Kansas Gov. Sam Brownback (R) spent the week in one of the fights of his political life, holding back a bipartisan attempt to raise taxes after the governor's signature 2012 reforms blew annual holes in the budget. A bill that would have upped the income tax on people making more than $30,000, projected to raise $590 million in revenue, passed by an 85 to 40 margin in the state House of Representatives and 24 to 16 margin in the state Senate — despite both chambers being dominated by Republicans. But the Senate vote fell short of 2/3, allowing Brownback's veto of the bill to stand.
The next day, Brownback spoke at the Conservative Political Action Conference — and didn't mention any of this. As part of a panel titled “The States Versus the State, How Governors are Reclaiming America's Promise,” Brownback called for abortion law to be returned to the states, for the Affordable Care Act to be “taken down,” for a standardized system of grading public universities and for national welfare policy to follow on Kansas's 2016 reform.
He did not mention the tax fight, which has drawn national (and typically negative) attention as Kansas has missed the growth projections that helped sell the cuts. Kansas's economy grew just 0.2 percent in 2015, the last year for which full figures are available. Last year, as oil prices slumped, Kansas ranked 45th among the states in private sector job growth.
Until this year, Kansas's state legislators stuck to the 2012 tax rates, tweaking sales taxes to patch budget holds. But in 2016, as Donald Trump was easily winning Kansas, the state's Republican Party lost surprising ground. Democrats gained 12 seats in the 125-member state House and one seat in the state Senate, bucking Election Night's national trend of rural Democratic defeats. Earlier in the year, several conservative Republicans lost primaries to moderates, who pledged to review the budget problem.
Still, one month after those losses, Brownback told the Wall Street Journal that his state's tax cuts could be a model for Trump. At CPAC, asked what lessons the Kansas experiences held for Republicans in Washington, Brownback again defended his approach at home.
“I think what you saw was a lot of people with a very liberal agenda got this last year — and they ran as Republicans,” he said. “What I would say is that the key issue here is growth. We've got to get the national economy growing above this paltry 1.8 percent, and I think it's going to be a key measure for Trump.”
Republicans in Washington are discussing a number of possible tax reforms, to come as early this summer. While the most heated discussions have come over a floated “border adjustment tax,” Trump's campaign tax plan suggested deep cuts to both the top income tax rate — from 39.6 percent to 25 percent — and capital gains taxes. According to the nonpartisan Tax Policy Center, the cuts would decrease federal revenue by trillions of dollars even if the economy grew more quickly. And both Brownback and Trump have been consulted by the supply-side guru Arthur Laffer.
Onstage and offstage at CPAC, Brownback found a different area of agreement with Trump. Onstage, he suggested that Republicans in Congress needed to move quickly and decisively to replace the Affordable Care Act.
“It's driven people out of the insurance marketplace and into Medicaid,” he said. “I think that's the one that really needs to be taken down, it needs to be addressed in a politically sound fashion, but that's the one near-term.”
After the speech, he explained that “politically sound” meant, in part, that Congress needed to preserve the ACA's expansion of Medicaid to people with income at up to 133 percent of the federal poverty level.
“They need to be figure out: How are we going to allow people to stay on the Medicaid expansion?” he said. “But let's set a date certain — after that, no more added.”
While most Republicans have called for a full repeal of the ACA, Trump promised during the presidential campaign that Social Security, Medicare and Medicaid could remain basically untouched, their cost covered by economic growth.