James Madison Institute's just-released analysis of the two main governor candidates' economic platforms could wither a cactus.
Most of us realize Ron DeSantis and Andrew Gillum have wildly contrasting economic plans, but I don't think we ever truly understood how much our choice on Nov. 6 could cost Florida and affect Floridians' way of life, perhaps for generations. As the analysis points out, "every single sector of our economy will either reap the benefits or suffer the consequences of the decisions our elected leaders make."
Ron DeSantis' platform would maintain Florida’s status as a low tax state and a national economic leader; Andrew Gillum's "would cost $2.6 billion in additional state taxes, not including his support for Medicare-For-All, which will raise taxes significantly more" and put Florida on an economic par with some of the highest-taxed nations in Europe.
If Gillum proposes paying for his spending proposals through Florida’s corporate income tax, the report concludes that ... "his corporate tax rate would have to rise to 11 percent, just above Pennsylvania’s tax rate, and even surpassing California’s rate."
Blow this study off at your own peril. This is JMI's business. It's what they do. For more than 30 years, the Tallahassee-based think tank has provided elected leaders and everyday Floridians with objective, compelling and timely information on policy issues affecting Florida's economy.
This analysis, "Election 2018: Platforms, Proposals, Projections," is only a continuation of JMI's mission. To produce it, JMI partnered with the Washington Economics Group and Arduin, Laffer, and Moore -- both recognized internationally for their expertise and objectivity. Please take the time to read and share it.
"Election 2018" gets inside the central elements of each candidate’s economic agenda. It analyzes the fiscal implications of major proposals and projects the overall impacts from each on the economic climate of Florida.
There's no sugar-coating progressive candidate Andrew Gillum's policy agenda. It is to increase the corporate tax rate significantly, almost double the minimum wage, sharply expand government-controlled health insurance and mandate a $50,000 starting salary for teachers. According to the report, this is something that "would adversely impact the business climate of the state through higher taxes, a sharply higher minimum wage and state mandates to expand government-controlled health insurance."
All told, the policy agenda Gillum proposes would require an increase in the corporate tax rate to the second highest in the United States, an increase in Florida’s sales tax to 39 percent, or the imposition of a state income tax as high as 37 percent (and a state income tax is only possible through a constitutional amendment).
It's concerning that this report was prepared before Hurricane Michael virtually leveled an entire Florida tourism region, destroying whole towns -- people's houses, businesses, jobs and security. My husband and I went through Katrina on Mississippi's Gulf Coast. I've seen the wreckage, the homeless and the long process of relocation, the mental illness the storm's aftermath wrought, the hopelessness of people who may leave Florida and never return. Yes, Florida is resilient and it will rebuild, but I can tell you that in the end, the federal government will not pay all the bills.
Keep the rising Hurricane Michael bill in mind as you read this analysis.
If Florida chooses Gillum, "the economic impacts of abandoning the current low tax/top business climate rankings of Florida, based on the experience of the higher tax states presented in this brief, would ultimately cost Florida direct employment losses of 155,000 jobs and $28.2 billion in economic losses per year," say the authors.
Gillum also favors the legalization and taxation of marijuana to offset the cost of his education proposals. Possible marijuana revenue would gain the state $67 million a year in new revenue. But Florida legalized medical marijuana four years ago and again in 2016 and still it's ensnared in bickering and red tape.
DeSantis' agenda, to largely maintain the pro-growth-oriented strategy of Florida through low and stable taxes, "would preserve and strengthen the state’s business climate, which supports the attraction, retention and expansion of employment-generating business enterprises. This agenda also includes investing in the "classroom" the savings from lower educational administration costs, and in technical/vocational programs to improve workforce development. Ultimately," the report concludes, "this agenda would lead to the creation of 215,000 jobs annually and $26.6 billion in annual economic output."
The analysis includes much more about health care, criminal justice and education, and you'll want to have a look at that, too. But I worry about the strings Gillum's billionaire donors will have on his agenda if he is elected. I see no cost anticipated for the demands of environmentalists to fight climate change, re-program water projects, impose clean-energy mandates.
As JMI points out, elections have consequences, and policy agendas have costs and benefits. In the end, it's Florida voters who must weigh the costs of each candidate’s agenda and choose which policies/candidates they believe will create a brighter, more prosperous future for Florida. I hope Andrew Gillum will have a chance in the upcoming candidate debate to explain how Florida can afford to elect him without becoming another bloated, big-government fiscal failure like the states people up North are anxious to leave.
Reach Nancy Smith at email@example.com or at 228-282-2423. Twitter: @NancyLBSmith