Sonny Perdue Joins List of Tax-Happy GOP Governors

Joshua Culling is the State Government Affairs Manager at the National Taxpayers Union.

With a large number of states considering tax hikes to balance their budgets, I looked at Georgia as a state with an opportunity to pass real pro-growth legislation. Rep. Tom Graves introduced the JOBS Act, which would have cut the capital gains tax in half and phased out the corporate income tax. After it passed the House and the Senate, it sat on Gov. Sonny Perdue's desk. We worked hard to convince him to sign it. Yesterday, he decided not to.

There has been a lot of talk about Republicans struggling to find their identity in the wake of devastating losses at the national level in 2006 and 2008. To be sure, the National Taxpayers Union (my employer) is a non-partisan organization, so we haven't been very involved in that discussion. But I think it's important to note that the decisions of some Republican Governors this legislative session flies in the face of the Republican principles of low taxes and small government.

Gov. Schwarzenegger (R-CA) urged California politicians to embrace tax hikes to pay for his rampant overspending. He has presided over a larger annual spending increase than his predecessor, Gray Davis (D), who was recalled from office due to his inability to manage the state's budget.

Gov. Linda Lingle (R-HI) just signed a cigarette tax increase into law. Haley Barbour (R-MS) looks poised to do the same. Charlie Crist (R-FL), now a Senate candidate, has waffled on the issue. Make no mistake about it: cigarette taxes are TAXES. They hit the poor especially hard, they hammer small businesses, and they drive economic activity over state lines. Nonetheless, lawmakers across the country have scrambled to hike tobacco taxes in the middle of a devastating recession.

And now Gov. Perdue, with an opportunity to do something very few Governors even considered, has politely declined to give a boost to investors and job-providers in Georgia. He's content with the status quo. Nevermind the evidence from capital gains tax cuts at the federal level that shows a net revenue INCREASE after their enactment. Forget the fact that Georgia sports an unemployment rate of 9.2 percent. In Gov. Perdue's office, it was time to play to the rent seekers that profit from government spending. It was time to play politics over principles.

And it's not as if we can look to the 2010 GOP gubernatorial primary for the right answers. One of the three potential Republican candidates mentioned in this article has expressly advocated an override of the veto. The others basically refuse to give a straight answer.

I'm not naive. I understand the political realities that come with tax cuts for "revenue hungry" states. But one would hope that during these crippling economic times, when so many bad ideas are floated by Legislatures and embraced by Governors, one could look to the GOP for at least one good solution. I'm not even asking Gov. Perdue to come up with a good idea. Rep. Graves and the Legislature did that for him, and they passed it overwhelmingly. It was gift-wrapped for him to sign with all the political cover in the world.

He failed.