If you are interested in the long-term growth of the state's economy, the best thing to do is to keep taxes as low as possible. There is a lot of evidence to support this proposition. Unfortunately, the fiscal relationship between states and the federal government works against this type of fiscal responsibility and farsightedness. In fact, it makes it very difficult for local politicians to take the long-run view when considering tax policy. The overriding reality today is that much of a state's tax base goes directly to Washington.
States then have to plead and struggle to get some of that revenue back.
This creates a situation where it is almost impossible for state politicians to act responsibly. We are going to keep sending most of our taxes to Washington regardless of how much we get back. The result of this process is that any cockamamie project looks pretty good to state politicians, provided it will appeal to federal officials and will result in the recapture of some tax dollars. What we're really doing is begging. We're begging . . .