Abrams calls on using budget surplus to invest in Georgians

Democratic gubernatorial candidate Stacey Abrams is arguing that it’s time for Georgia to use its budget surplus to invest in its residents, accusing Gov. Brian Kemp and other Republicans of hurting the state by prioritizing low taxes and low spending.

With the state flush with $7 billion in extra funds, Abrams has proposed $1 billion in new spending, including expanding Medicaid and giving raises to teachers, state police and prison guards.

“What I’m saying is let’s put Georgians to work. Let’s invest in Georgians,” Abrams told The Associated Press in an interview ahead of a speech on the economy she’s expected to deliver Tuesday. “Let’s use the resources that are in our state to do what’s right for the people of the state.”

Trailing in the polls, Abrams is focusing on the economy as she looks to press reset on an issue that has emerged as a top vulnerability for Democrats across the U.S. this year amid inflation and high gas prices. Kemp is hoping the economy is an especially potent issue for him in Georgia this year as he points to billions of new investment in the state under his administration.

“This team has put our state on the path to greater economic opportunity for all who call the Peach State home,” Kemp said in a campaign speech last month in the Atlanta suburb of McDonough. “We brought good paying jobs to every corner of Georgia, landed the largest economic development deals in our state’s history, passed the biggest income tax cut on record, and kept government out of your way and out of your pocket.”

Kemp plans to unveil his own plans on Thursday for some of Georgia’s surplus. It’s likely to include another round of state income tax rebates plus a property tax break for homeowners, said a Kemp campaign official with knowledge of the governor’s plans who spoke on condition of anonymity to preview the announcement.

Nodding at Abrams’ work as a voting rights advocate, Kemp said she shares responsibility for the surging inflation and stubbornly high gas prices by helping get Joe Biden elected. He calls it the “Biden-Abrams agenda.”

The question is whether pocketbook issues will take precedent over other concerns for voters, including abortion, particularly in a state where a six-week ban is now in effect.

Abrams and other Democrats hope to pivot away from inflation and toward ways government can help voters. Many of her plans are the same as when she ran against Kemp in 2018, including expanding the Medicaid health insurance program to all low-income adults and expanding state aid to small businesses.

But in 2022, Georgia is flush with cash. The state closed its budget year in June with a roughly $5 billion surplus, atop $2.3 billion in surplus from the year before, and a legally protected $4.3 billion rainy-day fund.

Abrams acknowledges austerity may have been necessary during the Great Recession. Now, though, she says Republicans are inflicting a “poverty of imagination and a poverty of thinking” on Georgia by insisting on low spending and tax cuts.

“I liken it to a company that realizes a windfall,” Abrams said. “You can either give dividends to your wealthiest shareholders or you can invest in the infrastructure of your company so you can create more opportunities and create more revenue. I want to do the latter.”

Kemp warns that increasing spending will worsen inflation and argues Abrams will ultimately seek to raise taxes after spending the surplus.

“What she really believes is more government, controlling more and more of your everyday lives, and taking more of your hard-earned paychecks,” Kemp said in McDonough.

Abrams flatly vows not to raise taxes and says her spending plan is sustainable.

The Democrat weaves her argument with other attacks on Kemp. She says permissive gun laws and a law banning most abortions after six weeks of pregnancy will drive away business.

She’s also trying to eclipse Kemp on some policies, arguing for another round of checks to taxpayers like a billion-dollar state income tax rebate Kemp championed earlier this year.

Kemp has repeatedly suspended Georgia’s state gas tax for short periods, but Abrams calls for Kemp to pledge now to suspend it until the end of the year. And Abrams has pledged not to repeal a state income tax cut that begins in 2024 and could ultimately reduce taxes by $2 billion.

Kemp said Abrams’ support for his proposals shows voters he’s the one to trust.

“I’m running on my record. You know what Stacey Abrams’ record is? It’s going to be different tomorrow than it was today, I can tell you that,” Kemp said Thursday during a northeast Georgia campaign stop in Toccoa. ”She keeps changing it based on the way the winds are blowing or the way the polling is.”

Abrams notes Georgia ranked 24th among states for per-capita income in the early 2000s but has slid to 40th. Although close observers debate the cause of that, Abrams ascribes it to steering too many benefits to the rich.

She said it’s time to quit subsidizing out-of-state companies to set up shop and pay low wages, the traditional Southern approach to economic development.

“As long as our plans rely on sucking dry our people, then that’s the wrong approach,” Abrams said.

Instead, she said she envisions a focus on small businesses, helping minority-owned businesses catch up and promoting economic mobility in a region of the country where poor people are the least likely to get ahead.

“We can invest in every level of our economy, and everyone can thrive,” she said.