The White House’s senior adviser on economic affairs outlined what Arizona businesses can expect if President Donald Trump is re-elected during an event sponsored by the Arizona Chamber of Commerce and Industry and the Arizona Bankers Association last week. 

The nation’s top economic adviser, Larry Kudlow, also urged the business community here to reject Arizona’s Proposition 208 tax increase. 

Pushing Arizona’s income tax rates higher during the pandemic would be foolish timing, said Kudlow, the assistant to the president for economic policy and the director of the National Economic Council. 

“While men and women are returning to work, this is not the time to raise taxes,” said Kudlow,  who leads the coordination of the president’s domestic and global economic policy agenda.

Unwise timing for a hike in income tax rates 

If passed, the so-called “Invest in Ed” proposition will raise the state’s top income tax rate by 77.7 percent, making Arizona’s top income tax rate higher than every other state in the West except California, and one of the ten-highest nationwide. 

“We are coming out of a pandemic contraction. We do not want to be removing money from the economy,” Kudlow warned. 

Higher income tax rates would erode Arizona’s economic edge at a critical time. Right now, Arizona is seen as a desirable location to live, play and do business. 

“Arizona’s personal and business taxes have been moderate down the years. It’s a hot sunbelt state and you don’t want to destroy that story,” he said.  

Data speaks to successes 

During the event, Kudlow detailed Trump’s platform for the economy moving forward, the administration’s successes so far, and efforts to help those still struggling from pandemic disruptions including small businesses, the airline industry and the unemployed. 

One only has to look at data from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics and the Federal Reserve to count the success of the administration’s economic policies over the past four years, he said.

Prior to the pandemic, the standard of living went up for the first time in 20 years, corporate and individual income taxes dropped, and regulatory red tape was reduced, Kudlow said. 

“Inequity fell, poverty fell, unemployment fell, the living standard rose and family income rose,” he said.

Platform forward would be a repeat of past four years 

Basically, the economic plan for the next term would be a repeat of the White House’s guiding principles the past four years, he said. 

“That is, lowering business taxes across the board, lowering individual taxes, and rolling back costly and burdensome regulations,” Kudlow said.

Keeping the economy open and reopening schools while practicing all the lessons learned about masking, social distancing and hygiene is a top priority, he said. 

Also high on the list are investment in new technology advances in energy, particularly in natural gas fracking and horizontal drilling, and the brokering of “better” global trade deals to mimic the success of the new free trade agreement, the United States-Mexico-Canada Agreement (USMCA). 

Good news for full economic recovery 

A rash of economic indicators show that the pandemic recovery will be V-shaped, Kudlow said. A V-shape recovery is characterized by a quick and sustained recovery in measures of economic performance after a sharp economic decline.

Currently, about 80 percent of the economy has recovered and about 50 percent of the unemployed are back to work, he said. Industry sectors like construction, auto sales and manufacturing, and certain retail sectors are seeing “booming” growth. 

Meanwhile, unemployment is dropping. Since the country was shut down at the start of COVID-19, about 14 million workers are back to work, bringing unemployment down to 7.9 percent, he said.

CARES Act helped keep businesses, individuals afloat

Part of the recovery is due to the CARES Act economic stimulus package that was passed by Congress and signed by the president to help the country survive the shutdown.

About 12 million people are still unemployed, he said. Moving forward, Congress is trying to broker another package to help those still struggling. 

“We look at this (package) as being smart and targeted,” Kudlow said. “The other side sees this as a political and ideological wish list.”

Nevertheless, the Republicans and the president are willing to “compromise and put up more dollars to make a deal.”

Meanwhile, $139 billion from the act is still waiting to be allocated. Congressional members need to pass stand-alone bills to appropriate the funding to aid those still in need. 

President “rewards success”

In conclusion, Trump’s economic policies “have benefited those who need it most,” Kudlow said. A vote for Trump will be a vote for America’s recovery. 

