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Biggs finds supply-side economics embarrassing & dangerous

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What the Devil won't tell you

Biggs finds supply-side economics embarrassing & dangerous

Quarter-century of tax, spending cuts leaves Az trailing high-tax states

  • Biggs in 2012.
    Cronkite NewsBiggs in 2012.

Arizona Senate President Andy Biggs had enough.

Boy did he let the his critics have it — hitting them for the second time this legislative session square between the peepholes with the patented Pig Latin Pivot.

Refuting claims in an Arizona Capitol Times story that a new lifetime limit of one year — existing in no other state — would cost Arizona more in the long run, Biggs did not hold his fire.

Well, he counterpunched with a haymaker: "Iks-nay on the uts-kay omeone-say ill-way ear-hay ou-yay."

“They have no reason to believe that that’s true. None of us do. There’s no study that says if you allow someone to stay on TANF 24 months, you never see them on welfare assistance again. That’s just a statement. It’s not even necessarily intuitive. It’s just, we’re going to make a statement and make an argument to try and embarrass people,” Biggs said.

Okay, well, let's start with the intuitive and linger on the idea that if someone reaches a "lifetime limit" of 24 months they are not going to show up on welfare again because it's a lifetime limit. That's what it means. And let's look past that even he quoted the reality that the average lifetime recipient gets welfare (TANF in bureaucrat) for an average 14 months because it's never been the way of life program it's been characterized as by the right.

Biggs of course is raising a bigger point that there are other welfare programs or state assistance (or the Department of Corrections) where the kids on welfare will end up. There's no study — he says — none. If there were it would be embarrassing.

I got a study right here. Originally published in the no-account fishwrap, the Journal of the American Medical Association.

"The median cost of services used by an un-housed chronically homeless person was$4,066 per month. Once that person was provided with housing and wrap around services, the cost declined to $1,492 after 6 months and $958 after 12 months."

Don't get JAMA, Sen. Biggs? Me neither. I didn't find it there. I pulled it from a document by that leftist institution, the Arizona state government. It's from the 2012 Arizona Department of Economic Security Annual Report on Homelessness. It's a Seattle study. But there it is. One study it took me just 10 minutes to find.

Biggs has a tried and true political communications strategy: When cornered, get emphatic and call everyone else a liar and hope the press doesn't dig.

He did it too in January, immediately after Gov. Doug Ducey's first State of the State address.

He got all lathered about a quote from a leading Democrat questioning the GOP's commitment to education. He called the idea that Republicans don't care about schools in the state "dangerous and erroneous," and then spent the next couple months ready arguing against a judge's ruling that Republicans in Arizona don't care enough about schools enough to fund them as legally required. Then last week, former House Speaker and Arizona Board of Regents President Mark Killian threatened a lawsuit against the Legislature for cutting higher education budgets to an unconstitutional degree. The Arizona Constitution commands the state to provide college education "as nearly free as possible."

I'm no lawyer but I don't think the legal definition of "as nearly free as possible" as written in 1912 would be construed mean "allowing politicians to keep a politically expedient no-tax pledge 103 years later."

Just as an aside, Arizona's supply-side push started about the time Killian took over as House Speaker in the mid-1990s. That Killian is doing this is nuts. Never mind Nixon going to China, this is Jesse Helms challenging Ted Nugent to a duel to defend President Obama's honor. Killian is the guy who in 1994 was so angry that the University of Arizona got $2 million more than he wanted in funding that, as speaker, he threatened the future of Davis-Monthan Air Force Base in retaliation. He would go on to remove from the House Ways and Means Committee a Flagstaff Republican who marked up the same bill to give Northern Arizona University another $2.1 million. Yes, that Killian. That guy, Biggs. You offended that guy.

But that doesn't answer the most pressing question about Biggs efforts to shut his critics' yaps: Why in the name of Howie Fischer aren't you bragging on it from the rooftops, Sen. Biggs? Why is it dangerous to point out the state's rankings and why is it embarrassing to eliminate the social safety net?

The Legislature didn't slip 25 years in a row on the same banana peel in their chambers and use the aye button to brace their fall. They created the way things are on purpose and for the more noble goal of improving the state's economy, or am I missing something? Leaders must choose a model and this is yours. So why not trumpet it: Put "last in kids, seventh in prisons" on our license plates or take out full-page ads in the New York Times declaring "Alabama says they screw the poor, in Arizona we feed 'em to the meth dealers." It's a jobs plan that will rise up all tides and lift all tubing trips.

