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Best Move For Cash-Strapped States

Posted by Chris Liebenthal on May 10, 2010

Via Dean Mundy on Twitter, the best way for cash-strapped states to dig their way out is through progressive taxes, not budget cuts:

Budget cuts deepen the recession and stifle recovery by immediately putting people out of work, reducing public and private investment, and abandoning residents in their hour of need. The long-term economic consequences are also damaging, including lost productivity, a less-skilled workforce, and reduced competitiveness.

The key to the twin goals of budget repair and economic recovery is significantly increasing progressive taxes.

While naysayers claim that increasing taxes during a recession is unwise and counterproductive, it will work if you pick the right taxes.

Progressive taxation raises revenue, underwrites critical public investment, stimulates additional private investment, and maximizes job retention and creation. In the long run, progressive taxes are among the most sustainable revenue sources and result in more widely shared prosperity.

And how does Scott Walker’s plan compare to the best way? Not so good, actually.


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