“He’s a president who wants to reward success and promote workers. Whereas my friends on the other side seem to always want to punish success.”

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A that analyzes the economic impact of Proposition 208 in Arizona shows it will likely place Arizona 8th or 9th in the nation for the highest income tax rates. Negative unintended consequences will likely follow, two nationally renowned economists said Tuesday.  

The ballot initiative is intended to tax the state’s highest earners, but those at the bottom of the income scale would suffer most, said Stephen Moore, an American author and television commentator on economic issues, who released the report during a press conference hosted by the Arizona Chamber of Commerce and Industry. 

“It’s not the rich people that are going to be hurt. The rich can pay higher taxes or they can go somewhere else. It’s really the people at the bottom who will lose jobs,” Moore said. “About half the impact of this tax will be paid not by big corporations and not, you know, the very, very wealthy, but will be paid by the small business owners. 

Moore and fellow economist and researcher Dr. Arthur Laffer conducted an analysis of how tax rates have affected states over the past 30 years for the report, “Arizona’s Proposition 208 Loses Jobs and Harms Small Businesses.” 

What they found is that almost all states with lower income tax rates perform better than higher income tax rate states in most economic indicators. 

Initiative would almost double top tax rate

Proponents of the measure, also known as Invest in Ed, want to tax high income earners to provide funding for K-12 education. 

Under the initiative, Arizona’s top income tax rate would be raised from 4.5 to 8 percent – almost an 80 percent increase for individuals who earn $250,000 and joint filers who earn $500,000.  

Couldn’t come at a worse time for small business

The tax increase would come at a time that could further devastate a large number of small businesses that may be affected by the new tax, said Laffer, who is known as the “Father of Supply-side Economics” for inspiring a world-wide tax-cutting movement in the 1980s. 

Those most at risk are small businesses still struggling to keep their doors open during the pandemic. 

Simply put, Arizona would move from having the 13th lowest income tax rate on small businesses to the 8th or 9th highest in the nation, Laffer said. 

Raising taxes when the nation is trying to recover from the COVID-19 is “inappropriate and foolish,” Laffer said. 

Almost all states with lower tax rates perform better

Such a drastic increase would dampen investment and growth, and research backs that up, they said. 

In conducting their research, the economists examined how similar types of tax increases over the past 30 years have affected states. Almost all states with low or zero income tax rates performed better in most economic indicators than those states with high tax rates, they found. 

High tax states saw less revenue for government responsibilities, including education, Laffer said. 

An analysis of the 11 states that introduced income taxes since the 1960s shows they are at the “very bottom of performance” in not only economic and population growth, but revenue for public services, Laffer said. 

Harsh implications for Arizona

Using data from other states, the economists measured the impact Arizona’s Proposition 208 would likely have on jobs, wages, interstate migration, tax revenue collections, state competitiveness, and small businesses.

They found that all areas would likely suffer, making “Arizona residents poorer and the state’s economy less competitive.” 

Among their findings:

•An estimated 200,000 jobs and about $25.5 billion in personal income would be lost over the  next 10 years. 

• Fifty percent of the tax would be borne by small business owners and operators that typically generate from half to two-thirds of the jobs in a state.  

• Arizona’s economic competitive position among the 50 states would fall from No. 10 to No. 16, according to the ALEC-Laffer competitiveness index.

•The state would lose 700,000 people in net instate migration over just the next decade.

•Wage growth would decline in the state and after a decade average household income would be roughly $6,000 lower with the tax hike. 

•A loss of businesses, jobs and taxes from in-migration would reduce by half the proponents estimate of $1 billion in tax revenue gains 

“The preponderance of the evidence shows a negative effect when states raise income taxes,” Laffer said. “That’s because we’re a country where people can move across borders. We’re a very mobile population. Businesses, corporations and financial capital can move across borders and they do.

“They move to places where they have the best pro-growth and pro-business atmosphere.”

