Townie

Sat, Jan 15, 2011 : 6:20 p.m.

Braggslaw: " If you look at the long term pension liabilities for states they are enormous. Most private companies do not have pension plans. What do we disagree about?" What we disagree about is whose fault it is. Where I come from is that if you create the problem it's yours. The legislators who made the decision to throw away revenue (guess which party?) need to own the problem instead of blaming someone else. They gave the revenue to the wealthy under the excuse that they would great jobs and a better economic environment for everyone. That didn't happen (really it can't) and now the blame is assigned to the unions and pensions. Re your 'Most private companies do not have pension plans.'. Wrong again. Most enterprises the size of the State of Michigan do. GE, GM, Ford, etc. do. Little private companies don't but they would over time. UM has one. It's a trade off incidentally -- you pay your employees less (like state government) but promise a long term gain (pension). But you have to pay off (it's called ethical behavior) and now states who gave the pension money to the rich under irresponsible leadership are trying to blame the wrong party. It's not really hard to understand.

braggslaw

Sat, Jan 15, 2011 : 12:39 p.m.

Townie, I guess I don't know what we are disagreeing about.. If you look at the long term pension liabilities for states they are enormous. Most private companies do not have pension plans. What do we disagree about?

Townie

Sat, Jan 15, 2011 : 12:20 p.m.

Braggslaw: #5 we will have to disagree on pensions. Long term obligations to retired state workers have destroyed many state budgets. Most if not all private companies do not have pension plans. It is a cash and carry system." In almost all the states where this is brought up (NJ comes to mind) if one goes back and looks you'll find that the tax cut mania (with the largest % going to the wealthiest in the state) cut the state's revenue creating a deficit (and severely worsened by the Wall Street caused recession) and the Republicans chose to blame state union pensions as the culprit. They chose to give state revenue back to the wealthy and created a deficit and blamed it on union benefits and pension plans for the deficit!

braggslaw

Fri, Jan 14, 2011 : 9:58 p.m.

Jeff, Thanks for the response. I disagree with you on a number of points, but it was nice to see your answers. #2, I think your answer reflected the interests of collective bargaining rather than taxpayers. #3. Saline gets about 70% of the funding that Ann ARbor gets yet equals or outperforms Ann ARbor. #4 as a rule Charter Schools outperform Public schools in devastated urban areas, where the parent need the choice. #5 we will have to disagree on pensions. Long term obligations to retired state workers have destroyed many state budgets. Most if not all private companies do not have pension plans. It is a cash and carry system.

Jeff Irwin

Fri, Jan 14, 2011 : 9:47 p.m.

@braggslaw: You ask some important and weighty questions. I will not be able to do them justice in this format, but Ill try to give a sense of my thinking. 1) I dont know why we have so many levels of government in Michigan, but it seems to me that we have too many overlapping or duplicative layers. With respect to municipal and county governments, this was set out in the Constitution as a vestige of the local control ethic of the Northwest Territories. My view is that we can keep the local control ethic intact, but revise how we define local in more modern terms. This could save money that could be directed towards some combination of services or tax relief. On the school side, I am less versed on the history but I can say that many of our school districts in Washtenaw County are working together to share costs more and more every year. 2)It would be most efficient if all citizens of the United States were sharing administrative costs in the manner your question is suggesting. With respect to the health care pooling plan that has been proposed over the last years, I dont believe it will save money. The former Speaker produced no data to support his assertion that it would reduce costs and when other states have tried this (such as North Carolina); it turned out to be much more expensive than anticipated. As far as MESSA specifically, I think that if educators want to bargain for excellent health care coverage then that should be hammered out at the bargaining table (its like any other element of a business/contract negotiation). The point of MESSA is to create a large pool to share risk and administrative costs over many members and to provide customer service to their members. The way that MESSA benefits MEA is by maintaining very high standards of service and attracting the interest of the educators who have to bargain hard for MESSAs product (MESSA doesnt support MEA financially). 3)The most highly funded schools in the state happen to also be the best schools in the state. Districts like Ann Arbor, East Lansing, Birmingham, Royal Oak, Farmington and about two dozen other districts receive the largest per-pupil allocations and boast some of the best performance. However, I dont think this point adequately addresses your question about urban schools in communities that have been absolutely devastated by deindustrialization, depopulation and racial acrimony. Obviously, I dont know all of the answers to how we fix troubled schools, but I would look at smaller class sizes, recruitment of top teachers and maximizing the number of educators versus administrators in the system. Smaller class sizes and recruiting top teachers requires both an investment and a culture that values education and intellect. 4)Im trying to stay on top of the best and most current research on this subject, but what I have read in the past concludes that our charter schools are performing at a lower level than our public schools. In other words, when you compare the public schools and charter schools within a struggling district, the charter schools typically underperform. 5)It depends. If the performance of the investments that pension funds would be invested in is very good, then a pension is less expensive for government in the long term. If those investments do poorly, then the defined contribution system is less expensive. Of course, all of this depends on what benefit is promised (how much) and how faithful the current government is when appropriating funds to meet future obligations. The great thing about defined contribution programs is the certainty for the employer, but the magnitude of the cost is all about the juiciness of the benefit. The problem for Michigan is, if we do want to move to a defined contribution system, we would have to pay off our defined benefit liabilities now rather than over the 30 years that the actuaries have planned. Once again, these answers are pretty brief considering the issues that you raise. Ive tried to encapsulate some complex matters into a couple of sentences but there are many other considerations that play into each of these bullets. Also, Im always trying to learn more about the issues so if anybody would like to help with that process, Im easy to find.

