(Source: The Tax Foundation)
The other day the Seattle Times endorsed Tim Eyman’s I-1053, arguing that it would help restrain state government, as if our current budget crisis is the result of out-of-control government spending. Of course, it’s not.
The chart above plots Washington state and local taxes as a percentage of personal income from 1977 through 2008, and compares it to the national average of the 49 other states. As you can see, WA taxes as a percentage of the total economy is near a thirty-year low at the moment, after plummeting dramatically from the mid 1990’s. You can also see that WA state and local tax “burden” is also well below the national average, and has been for more than a decade.
And in case you’re wondering where I cherry-picked my numbers, it’s from the conservative Tax Foundation, the same source Eyman often uses to support his preposterous claims.
I know the Times would like you to think that all our budget woes are due to profligate Democrats lavishing our tax dollars on organized labor, but that is simply not the case. In fact, our budgets are unsustainable, but not because spending is out of control. Rather, we have an antiquated tax structure that simply cannot keep pace with the economy and the associated growth in demand for public services.
That’s the real economic reality both the Times and our legislators refuse to address.
We need a state income tax.
I second that motion.
@1
Yup!
********
3 minutes at the OFM’s website will show you that we’re neither overtaxed or that the state engages in out of control spending.
I agree with 1-3.
But I do note that this chart creates some anomolies in that it is based on a percentage of personal income. Personal income rises and falls – sometimes dramatically – with economic cycles, but state & local spending isn’t quite as flexible. Citizens still need fire & police protection, general law & regulatory enforcement, highway repairs, building departments & code enforcers, auditors, and a hundred other things government does rather quietly.
I think that’s why you see the dramatic drop-off in the late 1990’s. It’s not that taxes were cut that much (they were, but not that mouch). It’s that personal income increased dramatically. Without meaning to, it demonstrates an interesting point: the more incomes rise on a broad basis, the cheaper it becomes to fund government.
But the graph accurately shows that Washington State is not the high-tax state Iman & Co. would like you to believe.
@4
One interesting thing if you look at per-capita GDP by state is most of the states with the highest per-capita GDP are blue states and the states at the bottom are all red states.
Now the question is are the poor states poor because the atre conservative or conservative because they are poor?
5
I tend to go with they are poor because they are conservative. Conservatives distrust innovation and change and fear what is unknown to them (which is pretty much everything). A combo like that doesn’t tend toward producing a vibrant, dynamic economy.
Considering the budget troubles of New Jersey 1st (highest burden), New York 2nd, and California 5th, our “antiquated” tax structure (at 35th) seems to doing quite well.
@5 Chris Stefan spews:
1) Got some backing for this?
2) Blue states, typically dominated by large city populations have higher cost of living. So unless your figures (assuming you can provide them) normalize per-capita GDP for cost of living, the comparison is not meaningful.
@1
only as long as EVERYONE pays.
no freeloaders.
1) Bureau of Labor Statistic by way of Wikipedia.
2) Large cities might explain some differences but it doesn’t explain everything.
@5,6 Well, for one thing, the best and brightest workers tend to leave low-wage states. I mean, why would they stay? Why would a bright young college graduate stay in a state like Arkansas where chicken farmers work 15-hour days to make $25,000 a year?
@7 Considering that conservatives want to turn Washington into a California, where nobody can fund anything, the last thing Washington needs is conservative tax ideas.
# Proud Leftist at 6 said:
I grew up in a state which was a bit to the right of Ghengas Kahn when I left some thirty + years ago, and it’s been shifting even further right ever since.
A couple of years ago I checked out my old high school on the web. It had a picture of the school, the office telephone number, the football schedule, and one e-mail address for the entire school, and the school’s dress code. Nothing else.
So I sent an e-mail to the school. I identified myself as an alumni, and I asked if they had any computer training programs, and perhaps the kids could design a site which had more content? I pointed out to the web site for my children’s high school allows secure sign-in for parents to view homework assignments and maintain e-mail contact between the parents and their teachers. The site also lists all the programs available, schedules, etc.
I received back one curt response, by snail mail. The vice-principle said it was “too dangerous” to teach children at a high school level computers, because they might use it to access pornography or for hacking. Apparantly they think you shouldn’t how learn to use a PC until you go to college.
It was pretty depressing. The strange thing is, that in the early 1970’s, I was learning more about computers in that school (albeit Fortran, Cobal, and Basic), than they are teaching now. I sure am glad I’m not living there anymore. It’s like paddling against the current to get anything done.
Goldy, you’ve been on fire lately. Keep it up.
