The policy of "government knows best" in Oklahoma has created a leviathan of sorts when it comes to the massive obligation that is our state government. As such, the financial demand that is placed on individuals in Oklahoma to continue to fund too many failing systems has done little to encourage growth and economic expansion at the same rate as our neighbor to the south.
And now we're hearing arguments for increased taxes on Oklahoma's wealthiest, when such a policy is exactly the type of archaic, punitive policy that hamstrings growth, development and prosperity.
Instead, we should be asking how we can meet our revenue needs while encouraging economic growth and investment here in Oklahoma. One answer is to abolish the personal income tax.
The abolition of the personal income tax is not a new idea. It's been around for some time, but each time a serious proponent steps forward, they are met with heavy resistance from the same crowd that says Oklahoma has the greatest child welfare system in America or could never support an NBA team. These are the proponents of the same tax-and-spend public policy that is sending California into bankruptcy while Texas is laughing its way to the bank.
Can I say that we do need to be more like Texas, at least when it comes to our budgetary policy? With a Legislature that only meets every other year, Texas has developed public policies that are showing remarkable economic results in a time when most states are trying to overcome stifling deficits. Based on good conservative economic principals, Texas is leading the country out of this recession.
According to Texas Gov. Rick Perry, 70 percent of all the jobs created in 2008 were created in Texas, thanks in part to having more Fortune 500 companies than any other state, as well as continued growth of manufacturing jobs. This success is simply indicative of the more growth-minded public policies of low spending, no personal income tax and a manageable regulatory climate, which allow for the growth and prosperity attracting and keeping companies, jobs and people.
Oklahoma tries to beat Texas in every way imaginable, except when it comes to tax policy. Why? It's all right to be envious of a more successful public policy. We should be. There's nothing wrong with looking at a successful model and trying to emulate it. Why wouldn't we?
On the same note, we should look at failed policies and try to avoid them. California is reeling with budget woes, and will likely be the last state to make it out of recession as a result of their punitive tax policies and unrestrained public spending. They adopted the policy of "tax and spend, and tax some more," and it has led them to the most unenviable position of any state in the union. Why would we want to emulate that policy?
It is possible to abolish the personal income tax in Oklahoma. By most credible accounts, a service sales tax will meet the revenue needs of the state and encourage new growth and development. The alternative of placing additional tax obligations on Oklahomans will have the opposite impact and discourage economic growth and the attraction of new business
The current Oklahoma Legislature has taken great strides to eliminate waste and inefficiency. Budget leaders have shown leadership in making the choice to trim as opposed to tax. However, if they would give serious consideration to eliminating the personal income tax, they may not have to choose between the two again.
Smith is an attorney living in Oklahoma City.