"As governor of Arkansas, I cut taxes and fees almost 100 times, saving the taxpayers almost $380-million. I left a surplus of nearly $850-million."
Mike Huckabee on Thursday, August 2nd, 2007 in a news release.
A nickel-and-dime defense
The nonprofit organization and its political action committee often target political candidates who don't live up to the group's standards of low taxes and low spending. In the presidential race, the club is giving special attention to Huckabee, going so far as to set up a Web site (www.taxhikemike.org) to post attacks on the former Arkansas governor's fiscal record.
In the summer of 2007, the club ran a TV ad in Iowa comparing Huckabee to his Democratic predecessor Bill Clinton and calling him a "tax-and-spend liberal." Huckabee fired back with a press release:
"As governor of Arkansas, I cut taxes and fees almost 100 times, saving the taxpayers almost $380-million. I left a surplus of nearly $850-million, which I urged should go back to the people. ... I pushed through the Arkansas Legislature the first major, broad-based tax cuts in state history – a $90-million tax relief package for Arkansas families."
But Huckabee's response has glossed over some facts.
The Arkansas Democrat-Gazette , a Little Rock newspaper, examined the boast. The paper obtained a list of the near-100 tax cuts passed during the governor's tenure and found they included such small-change items as a sales-tax break for manufacturing machinery amounting to $500 a year and a tax exemption for county fairs that cost the state $15,000 a year.
Whitney McLaughlin of the Arkansas Department of Finance and Administration confirmed the Democrat-Gazette's budget numbers for PolitiFact. During Huckabee's tenure, taxes or fees were cut 90 times, which did reduce tax revenue by about $380-million. The paper concluded that Huckabee doesn't deserve credit for all of those cuts, noting that all but one required a vote from the legislature, and most were the product of larger negotiations between the branches of government.
The one tax cut Huckabee undoubtedly had his hands on was a $90.6-million income tax reduction enacted in his second year as governor. His administration did, as he says, leave the state with an $844.5-million budget surplus (as of March 2007) that the current government is now figuring out how to dispose of. And Huckabee did advocate for sending surplus rebates to taxpayers in 2006, when the year's surplus was expected to be $332-million.
All of those Huckabee figures are correct.
But, where did the money in that surplus come from? Mike Stormes, the state budget administrator, said the surplus was the result of "a conservative budget combined with a booming economy." The Arkansas Department of Finance and Administration estimated that tax revenues grew by $505-million between 1997 and 2005.
As governor, Huckabee supported a number of tax increases, including hikes in the state sales tax, a cigarette and tobacco tax and a nursing home bed tax, to name just a few. The per capita tax burden in state and local taxes rose in Arkansas by 47 percent between 1997 and 2005.
Huckabee correctly toots his own horn about a major tax cut in his second year as governor and he did leave a big surplus when he left office. But we give him a Half True for mischaracterizing his fiscal policies in between.