A Glimpse Into North Carolina's Future: The Kansas Budget Crisis

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Back in 2012, a new Governor and conservative legislature passed a massive "tax reform" bill that slashed taxes on corporations and the wealthy. At the time the Governor said it would jump start the economy and generate more than enough revenue to offset the costs. However the rosy predictions proved untrue because the tax cuts never stimulated the economy as promised and a massive budget deficit was created.

That might sound a lot like North Carolina, but actually we're talking about Kansas and Governor Sam Brownback. With session about to begin in the Kansas legislature, lawmakers are scrambling to make up a budget hole of several hundred million dollars. They are faced with two basic options; repeal Brownback's reckless tax cuts, or dramatically slash public education and other vital services. 

Through just a few months of the fiscal year, North Carolina's tax revenue is already down over $400 million. Without repealing the reckless tax giveaways, North Carolina will face the exact same situation that Kansas is in. 

From the Mother Jones article on the looming Kansas budget crisis,

In 2012, when Kansas Gov. Sam Brownback first pitched his plan to drastically slash the state's income taxes, he promised "a shot of adrenaline into the heart of the Kansas economy." Brownback brought in Arthur Laffer, Ronald Reagan's trickle-down economics guru, to help sell the idea that the cuts—which zeroed out taxes for 200,000 businesses and slashed rates for top earners—were guaranteed to boost the state's fortunes, prop up the economy, and bring in countless new jobs as businesses and individuals flocked to Kansas to escape the tyrannies of higher-tax states.

Two years later, those rosy predictions have turned to doom and gloom. Next week, when the state legislature kicks off its new session, lawmakers will face a daunting budget deficit that will require either overturning Brownback's tax cuts or shaving hundreds of millions from the state's budget. A recent string of court cases mandating increased funds for education will make that job trickier. Thanks to Brownback's efforts to transform the state into the Koch brothers' dreamland, Kansas is now mired in a fiscal disaster.

Unlike the federal government, which can leave deficits on its books, state governments have to keep their budgets balanced from year to year. Throughout 2014, monthly tax revenues in Kansas came in far below expectations. Tax revenue in December alone came in $15 million below target.

Before the end of the fiscal year this summer, Brownback will need to trim $279 million from the current budget. Brownback's proposal would take $100 million away from spending on the state's highways and use a bit of numbers jujitsu to tinker with pension spending. But these tweaks will only carry the state through the current year. As further tax cuts phase in over time—the state's income tax rate, which has already fallen from 6.45 percent to 4.9 percent, is set to fall another point by 2018—the gap between spending commitments and revenue will only grow more dire. For fiscal year 2016, which starts in July, state legislators will need to slash an additional $650 million, according to the legislature's research office. Standard & Poor's and Moody's, two of the top three credit-ratings agencies, downgraded the state's credit rating last year due to the budget woes.


  1. Reg's avatar
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    This act is a reckless attempt to coverup the pitfalls of making ill advised decisions, The citizens of Kansas and North Carolina deserve better.
  2. Michael Jones's avatar
    Michael Jones
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    Doesn't matter NC and Kansas still voted in the same people that passed these ideas.<br /> <br /> Lazy non-voters and Republicans are causing this country to be sold out!!!
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