Showing posts with label tax reform. Show all posts
Showing posts with label tax reform. Show all posts

December 18, 2017

Three ways bad

For a quick look at what's bad in the #taxscam bogus tax reform that seems ready to slide through Congress, all you have to do is take a look at three charts here that show how it will:

*increase pre-tax inequality;

*make the tax system more regressive, meaning that people with lower incomes will pay a higher percentage of their income; and

*raise after-tax income for the top 10 percent of income at the expense of the bottom 90. Most of the benefits will go to the wealthiest 0.1 percent.

I guess this is what happens when money trumps democracy.

December 14, 2017

Out of touch

One thing that most people would agree on across the political spectrum is that West Virginia would be better off if more of us were working and earning a living wage. I know I’m down with that.

Unfortunately, some of the ways that have been proposed for working towards that goal are counterproductive and just mean. Possibly cynical, too.

For example, Seema Verma, head of the federal Medicare and Medicaid program under the current regime, recently proposed to solve that problem by clamping down on Medicaid, specifically on those millions of people who gained coverage under the Affordable Care Act. Most of whom work. Go figure.

In a speech to state Medicaid directors, she said things that have at best a tenuous connection with reality. She seemed indignant that some of those who have gained health coverage in recent years are people who “are physically capable of being actively engaged in their communities.”

Let’s start with the basics. They already are. People who gained coverage due to Medicaid expansion had to come from families that had income, although it was under 138 percent of the federal poverty level. That means they weren’t receiving TANF (welfare) or disability payments, in which case they would have qualified for traditional Medicaid.

Generally speaking, that means they work.

Let’s be more specific. These are the people who do the grunt work of society. They wait on us in stores and restaurants. They change our oil. They clean our motel rooms. They wash our dogs. They clean up our messes. And, most importantly, they take care of our children and elders.

It would take a lot to persuade me that Verma didn’t know better when she said that. But if she, and the regime she serves, didn’t, it only shows how out of touch they are with the reality of millions of working people.

According to the Center on Law and Social Policy, around 60 percent of working-age adults on Medicaid have jobs. And around 80 percent are in families with at least one worker. The few that aren’t are usually seeking work, dealing with illness or disability, or caring for other family members.

In her speech, Verma seemed to imply that people like this who get Medicaid coverage enjoy wallowing in poverty and “government dependence.”

(Ever notice that many of the people who complain about this receive some form of health care from the federal government?)

I guess one of the innumerable advantages of being well-off is being spared the knowledge that less than half of all Americans are covered by work-based insurance. According to the Census Bureau, in 2016 only 58.3 percent of West Virginians of prime working age (19-64) get coverage from their jobs.

Here’s the reality in West Virginia. Since 2001, the percentage of low-wage jobs (earning under 150 percent of the poverty level for a family of two) has grown by 14.5 percent, even as jobs in high-wage industries have declined. These jobs typically don’t offer health coverage.

Nearly one in four West Virginians works in such a job. Around 55 percent of West Virginia’s children live in a family with at least one low-wage worker. For many, low-wage jobs are no longer a temporary steppingstone to a better gig but are rather a lifetime path.

Most low-wage workers are white, although blacks make up a disproportionate share. Fifty-six percent are women. Younger workers are more likely to earn low wages, but nearly half of workers above age 35 work in low-wage jobs.

Behold the face of “the enemy.” It may look a lot like our friends, neighbors, relatives and even ourselves.

I think what’s really driving this push at the federal level to cut back on things like health care is the desire of the administration and its allies in Congress to pass a massive “tax reform” package that would give huge breaks to the very wealthy — who don’t need them — at the expense of everyone else. That $1.5 trillion giveaway to the rich has to come from somewhere.

And, under what must be huge pressure from the federal administration, there are officials in West Virginia who seem eager to push for bogus “reforms” that will ultimately reduce the number of people with health care. Cutting Medicaid rolls may seem attractive to some people, even if it means taking away coverage and increasing the costs of uncompensated care for everyone else.

Some options now under consideration include unnecessary and redundant “work requirements” for Medicaid that would wind up taking millions of dollars out of the state’s economy and harming those sectors that are actually providing and increasing jobs.

In the past, Gov. Jim Justice has eloquently defended vulnerable West Virginians. I hope he continues to hold the line.

At this point, no one can say how far these proposed changes will go. But we’d be better off if they didn’t go anywhere.

(This ran as an op-ed in yesterday's Gazette-Mail.)

December 11, 2017

That fuzzy line again



There has been story after story lately of politicians pretending to care about West Virginia's--and the nation's--opioid crisis.

Unfortunately, these are the same politicians who have been working night and day to reduce or eliminate the kind of treatment recovering addicts need by repealing the ACA and/or pushing through a #taxscam bogus tax reform bill that gives massive cuts to the rich while crowding out other kinds of federal funding. Like addiction treatment and Medicaid expansion.