We're leading the country in slash-and-burn fiscal policy, obliterating the social contract that holds business back and we've been doing it for 25 years. So let's marvel at the results that have Arizona's "streams" of milk flowing into "rivers" of honey. Low tax rates require rock-bottom spending. Therefor: America's thinnest safety net and a school system running on fumes means jobs. So what's the danger? Where is the erroneous assumption? What is their to be embarrassed about? Why aren't you picking up the phone to company after company and saying "Boy, am I going to email you a budget." Send the email blast and go wait at Sky Harbor for all the jumbo jets of site selectors to arrive in their I heart AZ T-shirts.

Hey, don't take my word for it, talk to this lady, Sen. Kelli Ward, R-Lake Havasu City, who says, in the same Capitol Times article, the way to create jobs is to punch the poor in the teeth.

While explaining her vote on the human services budget in the Senate Appropriations Committee on March 5, Republican Sen. Kelli Ward said people need to face consequences in order to be propelled off cash assistance and get a job.

“Sometimes people have to face a little bit of consequences so that they’re able to get out, get on their feet, especially healthy, working-age adults, so I’m hopeful that this plan with the TANF is going to lead to that so more people are self-sufficient,” Ward said.

Okay, maybe it's just a love tap that knocks the poor's teeth out, as if they themselves are not responsible for the income distribution curve ... ('Scuse me. Gotta wipe some sarcasm off my shirt) ...  found in every market economy. 

Never mind supply-side, demand-side or the Austrian School of economics, this is whole heterodox of the discipline — Kellinomics. Worsening conditions on the poor forces them to look harder for jobs improving the economy for all of us. Someone alert the Nobel Committee, because that talk about "a poor person never gave me a job" been claptrap all along. What creates investment isn't the wealthy. No, as Ward would tell it, it's the economically worked-over reaching a critical mass of desperation that triggers a surge in demand for new homes, consumer electronics and creates new lending. Otherwise, I mean, telling the poor to find jobs that aren't there is just-plain mean and borderline sadistic, right?

Ward is so enamored of poverty as an economic stimulus she unveiled her own bill, SB 1329, to gut the states' SNAP (food stamps) program, which is on it's way to becoming law.

Maybe taxes aren't the over-riding issue? Nonsense.

Okay, where would the typical Arizona family find themselves financially if they body swapped with a typical family in a state so known for the jack boot of taxes its nickname is "Tax-A-Chusetts?"

Joe and JoeAnn Saguaro would pay $1,702 more in taxes than Debbie and Dicky Soxfan. Wait. Hold on ... the Soxfan family also earns $18,332 more than the Saguaros, which is a 50 percent higher wage. I'm no math major but it would appear that even after Massachusetts' 22 percent higher cost of living the family there has a lot more money in their pockets than the Saguaro clan. The typical Massachusetts family is $15,209 better off after taxes.

Would you buy a stock for $1,702 to see an annual return of $15,209? If you answer "no," you have the business savvy to lead the Arizona Legislature.

Oh, the Soxfan family sleep more secure in that taxation hell hole because they are 20 percent less likely to be unemployed. Massachusetts doesn't have a ripping low unemployment rate, it's right at the 5.1 percent national average. Arizona stands at 6.6 percent.

So obviously, Arizona must chase the other un-taxed states, obviously found at the top of the unemployment ladder to radically improve its economy and cut the joblessness numbers. Hey, Minnnesota has just 3.9 percent unemployment. Jann and Janna Walleye pay $1,477 more in taxes and only make $9,563 better income with a near-identical cost of living as Mr. and Mrs. Saguaro. So they are $8,000 ahead of the Saguaros in Vikingland.  Minnesota's tax burden is the sixth-highest in the country, ahead of Massachusetts, according to the Tax Foundation.

Low taxes as a necessary condition to a strong economy is one thing. Arizona has for a quarter century doubled down on the low tax, low-service model. Now, Gov. Ducey and the Legislature seem to be hoping that it alone is a sufficient condition all by itself to bring in jobs because in their budget prisons are more paramount than universities.