About Stephen Moore

Stephen Moore is FreedomWorks’ chairman of the Task Force on Economic Revival. He previously served as president of the Club for Growth, chief economist of the Heritage Foundation, and as a member of the Wall Street Journal editorial board.

About Arthur Laffer

Arthur Laffer is the founder and chairman of Laffer Associates, an institutional economic research and consulting firm, as well as Laffer Investments, an institutional investment management firm utilizing diverse investment strategies. Dr. Laffer’s economic acumen and influence in triggering a world-wide tax-cutting movement in the 1980s have earned him the distinction in many publications as “The Father of Supply- Side Economics.”

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To check the pulse of entrepreneurs across the nation during COVID-19, Arizona U.S. Representative David Schweikert and other members of Congress met with business owners from across the nation during a virtual roundtable last week.

The lawmakers said they wanted to hear directly from business owners so they can better craft effective legislation going forward and find gaps where small businesses are falling through the cracks. 

Schweikert said small retailers and restaurants are showing some of the highest displacement numbers, and an “unusually high” number of new business filings indicates they are starting new businesses. 

Congress needs to find a way to help them succeed, he said.

“This may be really important for the country’s economic recovery and those in the policymaking world are going to have to think about everything from access to capital, to the regulatory state, and how do we help microbusinesses that are going to be run from home for awhile,” Schweikert said. “How do you help them hit the launchpad and take off? That needs to be part of the economic recovery plan as we work through this.”

Schweikert co-hosted the event with Rep. Bill Foster (IL) and Rep. French Hill (AR) who spoke of legislation to help, including possibly extending the federal Paycheck Protection Program that helped millions of small businesses keep their employees on the payroll, their lights on and rent paid for months during COVID-19 shutdowns. 

All three, once young entrepreneurs themselves, are co-chairs of the bipartisan House Entrepreneurship , which serves as a forum for lawmakers to stay abreast of the most pressing issues facing businesses.  
The event, the Entrepreneurship Roundtable, was hosted with the . The center is a nonpartisan research, policy, and advocacy organization that works with policymakers in Washington and across the country to achieve a policy environment that promotes new business formation, survival, and growth.

Bumpy ride for all 

At the roundtable event, entrepreneurs from a range of industries including technology, real estate, digital food service, engineering, and marketing detailed the damage all experienced and what they need moving forward. 

All reported deep dives in revenues from the disruptions. All have also managed to keep their companies open. 

Federal stimulus programs helped, they said. 

“We might have survived without federal assistance, but it would have meant significant layoffs and downsizing. We did not lay off one person,” said Jimi Allen, CEO and founder of , a marketing and visual services company in Aurora, Colorado.

Almost all of the executives said they benefited from two federal stimulus loan programs created earlier this year to help businesses with 500 or fewer employees: the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program, they said.  

Remote workers here to stay?

All of the companies said they have had to go to completely or partially remote operations.  

Lori Anna Harrison of Scottsdale real estate marketing firm , said working remotely has been so successful for her company, they have no intention of switching back. 

“We will never go back to brick and mortar,” said Harrison. “It hasn’t impacted clients at all. We are able to give the same level of service.”

Businesses owned by people of color being left behind 

Sky Kelley, the Black owner of Avisare, a Los Angeles company that uses artificial intelligence (AI) to help government agencies and small businesses procure contracts, said COVID-19 almost devastated her business. 

When the pandemic hit, Avisare was in the late stages of negotiating a major contract with their first private client. That deal instantly went away, she said. Other deals also fell through with government agencies that suddenly were financially strapped as well. 

Meanwhile, all of her highly skilled engineer employees, who were earning six figure incomes, had to move to independent contractor status.

When Kelley applied for a PPP loan, she was turned down. After repeated phone calls and reapplying for an EIDL loan she finally received $68,000. 

Nevertheless, Avisare has survived by scrambling to find new business, she said.

“We were able to ride through it, but we had to get really creative and do double duty while also managing kids and home and childcare.” 

Kelley also expressed concerns that businesses owned by people of color are falling by the wayside during the pandemic, especially companies owned by African Americans.

