our more highly educated per capita come from out of state. Why is that?
Likewise, I would prefer Colorado better prioritize the things that give us such high quality of life scores. In addition to P-20 education funding, clean air and water, for example. Which would mean strict air quality standards (no more brown cloud, thank you) and strict water quality standards that would require fraccing fluids to be safe and controlled- starting with known ingredients.
And because that tax and budgeting process is and should be based on a more complicated assessment of not only how much a state collects, but from what sources and how it is spent, then I strongly prefer to have a tax and budget process that makes our elected officials accountable for the taxes they imposed and the budgets they created. Instead, because of TABOR and other constraints on the process, our legislature and governor cannot really be held accountable. Likewise, because of the voters’ poorly informed knee jerk reaction in this state to any discussion of increased revenue or removing budgeting constraints, our elected officials cannot even discuss it. (see AB and Marostica 2009)