by Tom Loftus , @TomLoftus_CJ –
FRANKFORT, Ky. – Supply-side economist Arthur Laffer, who with five close associates gave at least $228,500 toward the successful effort to elect Republicans to the Kentucky House this fall, is scheduled to meet with Gov. Matt Bevin on Friday.
State Budget Director John Chilton said in a telephone interview early Friday that Laffer is scheduled to meet with Bevin later in the day but called it “just a social visit.”
Chilton said, “I want to reaffirm that he (Laffer) is not a consultant for the state. He’s not an adviser for the governor. We’re talking to lots and lots and lots of people about whatever they want to talk about related to taxes. And he’s one of the guys.”
Laffer is chairman of Laffer Associates, an economic research and consulting firm based in Nashville. He is perhaps the most well-known supply side economist in the country and has been a major voice in a national tax-cutting movement for decades.
Laffer did not return phone messages left with his office staff Thursday and Friday. And Amanda Stamper, Governor’s Office press secretary, did not immediately return phone messages Friday morning.
His visit comes as Bevin is developing a tax reform proposal that the governor plans to offer to a special session of the Kentucky General Assembly next summer. Laffer said in an interview with the Courier-Journal last month he would “very much” want to help shape that tax reform plan, though he said he had no interest in being paid by Kentucky.
Jason Bailey, executive director of the Kentucky Center for Economic Policy, said Friday morning that Laffer’s meeting with Bevin is cause for concern.
“It should be very worrying to Kentucky to have Art Laffer at the table helping come up with a tax plan if that’s what is happening. His advice has backfired dramatically in other states, it hasn’t worked anywhere as promised,” Bailey said.
Bailey noted Laffer advised Kansas Gov. Sam Brownback on a plan that deeply cut income and business taxes about five years ago. Kansas has struggled through years of budget shortfalls ever since and has yet to experience the promised boom in jobs and business expansion.
Laffer said in the interview last month that his role as adviser to Brownback was minor and that the tax changes Kansas ultimately enacted were different from what he and Brownback preferred. Still, Laffer said he liked the changes Kansas enacted and noted that Brownback has since been re-elected governor.
Laffer also said in that interview that he and five like-minded associates banded together last fall to make political contributions aimed at winning a Republican majority in the House because “it’s time that we had a new agenda in Kentucky … The Republican Party agenda with Matt Bevin and the Senate would make a huge difference to the prosperity” of Kentucky.
The Courier-Journal reported days before the fall election that Laffer and his out-of-state associates – none big Kentucky donors before – combined to give at least $164,000 during October to Republican candidates for the House and the Republican Party of Kentucky.
But post-election campaign finance reports filed in the past two weeks show additional contributions made in the last two weeks before the election cause the Laffer group’s bundle of contributions to balloon to at least $228,500.
Laffer said he and his five friends had a Kentucky Republican contact who advised them on how most effectively to contribute their money to elect Republicans to the House. He declined to identify that contact.
Reports filed as of Friday morning with the Kentucky Registry of Election Finance and the Federal Election commission show Laffer made at least $42,500 in contributions to Kentucky Republican candidates and causes in the closing weeks of the fall election.
Here are the other five donors – described by Laffer as close friends and associates – who were part of the giving group. With each name is how much FEC and Kentucky Registry of Election Finance records show they gave to the effort to elect Republicans to the Kentucky House in the closing weeks before the November elections.
►Rex Sinquefield, of St. Louis, a mega-donor to Missouri Republicans and advocate for eliminating the income tax who co-authored a book with Laffer, $45,000.
►Travis Brown, Miami, chief executive officer of First Rule Media, who also co-authored the book with Laffer and Sinquefield, $43,000.
►James Dondero, Dallas, president of Highland Capital management and NexPoint Residential Trust, (Laffer serves on the board of directors of NexPoint), $42,500.
►Harold Blue, New York, managing partner for BelHealth systems, (Laffer serves on the BelHealth advisory board), $41,500.
►Lee Beaman, Nashville, Owner of Beaman Automotive and friend of Laffer, $14,000.
Reporter Tom Loftus can be reached at (502) 875-5136 or [email protected].
