The LEGISLATURE is in session. Hold on to your pocketbook! So goes the old saying.
Covid-19 has put a lot of other issues on the back burner as all eyes are focused on the pandemic. When the legislature has the time to focus on major tax reform, you know things are relatively calm.
For one thing, the money is good. Governor Reeves says state tax receipts are 30 percent higher than projections. The Mississippi economy has escaped the Covid crisis relatively unscathed.
The latest federal employment statistics show Mississippi has lost 16,400 jobs to Covid — a better result than all but five states. Federal Covid aid to states has been generous. There is no budget crisis in Mississippi.
The two big issues from the last gubernatorial race — Medicaid expansion and increasing the gas tax — aren’t getting any traction, even though polls indicate a majority of Mississippians support both. Elections matter. Reeves was against both and he won.
It’s very politically popular to not raise taxes and that’s how politics goes. I’m not in favor of socialized medicine but the Affordable Care Act is the law of the land. It seems a waste to simply turn away a billion dollars a year in federal Medicaid subsidies, especially when the money would go to help working families get medical care.
Same with the gas tax, which hasn’t been raised since 1993. We will pay far more to rebuild the roads than we would to maintain them, but that’s politics. When the roads crumble, public opinion will change. Such a shame.
A big legislative issue is a bill to reform our tax code and eliminate the income tax. Texas has no state income tax. I think the Mississippi Republican state leaders have a case of Texas envy.
What state wouldn’t want to be like Texas? The economy is booming and people are moving there in droves.
There’s only one problem. Texas has a bunch of huge cities that drive economic growth and prosperity. Mississippi doesn’t have a single one. That’s a problem when you want to eliminate one of the few reliable sources of tax revenues we have.
By the way, property taxes in Texas are sky high. That’s a big downside to eliminating the income tax.
I’m a big believer in limited government and low taxes, but there are basic governmental services that can’t be neglected: roads, schools, law enforcement, prisons, courts, water and sewer. Neglecting basic infrastructure can offset the economic development benefit of lower taxes.
If Mississippi wants to grow, we can’t let our state be a dilapidated third-world state. That will scare business away.
No doubt there are some people who would like to keep Mississippi the small, beautiful agrarian paradise that it is. It is the most spiritual, charitable, friendly state in the nation.
But development has its benefits. There is still a lot of poverty in our state. Higher incomes could put a big dent in that.
One idea is to increase the sales tax to 9.5 percent to offset the decline in the income tax. But that will hurt stores and depress economic activity. Plus, a high sales tax tends to hurt working families who have to spend a higher percentage of their income purchasing the goods and necessities to live. Sales tax is less fair tax than an income tax.
I’m excited about the new broad-based jobs incentive plan that may soon be law. Instead of special tax breaks for huge companies, the plan will give all job creators equal access to incentives. This is long overdue.
Teacher pay is always an issue but seems to be on a back burner this session. I am for raising teacher pay to the average of our neighboring states.
Criminal justice reform is still alive. Mississippi has one of the highest incarceration rates in the world. Our prisons have been taken over by gangs. There’s little rehabilitation. Locking them up and throwing away the key is not working and it’s un-Christian.
The new prison commissioner, Burl Cain, spoke to the Rotary Club of Jackson recently and his words were encouraging. He is making great progress taking control back from the gangs and introducing spiritual-based rehabilitation back into our system. There’s a chapel being built at Parchman. This is all good news and should be encouraged. Prison should be an opportunity to teach people skills that will allow them to live productive, non-criminal lives.
In a weird move, the legislature passed a statutory version of Initiative 65, which is now part of our state constitution. The initiative dictates that medical marijuana can’t be taxed more than the normal sales tax, which is driving the state legislature nuts. They would love to see the state supreme court throw out the initiative on technical grounds, which would put medical marijuana under legislative control (more taxes!) Not likely. The legislature missed this boat big time.
There are some other bright lights. Vocational training for students who don’t go to college is being given the attention it deserves. Broadband is expanding in rural areas rapidly thanks to federal grants.
The legislature really needs to do something about the horrible decline in funding for our public parks and wildlife areas.
Free-market think tanks Empower Mississippi and the Mississippi Center for Public Policy are pushing for deregulation of occupational licensing. This has been quickly embraced by the state Republican leadership, although expect significant grassroots opposition when the rubber meets the road. Nobody likes their oxen being gored.
Lieutenant governor Delbert Hosemann and House speaker Philip Gunn seem to be getting along well, although both are strong personalities with definite opinions. This will be a healthy situation. The Hosemann/Gunn combo holds more power than Governor Reeves, but Reeves will reluctantly accept and adapt. Reeves is a practical politician above all.
The Covid situation has improved dramatically in the last month. Cases and deaths are a third of the January peaks. This is with only 12 percent of the population vaccinated, so some type of herd immunity is kicking in. The state has had 300,000 reported infections. The CDC says there are six unreported infections for every reported infection, so over half the state has been infected by now. We have weathered the storm. As more vaccines are given, things will only get better.
Our new flag is now flying, which warms the cockles of my heart. This is truly a sign that our state is embracing the future and not clinging to the past. There is so much to be optimistic about in Mississippi. We are moving forward in so many ways. We need to find that perfect balance of preserving what is good about our past and embracing the changes that can make our future even better.