Arthur Laffer, the father of President Reagan's "supply-side economics," says Utah will prosper almost immediately if voters approve three tax-limitation initiatives.
Visiting Utah on Wednesday in support of independent gubernatorial candidate Merrill Cook, Laffer said industry is staying away from the state because taxes are too high. A tax cut would increase funds in state coffers because people would begin moving to Utah."The only reason you (Utah) are attractive (to industries) is that you have low wages," he said. "No one wants to pay the excessive taxes you have in this state."
The three tax initiatives would reduce income, sales, gasoline and cigarette taxes to 1986 levels, lower residential property taxes to .75 percent of market value and 1 percent of the value of other property and give income tax credits to parents whose children attend private schools.
Laffer, a Republican, said he met Cook only recently but decided to endorse him because Cook is the only gubernatorial candidate who supports the tax initiatives.
Utah's tax initiatives are mild compared to Proposition 13, passed by California voters 10 years ago, Laffer said.
"The only thing it (Proposition 13) destroyed was the unemployment lines," he said.
Laffer said opponents of the initiatives have yet to learn that people don't work so they can earn money to pay taxes. "They work for what they can buy after they pay taxes," he said.
"What's happened to growth in Utah in the last year or so is not luck, it's not chance," Laffer said. "Are you going to let people out-migrate until you have no tax base?"
Utah's taxes are out of line with other states, Laffer said. The state can lower its tax rates while still raising the money needed to educate its many children.
"All you have to do is look elsewhere and see what's happened," Laffer said. "Kids in California are better off now than they ever were before."
Utah children will be hurt if the initiatives are rejected, he said.
"I don't know how you can send a kid out into a declining economy where he won't be able to get a job," he said.
Laffer, whose supply-side theories have been widely criticized in recent years, said the theory has been responsible for creating 16 million jobs nationwide since Reagan became president.
Democrats talk about the federal government's huge deficit only because the unemployment rate is low and interest and inflation rates are down.
"It (the deficit) is the only thing really left," he said, adding that he believes supply-side economics is not responsible for the deficit.