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Cato Institute gives Brewer a "D" on fiscal policy

A libertarian think tank that grades governors around the country on fiscal policy has given Arizona ’s Jan Brewer low marks. The Cato Institute advocates small government, low taxes, and free markets. Every other year they release a fiscal policy report card, ranking U.S. governors from A to F. For the second time, Governor Brewer has received a D.

The report chides her for increasing spending and taxation; in particular, her support for a temporary sales tax increase in 2010. Cato says those temporary hikes often end up being permanent, and an initiative on this November’s ballot would do just that in Arizona .

Chris Edwards, the author of Cato’s Fiscal Policy Report Card on  America ’s Governors, commended Brewer for opposing a permanent increase, but said state governments -- including  Arizona's --  need to be smaller.

“A few years ago, a lot of states probably expected the recession to be very short-lived, but we’ve had a stagnant economy now for many years," Edwards said. "I think states really have to think about restructuring the budgets in the long term to take account of the slower economic growth we’re experiencing.”

Governor Brewer’s spokesman Matt Benson said the Cato Institute’s analysis falls short.

“Governor Brewer came into office in 2009 inheriting the worst budget deficit in the country," Benson said, "and over the last four years or so, she has balanced the budget, [and] the state of  Arizona  now has about $800 million set aside on top of that. And the economy in the state of  Arizona  has improved significantly.”

Benson says the temporary sales tax increase the Cato Institute blasted Brewer for was necessary to avoid devastating cuts in areas including education.

The Cato Institute's Edwards did praise Brewer’s corporate tax policy.

“I’m seeing business tax reforms in a lot of states across the country, and that is something that Governor Brewer, to her credit, is out in front on," Edwards said. "She signed into law a corporate tax rate cut, which I think is very important. Ultimately, state corporate taxes are not really paid by corporations at all. They’re paid by the citizens in a state.”