https://www.wsj.com/articles/battle-of-the-statehouses-1540336650
While the battle for Congress is the main event this election, the fight for control of 36 governorships may be as consequential for American politics. Opposition to Barack Obama’s policies galvanized conservatives during the 2010 midterms and ushered in GOP control of statehouses from Arkansas to Wisconsin. In 2010 Republicans held majorities in 15 legislatures and 24 governorships. Today the GOP controls 32 legislatures and 33 governorships.
The result has been a remarkable record of reform and economic revival in many states. Eight years of conservative governance have bolstered state budgets and economies. (See the nearby chart on job growth.) But this year Democrats are riding anti-Donald Trump sentiment in a bid to sweep most of the big state governorships and many legislative chambers and move in a far different policy direction. The stakes are worth highlighting.
Start with tax reform. In 2011 Michigan Republicans replaced the state’s onerous business tax with a flat 6% corporate rate while eliminating myriad carve-outs. The Wolverine State has led the Great Lakes region in GDP growth over the last seven years as business investment has surged, prompting other states in the Midwest to cut taxes to compete.
Indiana Republicans slashed the state’s corporate rate to 5.75% from 8.5% in 2011 and plan to reduce it to 4.9% by 2022. Republicans in Ohio have cut the state income tax by 16% across the board and reduced the top marginal rate to 4.997% from 5.925%.
Iowa has long been the New Jersey of the Midwest with the nation’s highest corporate rate and a punishing 8.98% top income rate. Republicans this year made the Hawkeye State more competitive by putting the top income tax rate on a path to 6.5% by 2023. Over the next three years, the state’s 12% corporate rate is set to decline to 9.8%—assuming GOP Gov. Kim Reynolds isn’t defeated. Her Democratic opponent Fred Hubbell has warned President Trump’s trade brawls may compel him to hit pause on the tax cuts.