@8 ConservativeFirst 06/21/2010 at 5:17 pm,
Bullshit.
There is no state, red or blue, which is only a large city. It is not necessary to normalize per capita GDP for cost of living to compare the results of blue vs. red public policy in an economic sphere.
Think about this, the southeast has been red since at least 1994. The west coast has been blue for at least that long. If Mississippi, Alabama, Arkansas, Louisiana, South Carolina look good to you wtf are you still doing here?
@8 Well yeah, urban states do have higher per-capita cost of living, compared to states where everyone goes barefoot and lives in dirt-floored shacks.
http://1.bp.blogspot.com/_473n.....s-wife.jpg
@9 Right now it’s high-income households who are freeloading. They pay 3% of their income to state/local taxes compared to 17% for low-income households. That’s why Washington is a magnet for billionaires. A high-earner income tax on those making over $200,000 would put those who live here without paying for state and local government services more on a par with the rest of us. A person making $20,000 a year pays over 5 times as much of his income in state/local taxes as a person making $200,000 a year.
A nice link on state governments & higher income tax rates
http://www.offthechartsblog.or.....they-flee/
via Yglesas
rhp6033@4
Yep, that Contract with America, starting in 1994, really helped increase your personal income in the late 90s huh?
Roger @15, You mean these two, da dumb moron liberal scientist and da big fool zotz?
@8: It’s a bit dated, but I don’t expect things have changed much since ’98:
http://www.state.ok.us/osfdocs/budget/table7.pdf
Note the preponderance of blue states in the top third.
Roger Rabbit spews:
This makes no sense. Conservatives aren’t supporting an income tax (which California has), liberals are. California has the 5th highest per capita tax burden in the country, yet they can’t “fund anything”. There’s a disconnect in your logic here.
Puddy @ 18: Nope, the opening up the internet, GPS access, etc. by the Clinton administration caused an explosion in technology which caused a boom in business and personal productivity.
The GOP’s term limits pledge, among other things in the “Contract with America”, was an election-year gimic which was widely ignored by most Republicans as soon as they gained office.
MikeBoyScout spews @14:
If you’d actually read my comment, you’d know I never made the claim that there was a state made up of “only a large city”. I said ” typically dominated by large city populations”.
New York City has 8.2 million people and the state has about 19.5 million. So about 42% of the state’s population reside in a single city.
Mississippi has 2.9 million people and no city even close to 1.2 millon people (or 42% of the state population).
So yes, the numbers do need to be normalized to be meaningful when compared.
rhp @ 13
I think your high school alma mater example is telling proof that conservative produces stupid. Fear of what kids might find on the internet means these kids don’t get any computer training at school. Can you imagine how far behind these kids would be when they reach college? I have a friend who teaches political science at a university in Missouri who tells me that his freshman classes are filled with students who have bought off on the line you address. He’s given up arguing with them. They start behind and stay behind. Then, to also explain red state poverty, there is the phenomenon that Rabbit identifies above–those with the most talent, intelligence, and skill go where they are most likely to meet challenge and find reward. That would be, more often than not, blue states.
That’s interesting Mark Centz.
Some Previously Posted Positive Public PuddyFacts!
Here are some data on why the revenue went up even though peeps left NJ. And this was the Maryland story here and the this was an original post on NJ from PuddyFacts on HA. And here are the California facts on the same subject. You can be the first to grow a set and verify these original PuddyFacts on clueless goober arschloch goatsee’s personal database.
“However, even as the national population of millionaire households grew by 5.9% in 2007, Los Angeles County lost about 7000 of these households. Orange and San Diego Counties lost millionaire households as well.
Milton Friedman’s maxim that few things are as mobile as rich people and capital, is proven starkly by data showing the wealthy are leaving California in record numbers. It is probably no coincidence that, while California has been punishing the successful for the sin of being rich, Maricopa County in neighboring Arizona gained 23,000 new millionaire households in the same time period. Arizona’s top marginal personal income tax rate is 4.79%, less than half California’s rate of 10.3%, which includes the Prop. 63 surcharge.”
Puddy thinks it’s all in how you “spin” the data, something liberals are very good at.
Roger Rabbit spews @15:
Unlike you, I don’t stereotype people, because that’s a large contributor to bigotry.
Wow rhp6033 thanks for reminding Puddy on that Chicom Loral GPS super sale on rocket telemetry. Oh yeah those Clinton approved those supercomputers for improved internet control in china or was it to have them send more virii on your computer or was it to make better weapons. It’s a toss-up to Puddy.