Legislation to support entrepreneurship 

After hearing from the company heads, Schweikert and the other congressional members spoke of measures they and others are making to help spur innovation and prevent entrepreneurs from falling through the cracks. 

The New Business Preservation Act, for example, would provide funding for innovation and startups. The bill also has provisions to protect women and people of color. 

Schweikert said Congress is continuing to work to come to agreement on a stimulus package for small businesses. 

America’s edge relies on entrepreneurship, he said. 

“Small businesses have always been, and will continue to be, an integral part of our communities,” Schweikert said.

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Arizona Gov. Doug Ducey laid out a multitude of goals for 2020 that revolve around issues important to business and industry during his sixth State of the State address Monday.

Among his priorities? No new taxes. Stronger ties with Mexico. Innovation in water conservation and management. Broadband for rural areas. Workforce training. Highway expansion. And much more.

Ducey, whose tenure has centered around spurring economic growth and boosting the state’s “rainy day” reserves to a whopping $1 billion, stated that businesses and citizens can expect more of the same this year.

“We got here by doing things our way. The Arizona way. And I’m here to tell you, you ain’t seen nothin’ yet,” Ducey said as he addressed a crowd of lawmakers, civic leaders and others at the state Capitol to coincide with the opening day of the legislative session.

Building on state’s economic boom

The governor spoke for over an hour, laying out plans to increase funding for academic achievement for low-income children, pay raises for many state workers, increased mental health services and reduced government fees and “red tape.”

He also touted Arizona’s successes.

The state now outshines most of the country in almost every venue, he said: “The prime rate is dropping, school test scores are rising, and our debt is way down. Household incomes have hit a record high and our poverty rate has dropped faster than any other state in the nation.”

Arizona already outshines rest of nation

Arizona now is in the top ten when it comes to jobs in transportation, technology, science and healthcare, Ducey said.

He highlighted keystones of his administration: eliminating regulatory red tape, reducing government fees and making Arizona the first state to grant universal recognition of out-of-state occupational licenses.

It’s no surprise why 300 people are moving here every day, he said.

“Other states and Washington, D.C. politicians may be focused on growing government. Arizona grows opportunity,” Ducey said. “Our population is surging, but the size of our government is actually shrinking.”

Here are eight business takeaways from Ducey’s speech:

No new taxes

“Let me reiterate what I’ve said in five prior State of the State speeches and two inaugural addresses, because apparently it bears repeating. No new taxes. Not this session. Not next session. Not here in this chamber. Not at the ballot box. Not on my watch.”

Investment in teachers, students and schools

“In total, we’ve pumped $4.5 billion in new investments into Arizona schools. With our latest budget, that figure will rise to $6.6 billion. And we’ve done all of this without raising taxes.

“In addition, an even larger investment in school counselors, cops on campus and school safety. A stronger focus on CTE (Career and Technical Education) and the trades. More money for the Arizona Teachers Academy and Teach for America. And a full, complete and accelerated restoration of flexible funding two years ahead of schedule.”

Rural jobs

“There’s no shortage of new jobs in Arizona, but many vital jobs remain unfilled in our rural communities. So, we’ve got a plan — a Rural Jobs Initiative.

“First, tourism and state parks. There’s no place more beautiful to vacation than scenic Arizona, and with an infusion of new dollars, we’re going to work with Tourism Director Debbie Johnson to ensure the whole world knows it.

“Next, workforce. Small business is the backbone of our economy. So, we’re launching a partnership with Local First Arizona to strengthen small businesses, get rural Arizonans back to work and bolster our local economies.”

Long term water planning

“We will continue to protect Lake Mead, the Colorado River, groundwater and our [agriculture] jobs. But we shouldn’t be dealing with this issue one generation at a time. We need a strategic ongoing effort to turn Arizona into the international capital for water technology.

“Look at all that Israel has done. Why not Arizona? We’ve been a leader on water, and with this approach, we will continue to be an even stronger leader far into the future.”

