A Tax Day Reminder: Stephen Moore’s Tax Ideas Are So Bad They Wrecked Kansas’ Economy

April 15, 2019

WASHINGTON, D.C. — President Trump’s Fed board choice, former economic advisor to Kansas Gov. Sam Brownback, and self-described “radical” Stephen Moore may not be a “big believer in democracy,” but there’s nothing that can shake his belief that tax cuts mainly for the rich are the answer to all economic ills, no matter how many times they’ve failed to create jobs or magically add revenue.

“Stephen Moore is a one-trick trickle-down pony and doesn’t care that no one has ever successfully pulled it off,’ said Jeremy Funk, spokesman for Allied Progress. “From Bush to Brownback and now Trump, tax policies that exclusively reward the rich always have the same result: anemic job growth and exploding deficits followed by calls from conservatives to cut things like Medicare and education to pay for them. To Moore, there is no price too steep for more tax cuts for the wealthy, even if it means higher taxes on the poor and middle class in the form of a highly regressive national sales tax.”

Added Funk: “The more Moore’s extreme right-wing views come to light, from urging kids to burn their Social Security cards to returning to the gold standard, the more it becomes clear he does not belong anywhere near the Fed. That he is Trump’s first choice for the job reveals nothing we didn’t already know, however, about how unserious the President takes his own job of filling important government positions that can impact millions of lives.”

Previously from Allied Progress:

• Even the Big Banks Think Stephen Moore’s Monetary Policy Ideas Are Too Extreme
• Moore Urged Kids to Burn Up Their Social Security Cards in Support of Privatization
• More Moore Thoughts on Social Security: “We’ve probably gone too far in providing a safety net for the elderly”, “Essentially was a Ponzi scheme”

WHAT YOU NEED TO KNOW:

Stephen Moore Was One Of The “Principal Architects” Of Kansas Governor Sam Brownback’s Experimental Tax Cuts That Devastated The State’s Economy.

Stephen Moore Was Among The “Principal Architects” Of Kansas Governor Sam Brownback’s 2012 “Massive Tax Cuts,” Which Were Rolled Back Just Four Years Later After Kansas’ Revenues Fell And Led To A $900 Million Deficit.

Stephen Moore Was One Of The “Principal Architects” Of Kansas Governor Sam Brownback’s “Massive Tax Cuts,” Which Did Not Create The Economic Boom He Predicted. “But those who will evaluate the revised Trump tax cut proposal should keep something in mind: Moore and Laffer were principal architects of Kansas Governor Sam Brownback’s massive tax cuts, and their predictions that those tax cuts would spur an ‘immediate’ Kansas economic boom have proved strikingly inaccurate.” [Michael Mazerov, “Kansas’ Tax Cut Experience Refutes Economic Growth Predictions of Trump Tax Advisors,” Center on Budget and Policy Priorities, 08/12/16]

Although Brownback Promised That The Tax Cuts Would Be A “‘Shot Of Adrenaline’” To The Economy When They Were Passed By The Legislature In 2012, Kansas’ Revenues Fell, Its Economy Grew At A Slower Rate Than The Rest Of The Nation, And The State Cut Investment In Education And Infrastructure. “In 2012, the Republican governor pushed reforms through the state Legislature that dramatically cut income taxes across the board. Brownback boasted the plan would deliver a ‘shot of adrenaline’ to the Kansas economy. Revenues shrank, and the economy grew more slowly than in neighboring states and the country as a whole. Kansas’ bond rating plummeted, and the state cut funding to education and infrastructure.” [Jeremy Hobson, Dean Russell, and Samantha Raphelson, “As Trump Proposes Tax Cuts, Kansas Deals With Aftermath Of Experiment,” NPR, 10/25/17]

Just Four Years After Governor Brownback’s Tax Experiment Was Enacted, Kansas’ Republican Legislature “Voted To Roll Back The Tax Cuts,” And The State Was Still Struggling To Close A $900 Million Deficit As Of Late 2017. In 2016, “the Republican-controlled state Legislature voted to roll back the tax cuts, but Kansas is still dealing with the aftermath of this bold experiment. State lawmakers are now seeking to close a $900 million budget gap over the next two years.” [Jeremy Hobson, Dean Russell, and Samantha Raphelson, “As Trump Proposes Tax Cuts, Kansas Deals With Aftermath Of Experiment,” NPR, 10/25/17]

Despite The Havoc It Wreaked On Kansas’ Economy, Stephen Moore Maintained Just Last Year That The Kansas Plan Was “Mostly Very Positive,” While Admitting That “The Revenues Didn’t Come In As Anticipated.”

