The Texas gubernatorial election takes place on Nov. 4, 2014, exactly one year from this coming Tuesday. Potential candidates have already started campaigning, but the question remains: What will be the big issues in the race?
Education and taxes seem to be on the list. The two may be tied together, with state education funding slashed and taxes suggested as a possible way to recuperate the money.
Wendy Davis, the likely Democratic nominee, has said she wants more money for schools. And though Davis said in an interview that she believes the state has enough revenue to meet all of its needs — including education — Greg Abbott, the frontrunner for the Republican nomination, has already accused her of favoring tax increases, a harsh criticism in a state in which passing a personal income tax is unconstitutional.
Abbott accused Davis of “threatening to raise taxes up to $35 billion” in a Facebook post in October. This accusation seems to be part of a trend of Abbott’s, drawing attention to the fate of taxes in Texas if a Democrat were to take the governor’s mansion.
In a recent poll on his website entitled “Texas or Taxes,” Abbott once again highlighted taxes with the claim, “The Lone Star State has already proven the keys to economic success and more jobs are lower taxes, less regulation & limited government.” The poll then asks which of these policies — balanced budget, fewer regulations or lower taxes — Washington should adopt.
But is there any truth to these suggestions of Davis favoring tax hikes? The Austin American-Statesman’s PolitiFact said no. Abbott’s accusation that Davis threatens to increase taxes by $35 billion came from Davis’ statement on the importance of reviewing the $38 billion in tax exemptions that the state allows. The Statesman rightly points out that calling for a review of these exemptions is not the same as calling for “an across the board repeal.”
Should these state tax exemptions be reviewed and potentially repealed? Maybe not. $36 billion of the $38 billion in exemptions come from sales tax exemptions. Sales taxes are regressive taxes, meaning they disproportionately affect the poor. To understand why, think of what some of the current exemptions address: groceries, residential gas and electric utilities and prescription drugs. Spending on these goods doesn’t increase much as income increases, so removing these exceptions would only hurt the poor. That could in turn cause the poor to spend less, which could affect overall consumption in the state economy.
It is also important to note that while Davis has been adamantly against raising sales or property taxes, decreasing sales tax exemptions really does the same thing as increasing sales taxes. In both cases an individual pays more money to the state. It seems Davis favors one over the other for public relations reasons, which represents an overall theme in her campaign.
So far, Davis has stayed in relatively safe territory regarding her stance on almost all issues. She favors education spending, is opposed to raising sales taxes and property taxes and has noticeably left her filibuster on abortion out of recent discussions. That’s OK. In fact, it’s a common political move. But in the coming months, Davis has some hard questions to answer. What will she do with the $8.2 billion rainy day fund Texas has? Which tax exemptions will she look at if she becomes governor? If taxes increase, what is she going to use the extra revenue for?
Even with all these unanswered questions, one thing is clear: Education and taxes will be important issues in the upcoming election. Education needs more funding. But the typical answer of increasing taxes isn’t always correct. In Texas’ case, there seems to be a need to more efficiently allocate already sufficient resources, rather than to try and change government revenue through taxes. And given the state’s conservative history, it might be a more popular stance for Davis to take as well.
Malik is a Plan II and business honors sophomore from Austin.