The Kansas Legislature has appointed a new, bipartisan Rural Revitalization Committee, with Rep. Don Hineman as its chair and Lt. Governor Lynn Rogers a strong supporter. Here is a hint for them: there is only one way to bring economic growth to rural Kansas. Bring in the workers that businesses want to hire. That means thinking differently.First, here is what not to do. Do not offer tax breaks. It is a popular, but wrongheaded strategy. At the state level, the relationship between taxes and economic growth was put to the test with former Governor Brownback’s “Great Experiment” starting in 2012. The results were disastrous, with the state highway trust fund and other savings drained, schools and social services cut, and an attempt to fill the hole with regressive sales taxes, pushing Kansas’ grocery taxes up among the nation’s highest. Meanwhile, Kansas lagged the region in economic growth.
Tax cut packages do not work at the local level, either. Just ask the folks in Kansas City. In recent years, Kansas has forfeited $184 million in tax revenue to lure businesses across the state line, while Missouri has blown $120 million on the same. There is no net increase in jobs, since the businesses just move back and forth—or threaten to —in order to reap the tax breaks. Meanwhile, schools and infrastructure lose funding, and the tax burden is shifted to individuals and families. This is why the Missouri House recently passed a “truce” bill that would end this practice in the KC area, once Kansas responds with similar legislation. Come on, Kansas, do it!
Back East, New Yorkers recently told Amazon to “fugetaboutit,” withdrawing their huge tax package when they realized the staggering cost of a new headquarters. This has triggered a long-overdue, national discussion. Site-specific tax breaks are out of control.
If tax breaks will not do the trick, what will? Just ask any employer in rural Kansas. What they need are good employees. Economists call it “human capital theory.” The best way to lure businesses is to lure the workers that they wish to hire.
Start with the blue collar workforce. Among native-born Americans, the working class is getting older. For example, the average age of truck drivers is over 55. This pattern can also be found in a host of similar jobs. However, there is a growing sector of people willing, perhaps even eager, to take these jobs. They come from Mexico, Central America, Africa, south Asia, and around the world. They are immigrants, eager to live the American dream and willing to live in places that native-born young Americans may overlook. Will they be welcomed by the communities, schools, churches, and workplaces of rural Kansas, as they were at First United Methodist Church of Dodge City? Our future depends on it.
Employers also need professional workers in fields like research and development, and also management. This means college graduates, and even my students from rural Kansas agree overwhelmingly: to feel welcome, their friends who are LGBT must feel welcome, too. For them, being open and affirming has become the litmus test for tolerance. Even heterosexual young college grads use this yardstick: if their friends are welcome here, then all are welcome. Throw in a crazy-low cost of living, beautiful prairie land, good schools for the kids that may come along someday, and an easy commute back home to visit their parents, and you just might have a deal.
Rep. Hineman, forget the tax breaks. If our young blue- and white-collar workers know they are welcome here, the employers that hire them will come, too.
Michael A. Smith is a Professor of Political Science at Emporia State University.