Damaging winds of more tax cuts in Iowa

Palisades-Kepler State Park was smashed by the derecho last August and only recently opened. Trees still hang against other trees and masses of branches are piled just off the trails.

Volunteers helped get the park in shape to open as the Department of Natural Resources had too little in its budget to pay for it all. The state never has enough money to take care of its beautiful places. We never have enough to clean our waterways, either, or to make sure the youngest kids get subsidies for child care, or to overcome barriers of limited slots, hours and transportation to participate in preschool, so they can thrive when they begin school.

Yet unchecked one-party control of state government is cutting taxes while Iowa families still are dealing with all those needs plus the economic effects of a pandemic that is not over, its human toll reaching toward 6,000 deaths and 400,000 positive tests.

You'll hear a lot from politicians, and regular anti-tax commenters such as John Hendrickson in the May 10 edition of The Gazette, that mask the severely detrimental impact of Iowa's continued drive to cut taxes and reduce services that boost prosperity.

Altogether, the various tax proposals still alive in the Legislature would cost the state in excess of $500 million over the next four years. These tax cuts are so large that they put the state at risk of losing $100 or $200 million in federal fiscal relief, funds that could help ordinary Iowans. The cuts will drastically reduce revenue that we would use for education and services to lift all Iowans, to make Iowa a welcoming place where people would move to raise their families and fill jobs.

Inheritance taxes — already nonexistent for lineal family members (parents, children, grandchildren, spouses) — will be completely eliminated for others. Shirttail relatives or non-relatives, many outside Iowa, will benefit. Most of the untaxed money will come from wealthy estates.

So what are we doing for the workers who lost their jobs, for the parents who gave up a job to keep their children safe while schooling them at home, for the entrepreneurs whose small businesses had to close up shop? We are cutting their unemployment benefits.

The governor just announced Iowa is turning back millions of dollars of federal money that was helping unemployed Iowans, including the self-employed, money that counted for half of the unemployment assistance for Iowans.

Apparently some restaurants complain they can’t find workers willing to work odd and unpredictable hours for the tipped minimum wage of $4.35 and few benefits — hoping tips will get them up to just the minimum wage of $7.25. When a living wage in Iowa even for a single person is well over $12 per hour, it is not surprising that workers might be hard to find for low pay, while risking their health or that of their family.

We could make work more attractive in the hospitality sector by improving options for child care to help parents go back to work. But new tax cuts will pit that choice against many others, and all of them are squeezed by reductions in state funding.

That is the inevitable damage of new tax cuts — making life in Iowa more difficult and our state less inviting. It is a storm we could avoid, but lawmakers are volunteering some Iowans to sacrifice so that others get tax breaks.

David Osterberg, a former state representative from Mount Vernon in, is a senior researcher at Common Good Iowa, a nonpartisan policy analysis and advocacy organization. dosterberg@commongoodiowa.org