"Taxes should be proportioned to what may be annually spared by the individual."
- Thomas Jefferson to James Madison, 1784. -
"Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise."
- Thomas Jefferson to James Madison, 1785. -
Originally, I had intended this post to be about the divisions in this country as we approach the 234th anniversary of its founding. But I saw this piece in today's Minneapolis Star Tribune written by former Minnesota Senator Mark Dayton, himself a wealthy descendant of the Dayton-Hudson department store chain founders, and it resonated with me. It is, in my view, a strong indictment of the fallacies and end results of the Ronald Reagan/George W. Bush, conservative Republican anti-tax, tax-cut-for-the-rich economic philosophy and practice. It also provides an insight into the potential disaster electing Republican Tim Pawlenty President would be. Sen. Dayton is looking to replace Pawlenty as Minnesota's Governor. The graph at very bottom was taken from a past post in one of TomCat's ever-thoughtful and informative Politics Plus blog.
Does the deficit call for wealthy to pay their share?
By MARK DAYTON
Gov. Tim Pawlenty has protected the rich from paying their fair share of taxes, and the results are chronic budget deficits, drastic cuts in funding for education and other essential services, and increased property taxes.
During Pawlenty's two terms, state funding for our schoolchildren has been reduced by $1,400 per pupil. As a result, several districts can afford to provide school only four days a week. Others are forcing more and more children into overcrowded classrooms. Thousands of dedicated teachers are being laid off.
After college, I taught ninth-grade science in a New York City public school, with 32 students in each class. I learned how much skill and dedication it takes to become a good teacher. I also learned that it's not possible for one teacher to meet the educational needs of 32 children.
So, when I visit a fifth-grade class in Rochester with 36 children and only one teacher, I know something is seriously wrong.
And when I see other overcrowded classrooms throughout Minnesota, I know that we are underfunding public education, and that this failure is jeopardizing our children's futures and our state's future.
To make matters even worse, Pawlenty's most recent insistence on protecting tax loopholes for the rich led him and the Legislature to "shift" almost $2 billion owed Minnesota's school districts into the next biennium. Their fiscal irresponsibility has driven the next projected budget deficit to almost $6 billion.
How can the next governor and Legislature balance the state's budget during the first five months of 2011? The best way is to add jobs. Once again, Pawlenty and his policies have failed Minnesota. Since he became governor, there are 200,000 more people living in Minnesota, yet there are 12,000 fewer people working in the state. Yes, there was a national recession; however, during his eight years, Minnesota was one of the 10 worst states for employment growth. Putting more people back to work must be our next governor's top priority.
Until many more people are working, however, there are only three ways to eliminate a $6 billion budget deficit:
1)Raise taxes on the richest Minnesotans;
2)Raise taxes on the rest of Minnesotans; or
3)Cut $6 billion more in state spending.
The second has already happened under Pawlenty. The state auditor reports that property taxes have more than doubled in Minnesota during the past decade. The property tax is the most unfair tax, because it must be paid whether someone has a job or an income, or whether a farm or business is producing a profit. Many senior citizens and others on fixed and limited incomes are being forced out of their homes by rising property taxes.
Option No. 3 is superficially appealing. No one likes paying taxes. It's simple to say, "Let's cut $6 billion, which is 16 percent, of the next biennial budget." However, as my friend Tom Harkin, a U.S. senator from Iowa, likes to say, "For every complex problem, there is a simple solution. And it's almost always wrong!"
Ninety-three percent of the state's budget is spent on education, health care, human services, transportation, public safety, property tax relief and local government aid. Another 3 percent goes to debt service. GOP Rep. Tom Emmer pretends that merging state agencies will eliminate the deficit. That's absurd fiction, and his continued pretension insults the high intelligence of Minnesota voters.
The truth is that state government spends its revenues on us, the people of Minnesota, and on services that benefit us. Certainly there can and must be improvements and greater efficiencies. However, eliminating $6 billion of spending would have severe consequences, which is why Emmer is afraid to tell us what they are.
There is a much better alternative. As governor, I will make the richest Minnesotans pay their fair share of taxes. The Minnesota Department of Revenue reports that, as a percentage of income, the wealthiest 10 percent of our citizens pay only three-fourths as much in state and local taxes as do the rest of Minnesotans. The richest 1 percent, who on average make over $1.2 million a year, pay only two-thirds as much.
If they all paid the same percentage of their incomes as everyone else, there would be an additional $4 billion in revenues for the next biennium. That would eliminate two-thirds of our state's next budget deficit.
It would allow us to begin to restore our commitment to education. To serve our senior citizens. To lower property taxes.
The current candidates for governor should be judged by this very important measure. Are they for protecting tax breaks for the richest Minnesotans, or for building a better state for all Minnesotans?
More than anyone else, I will close tax loopholes favoring the rich, make them pay their fair share of taxes, and invest that money in better education and a better future for all Minnesotans.
Former U.S. Sen. Mark Dayton is a DFL candidate for governor.
Conservative Republicans, the wealthy elite, and Tea Party activists love to complain about taxes, even though many of them pay none at all or pay a much lower proportional percentage than do working and middle income Americans. They infer that they are being punished for being wealthy for showing initiative and generating wealth. They scream this nonsense even as they freeze wages, scale down benefits, and export the jobs of their employees. And even after taxes, they still have far, far more money left over to play with than do working Americans. Patriot, Founding Father, and President Thomas Jefferson is spinning in his grave...
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