So why are we lagging behind the rest of the country? Why is our unemployment rate higher, our median income lower and with a budget relying on boom bust sales tax revenues always out of whack — even in improving economic times. My god, is the Legislature banking on riding on Barack Obama's coattails? That can't be. But two of Arizona's leading economists told Phoenix-area business leaders Arizona is, in fact, riding the national wave and not leading. Lee McPheters, director of Arizona State University's JPMorgan Chase Economic Outlook Center and Elliott Pollack, a Valley economist who has been around so long he probably advised the Earp Boys, said Arizona's economy is following the country and not leading it.

The 25-year, supply-side experiment in Arizona is reaching its zenith — a peak so high even the guy who helped commission the climb is now getting vertigo and altitude sickness. The Legislature and four Republican governors now have had fast-break slam dunk opportunity after another to run up the score on their vision for economic preparedness. There's no excuse for the state being less than exemplary. This state should be a beacon of prosperity, boldly bounding out front of a nation limping toward recovery.

Or is there?

If Biggs isn't worried about the state services as a component to the economic model why the hell did he say this to business leaders prior to the state of the Legislative session:

"(But) ... if you want to consistently say to business: ‘Hey, you know what? We have a crappy education system,’ you’re not helping the state, you’re not helping our education system, and you are hindering our economy."

If I were to hazard a guess, I would say that Biggs and smart people like Ward (Duke grad and I'm calling a foul on her — God's wrath upon me follows) know that when businesses choose to do business in the U.S., they want to do business in the developed world. A world that affords a safety net, public schools that provide educated labor pools and not maybe a state with armies of impoverished, homeless but legally allowed to be armed-to-the-teeth.

The Tea Party and arch-conservative echo chamber live in a very specific and it can translate broadly to the voters. The practice gets tricky. Arizona is never going to — nor should it — pay for the top-funded school districts in the country but Biggs knows voters and business don't necessarily want to know that the state ranks No. 49 in school funding (or 48th depending on what side of the moonshine bottle Oklahoma woke up on in the morning). Voters in Arizona don't want a fat welfare state but aren't comfortable with basically eliminating it. 

Guys like Biggs know this. However, they get together in a back room with the budget in front of them, crank up Rush Limbaugh to 11 and lose their minds juiced up on talk radio ju-ju. The morning after when the buzz wears off, they are left to explain "it's not what it looks like."

Biggs and Ward can talk about personal responsibility and bad decisions of the impoverished post-Great Recession (just how "post" is up for debate) but what about bad decisions made by Arizona's political leaders make misreading the modern economy. They party like it's 1999 but seem to forget that song was a big deal because it sounded futuristic in 1983. They forget that its' now archaic. The Y2K-awaiting economy has changed into the modern one and Arizona is not at the forefront. So the state's poor finds themselves looking for work with dial-up skills in the knowledge economy's digital speed because Arizona's leadership made it so. How much must welfare recipients  learn from the mistakes Republicans in the Legislature?

And yes, lower taxes can attract jobs but if it's all that's being offered, the only companies moving to Arizona will be the ones that only care about taxes. Sounds a lot like call centers. Would a company that values education and quality of life come to Arizona and don't say "sun," because business seems to be stoked to be in North Dakota and Minnesota. Would Dicky Soxfan's company relocate to Arizona and pay a Massachusetts wage? Or how about a Minnesota wage? If they are expecting Boston or St. Paul test scores, they are going to be horribly disappointed.

One party has been in control of the state Legislature for 25 years and held the governorship for all but six of them. A quarter century ago they were charged with preparing Arizona for the future that is now. Look where we are.

They continue to do more of the same, bending Arizona's economic landscape to their vision. despite slicing and dicing Arizona's TANF payout to the lowest in the country, food stamps is about to follow and Arizona's unemployment insurance's maximum benefit is second to last in the country. They did it. The safety net here is the thinnest in the country but they are now relying on riding the national updrafts, rather than creating our own. That embarrasses you, senator? You made it that way. Isn't the fact public schools get funded less than 48 other states  dangerous because it's not erroneous?

The truly erroneous and dangerous assumption holds that corporate site selectors either never heard of — or don't have access to — Google. None of this is a secret.

It's a slim slice of the population that looks at 100 years of Mississippi's history and says "coooooolllll ... let's do it like them." Maybe they miss the joke in the South "Thank God For Mississippi" isn't in praise of it.  That, Sen. Biggs, would be embarrassing. 

Blake Morlock covered Arizona government and politics for 15 years, including 11 in the Tucson Citizen. He also worked on Democratic Party campaigns in the field of political communications. Now he’s telling you things that the Devil won’t.

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