In April 2018, Stephen Moore Maintained That Governor Brownback’s Tax Plan Was “Mostly Very Positive,” And Said “The Idea That This Was Some Kind Of Massive Failure Is Simply A Mythology.” In an April 2018 event at the Heritage Foundation, Stephen Moore recounted his experience working on Sam Brownback’s tax plan. “It was about six or seven years ago that we got a call, Art Laffer and I, from Sam Brownback about redesigning the Kansas tax system. And so we worked very closely with them to put together a plan that was mostly very positive. […] But it became, almost overnight, after a couple of years, certainly, a cause célèbre for the left that somehow everything had gone wrong in Kansas. […] This idea that this was some kind of a massive failure is simply a mythology.” [“What Was Really the Matter with the Kansas Tax Plan: The Undoing of a Good Idea,” The Heritage Foundation via Youtube, 04/11/18 (04:25)]

Moore Said That, “The Problem Was That The Revenues Didn’t Come In As Anticipated.” ““There were a lot of successes in Kansas. The problem was that the revenues didn’t come in as anticipated.” [“What Was Really the Matter with the Kansas Tax Plan: The Undoing of a Good Idea,” The Heritage Foundation via Youtube, 04/11/18 (06:43)]

Stephen Moore Was Discredited By The Kansas City Star In 2014 For “Substantial Factual Errors” In A Piece He Wrote Trying To Rebut A Nobel Prize-Winning Economist’s Assertion That Moore Was Among The “‘Charlatans And Cranks’” Who Have Pushed Radical Tax Cuts.

In 2014, The Kansas City Star Editorial Editor Said, “‘I Won’t Be Running Anything Else From Stephen Moore,’” After The Paper Identified “Substantial Factual Errors” In An Op-Ed Moore Penned. “‘I won’t be running anything else from Stephen Moore.’ So says Miriam Pepper, editorial page editor of the Kansas City Star—and not just because she’s retiring this week. Pepper’s no-Moore stance comes after her paper discovered substantial factual errors in a recent guest op-ed by Moore, the chief economist at the conservative Heritage Foundation.” [Deron Lee, “Why one editor won’t run any more op-eds by the Heritage Foundation’s top economist,” Columbia Journalism Review, 07/31/14]

Stephen Moore Was Responding To A Column By Nobel-Prize Winning Columnist Paul Krugman, Who Identified Moore As One Of The “‘Charlatans And Cranks’” Who Have Called For “Low-Tax, Supply-Side Economic Policies—With Ruinous Effects.” “It all began a month ago, when the Star ran a piece by the Nobel Prize-winning economist-turned- liberal New York Times columnist Paul Krugman, as it does regularly. The column named Moore as one of the ‘charlatans and cranks’ who have influenced policymakers at all levels to enact low-tax, supply-side economic policies—with ruinous effects, according to Krugman. The sweeping 2013 tax cut in Kansas is only the latest example, he wrote, citing unfavorable economic and fiscal news in the Sunflower State.” [Deron Lee, “Why one editor won’t run any more op-eds by the Heritage Foundation’s top economist,” Columbia Journalism Review, 07/31/14]

Stephen Moore Has Advocated For A National Sales Tax, A Regressive Tax That Would Increase The Tax Burdens Of Lower- And Middle-Income Taxpayers.

Stephen Moore Has Advocated For A National Sales Tax, Claiming It Would Be “‘Rocket Fuel For The Economy’”…

Stephen Moore Advocated For A National Sales Tax, Claiming It Would Be “‘Rocket Fuel For The Economy.’” “One of the key economists who helped presidential candidate Herman Cain draft his 9-9-9 tax plan is backing away from the most controversial component of it, warning that the criticism Cain endured at Tuesday night’s Republican presidential debate shows his proposed 9 percent national sales tax might have to go. ‘It was such a dart board,’ economist Stephen Moore said Wednesday of the proposal. […] Moore said he likes the sales tax idea and thinks it would be ‘rocket fuel for the economy,’ but explained that it’s just too much of a punching bag.” [Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]

…Even Though A National Sales Tax Would Be “Regressive” And Increase The Tax Burdens Of Low- And Middle-Income Taxpayers.

A National Sales Tax Would Be “Regressive” And “Cause A Massive Downward Shift In The Tax Burden From Upper-Income Taxpayers To Low- And Middle-Income Taxpayers.” “A national sales tax and a value-added tax—which is like a sales tax collected by businesses at each stage of production—are two consumption taxes most commonly put forth in these proposals. Both proposals are broad-based, potentially applying to just about anything that people buy, and the burden of both would ultimately fall on consumers. Consumption taxes are regressive; that is, they impose a heavier burden on lower-income taxpayers than higher-income taxpayers for two reasons. […] Replacing the income tax with a consumption tax would cause a massive downward shift in the tax burden from upper-income taxpayers to low- and middle-income taxpayers.” [Alexandra Thornton and Harry Stein, “Who Wins and Who Loses?” Center for American Progress, 10/22/15]

Trump’s Fed Board Pick Stephen Moore Said He Supported A National Sales Tax Because “The Hookers And The Drug Dealers” Would Have To Pay It “When They Go Out And Buy A Pink Cadillac: “In 2011, Stephen Moore Said He Supported A National Sales Tax Because “The Hookers And The Drug Dealers Have To Pay [It] […] When They Go Out And Buy A Pink Cadillac.” “I agree with Herman Cain, you want a tax plan that actually the hookers and the drug dealers have to pay, it’s the national sales tax, right? Because when they go out and buy a pink Cadillac, they have to pay the sales tax on it. So I think there’s a lot of truth to that.” [“Your World with Neil Cavuto,” Fox News via Archive.org, 10/19/11 (00:06)]

Stephen Moore Was “One Of The Key Economists” Behind Herman Cain’s 9-9-9 Tax Plan, Which Included A 9% National Sales Tax That Was Too Regressive Even For The 2012 Slate Of GOP Presidential Primary Candidates.

