The New Tax-Cutting Democrats

In Michigan, Governor Whitmer, a Democrat, is airing a campaign ad featuring a slogan most associated with President George H.W. Bush, a Republican: “No new taxes.”While Ms. Whitmer’s adoption of the slogan immediately drew criticism from the Michigan press, who pointed to her 2019 proposal for a 45-cent gas tax to fund road repairs, her messaging is indicative of an emerging Democratic strategy in races across the country.In some of the nation’s most closely contested elections for governor and Senate, Democrats are cribbing from the Republican script by running on tax cuts — but some economists are warning that their policies could be inflationary and that a more effective strategy would be to lower the top marginal income tax rates in these states.According to the vice president of federal tax policy at the Tax Foundation, Will McBride, now is a suboptimal time to adjust tax policy because there are too many “moving parts” in the economy, such as interest rate hikes.He did suggest, however, that if one were to cut taxes in an effort to avoid a recession, lowering the top marginal tax rate would make the most sense.“The other aspect of this economy to consider is how, if we’re heading towards a recession, how can we avoid that?” Mr. McBride asked. “The best way to do that is to reduce marginal tax rates at the top as well as for businesses.”By contrast, Democrats campaigning on tax cuts are promoting ideas geared toward working-class taxpayers, like eliminating sales taxes on groceries, reducing gas taxes, and lowering real estate levies — along with a “middle class tax cut.” A middle class tax cut proposal features prominently in campaign messaging from Wisconsin’s lieutenant governor, Mandela Barnes, the Democratic nominee for Senate in a close race with Senator Johnson, the Republican incumbent.A recent ad from Mr. Barnes’s campaign features the candidate at a school cafeteria recounting his family’s working class background and arguing in favor of tax cuts and for bringing manufacturing back to the state.“We need a middle class tax cut to put more money in your pockets,” he says. “If we want to change Washington, we’ve got to change the people we send there.”In New Hampshire, Senator Hassan is touting the support of small-business owners in the state, who she claims support her because of her record of supporting tax cuts and working to increase the federal and state research and development tax credit for businesses.“New Hampshire’s small businesses strengthen our economy and expand opportunity,” she said. “I am so grateful to have received support from 144 small-business owners across our state.”Ms. Hassan earlier introduced a bill with Senator Blunt to reduce the tax burden on homeowners and has advocated for businesses trying to navigate online sales tax red tape.Governor Kelly in Kansas has touted her most popular accomplishment, eliminating Kansas’s tax on groceries by signing a program that will phase out grocery taxes by 2025.“When Kansans needed it most, we were able to bring Democrats and Republicans together to eliminate our state’s tax on groceries,” the governor said.She once opposed eliminating the grocery tax, saying the state did not have the money to pay for it following the so-called Kansas experiment of Governor Brownback’s administration. This year, however, she came around to the idea.Now, the grocery tax cut features prominently in campaign materials and is serving as rhetorical armor against criticism from Republicans eager to paint her as a high-tax, big-spending Democrat.In Pennsylvania’s closely watched Senate race, Lieutenant Governor John Fetterman, the Democratic nominee, has proposed a tax cut for “working people” that is similar to Mr. Barnes’s plan, and expressed support for the suspension of the federal gas tax.His proposals draw contrast to the proposals of his opponent. Mehmet Oz, the Republican nominee, has promised: “I’ll cut your taxes and I won’t take a penny of them either.”His campaign has clarified that he intends to cut taxes on small businesses and plans to donate his salary to charity if he wins the Senate election there.Among the states where Democrats are campaigning on tax cuts, Kansas is ranked by the Tax Foundation as the 33rd worst state in the country in terms of its state and local tax burden, which stands at 11.2 percent of the state economic output. Wisconsin is ranked slightly better at 32nd in the country, taxing 10.9 percent of the state’s economic output. Pennsylvania stands at 28th in America with a 10.6 percent state and local tax burden. New Hampshire ranks 16th, at 9.6 percent. The Tax Foundation rates Alaska as first in America for having the lowest state and local tax burden — 4.5 percent.Making sense of the unusual prevalence of tax cuts in Democratic rhetoric this year, a professor of political science at John Jay College of Criminal Justice, Brian Arbour, says that tax cuts are just good politics.“Nobody likes to pay taxes, Democrats don’t, Republicans don’t, independents don’t, so saying that I want to cut your taxes is powerful for all politicians,” he tells the Sun.There is, however, a risk in adopting an issue that is “owned” by Republicans, as Mr. Arbour puts it.“What I and others have found is that campaigns are willing to trespass on the other party’s issues but they do it in ways that reinforce the messaging of their party,” he says. “One of the problems with agreeing with the other side is that they will agree with you but want to go further.”Mr. McBride said a suspension of the federal gas tax and a tax cut for lower- and middle-income tax brackets would be inadvisable given current conditions.“The gas tax is effectively a user fee for the highways which are funded by the federal government as well as the state government,” he tells the Sun. “Do I think it makes sense to be cutting the gas tax right now? No, not on the basis of the original design of the highway trust fund.”The federal gas tax hasn’t been raised since 1993, and so cutting it or suspending it now would only make America’s highways more of a burden on those who don’t drive, Mr. McBride said. Mr. McBride also cautions against a so-called middle class tax cut, unless it accompanies an equal or larger cut in government spending, saying that it could contribute to inflation, which he calls “the most severe challenge we have right now.”

The New Tax-Cutting Democrats

More from the New York Sun

Could the Supreme Court’s Tariff Decision Be Applied to the Fed?

American Skier Hunter Hess Says Trump Post Led to ‘Two Hardest Weeks’ of His Life

A Haunting Study of Five Remarkable Black Men Who Soared Despite Societal Challenges

More from the New York Sun

Could the Supreme Court’s Tariff Decision Be Applied to the Fed?

American Skier Hunter Hess Says Trump Post Led to ‘Two Hardest Weeks’ of His Life

A Haunting Study of Five Remarkable Black Men Who Soared Despite Societal Challenges

Revisiting the Australian Film Debut of a Marvel Director

Supreme Court Hands Trump Major Defeat With a Six to Three Decision Striking Down His Global Tariffs

Veterans Sue To Stop Trump’s 250-Foot Triumphal Arch, Saying It Would ‘Dishonor’ Their Military Service

MAHA Movement Stunned by Trump Order Shielding Pesticide Makers From Lawsuits

‘How To Make a Killing’ is Dead on Arrival