Don’t Spend it All in One Place

According to Citizens for Tax Justice, the tax cut unveiled by Wisconsin Governor Scott Walker this week would afford the bottom 20% of the state a whopping 2 dollars.

In his budget address this week, Wisconsin Governor Scott Walker followed through on his promise to provide middle class tax cuts. His proposal reduces the bottom three income tax rates and costs $343 million over two years. The Institute on Taxation and Economic Policy’s (ITEP) analysis of this proposal found that middle-income taxpayers do get some benefit from Governor Walker’s proposal ($43 on average), but many low-income Wisconsinites do not. In fact, those in the bottom twenty percent of the income distribution, many of whom were already dealt a blow in Wisconsin’s last budget, see an average tax cut of a mere $2. The Governor’s proposed tax cuts come on the heels of reductions to the state’s earned income tax credit and property tax homestead credit, both of which effectively raised taxes on low-income working families. A better approach would be to reverse the damage recently inflicted on the poorest Wisconsinites, by increasing the earned income tax credit and homestead credit.

Scott Walker Tax Cut Chart

This doesn’t even begin to make up for the blow previously dealt to the bottom 20 percent of state taxpayers.

According to the Center on Budget and Policy Priorities, Walker raised taxes on low-income families, seniors, and the working poor by $70 million between fiscal 2011 and fiscal 2013 by cutting the state Earned Income Tax Credit by $56.2 million and by ending indexing of the Homestead Tax Credit.

And I suppose $2, or $43 if you’re more fortunate, is suppose to make up for that.

Job growth in Wisconsin is projected to be second to worst in the nation through 2016 according to Forbes with a projected annual job growth of 1.7 percent, and throwing another lopsided tax cut at the problem isn’t going to fix it.

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  • trgahan

    Sadly, most of the bottom 40 percent of earners probably blames Obama for their lives getting harder since 2011. Cause socialism er something…

    Conversely, to the top 4 percent ($233) and 1 percent ($285), was this tax cut really necessary? Does it make any difference in your daily life if you’re already counting your income in $100,000’s? Or will this crap not stop until you all have ZERO obligations to the society that made you wealthy in the first place?

    • bphoon

      Well, I’m sure that those who are in the top 1% are gonna take their $285 and run right out and hire someone or something.

      The GOP only has two potential solutions to any economic problem: 1) Tax cuts, and 2) Spending cuts. As far as they are concerned, those two things–and those two only–will magically cause an economy to grow and we’ll all live in perpetual prosperity for ever and ever.

      We’re fixin’ to experience the same things as Wisconsin here in Kansas where our illustrious Governor Brownback, along with the Kansas Chamber of Commerce and various Tea Party-affiliated groups, got far right wacko super majorities elected to the legislature. They’re falling all over themselves pushing boiler plate American Legislative Exchange Council bills through because, Growth! Prosperity! Freedom!

      Jesus Christ, we’re fucked.

      • D_C_Wilson

        Meanwhile, republicans in Pennsylvania are moving forward with their electoral college rigging scheme.

        We’re fucked.

    • Christopher Foxx

      Ah, you understand. Excellent.

  • MrDHalen

    What I see here is this:
    Take $343 million tax dollars away from government effectiveness so you can give it back to people in the form of $40. They spend the money which the bulk of will make it into the pockets of the state’s business leaders. The Governor cries “We’re Broke!”, and slash more government services and the people cry “Government Sucks!”.

    I’m personally all cried out! Until they take away voting, we get the government we deserve.

  • D_C_Wilson

    Once again, what does Walker have to do for Wisconsinites to wake up? Torch Lambeau Field?

    • bphoon

      Probably

  • mrbrink

    It’s like Scott Walker and the GOP are moving crates marked “middle class” and “democracy” out the back door and loading them up on a truck headed for a landfill.

    This is the GOP’s “balanced approach.”

    • http://www.politicalruminations.com/ nicole

      “It’s like Scott Walker and the GOP are moving crates marked “middle
      class” and “democracy” out the back door and loading them up on a truck
      headed for a landfill.”

      Unfortunately, Walker isn’t nearly as bad as Rick Snyder (MI), who Maddow called the worst R gov in the country. But yeah, you’re exactly right that they’re decimating both democracy and the middle class.

      I wonder if we’ll ever really recover (as a country).

  • JimmyAbra

    When I see these numbers it says a lot about who thinks this is “good”. It really is nothing as the affected people will see it – maybe I am assuming wrong that the bottom 20% cares about $2. But are some people saying (I bet there are) “We can do more with our $40 a year than our elected officials can with $343,000,000.” It shows how egotistical people tend to be, when they completely overestimate their actual outcomes.