Once again, I have trouble distinguishing irony and hypocrisy. But I'm leaning toward the latter.

Anyhow, here's an op-ed by a friend of mine explaining why you can't have it both ways.


December 07, 2017

#TaxScam revisited

It looks like America’s ruling elite has decided to give itself a huge raise and the rest of us are going to pay for it in one way or another. The U.S. Senate’s “tax reform” bill is one that is likely to affect Americans for years. Even decades. Not in a good way.

Here are 10 things we need to know about the highly partisan version of the bill that’s been pushed through the Senate.

1. President George W. Bush passed massive tax cuts and what we got was ... permanent prosperity? Oh, wait, it was the biggest crash since the Great Depression. I’m not saying the tax cuts were the main cause of the crash, although they did contribute to the financial bubbles that led to it. But it’s obvious that tax cuts don’t guarantee growth or prosperity or economic stability.

2. This is a Trojan horse. The massive transfer of wealth to those who already have it will eventually crowd out funding for things like Medicare, Medicaid, student aid, food security, housing, etc.

3. There are plenty of “starve the beast” ideologues who want that to happen. They hope a crisis will force cuts to domestic programs.

4. If that sounds paranoid, consider that President Donald Trump has promised to pursue welfare “reform” next, despite the fact that it was already drastically reformed over 20 years ago. This time around, the definition of welfare is going to be broadened to include any form of federal spending that goes to working people, seniors, kids or the poor.

5. Then there’s the whole thing about adding $1.5 trillion-plus to the deficit for no good reason.

6. Whatever cuts some middle class people will get is a sugar high. Those cuts are temporary, while cuts to corporations and the wealthy are permanent.


7. Due to the tilt of the programs towards the wealthy, people in 19 states, including West Virginia, will eventually pay more in 2027 than they do under current law.

8. Then there’s the consequences of repealing the Affordable Care Act’s individual mandate, which will greatly increase the number of uninsured Americans and drive up costs for everyone else. Trump has also pledged to pursue the further dismantling of recent health care gains.

9. The whole thing is based on flaky economics. A University of Chicago poll of economists found that only 2 percent of those polled thought the “reform” package would boost the economy; 36 percent were uncertain, 33 percent disagreed and another 19 percent strongly disagreed. There was, however, pretty universal agreement that it would blow up the national debt.

10. Over the last few decades, the U.S. has moved dramatically away from democracy and towards oligarchy and plutocracy, defined as effective rule by a wealthy few. This is likely to seal the deal.

Given all that, golly, what could possibly go wrong?

(This item appeared in the Gazette-Mail this week. It may resemble an earlier blog post.)

December 04, 2017

Yes, it's that bad

If you want to learn more about how bad the #taxscam aka "tax reform" bill that just passed the US Senate is, you can check this news story, this Gazette-Mail op-ed and this statement from Families USA. Short version: pretty damn.

November 29, 2017

TaxScam in a nutshell

Here's what I think we need to know about the highly partisan version of tax "reform" now being pushed through the senate:

1. George W. Bush passed massive tax cuts and what we got was....permanent prosperity? Oh, wait, it was the biggest crash since the Great Depression. I'm not saying the tax cuts were the sole cause, although they did contribute to the financial bubbles that led to it. But it's obvious that tax cuts don't guarantee growth or prosperity or economic stability.

2. This is a Trojan horse. The massive transfer of wealth to those who already have it will eventually crowd out funding for things like Medicare, Medicaid, student aid, food security, housing etc.

3. There are plenty of "starve the beast" Republicans who want that to happen. They hope a crisis will force cuts to domestic programs.

4. Then there's the whole thing about adding $1.5 trillion+ to the deficit for no good reason.

5. Whatever cuts some middle class people will get is a sugar high. Those cuts are temporary, while cuts to corporations and the wealthy are permanent.

6. Due to the tilt of the programs towards the wealthy, people in 19 states, including West Virginia, will eventually pay more in 2027 than they do under current law.

7. Then there's the consequences of repealing the Affordable Care Act's individual mandate, which will greatly increase the number of uninsured Americans and drive up costs for everyone else.

I mean, golly, what could possibly go wrong?

March 14, 2017

Notes from the bad idea factory

First off, if you happen to be around a screen on Wednesday, March 15 (the Ides of March!), check out a Facebook Live webinar thingie my co-worker Lida Shepherd and I are doing about SNAP (formerly food stamp) benefits, what they mean to WV, and what some people are trying to do to them. It's a 1:15. More info here.

Next up, this op-ed of mine ran in today's Charleston Gazette-Mail about the bad idea of replacing WV's personal income tax with a regressive consumption tax:

One of my favorite state legislators, who shall remain nameless except to say he’s Mike Pushkin, likes to call a certain place with a dome “the bad-idea factory.”

While I would never even dream of saying such a thing, some days I can see where he’s coming from. Like today, for example.