Yep you’re right about something rhp6033. Now the Chicoms can target your home in Everett much better now. Thanks for the mind refresher.
You know the arschloch is at home right now searching for those PuddyLinks using those skillz honed while collecting unemployment creating his home version of the HA database.
FYI..
I-1098 will tax individuals earning $200,000 of taxable income ($400K jointly).
Most people don’t make the distinction, so you could argue that I’m nitpicking. But people earning that much money will have tax advice and many deductions, so even less of the state’s population will be impacted by this tax.
Mark Centz,
There is the link Puddy used a couple of times for the loss of SF and local area Millionaires migrating from all the CA tax hikes too. Right now the link eludes Puddy. But it was a substantial number. Puddy would ask the arschloch for the link cuz Puddy knows he has it… butt you know the fowl mood he’s always in. He may be nice to you though if you ask him nicely.
@16
fuck that high-earner income tax. You want an income tax, then everyone pays…and on top of that, we need to do away with the B&O tax AND sales tax.
What I find interesting in the chart is that the average tax burden, at the US level, goes down in the Carter years. The up during Reagan and Bush I. Then down during Clinton. Finally, is goes back up during Bush II.
Which is exactly opposite of the “tax-and-spend” narrative we hear WRT Democrats.
Confused ? spews @ 30:
The graph is clearly marked to represent State-Local tax burden. So your argument linking the graph to who was President is irrelevant.
@29
I’m not real familiar with B&O taxes, (16 years of working for non-profit’s will do that to you) but I’ve seen a few things over the years that made it look like B&O taxes are set up in a way that helps large companies and stifles competition from startups.
@21
Clinton also had cheap oil, EZ credit and the American Shopping Extravaganza. Now we have expensive oil, nomo credit and all that’s left of the Shopping Extravaganza is the trash and the bills.
We’re in a contraction and the best thing we can do is figure out how best to ride this thing to the bottom.
@33
Now we have expensive oil, nomo credit and all that’s left of the Shopping Extravaganza is the trash and the bills.
That about sums it up.
With out question, the B&O tax is the weirdest excuse for a bad idea of extracting revenue short of outright stealing.
Puddy
You sound more and more like Glenn Beck and that is not a compliment.
To follow YOUR logic, America should reduce our taxes to the level of Monaco or Nigeria. Just wait and see what happens in a society that can not afford schools and streets.
BTW, Brazil tried that before the current government .. the result was a disaster though not for the rich, they just moved here.
You wanna a nother example, look at the relationship of no taxes New Hampshire to Taxachusetts. Yep, a lot of wealthy folk live in NH and .. commute to Boston because that is where the jobs (an state supported MIT, Harvard, Brandeis, U Mass, etc. are.
So I guess I am VERY worried that Paul Allan will move out of state .. very worried. Somehow, I would rather have Microsoft, Boeing , Expedia, the Gates Foundation, AT&T, Costco, Amazon … and let Paul live in North Kore or wherever he can avoid taxes.
You need to talk more to God.
The US Senate voted down the Deficit Adding Bill that would have given Washington State $480 MILLION. Of course, Gregoire & the State Dummocrats passed the Budget assuming it would pass. Idiots. Talk about counting your chickens before they hatch@!
http://www.publicola.net/2010/.....ure-grows/
Read about it.
One significant issue not included in any of these studies is the cost to business of land use and other regulations. This is a simplistic look at $$ generated compared to average wages. It would be interesting to see further studies that assess the regulatory environment. Also, using average wages can cause distortions when you have high paid folks calling Washington home because of the lack of income taxes. The State income tax will change these numbers drastically.
Stats are fun…but based on a series of underlying assumptions which starts by deciding what costs to include.
@16 “Right now it’s high-income households who are freeloading. They pay 3% of their income to state/local taxes compared to 17% for low-income households.”
That doesn’t come close to making up for what the wealthy pay in federal taxes compared to what low-income people receive in transfer payments.
Since we are all so keen on citing Tax Foundation data today, here’s another one for you:
A new Tax Foundation study, “Who Pays America’s Tax Burden, and Who Gets the Most Government Spending?” shows that the typical low-income household pays $1,684 in total federal taxes, yet receives $17,724 in federal transfer payments alone, not to mention other federal programs such as education and public transportation.1 In other words, the typical low-income household receives $10.53 in transfer payments for every dollar it pays in federal taxes.
http://www.taxfoundation.org/r.....22364.html
If we want to be “fair” (whatever that means) we would come a lot closer with a flat income tax sans sales tax.
