An excellent editorial in the St. Louis Post Dispatch discusses the disastrous effects of the GOP no-tax religion that some GOP state legislators, many lavishly funded by mega-rich, income-tax averse, retired investor Rex Sinquefield, are proposing to push even harder here in Missouri. As the Post-Dispatch implies, the already low state tax rates, far from promoting growth, have managed to reduce the state to a backwater that is near last in significant measures of quality of life – a factor likely to discourage all but sweat-shop industry.
A recent report from the institute on Taxation and Economic Policy underlines the fact that low, regressive tax rates are not exactly the panacea that Rex Sinquefield and his pet “think tank,” the Show-Me Institute (which the Post-Dispatch calls a “believe tank”), say it is. The report offers figures to support the fact that the tax burden in Missouri, along with the rest of the states, has been systematically shifted to those in the middle and at the bottom of the economic ladder. As the report’s authors note, “States praised as “low tax” are often high tax states for low and middle income families.”
The chart below details the situation in Missouri – and bear in mind that it describes the status quo, before the GOP tax masterminds in Jefferson City impose their particular brand of reform:
This situation will only get worse if those tax proposals described in the Post-Dispatch editorial are enacted. How do you think that income tax reductions, elimination of corporate taxes, and imposition of still more sales taxes to pay for necessary services (most recently proposed as the way to pay for long-overdue transportation needs), will effect the growing inequality between the wealthy and the rest of us?
And for all the folks who want to eliminate income taxes outright, take a look at this chart:
See Texas up there? Remember that Texas had a 27 billion dollar deficit last year. You know what that means: cuts to education and other services that help contribute to middle and working class prosperity. Just think about that when you hear some of the GOP tax gurus pontificating. And, of course, as the Post-Dispatch suggests, keep a watch on Kansas as it slashes taxes and hits the skids in deficit city.
As CNNMoney commented when reporting on the 7% decline in middle class income over the last 10 years, “The first decade of the 21st century will go down in the history books as a step back for the American middle class.” The same article also notes that the wealthiest Americans got wealthier during the same period, a trend that will only accelerate if we permit the state level GOP to continue to carry water for their rich friends and campaign contributors and destroy what remains of progressive state-level taxation.
James Moody, one-time budget director for former – highly conservative – Republican Governor John Ashcroft, observed that the Sinquefield cabal’s efforts last year to abolish the state income tax in favor of a sales tax indicated that “they don’t know what they’re doing.” And it’s not just ignorance that animates our GOP brethren in this instance, but willful ignorance. These are the folks who, to borrow Hillary Clinton’s phrase, have refused the invitation to inhabit the “evidence-based world” where their victims have no choice but to reside.
*Charts from ITEP, Who pays: A Distributional Analysis of the Tax Systems in All 50 States, ITEP, February 2013.