As the do-or-die deadline for the so-called supercommittee approaches, it is clear, as it has been for some time now, that the fight is over whether Congress will be responsible and raise revenues in some fashion, or whether Tea Party know-nothings, content with watching the country slowly devolve, will have their way.
Monday’s Joplin Globe featured on its opinion page three separate articles on taxes. Dale McFeatters began his column with this:
Slowly, very slowly, congressional Republicans are getting over their total aversion to tax increases, a vital component of any deficit-reduction plan that will really work.
It is true that Republicans on the supercommittee have offered what they estimate to be $300 billion in increased revenues over ten years. They would eliminate various deductions and tax breaks in the code in exchange for permanent cuts in marginal rates, the top rate dropping to 28 percent.
While that offer isn’t sufficient—it relies too much on cutting spending to achieve the committee’s mandate to trim $1.5 trillion over a decade—it is, as Senate Budget Committee Chairman and Democrat Kent Conrad said, “a step in the right direction for them to just rhetorically cross that line.”
Here in Missouri, we have our own problem with taxes. Monday’s Globe paid a mixed tribute to the late Mel Hancock, the prototype of today’s tax-cutting, budget slicing teapartier. Phill Brooks, director of the Missouri School of Journalism’s State Government Reporting Program, discussed Hancock’s legacy vis-à-vis Missouri’s finances:
Hancock led the successful 1980 petition campaign to impose a revenue limit on state government.
…in political reaction to the anti-tax sentiment Hancock’s petition campaign had demonstrated, the state’s governor and Legislature passed a sweeping package of tax cuts that constrain the state’s budget to this day…
Missouri now suffers from a bust cycle for tax collections. Taxes are growing at a far lower rate than the growth of the demands for state spending.
Brooks referenced Jim Moody, who worked for former Republican governor John Ashcroft as Missouri’s Commissioner of Administration:
In what became known in the Statehouse as the Moody Report, he warned that those post-Hancock tax cuts had ended Missouri’s ability to finance, on a long-term basis, “the basic functions of government” that are defined by law.
And that’s where we are today: unable to finance the basic functions of government. Brooks mentioned, for instance, how the state is unable to adequately fund our public schools:
…in the past few years the shortfall in state revenues has prevented the Legislature from providing local public schools with the minimum amount of state funds required by state law. Effectively, the state’s system for funding local schools is illegal because of the disconnect between state spending demands and the state’s tax base.
Sad it is that our state representatives—almost all Republicans—refuse to even consider tax increases to help keep Missouri in compliance with its own laws. And sad it is that national Republicans are willing to watch the country deteriorate in the name of low taxes.
That’s fanaticism any way you look at it.
Finally, and speaking of fanaticism, Monday’s Globe also included an editorial, written by the Kansas City Star, that opposed St. Louis zillionaire Rex Sinquefield’s attempt to place on the Missouri ballot a constitutional amendment to eliminate the state’s personal income taxes and replace them with an “everything tax,” which amounts to a 10 percent state and local sales tax.
Guess who gets the shaft from that gold mine of conservative economics? Yep:
Replacing the state income tax with an expanded sales tax would be great for people with very high incomes. They would gain more in tax savings than the extra amount they would have to spend on food, clothing, vehicles and almost everything else.
Included among those beneficiaries would be Rex Sinquefield, the St. Louis multimillionaire who is bankrolling an initiative petition drive to phase out Missouri’s income tax.
But Sinquefield’s gain would come at the expense of middle- and low-income households, which would not recoup enough in income tax savings to make up for the cost of a higher sales tax on a greater variety of goods and services. Many seniors would receive no income tax break but would pay much more for daily living purchases.
The justification, of course, for this dishonest proposal is that it would create more Missouri jobs and make us more productive and more attractive to businesses. But consider this graph, which was produced by Missouri state auditor and Republican Tom Schweich (click for better view):
Yikes. We’re dead last when it comes to taxing smokers, many of whom tax the health care system.
It must be noted here that none other than the United States Chamber of Commerce ranks Missouri seventh of the fifty states in its low-tax and regulation category. A question arises: If low taxes and lax regulation are so damn good for business, where are the jobs? Our unemployment rate is 8.5%.
What all this tax stuff comes down to, ultimately, is whether Americans—no, really it is Americans who vote—will reject the legions of anti-tax politicians who promise that lowering taxes on the wealthiest Americans will solve our economic woes.