There is an old story from the Civil War that takes place after the first day of the Battle of Shiloh. The Union Army of the Tennessee under General Ulysses S. Grant had been surprised by Confederate forces and had been pushed back to the Tennessee River. That evening, Brigadier General William Tecumseh Sherman remarked to General Grant, “Well Grant, we’ve had the devil’s own day, haven’t we?” Grant replied, “Yes. Lick ’em tomorrow though.” With the assistance of Union reinforcements that evening, that’s exactly what they did.
Now, the economic border war is not nearly as serious as actual combat between two opposing armies, but like Confederate General P.G.T. Beauregard, opponents of the tax cuts in Kansas are eager to declare a complete victory. The truth is that it appears Kansas just received some reinforcements, this time from the Bureau of Labor Statistics (BLS).
According to the BLS, Kansas private-sector job growth in 2014 surpassed that of Missouri (1.87 percent vs. 1.16 percent). Also, earnings in Kansas have grown nearly five times the rate that they have in Missouri (2.98 percent vs .59 percent). Does this mean we, as tax cut proponents, should declare victory? No. The next couple of months’ job or wage figures could change how the two states stack up. Overall, I think we just need more time to determine the tax cut’s effects. I definitely wouldn’t go as far as to say that these tax cuts are leading Kansas toward a disaster of biblical proportions.
As I’ve said many times, tax cuts are not everything. There are many factors that influence how an economy performs. However, with that being said, taxes do matter and income taxes in particular are harmful to economic performance. I hope these latest figures can give opponents a moment of pause before writing Kansas’ tax cut obituary.