Commentary

Nope, the economic world isn’t going to hell in a basket for Idaho

Idaho should use its $1.5B surplus on things with lasting shelf-life, such as infrastructure, roads and bridges, community water and sewer systems and broadband, writes guest columnist Stephen Hartgen.

October 28, 2021 4:05 am
Downtown Boise

Downtown Boise seen from the Boise Depot on March 20, 2021. (Otto Kitsinger for Idaho Capital Sun)

Lo and behold, the Idaho economy isn’t going anywhere except up and to the bank.

Whiners and complainers want you to think all we need to do is “drain the swamp” in Boise and things will be sunrise and roses. But the real numbers show Idaho is already doing fine on the economic front. Almost $170 million in taxpayer rebates have gone out to Idaho taxpayers this year.

In a recent report to the Legislature’s joint finance and appropriations committee, Alex Adams from the division of financial management summarize the numbers in public testimony.  Checks went out to nearly 645,000 Idaho income taxpayers this year, rebates based on income taxes paid in 2020. Last session, the Legislature added another $220 million in one-time income tax rebates and $163 million in ongoing income savings. And this is on top of an earlier tax rebate.

These tax reductions helped Idaho achieve back-to-back tax returns in consecutive years, as well as provide ongoing rate drops. These may not seem to be a lot, but over time, they’re substantial. 

The take of the malcontents is that Idaho is struggling on every front, that the economy is in the tank and that there’s no progress anywhere. This is patent BS, designed to lead you into thinking things terrible when they’re not.

This line is pushed by these economic Medievalists who think it’s OK for you and your children to live in poverty while they reap the rewards of connections to out-of-state money and influence peddlers. It is truly amazing that common-sense people in Idaho would fall for such horse-pucky.

Why is Idaho done so well in coming out of the pandemic and leading the nation in economic growth?

One reason certainly is the population increase. We’re up more than 250,000 people in 10 years, second only to Utah’s growth. More people in Idaho translate into more jobs, higher paychecks, and more state withholding. For the current financial year which began on July1, state revenue is up yet again. If Gov. Brad Little asks the Legislature for the third round of tax reductions, that would cement Idaho’s national rankings in income growth.

Even in a pandemic, people buy food and household goods and these sales also push up state receipts. That’s given additional weight with the shift to online sales and the keeping of the tax on out-of-state purchases as well as convenience store stop-and-goes. If you sit half an hour at a local truck-stop or convenience store, you’ll quickly see out-of-state plates on vehicles as their drivers come out with all range of snacks and travel drinks. These account for substantial portion of the so-called “grocery tax.” Without such seemingly small purchases, our sales tax receipts would be considerably less.

It used to be that Idaho, an agricultural state with great scenery and natural resources, was somehow stuck in a traditional industries past. But everywhere you look today you see startups, expansions, services, tourism and other sectors beyond extensive food processing. Now, we are really coming-of-age with a mixed economy in a broad mix of sectors. 

To be sure, the state has some distance to go. Our educational system needs to turn out more and better-trained workers. But many states would do well to look at Idaho’s ability to slash income tax rates and still grow the economy almost everywhere.

That was the real message in Adams’ presentation to the legislators. He is saying in effect, that what we’re doing is working. We are taking care of state needs, but we’re not spending beyond what we have. That gives us a nice surplus state budget of close to $1.5 billion. 

It would be wise not to fritter that away but rather to spend money carefully and cautiously on things with lasting shelf-life, such as infrastructure, roads and bridges, community water and sewer systems and broadband deliverability. 

Gov. Little in his various talks this fall constantly mentions his vision for the state as a robust participant in the Northwest and American economy. 

Some of his critics want more red tape to put people under more extensive government control. Others want to reduce services to bare minimums or eliminate them entirely. These Dead-Enders would lead us to exactly that, a dead-end of economic retraction. We see that in other states where natural resources languish despite proximity to markets. 

If that’s the kind of place we want Idaho to be, it’s easy to achieve by either just doing nothing or by spending money we don’t have. Wisely, we’ve picked a middle ground of cautious and prudent spending and strategic investment. That’s the Idaho way. People will know this spring which path we chose. So will our children, grandchildren and generations yet to come.

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Stephen Hartgen
Stephen Hartgen

Stephen Hartgen, of Twin Falls, is a retired five-term Republican member of the Idaho House of Representatives, where he served as chairman of the Commerce and Human Resources Committee. Previously, he was editor and publisher of The Times-News (1982-2005). He can be reached at [email protected]

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