Improving infrastructure with I-10’s widening

“The Phoenix-Tucson corridor is an economic artery for our state, and it needs expanding. It’s time to accelerate completion of I-10’s widening — in both directions — between our two largest cities.

“Our budget puts the pedal to the metal with the construction of a new six-lane bridge over the Gila River. This replaces a 56-year-old bridge. 62,000 people drive over it every day. That’s 23 million a year. So, let’s break ground ASAP.”

Connecting rural Arizona to high-speed internet

“Rural areas still lack high-speed internet. Let’s triple our investment in Rural Broadband Grants and also invest $50 million in Smart Highway Corridors to install broadband along our rural interstates.

“This will make our highways safer and smarter than ever before and pave the way to get all of rural Arizona logged on.”

Filling labor gaps

“ASU, U of A and NAU have also stepped up to fuel our economy, and we’re about to pour on the gas. [Arizona Board of] Regents Chair Larry Penley has proposed what he calls ‘The New Economy Initiative.’

“It’s an innovative approach that enhances our capacity to graduate more students for the critical jobs of today and tomorrow. It’s just the latest effort by our universities to solve problems and do it the Arizona way.”

Eliminating government red tape

“I’ve issued a new Executive Order, with a new reform: If the government ever deems a new regulation absolutely necessary, it must first identify three others to eliminate. The result: New regulations will naturally mean less regulations.”

Business community cheers

The Arizona business community leaders cheered the governor’s message of continued economic momentum.

“Small-business owners are thrilled to hear that despite record state revenues, our governor will not be going on a spending spree with our taxpayer dollars,” said Chad Heinrich, the Arizona state director for the National Federation of Independent Business. “While states like our neighbor California and others like Illinois and New York continue to lose residents, Arizona is the No. 1 inbound state for a reason: Low taxes, reasonable regulations and a government that is open to small-business entrepreneurs.”

Arizona Chamber of Commerce of Industry President and CEO Glenn Hamer was equally enthusiastic about the governor’s message and his pledge to hold the line on efforts to overspend.

“The governor made clear that he is going to work to improve our state’s tax climate, while removing regulatory barriers to growth. Competitive tax and regulatory environments have been central to our economic growth,” Hamer said. “We share his commitment to strongly resisting measures that will reverse our economic progress.”

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In 2019’s final episode of “Request To Speak,” host Garrick Taylor, executive vice president of the Arizona Chamber of Commerce and Industry, asks his guests for their “Arizonan of the Year” — anyone from the state who they feel has had a significant impact on Arizona residents. Featuring Bob Charles, director of First Strategic; Jessie Armendt, Compass Strategies senior associate; and Lorna Romero, owner and founder of Elevate Strategies.

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Next up on “Request To Speak,” host Garrick Taylor asks his guests about their predictions for 2020, including the presidential election, a U.S. Senate race and the Arizona Cardinals. Featuring guest panelists: Bob Charles, director of First Strategic; Jessie Armendt, senior associate at Compass Strategies; and Lorna Romero, owner and founder of Elevate Strategies. Join us again tomorrow!

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On the latest episode of “Request To Speak,” Garrick Taylor, executive vice president of the Arizona Chamber of Commerce and Industry, welcomes a panel of political experts to discuss what happened in the world in 2019 — for better or for worse. Featuring guest panelists Bob Charles, director of First Strategic; Jessie Armendt, senior associate at Compass Strategies; and Lorna Romero, owner and founder of Elevate Strategies. Stay tuned for Episode 8: Predictions for 2020.

The post Request To Speak – Episode 7: A Look Back at 2019 appeared first on ßŮÁ¨´ŤĂ˝.

With another move attacking Arizona Public Service, it appears California billionaire and now presidential candidate Tom Steyer cannot seem to quit Arizona.

Steyer’s attacks against the Arizona utility date back to the 2018 election cycle when his attempt to mandate onerous new renewable energy standards was rejected by voters in a 2 to 1 margin.

