The federal deficit has been a hot topic for awhile now, with an overwhelming chorus reciting that the federal government has a spending problem, and that drastic cuts are needed to close the deficit. But is spending the whole problem? Without a doubt, federal spending has increased a great deal the past few years in response to…
Tax and Budget
The Washington Post has a fantastic editorial by Delaware Governor Jack Markell. Markell explains why the "economic war between the states" is a lost cause and why states should focus on public investment to boost economic growth. This is something we've been trying to get the media and legislators to understand for quite some time.…
The Daily Mail reported today on the fate of legislation to address the state's OPEB liability and the future of public employee retiree health care. In doing so, they may have confused readers by not putting the OPEB issue in context for its readers. For example, the lead paragraph states: "Ask West Virginia legislators if…
How many people understand this point? My guess, not many. An article in the Charleston Gazette this morning may help: "The unfunded liabilities would be a problem if all state and local retirees went into retirement at once, but they won't. Nor will state governments go out of business and hand underfunded pension plans over to a federal…
There has been plenty of attention lately about unfair property tax assessments for homeowners, where even without a rate increase, a homeowner's property tax bill jumps due to an increase in the assess value of the home. However, there is another issue with property taxes that has been going unnoticed. Since 1994, when the first statewide reappraisal…
Earlier this week, I voiced concern that the proposed spending cuts coming from the U.S. House of Representatives would threaten West Virginia's ability to meet important needs like education, environmental protection, and community development, while threatening the fragile economic recovery. Now a report prepared for Goldman Sachs confirms that the proposed spending cuts would hurt the economy,…
Each year, the use of tobacco claims the lives of thousands of West Virginians. The state currently has the nation’s highest smoking rate among adults and pregnant women and one of the highest among children. Currently only seven states have a lower tobacco tax than West Virginia. Bills (SB 362/HB 2973) introduced in the 2011…
The New York Times and the Economist both had interesting pieces last week highlighting the difficulties of federal corporate tax reform. Most interesting, however, was a chart in each article showing the effective federal corporate income tax rate by industry. Unfortunately (or fortunately), the chart contained a major error. The effective rates in the chart…
Unlike many other states, West Virginia is not cutting any major programs or imposing any new taxes in FY 2012 but does face many challenges in the years ahead. A report released February 3, 2011 by the West Virginia Center on Budget and Policy provides an overview of the state’s budget, describes the proposed major…
Does West Virginia's business personal property tax keep companies from investing in the state? Do states with low business taxes have stronger economic growth? Evidence suggests that taxes actually may have a minor impact on a state's economic development. Instead, other factors like a highly trained workforce are more important. Read