Headed for Heartburn

Posted on January 11, 2006
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Despite writers at the Arizona Republic opining that “The Symington tax cuts kept government from growing at the same pace as the state’s population,” the truth of the matter is overall state spending has increased more than 100 percent’"that’s five times population growth’"since those tax cuts.  Government is now the second largest component of Arizona’s gross product. This is hardly “lean” government.

Some believe this is not all bad, arguing government can spend its way into prosperity by funding downtown hotels and picking the “right investments.” In the state of the state address, Governor Napolitano proposed millions of dollars in new spending, much of it under the guise of sparking economic growth. With a near billion dollar revenue surplus, the danger of increased spending is clear and present.   

However, research shows little or no relationship between increased public spending and economic growth. Worse, expansions of government often squeeze private initiatives out of the market.

Barry Goldwater once said “the only way to curtail spending substantially, is to eliminate the programs on which excess spending is consumed.” If Arizona’s economy is to avoid indigestion, this tough medicine needs to be swallowed.  

Key Links:

-Heritage Foundation: “The Impact of Government Spending on Economic Growth”
-Goldwater Institute: “Luxury Suites, or Cops for the Streets?”
- Arizona Republic: “Theory on cutting taxes doesn't hold even for its proponents”

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