No sales tax hike



It comes as no small relief in these quarters that our local Republican legislators are not on board with Gov. Kim Reynolds’s plan to raise the sales tax for mental health, natural resources and property tax relief. The governor’s plan does not respect the wish of the voters who, a decade ago, amended the Iowa Constitution to allow for a fractional sales tax to be used strictly for additional natural resource funding. Her proposal is a mishmash that does not appear to have much of a life with the legislative GOP caucus.

If the governor did what more than 60% of the electorate voted for in 2010, she would appropriate an additional $200 million (three-eights of a percent of new sales tax) to natural resource conservation and enhancement. Her budget appears to allow for an $82 million increase, much of which would be directed toward the Iowa Department of Agriculture and Land Stewardship. That is our basic problem: Reynolds thinks she can rewrite the funding formula that was presented to voters.

Rep. Gary Worthan and Sen. Mark Segebart, both Republicans, expressed skepticism at a recent legislative forum in Storm Lake for a different reason: It’s a tax increase. Republicans prefer not to run on that, and maybe they fail to appreciate how a slight increase in funding for water quality is worth a tax hike. They believe that the budget is in good enough shape to fund water quality and help counties avoid massive mental health property tax increases (an optimism we do not share, considering our rat’s nest of a Medicaid budget).

Some in the environmental lobby figure you should take the Reynolds plan as a bird in hand. They have been beaten to the point of picking up crumbs off the floor. County supervisors worry about ballooning property tax bills from a new, underfunded regional mental health system created by the sitting legislature and governor. It will be the legislators’ responsibility to avoid a taxpayer revolt in the next election, and it will be interesting to see what proposal they offer counter to the governor’s. They must offer relief of some sort. But not adding a percent to an already-high state sales tax.

It would appear that the legislature is not ready to fill the trust fund for the environment created by voters in 2010. That’s just as well, because the governor’s plan is not even half a loaf. Better to wait until she is up for re-election in a couple years.

Trump’s socialism

Somebody should loop Agriculture Secretary Sonny Perdue into Twitter. Last week Perdue cautioned farmers not to bank on another trade bailout payment. A day later, President Trump tweeted in all caps that farmers may well get another Trump Bump before the election. He thinks that will lock down the farm vote, which is about 6% or less even in Iowa.

Trump already has ladled two payments totaling $28 billion at farmers, Brazilian meatpacker JBS, and absentee landlords. This is bigger than President Obama’s bailout of the auto industry. Trump did not say how big this one will be, or at whom it will be targeted (the biggest farmers got most of the money so far). But it shows how desperate he is to hang on to hard-hit Midwestern swing states.

Just weeks ago, Trump was advising farmers to buy bigger tractors and more land because he reached a trade deal with China. He claimed China would buy $40 billion in ag products. Markets sank because nobody believed him. It appears that the purchases might be closer to $14 billion, lower than when Trump took office. Commodity markets continue to languish. Farm income is projected to be down 9% in Iowa this year. Bankruptcies in Wisconsin are up. Hence, another bailout payment. When producers have to look to the government for their very survival, this is not socialism. Right? We are a market-based economy. Until you destroy the markets.

Articles Section: