Editorial writer after editorial writer repeatedly raved over the health of the "Clinton economy" in recent years when in fact Federal Reserve Chairman Alan Greenspan wasn’t far from the truth when he cautioned the nation about "irrational exuberance," and only now is the press noting that during the year ending June 30, 1998 bankruptcy filings topped 1.42 million, an increase of 9.2 percent over the previous year and up from 845,000 filings per year just four years ago.

Economic growth as measured by Gross Domestic Product (GDP) averaged 2.6 percent per year between 1993 and 1997, the first five years of the Clinton Administration—impressive but hardly precedent-shattering. By way of comparison, note that during the Reagan years GDP increased an average of 3.9 percent a year.

Meanwhile, right up to August of this year government was proceeding as though nothing were remotely amiss and nothing could ever go wrong with the U.S. economy, especially in Nevada.

A few weeks ago the Board of Regents, which managed to get a 30 percent increase in educational expenditures out of the last legislative session, was preparing to ask for another increase in the upcoming legislative session—this time an increase of 45 percent—and all this, mind you, to finance an enrollment increase of 6 percent a year.

Just last month, commenting on a report from the Cato Institute, a libertarian think tank, Governor Bob Miller was quoted by the Associated Press as boasting, "We’re the third-lowest taxed state in the country and we’ve met our growth needs at the same time without increasing taxes." This is nonsense, obviously, and according to the U.S. Census Bureau which calculates such rankings Nevadans now have the 12th-highest per capita tax burden among the 50 states.

In just the last two decades Nevada has passed multiple increases in its gasoline tax, its sales tax, its insurance premium tax, its cigarette tax, its property taxes plus a long list of fee increases including automobile registration fees and the driver’s license fee. Interestingly, the North Koreans have a delightful word to describe the ideological myopia one finds in Carson City—yuilsasang, defined as "ideological monochromaticity," the ability to stick to an ideological political agenda without regard to the everyday realities of life.

Nevada’s precipitous drop in percentage gain in per capita personal income has two principal causes: (1) the rapid spread of gaming around the country while state government wasn’t taking the challenge of economic diversification seriously enough, and (2) to a lesser extent Nevada’s uniquely regressive tax structure which inevitably compromises the financial well being of lower- and middle-income workers and families. The first of these two causes has hit the state very hard in a very short period of time; just a decade ago all U.S. casino games were in Nevada and Atlantic City, but already in 1997 fully 48 percent of the nation’s total "gaming win" was generated outside those two markets.

Moreover, there are those who predict that if California’s Proposition 5 is approved Nevada could suffer a one-third reduction in annual visitors from California within a very few years. The picture isn’t pretty, and while clouds have been gathering on Nevada’s economic horizon state government has proceeded almost as if nothing were amiss. Meanwhile the state’s high taxes and regressive tax structure coupled with the growth of gaming elsewhere undermine Nevada’s economic future. Interestingly, many of the politically liberal states of the Northeast discovered the role of high taxes in compromising economic well-being several years ago and began slashing taxes rather than raising them. Indeed, the rankings of such states as Connecticut and Massachusetts on these two charts speak for themselves.