Senate Bill 335 is a case in point. It would replace West Virginia’s income tax with a steep boost on consumption taxes. The bill has numerous sponsors in the Senate, with the notable exception of Republican Finance Chairman Mike Hall, who knows more about the state budget than just about anybody ever has.

So what’s wrong with the bill?

For starters, it would slam middle-class and low-income families with much higher taxes while granting a huge break to those at the top.

West Virginia’s state and local tax systems are already topsy-turvy, with the poorest 20 percent paying a higher percentage of their incomes in taxes than the wealthiest 1 percent (8.7 percent vs 6.5 percent).

One reason for that is our regressive sales tax, which is basically a consumption tax. The imbalance here is even more extreme, with the poorest fifth paying more than six times the percentage rate of their income than the wealthiest 1 percent.

Eliminating the personal income tax, which is the only state tax actually based on the ability to pay, and replacing it with the proposed consumption tax would increase taxes on the bottom 80 percent, while providing breaks for the very wealthiest. Assuming revenue neutrality, middle-class families would pay over $1,000 more per year, while those earning $353,000 or more per year would see a tax cut of more than $27,000 according to an analysis by the Institute for Tax and Economic Policy.

The reason for this is pretty obvious. Middle-class and low-income people of necessity spend more of their money on basic necessities than the wealthy. According to the U.S. Bureau of Labor Statistics, people earning less than $70,000 per year typically spend 114 percent of their income (think debt) while those earning over $200,000 per year spend around 50 percent.

This shift in tax policy would only increase income inequality, which has skyrocketed in recent decades. In West Virginia, for example, between 1979 and 2011, the average real income in the state increased by only 3.9 percent, compared to the U.S. average of 14.8 percent. But over that time, all of the income growth was gained by the top 1 percent of richest West Virginians. Real income for them grew by more than 71 percent, while it fell for the bottom 99 by almost 3 percent. This bill would be another step in the wrong direction.

SB 335 wouldn’t be great for state businesses either. They already pay more in sales taxes than income taxes. Phasing out the income tax would likely mean a hit for them, as well.

Then there’s the border-county issue. I checked a map and found that 29 counties border another state (31, if you count tiny parts of Tucker and Summers). While small or moderate increases of excise taxes on some goods wouldn’t have much of an effect on consumer behavior, a major hike in consumption taxes would encourage people to take their business out of state or online, thus hurting the state’s economy.

Recently, Gov. Jim Justice memorably said West Virginia is like “a patient laying there, and blood is shooting to the ceiling.”

(Try getting that image out of your head.)

Sticking with that simile, SB 335 is like an unnecessary surgery that would make the bleeding even worse.


October 19, 2015

"Ripe for the picking"

Here's another great report by the Charleston Gazette-Mail's David Gutman. This one is on how WV came to lead the nation in overdoses.

ANOTHER BAD IDEA. Here's another report on why eliminating WV's personal property tax, a priority for big business, is a bad idea.

WELCOME CANINES! Enter the dog.

October 07, 2015

Here we go again

It looks like the state budget is tanking, due in part to declining severance tax revenues. In addition to the usual services and things like higher ed, this time K-12 education is up for cuts as well.

(I hate to say I told you so, but remember those millions in corporate tax cuts that were supposed to cut jobs but didn't?)

Meanwhile. the Republican-led tax reform select committee is pondering a suggestion to shift more taxes from businesses to families and homeowners.

Nice.I mean it worked so well last time, right?

June 01, 2015

Talking sense about West Virginia

I'm not saying it doesn't happen very often, but I'm always glad when it does. Here's a article from the State Journal that talks sense about higher education, taxes and the state budget. And then Ken Ward at Coal Tattoo tries to do the same on a bit of a tender subject these days. 

April 13, 2015

A graph that says it all


Tax reform is once again on the agenda in WV. As a union friend of mine recently said, "When they talk about reforming your taxes, watch out. You're about to get..."

We don't know the details, but it looks like WV Republicans want to pass still more business tax cuts, on the tired old theory that tax cuts for business creates jobs. Guess what: they don't. The chart above, put together by friends at the WV Center on Budget and Policy, shows it all.

In case you have trouble seeing it, here's the main deal: the blue line represents business taxes. It's gone down. The red line means jobs. They've gone down too.

Case closed. Next?

March 31, 2015

This is our concern, Dude

As this item from WVMetroNews makes clear, the new WV Republican legislative majority has its sites set on comprehensive tax reform.  That probably means that if they get their way, we are looking at more corporate tax cuts, cuts to education and other services, and shifting costs to working people.

Ironically, we kind of already did this back on 2006, only with a Democratic majority. Thanks to those reforms, higher ed has been cut and made less affordable and the state has forgone around $500 million per year in lost revenue--more than enough to provide free in-state tuition and fees for all WV public colleges and universities. Oh yeah, and  things haven't gotten all that much greater since then.

Here we go again. Here's hoping for successful damage control.