But, be honest, the real goal is to transfer as much wealth from those lazy, good-for-nothing, bottom of their class capitalists. It must really irk the academic types out there to know that the guy who got a C- in business is out there making more money than most of you could ever dream of, even those of you of clearly superior intelligence. Doesn’t seem fair does it?
Well, since you can’t get people to behave the way you want voluntarily, it makes sense that you would resort to physical violence (government) to even things out. I’m sure those of you voting to grant someone else the power to hold a gun to the despised capitalist’s head sleep soundly though, secure in your super intelligence and delusional theories of morality. A looter of the highest order, but a looter nonetheless.
lynn @39,
Blah, blah, blah. You couldn’t give a shit about fairness. But in the end, fairness isn’t even the point. The point is that government services, the rule of law, and public investments are the building blocks upon which a prosperous economy is based… the economy through which the wealthy become wealthy. It is in the top quintile’s self-interest to keep state and local government funded at somewhere about 10 percent of the state economy. It’s a utilitarian argument, nothing more.
By the way, even in the midst of the current “Great Recession”, the rich are still getting richer.
Source: MSNBC: World’s rich got richer in 2009
Meawhile working stiffs who try to keep their middle-class standard of living through collective bargaining are ridiculed by the wingnuts as being “overpaid” and lazy”.
@37
our brilliant governor and democratic legislature in fine form again…..
@40
LMFAO…when the lead hack for the website has to resort to “blah blah blah” after being presented with facts, you know he’s been OWN3D.
Robert Reich boils it down:
http://tpmcafe.talkingpointsme.....greenspan/
Europe’s experiment with Hooverism will fail horribly. I hope we don’t make the same mistake.
@ 43
Oh, lovely. Yet another wingnut idiot who doesn’t understand the difference between a statement of fact and a conclusion of fact.
Surpise, California finds out that Republican leaning counties are living off the taxes from Democratic leaning counties…
Report: Bay Area counties give so rural counties can receive.
Oh Goldy, of course I don’t give a shit about fairness. Fairness is a matter of perspective. It is not objective in the least, which is why someone like you would value it so highly. Because no matter the facts of a situation, you can always retreat to your own sense of the way things ought to be.
“It is in the top quintile’s self-interest to keep state and local government funded at somewhere about 10 percent of the state economy.”
Did you come up with that percentage all on your own? Utter nonsense either way.
Arguing that government should grow at the same rate as the private economy, rather than at the rate that protections and services are needed by citizens is ridiculous. Government spending should not increase for the sake of increase. Two reasons: 1) That’s like saying your food budget should always remain at 10% of your income, no matter how much money you make. Before you know it, you could be spending $1500 a month on food, when you really only need about $500 worth. Since government’s role is limited (or supposed to be) we would expect it to shrink as a share of the economy, even as absolute spending increases. 2) One would hope we could expect government to become more efficient over time as advances in technology will allow it to do the same types of things cheaper, faster and better. I say “hope” because the reality is that no incentives exist for this and in fact, incentives for those in government point to the opposite.
The best measure of government growth is to look at total state spending and compare it to inflation and population growth. That allows individuals to identify greater government spending in the form of policy ads. If spending grows at a rate greater than inflation + population, then legislators are adding new functions of government and/or increasing entitlements.
Goldy, my friend, you suffer from what I like to call an “imbalance of empathy.” Your empathy and sense of “fairness” is limited only to what you can see. Like the majority of people who have endured a poor economics education (or none at all), you fail to recognize the damage that is done (by government) to those you cannot.
This is the rot that infects almost all policy in America, and worldwide for that matter. It is the same reason people think the stimulus is great. They can see people getting put “back to work” on “shovel-ready jobs.” They can see all of the kids that get vaccinated and the roads that get built. But they can’t see the things that WOULD HAVE been built (new businesses, new brands, new investment, new products, new inventions, new private hires, raises, cheaper products?) by those who had the money forcefully taken from them to pay for those programs (either now, or in the future).
As Bastiat wrote: Law “produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them.” Bastiat further noted that “[t]here is only one difference between a bad economist and a good one: The bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen.”
Freakonomics is a good layman’s book on real examples of the seen vs. the unseen effects of policies and human action. I suggest you read it.
Yes Lynn those paper derivative products that were “built” in the last 10 years or so being tossed from one pool of money to the next have fantastic visibility and lifted many boats, yachts, private jets, what have you in our economy.
Wasn’t that the title of a Limbaugh book?
Oh my! This was a DISASTER in Colorado and had to be suspended.
It was rejected here in WA. Thankfully so.
Don’t TABOR me bro!