Monday, April 11, 2011

States with the most non-payers


Patrick_L said...

Essentially this chart shows that poverty is high in the South, so lots of people as a result of the EITC and child tax credit don’t have any tax liability. What’s the Tax Foundation’s response to this fact? Cut their tax support! Make them poorer! Make it harder for them to work by reducing their benefits from working!

This is just like Republican complaints over Medicaid’s problems as a result of low-reimbursement rates. What’s their solution? Cut reimbursement rates further!

Do conservatives even listen to themselves? I get whiplash trying to follow their “logical” trains-of-thought.

Patrick_L said...

Whoops- I had a typo. I said these people have no tax liability. That's false- they might have no federal income tax liability, but they pay payroll taxes, sales taxes, property taxes, excise taxes, (usually) state income taxes, etc.

Yes- those poor people are milking the system and the "productive class," as some conservatives like to refer to themselves, for all it's worth.

TJE said...

Mr. L, you need more sense of irony. The two maps show that anti-tax fever is highest where the burden is lightest.

Patrick_L said...

Irony? Read the Chart's subtitle. "Non-payers by State" is defined as "Percentage of Filers with No Liability."

This is a classic example of the Tax Foundation's approach to presenting tax statistics- they literally take delight in their reports when they say things like "Now, this isn't a very civic-minded way to think about taxes, but..." No, they constantly structure their reports to have taxpayers going head-to-head, with poor people cheating the system by being "non-payers" and everyone else "burdened" by the tax man who takes their money.

Here the Tax Foundation refers to low-income people as "Non-payers," implying these people are somehow cheating the system when instead they are taking advantage of an extremely successful tax program that reduces poverty and promotes work. Apparently these goals are objectionable?. These are programs which the Tax Foundation hates for some reason that escapes me. (Well- I'll actually feign ignorance about why the Tax Foundation attacks these important supports for low-income families.)

This chart does not show "anti-tax fever"- it shows the impact of the EITC and Child tax credit on federal income tax liability. These tax credits are proxies for poverty. Hence, my statement stands: "this chart shows that poverty is high in the South." These people aren't engaging in "anti-tax fever"- they're struggling to get themselves out from poverty and help their kids live a better life than they obtained.

I know some think it's a problem that the EITC and child tax credit are overly "generous." I know it's a travesty these tax expenditures result in poor and low-income families having the "lightest" "burden." I know to some the Ryan budget proposal must look like an appropriate and sensible vision for the government- finance tax cuts for the rich by cutting government programs like food assistance for low-income households.

The "burden" is the lightest in the South because people are so "poor" there. There may be "anti-tax" fever among white Southerners (though these charts don't show that), who clearly dislike government support efforts for disproportionately "black" poverty.

History shows us that the South's "free market" approach to poverty is clearly working. A great success! The whole country should copy that model and finance tax cuts for the rich by cutting government support programs for the "poor." That would solve our nation's problems.

TJE said...

Are 50% of households "poor"?

Patrick_L said...

First of all, the 47% figure is heavily influenced by the severe recession. I know conservatives like to use the recession’s countercyclical impact on programs like the EITC and food stamps to justify cutting these programs (“Look at how much Obama has increased spending!”), but I look at that and think- wow, a government program that responds quickly and effectively to an economic downturn- and a program (EITC, food stamps) with one of the highest CBO stimulus multiplier effects of any stimulus option they’ve studied (including other spending and tax cut options). The 47% also includes umpteen other tax credits that primarily benefit the upper-middle class.

Second, the whole point of the EITC and child credit is to get millions of people, in particular children, out of poverty by promoting work! It has been very successful at this- a large part of the reason welfare reform didn’t hurt families was because of the expansion of the EITC. Unfortunately for many Americans, working full-time at the wages provided in the labor-market doesn’t allow them to earn enough to support their families while paying for transportation, housing, food, child care (so they can work those jobs), utilities, health care expenses, etc. Real wages for men (and women now, according to recent Brookings research) at the bottom of the earnings distribution have actually been declining for years. The EITC as an income support improves children’s educational performance and their future working propensity and incomes. It also improves health outcomes. It meets the criteria that conservatives claim they support- promoting work and being a temporary support (since the vast majority of EITC claimants only receive the credit for a brief period of time).

In addition- I’ll repeat: These families still face significant tax burdens from other flat and downright regressive federal, state, and local taxes. I know conservatives want flat (or regressive now? I can’t keep up) tax systems- even though that actually hits low-income and poor households the hardest because they the lowest disposable incomes and many of their expenses are fixed. Too me that just seems backward.

Just how exactly are these families not paying their fair share?