Governor Hutchinson’s proposed budget for the next fiscal year contains a rather unusual tax cut. The top income tax rate currently is 5.9 percent but the governor proposes to cut it by one percent to 4.9 percent for new residents for 5 years. The idea is to recruit talent for the state’s tech and manufacturing industries from out of state.
The cost of the tax cut is estimated to be a modest 1.5 million dollars in the first year and 4.6 million dollars by fiscal 2023. This is a pittance in a multibillion dollar budget, but any tax cut means fewer services for the public. If this particular tax cut passes it conceivably could do more harm than good. That it passes is unlikely as leadership in both parties question the propriety of the cut.
So what can be done to attract talent in the tech area? How about rather than the “everybody gets a tax cut,” consider the other side of the balance sheet. How about use the funds not removed from the budget to provide additional opportunities for our residents? Education and recreation are two things that come to mind.
On the educational front, the rise in the cost of higher education, at least as a national average has been considerably outstripping inflation. Many students graduate with near-crushing debt. Rather than cutting taxes should we be cutting tuition? This would allow more of our residents to acquire those tech skills so needed for competition, not just with the tech industries in other states, but globally.
What are we up against education-wise? In Denmark, not only is higher education free, students are paid to attend for up to six years. It’s per capita gross national product is among the highest in the world. Such is the horror of socialist policies.
Another way of attracting or more importantly retaining tech talent is the quality of life issues. Outdoor recreation should be at the top of our list for youth in our state. That means taking care of, even nurturing our title as the Natural State. Our national parks and forests need protection and preservation for recreation. Many of our rivers, especially in the western part of the state are national treasures that deserve protection, most notably the Buffalo National River.
The park encompasses about 135 square miles, the boundary of which is only a half-a-mile or so on either side of the river. To preserve and protect the river requires actions watershed-wide which much larger, some 1388 square miles. After a long and public struggle, lead by the Buffalo River Watershed Alliance, the state bought out a hog CAFO which threatened to pollute the river. Making a temporary moratorium against medium and large hog CAFOs permanent would go a long way to protect this recreational treasure.
Additional recreational treasures are the Ozark Highlands Trail and the Ouachita National Recreation Trail. With a combined length of over 400 miles, they provide an inexpensive and healthy recreational experience.
Increasing both educational and recreational opportunities will go a long way to attract talent from out of state and retain our homegrown talent.
Dr. Bob Allen is Emeritus Professor of Chemistry, Arkansas Tech University.