Small: An agenda for all statewide candidates

An agenda for all statewide candidates

By Jonathan Small

Candidates for statewide offices such as governor, attorney general and lieutenant governor are kicking off statewide campaigns. While candidates are very important, equally if not more important is what those statewide office candidates would accomplish, and how, if elected.

Oklahoma faces great opportunities and significant challenges; to address both, it will require newly elected officials to be willing to discuss those opportunities and challenges on the campaign trail and repeatedly commit to “do hard things” and help lead the state to meet the opportunities and challenges.

Small: Setting Oklahoma on path to post-pandemic growth

Setting Oklahoma on path to post-pandemic growth

By Jonathan Small

COVID rates have plunged in the past month and the worst may be behind us. Now policymakers should adopt significant reforms to allow Oklahoma to grow and thrive in the pandemic’s aftermath.

At the Oklahoma Council of Public Affairs, we’ve released a new study that provides a blueprint. It has three major planks: eliminate the personal income tax, reform our state’s dysfunctional regulatory system, and put parents in charge of education with a universal Education Savings Account.

When it comes to taxation, the old adage holds true: If you want less of something, tax it more. Given that the income tax is a penalty on earnings—from work, investment, and risk taking—that means our state discourages job growth with the income tax. It doesn’t have to be that way.

If policymakers reduce Oklahoma’s income tax to zero and offset that change by broadening the sales tax and making sales tax rate adjustments (if policymakers want a revenue-neutral reform), our estimates show those changes would rapidly increase the state’s GDP by almost 3% and have a positive GDP growth impact of around a quarter-percent per year. Over 10 years’ time, Oklahoma’s GDP would increase by more than $13 billion, or more than 100,000 jobs.

OCPA column: COVID chaos requires bold reforms

COVID chaos requires bold reforms

By Jonathan Small

The assault on lives, livelihoods and medical needs of Oklahomans by governments’ response to COVID-19 is going to require bold reforms to reverse the damage. Lawmakers should enact several polices as a result.

First, any regulations waived to deal with COVID-19 should stay repealed. The state is functioning without those regulations and lives and livelihoods have been saved.

Oklahoma government is receiving more than $1 billion in federal funding to recover. As the federal government provides more flexibility, these funds should be used for a mix of purposes, including offsetting of state revenue shortfalls, financing of some strategic projects, and facilitating pro-growth reforms.

Pro-growth tax reform is desperately needed. With two “black swan” events underway—the collapse of the oil and gas industry and COVID-19—Oklahoma must now position itself to diversify with new businesses, preserve existing businesses, and attract business from other states.

OCPA: To combat coronavirus, unleash the private sector

To combat coronavirus, unleash the private sector

By Jonathan Small

The emphasis on “public distancing” to combat the COVID-19/coronavirus should not be mistranslated into an edict to stop caring or taking necessary action. These are the times we must all commit ourselves to extraordinary personal responsibility and individual initiative. We must be courageous, not fearful. We must be wise, not obstinate. We must be a good neighbor, not an isolationist. We must be innovative and not captive. We must be compassionate and not self-centered.

Our policymakers will need to increase, not decrease, our reliance on private-sector solutions and this challenge will require government to modernize and innovate.

To some, that will sound counterintuitive. Surely at a time like this, critics will say, we need to ignore what the private sector can do and trust big government more than ever. But Democratic presidential candidate Joe Biden noted the failures of big government in a recent debate when it was suggested government-run health care was needed to stop the coronavirus.

“With all due respect to Medicare for all, you have a single-payer system in Italy,” Biden said. “It doesn’t work there.”

Solutions from the private sector are helping significantly. In Colorado, which has a Democratic governor, the state waived regulations so medical professionals licensed in other states could immediately become licensed in Colorado, expedited the process for those currently seeking a medical license in-state, and expanded the ability of medical professionals other than current doctors and nurses to test for COVID-19.

If you reduce regulation, you can increase supply. Government has the opportunity during these challenging times to embrace this reality.

Similarly, in Texas, Gov. Greg Abbott, a Republican, lifted regulations so trucks delivering alcohol can also haul grocery supplies. Shortages in some grocery stores were not simply the product of mass purchases, but also regulations that restricted supply.

In Oklahoma, Gov. Kevin Stitt has issued similar executive orders waiving red tape as well.

At the national level, President Trump has tapped major businesses to make testing for coronavirus both easier and more efficient.

Unfortunately, these common-sense approaches often run counter to some of the loudest voices. Thus, some suggest we need bigger government, an approach that would require tax increases at a time economic contraction was already underway in Oklahoma. Such moves would set us back as a state, not speed recovery.

Instead, Oklahoma’s economy needs several pro-growth policy reforms to prevent long-term devastation from the simultaneous assault of the COVID-19 response and the oil production maneuvers between Saudi Arabia and Russia.

Oklahoma needs pro-growth tax relief and tax reform—including reforms to increase capital, such as building crowdsource funding infrastructure in Oklahoma, and expansion of tax credit programs that promote innovation and effectiveness in education and work-force training. These reforms are necessary, and the sooner they are enacted, the better for all Oklahomans.

These are the times when everything gets put into perspective, and we must prioritize what is most important. I have every confidence Oklahomans will lead the way.

Jonathan Small serves as president of the Oklahoma Council of Public Affairs.

Pro-Growth Cities

In tough economic times like today, it is important that cities encourage continued business growth. It can be difficult to achieve this, but one way is to avoid passing new ordinances that make it harder for businesses to expand.

I live in Muskogee, Oklahoma. The recession took a while to hit our area, but the inevitable has occurred. As is the case across the nation, growth has slowed, and jobs have been lost. One would think that the city leaders would be doing everything they could to reverse that trend, and they are to a degree, but you would be surprised at some of the things city leaders can overlook.

For example, in January of this year, the city council passed an ordinance effectively banning metal buildings from being built, unless the metal facade was covered in brick or some other material (or unless the structure is built in areas zoned agricultural, industrial, or for mobile homes).

Most metal buildings are constructed by businesses for one simple reason: they are relatively cheap to build. A metal building is significantly lower in cost and faster in build time than conventional construction.

One of the main reasons for this is that metal buildings are not very pretty. What is forgotten is that today's metal structures can be accessorized with various forms of facades or wainscots (which should be left up to the owner, not forced on them by government). Muskogee's leaders have, in recent years, been a little obsessed with making the town look nice, to the detriment of existing business. Another example of this was the portable sign ban ordinance that was struck down by the courts a few years back. And for another instance, see my post from June, when a rezoning request from a small businessman was denied.

In the midst of economic turmoil not seen in decades, municipal leaders in my town are more concerned about how the city looks than about economic growth. A town can look as nice as possible, but still be dead economically.

The council recently pushed for, and the voters passed, a sales tax increase (which mainly dealt with infrastructure improvements, with a bit of "pork", if you will). As a result, a businessman friend of mine now has his orders shipped to his property in the country, which saves him a lot of money since it is located outside the city limits.

Just a few miles to the east, the small town of Fort Gibson takes a different perspective. Fort Gibson does not charge some construction-related fees that most cities do. The town has had substantial growth for several years, which might not be a total coincidence.

Cities would do well to enact pro-growth measures, and eliminate hurdles to growing business in their town, especially when dealing with small business. In a time of recession, this is not an option - it's a must.


Cross-posted at Cities of Vision - a think tank for cities.