Your morning jolt: Sonny Perdue says Georgia can’t afford supply-side economics

Gov. Sonny Perdue has often said that he’s the point at which Republican theory meets up with reality.

As my AJC colleague Aaron Gould Sheinin notes today, fewer than three days remain for the rubber-meets-road governor to sign a quartet of major bills.

The most controversial, from a philosophic point of view, is H.B 481, which creates new tax breaks for business and cuts capital gains taxes — 25 percent in 2010 and 50 percent in years beyond.

The tax cuts would cost $340 million a year in lost revenue, but Republican supporters — who include state Rep. Tom Graves of Ranger and Senate Majority Leader Chip Rogers of Woodstock — argue that the tax breaks would act as an economic stimulus.

It says so in the measure’s title: Jobs, Opportunity, and Business Success Act of 2009.

But Denis O’Hayer at WABE (90.1 FM) caught the governor expressing serious economic skepticism during a press conference last week.

In essence, Perdue said the economic theories espoused by Ronald Reagan and Jack Kemp — that lower taxes actually generate more government revenue — are a gamble that don’t have a place in Georgia.

Not in hard times.

Here’s what Perdue said, as aired on Friday:

“Georgia’s a balanced budget state. And it’s very difficult to do the stimulus-type bills in a state that’s starved for revenue and cash at the same time.

So that kind of destroys a supply-side theory within a state government.”

While you ponder that, consider these items found while perusing this morning’s ajc.com:

  • A federal judge takes up the question of whether Atlanta is entitled to Lake Lanier’s water.
  • One insurance executive used 10 PACS to send $120,000 to Republican candidate for governor John Oxendine.
  • Those fund-raising allegations against Oxendine are serious, a spokesman for rival Karen Handel says.
  • The recession hits Atlanta mayoral campaigns, sending them to cheap alternatives like Facebook and Twitter.
  • On the PSC move to work around a state law governing its chairmanship.
  • PSC vice chairman Lauren “Bubba” McDonald is fined for ethics violations.
  • Jim Axel, a voice from TV’s ‘era of quality,’ is fighting cancer.
  • Some opinion:

  • Cynthia Tucker says religious conservative silence on torture has been troubling.
  • Jim Wooten says a mother’s love still lives on.
  • Jay Bookman declares Harry Reid’s victory on Yucca Mountain to be the nation’s loss.
  • And from elsewhere:

  • LAT: John Edwards’ aides plotted to sabotage his campaign over affair.
  • WP: Wanda Sykes, Rush Limbaugh and the politics of humor.
  • NYT: A shaky Pakistan is seen as a target of plots by Al Qaeda.
  • LAT: Mickey Edwards says the nation needs a better GOP.
  • For instant updates, follow me on Twitter.

    4 comments Add your comment

    [...] cut taxes for business and capital gains, a key component of supply side economic theory. Today the AJC points out that Perdue doesn’t consider himself an adherent of supply side economics and doesn’t [...]

    Native Californian

    May 11th, 2009
    10:22 am

    Purdue is showing more common sense than I am used to giving him credit for.

    Copyleft

    May 11th, 2009
    12:36 pm

    Amazing. He’s broken ranks with the most sacred principle of the Republican Party leadership: Tax Cuts Cure Cancer.

    Sure, the rank-and-file are kept distracted with nonsense about abortion and gays and such, but the REAL powerhouses of the GOP have only one principle: tax cuts for the rich. Supply-side Uber Alles.

    And Perdue dares to DISAGREE with the sacred mantra? Gutsy guy….

    Bill

    May 12th, 2009
    3:03 pm

    Not gutsy at all. He’s always been a democrat – he only changed parties because he couldn’t get elected as a dem. Also, he’s at the end of his reign and can’t be re-elected.