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Messenger: Centene CEO issues challenge to policymakers. Here’s one for him.
TONY'S TAKE

Messenger: Centene CEO issues challenge to policymakers. Here’s one for him.

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Jeanette Mott Oxford isn’t very often going to be confused for Michael F. Neidorff.

Mott Oxford is the director of policy for Empower Missouri, a nonprofit that advocates for public policy that tries to lift the lives and opportunity of people living in poverty.

Neidorff is the highest paid CEO in St. Louis. As the chief executive of Centene Corp., he earned about $26 million in 2019.

Last week, Neidorff and Mott Oxford were on the same page when it came to what it’s going to take to turn Missouri’s economy around and encourage more companies like Centene to bring more jobs to the state and to lift the fortunes of those near the bottom economic rungs of the ladder.

Mott Oxford went first.

“Today’s report from Missouri’s State Auditor shows that Missouri is continuing to decline in the revenue strength needed to withstand stresses like the current COVID-19 pandemic and economic downturn,” Mott Oxford said in a news release. “It is time that legislators take a serious look at Missouri’s unfair, outdated and inadequate personal income tax system. When ‘the common good’ is inadequately funded, our state is unable to educate K-12 and university students, respond to health and mental health needs, or invest in workforce development.”

The report that Mott Oxford, a former state lawmaker, was referring to is one I’ve written about nearly every year, issued by the state auditor as required by law. Each of the past several years, under both Democratic and Republican auditors, the report has said the same thing. State revenue is more than $4 billion — and growing — below the caps set by voters in the Hancock Amendment, passed in 1980. The Hancock Amendment was one of the first statewide anti-tax constitutional amendments passed in the country. It limits overall state revenue to an amount that won’t create a higher per-capita tax rate than 1981.

Any tax increase that would raise revenue above that level requires a statewide vote of the people.

If state lawmakers raise more money than that, even by accident, like when revenue rises after a recession, then they owe taxpayers a refund. The last refund was issued in 1999. Since that time, the Republicans who control the Legislature have cut taxes even more, particularly for businesses and the wealthy. The result is that Missouri is leaving $4.5 billion on the table — money that could be spent on schools and roads and public health and public safety — while still having an effective tax rate no higher than it was in 1981.

It’s madness, Mott Oxford says, and she’s right.

Neidorff, apparently, agrees. Last week he gave a series of public interviews — a rarity for any St. Louis CEO — after news broke that Centene is building a new East Coast hub in Charlotte, North Carolina. The company isn’t leaving St. Louis — it just built a shiny new headquarters in Clayton — but Neidorff made it clear he’s not happy with the way things are going in St. Louis or Missouri.

In St. Louis, he pointed to myriad problems, from the traditional division between the city and the county, the short-sighted attempt to privatize the airport, and the city’s struggles with crime. But the bottom line for most CEOs is they have to be able to recruit employees, and that starts with an investment in the same sorts of things Mott Oxford is talking about.

Business surveys show the same things year after year. Yes, tax breaks are nice, but workforce, schools, highways, investment in cities, these are the things that draw the attention of CEOs.

It’s hard to do something about that when you’re $4.5 billion into an ever-deepening hole.

Colorado passed a version of the Hancock Amendment a decade after Missouri did, but after the last recession, facing an inability to recoup the revenue lost in a down economy, the state’s leaders, including its then-Republican governor, supported a statewide vote that allowed the state to recover from the downturn much more quickly than Missouri has.

Among the things holding Missouri back, Neidorff said? Its failure to expand Medicaid and join a majority of states in the country that have done so and received an economic boost because of it. The Missouri Chamber of Commerce, generally a cheerleader for the Republican Party, agrees with him.

Last week Oklahoma, as red a state as they come, passed its version of Medicaid expansion. Missouri voters will get their chance in August.

Perhaps after that, Mott Oxford suggests, they’ll take a look at doing something about the Hancock Amendment, which works full time to hold the state back.

“The net impact of our outdated system, in combination with the Hancock Amendment and other features of Missouri’s tax laws, is that the one-fifth of Missouri non-elderly households are harmed,” she says. “Those with incomes of less than $17,800 pay far more in taxes as a share of their income than the richest one percent. That bottom fifth pay 9.9 percent of their incomes in state and local taxes, as compared to 6.2 percent for households making more than $447,300 annually.”

If Neidorff wants Centene to stay in Missouri, he should help Mott Oxford in her cause.

They’d make a powerful team.

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