Stephen Moore Was “One Of The Key Economists” Behind Herman Cain’s 2012 Presidential Campaign And Served As An “Architect” Of Cain’s 9-9-9 Tax Plan.

Fox News Described Stephen Moore As “One Of The Key Economists Who Helped Presidential Candidate Herman Cain Draft His 9-9-9 Tax Plan,” Which Would Have Replaced The Tax Code With A 9% Tax On Income, Corporations, And Sales. “One of the key economists who helped presidential candidate Herman Cain draft his 9-9-9 tax plan is backing away from the most controversial component of it […] The plan calls for throwing out the old tax code and replacing it with an across-the-board 9 percent income tax, 9 percent corporate tax and 9 percent national sales tax.” [Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]

Fox News Described Stephen Moore As An “Architect Of Cain’s 9-9-9 Plan.” [“Your World with Neil Cavuto,” Fox News via Archive.org, 10/19/11 (01:05)]

Herman Cain’s 9-9-9 Plan Would Have Replaced The Current Tax Code With A Flat 9% Tax On Income, Sales, And Corporations, Raising Taxes For Everyone But The Richest 20% Of Taxpayers.

Herman Cain’s 9-9-9 Plan Would Have Replaced The Current Tax Code With A Flat 9% Tax On Individual Income, Corporate Income, And On Sales. “The plan would eliminate the current tax system all together, replacing it with a 9 percent personal income tax, a 9 percent corporate income tax and a 9 percent national sales tax.”[Aaron Sharockman, “The facts about Herman Cain’s 9-9-9 tax plan,” Politifact, 09/26/11]

An Analysis By The Tax Policy Center Found That The 9-9-9 Plan Would Have Raised Taxes On Everyone But The Richest 20%, Who Would Enjoy An Average Tax Cut Of $23,522. “According to an analysis by the Tax Policy Center, the Cain plan would mean a $23,522 federal tax cut for the top 20 percent and an increase for everyone else. So much for tearing the chains off the backs of the American people.” [Jonathan Capehart, “Herman Cain flogs slavery theme to push his flawed ‘9-9-9’ plan (Opinion),” The Washington Post, 11/28/11]

The Plan’s 9% National Sales Tax Was Uniformly Criticized By His Republican Opponents In The 2012 Presidential Primary

In October 2011, Stephen Moore Backed Away From Herman Cain’s Proposed 9% National Sales Tax After It Was Criticized At A Republican Presidential Debate Because It Would “Hit The Middle Class Hardest.” “One of the key economists who helped presidential candidate Herman Cain draft his 9-9-9 tax plan is backing away from the most controversial component of it, warning that the criticism Cain endured at Tuesday night’s Republican presidential debate shows his proposed 9 percent national sales tax might have to go. ‘It was such a dart board,’ economist Stephen Moore said Wednesday of the proposal.Cain weathered a storm of complaints over his tax plan at the Republican debate in Las Vegas. Virtually every candidate took turns accusing the businessman of pushing a scheme that would introduce new streams of revenue and hit the middle class hardest.” [Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]

• Cain’s Opponents In The Republican Primary Argued That “84 Percent Of Households Would See Their Taxes Increase Under The Plan, With Lower And Middle Income Families Hit Hardest.’” “At the debate, his opponents were quick to invoke a new study from the Tax Policy Center showing 84 percent of households would see their taxes increase under the plan, with lower and middle income families hit hardest.” [Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]
• After The Debate, Moore Said That Cain Should Replace The Sales Tax With A 9% Payroll Tax. “Though Cain parried point-for-point with his opponents and stood by the plan, Moore said the debate further confirms his belief that the candidate should strip the sales tax out of his plan, and replace it with a 9 percent payroll tax.”[Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]

• Moore Continued To Support The Idea Of A 9% Sales Tax, Arguing That It Would Be “‘Rocket Fuel For The Economy,’” But Felt It Was Too Politically Vulnerable. “Moore said he likes the sales tax idea and thinks it would be ‘rocket fuel for the economy,’ but explained that it’s just too much of a punching bag.” [Judson Berger, “Economist Who Helped Cain Craft 9-9-9 Plan Backs Away From Sales Tax,” Fox News, 10/19/11]

 

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