Bringing the Economy Home

Sen. Werk: Idaho Needs to Level the Playing Field for Business

The Idaho Legislature convenes January 9th.  In advance of the session, we interviewed several legislative leaders and asked them about Idaho’s economy and what the state could be doing to boost growth and job creation.

Idaho Legislature / State of Idaho

Sen. Elliot Werk (D-Boise) was first elected in 2002.  He’s one of seven Democrats in the Idaho Senate and made our list of most influential state lawmakers.  On his website, Werk calls Idaho’s economy a “dismal mess”.  He says the key to turning things around is education.

Q: What are your funding priorities?

A: The legislature needs to focus on funding the basic element that increases help for the middle class, which is education.  Both K-12 and higher education. The shameless slashing of those budgets will do lasting and long term damage to Idaho’s economy unless that trend is reversed.

Q: Many of your Republican counterparts have also said education is their top priority, including the governor.  Do you think the majority party has done an adequate job of funding education?

A: Well, I appreciate statements from the governor and my Republican counterparts indicating they prioritize education, the reality is their votes and their actions don’t show that in any way, shape or form.  We really have a crisis in Idaho in terms of our overall structure for revenues.  And the Republican Party has steadfastly refused to address the issues we have with revenues and inequities in the system so they have piled on cuts onto the middle class while they continue to enrich their benefactors continually with more breaks and more exemptions and more giveaways.

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Q: Are you talking about tax incentives and exemptions?

A:  Yeah, exemptions in the system.  We’re giving away the store to the benefactors to the majority party and have not addressed seriously any kind of reform to that structure in probably 40 years.  As a result, we are taxing and harming the middle class. Cutting the services that are most beneficial from government, which is education, education, education.

Q: What would be your second and third funding priorities?

A: We need to restore funding for mental health issues, because those issues place our communities in danger.  We’ve seen a number of shootings in the last six to eight months that can be directly linked to a lack of services for people who are in mental health crises.  So we certainly need to be looking at that, and we also need to be looking at our transportation infrastructure.  The legislature has allowed our transportation infrastructure to deteriorate to where it’s beginning to negatively impact our economy as well.

Q: What about taxes, is the state in a position to cut or increase taxes this session?

A: The idea of cutting corporate taxes could be beneficial, the only problem is we need to be able to pay for that.  There’s no literature, or history, that shows by cutting taxes we actually increase revenue.  And right now, we don’t have any revenue we can give away. So in order to decrease corporate taxes we need to look at eliminating some of the exemptions that make the playing field un-level for businesses out there, and that should be easy to do.  There’s lots of money in the exemption system that can be brought back in and that money could be used to offset the cost for lowering the overall corporate income tax rate.

Q: How would you revamp the tax system?

A: Well, it’s pretty obvious.  The middle class, which the Democrats represent in the legislature, value hard work and they value a level playing field.  Right now we don’t have a level playing field.  And the exemption system makes it so the playing field favors the very wealthy and connected corporations.  What we really need to do is go into the exemption system eliminate all the dead weight in there, and remember this is about a billion dollars in revenue a year, and if we can go in there and eliminate all of that dead weight, lower the corporate income tax rate, provide a little more money for education, we’re going to see job creation come out of those kinds of moves.  The one thing killing job creation in Idaho is the fact that the playing field isn’t level and small businesses cant’ get a foothold here.

There’s no literature, or history, that shows by cutting taxes we actually increase revenue.  And right now, we don’t have any revenue we can give away.

Q: The Hire One Act is set to expire in 2012, should it be renewed?

A: My impression is that the Hire One credit has not resulted in a single job, I don’t think there has been any documentation of a single job coming from that.  I haven’t seen anything in the last three or four years from the majority party that has provide any job creation within the state.

Q: Should the state be in the business of job creation? Can it be in the business of job creation?

A: Democrats have already had a package of job proposals called the IJOBS package, the Idaho Jobs and Opportunity Blueprint that was put out in the 2010 legislative session.  The Republicans rejected all of those jobs ideas that included hiring credits, some information for business to make them more competitive.  We even had a jobs council that we thought we’d get state governments focused on creating jobs and in the coming session the democrats will be coming up with another slate of job creation packages to help the private sector create jobs and we look forward to our republican counterparts this time deciding to take job creation seriously and working with us.

Q: What will be included in your jobs proposal this session?

A: Right now the packet is being put together, I’m not privy to all the details and I’d rather wait until session to get into the details.


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