2012, Kansas Governor Sam Brownback sought to boost the economy by sharply cutting income taxes across the board.
Under his plan, the tax rate on pass-through business income fell to 0. The idea was to boost investment, raise employment, and jump-start the economy.
This type of supply-side trickle-down theory has been proposed by Ronald Reagan, George Bush, and many others.
The program in Kansas served as a lab test for how supply side tax cuts may work at the federal level. In Kansas, however, these tax cuts proved unsuccessful.
The Kansas economy did not grow faster than neighboring states, the country itself, or even Kansas’ own growth in previous years.
The experiment with tax policy was such a failure that a Republican controlled legislature not only voted to raise taxes, but did so over the veto of the governor.
Rather than Democrats overturning the tax measure, this was a case of Republicans in power looking at the effects of the tax cut on the economy and making the decision that it was, overall, a bad idea.
More recently, he served as the architect of Sam Brownback’s (R) failed right-wing economic experiment in Kansas, which destroyed state finances and did little to improve the state’s economy. Laffer vowed that Brownback’s plan would generate “enormous prosperity,” which is largely the opposite of what’s actually happened.
When the the GOP governor’s agenda failed to deliver on any of the expected results, Laffer was pressed for an explanation. “Kansas is doing fine,” he boasted.
Kansas was not doing fine.