JAN. 15, 2010 – Wake up, South Carolina! If we don’t start investing in our state, we might as well submit to being serfs to the Chinese.

Simply put, we need to tax ourselves more. We need to use the money to revitalize education, our business environment and the parts of state government that attract jobs.

Yes, the idea of raising taxes is a bitter pill for many to swallow. But South Carolina has become so blinded by the addiction of always wanting more tax cuts that the state is bleeding a death of 1,000 paper cuts. We need to go cold turkey on tax cuts and be smart for a change. We need to take a longer-term view that focuses on making new tax investments that will pay off.

Lawmakers have to face this music: our state’s revenue sources have been sliced past the bone:

• The state’s current budget of $5.1 billion is $1.6 billion less than in 2007. That’s a 23.6 percent drop in just three years.

• The state’s current budget also is only 0.2 percent more than it was in 2000. In other words, we’re at the same place fiscally today that we were 10 years ago. And, Lord knows, the costs for health care, education and prisons have gone up way more than 0.2 percent over the last 10 years.

• Future state revenues are projected for years to rise only 2 percent annually when common sense dictates costs will rise more than 2 percent every single year.

• Our tax base is shrinking dramatically. Ten years ago, the state collected sales taxes on 48 percent of the state’s gross sales. Now, thanks to tax breaks and cuts, sales taxes are collected on only 41 percent of our gross sales.

• Over the last four years, lawmakers have approved tax cuts of more than $1.2 billion. Major sources of revenue drops are the ill-conceived property tax swap from three years ago, elimination of sales taxes on groceries, elimination of the bottom income tax bracket and a cut to corporate income tax.

Ladies and gentlemen, our lawmakers have been giving away the store, gutting the government that is here to serve us all. Seemingly lost in a dogmatic zeal to cut taxes at any cost just to score political points with a lemming-like electorate is need of children in the Palmetto State to go to decent schools, get decent health care and face a decent future.

Meanwhile, the Chinese are investing in education and infrastructure at record paces (not to mention lending billions of dollars to us as we sit in Barcaloungers and eat junk food).

Robert Fogel, winner of the Nobel Prize in economics a few years back, wrote in the new issue of Foreign Policy magazine that China is poised to claim 40 percent of the world’s gross domestic product by 2040 with the U.S. contributing just 14 percent.

Imagine that – the Chinese, quietly manufacturing and lending while we sit back and spend without investing, end up being the superpower. We are on track to take a back seat to China – unless we start investing in ourselves more. Not only does each family need to save more for the future, families need to invest unselfishly in the state so it can provide the educational and business foundations that students need to be successful in the economy of the future.

What does such investment mean here in South Carolina?

• It means broadening our tax bases — paying a little more in taxes and spending it on education.

• As the state Chamber of Commerce says, we need to repeal the Act 388 property tax swap and replace it with something fairer for businesses and schools.

• Instead of giving away $2.5 billion in special-interest sales tax exemptions every year, we need to cut many that are outdated and use the revenues as an investment or to reduce tax rates to make the state more attractive to business.

• More than anything, we need to stop having kneejerk reactions anytime the word “tax” is mentioned.