Now, Steyer is using a digital ad to accuse the company of corruption. This is the second time in recent months that Steyer has inserted himself into Arizona issues.

Many observers attribute his behavior to a desperate attempt to increase his name ID in the state and salvage his reputation after and painful and expensive loss in the fall.

“California billionaire Tom Steyer can’t stop meddling in Arizona politics,” Arizonans for Affordable Electricity spokesperson Matt Benson said. “It was just last year that Arizona voters overwhelmingly rejected Steyer’s Prop 127, which would have added $1,000/year to the typical family’s electricity bill. Now he’s back – this time as a self-described ‘ratepayer advocate.’

“You’re not fooling anybody, Tom.”

The California billionaire, who made millions investing in fossil fuels, is inserting himself in Arizona policy conversations claiming the state is being misguided by corporations and elected leaders. But the state’s economy has been booming for the past year with local economists touting the diversity in job and industry growth.

Arizona’s economy continues to grow at one of the fastest rates in the nation, ranking fourth in the U.S. for GDP growth last year and second in the country for personal income growth.

More than 300,000 new jobs have been added since 2015 and Arizona is projected to add another 165,000 new jobs by 2020.

Also, the greater Phoenix metropolitan area has officially eclipsed its pre-recession job peaks in almost every industry.

“Arizona is open for business and our economy is booming,” said Governor Doug Ducey in a statement. “It’s not by accident: Arizona’s pro-business policies, low taxes and light regulations are delivering more job opportunities and bigger paychecks for Arizona workers.”

Business community advocates say Steyer’s latest advertisements are likely to prove as unsuccessful as his previous political activities in the state.

“This guy apparently can’t take a hint,” Arizona Chamber of Commerce and Industry spokesperson Garrick Taylor said. “Arizonans have rejected over and over Steyer’s job-killing agenda, but yet he keeps coming back here. Arizona’s economy is doing just fine without Steyer, thank you very much, in large part because lawmakers and the governor have studiously avoided the sort of policies he advocates.”

Steyer’s efforts in Arizona began in 2018 when his progressive political action committee, NextGen Climate Action, launched an effort to mandate that utilities provide half their annual retail sales from renewable energy sources by 2030 “irrespective of cost to consumers.” The effort excluded zero-emission nuclear energy from the definition of renewable energy.

Then in May, Steyer portrayed himself as a ratepayer advocate by engaging in an APS rate case before the Arizona Corporation Commission. Many were quick to point out that his 2018 energy mandate, known as Proposition 127, would have increased costs on Arizona residents, including low-income families and small businesses. Estimates revealed the typical Arizona family would see its utility bills increase by $1,000 or more over the course of a year.

In addition to the $28 million Steyer dumped into the failed campaign, he also attacked Republican candidates, spending more than $3 million against Attorney General Mark Brnovich and engaging in the Arizona Corporation Commission race through dark money groups such as ChispaAZ.

On Tuesday morning, Steyer announced his candidacy for president in a digital video. Steyer plans to spend at least $100 million on his campaign.

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Host Garrick Taylor sat down with Roy Herrera and Courtney Shadegg on the latest episode of Request to Speak to discuss why we see politicians change their minds on different issues, the relevancy of ideological identifiers and their book recommendations.

Read/Watch/Listen:

• Roy Herrera recommends a book: “Charged: The New Movement to Transform American Prosecution and End Mass Incarceration” .
• Courtney Shadegg recommends a book: “Ship of Fools: How a Selfish Ruling Class is Bringing America to the Brink of Revolution” .
• Garrick Taylor recommends a graphic novel: “A Fire Story” .

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In the latest episode of Ham(m)er Time! Glenn Hamer, president and CEO of the Arizona Chamber of Commerce and Industry, sat down with Arizona Senate President Karen Fann and talked about the transition to her new leadership role, the importance of the DCP and the hidden gems of Prescott.

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