braggslaw

Fri, Jan 14, 2011 : 8:05 p.m.

Jeff, thanks for engaging. I had a couple questions for you regarding public education. 1. Why do we have so many school districts (and with it the over head and bureaucratic costs?) I can't for the life of me understand why there is a Lincoln, Ypsi, and willow Run school districts... etc. 2. Why don't all state employees (including teachers)share the same healthcare (reducing overhead and bureaucratic costs?)What's the point of MESSA other than a middle man and funding for the MEA? 3. Why is there such a huge disparity in per pupil funding and why is there no direct correlation between funding and performane. E.G. the detroit/flint/etc. public school system are highly funded yet have horrible graduation rates and test scores? 4. Where do you stand on private and/or religious schools competing for the school funding with public schools? (let's not bring up church-state separation) 5. Do you see a move for public employees from a pension system to only a 403(b)? eliminating long term pension costs for the tax payers. Michigan Is around number 37 out of 50states for average income. (dropping dramatically in the last decade). With reference to other state agencies. I believe the state park system in Michigan went to a self funded system. (please correct me if that is not true). This led to more rationale sustainable spending. Do you see more targetted fees for state service (and the resultant accountability?) What state agencies can we no longer afford? Just asking

Speechless

Fri, Jan 14, 2011 : 8:01 p.m.

"... we're also facing the structural budget cliff from years of one-time accounting gimmicks and the loss of federal ARRA funds. The 'rainy-day fund' was emptied long ago...." "... the Speakers vision seems focused on ideas like eliminating tax credits for low income families and making deep cuts in schools, police and our safety net...." Michigan's revenue system based on flat taxes has now reached the point of catastrophic failure. But the new Republican legislature sees this imminent disaster as a most wonderful opportunity to tear down a wide variety of publicly funded services, Some state programs aimed at the working poor or unemployed could get tosssed overboard like so much unwelcome ballast. Line items favored by the middle class, such as university spending, may see their worst round of heavy cuts yet, more severe than 8-9 years ago. Yet GOP lawmakers tightly circle their wagons to preserve nearly every tax break and entitlement benefiting wealthy residents and large businesses. They will either quietly try to forget these special perks exist, or else, when pressed, insist with a straight face that they represent 'essential' services. Greed can expect resolute protection, no matter the social consequences. Will Snyder have the courage to discipline the brats running the legislature? Michigan's enormous budgetary train wreck was quite avoidable. The elimination of corporate loopholes, along with a statewide vote to allow graduated income taxes, should have both happened a long time ago. If they wish, GOP lawmakers and Gov. Snyder might still carefully review former Rep. Alma Wheeler Smith's proposal for overhaul of state taxation.

Jeff Irwin

Fri, Jan 14, 2011 : 5:56 p.m.

Michigan is facing a huge challenge with this budget. Of course, our economy is struggling; but we're also facing the structural budget cliff from years of one-time accounting gimmicks and the loss of federal ARRA funds. The 'rainy-day fund' was emptied long ago and the changes that the Republican leadership are hinting at are scary for schools, universities, public safety, transportation, public health and especially for people who are struggling to get by. Some of their ideas are good, such as the desire to create a better climate for economic growth and Im hopeful that they will propose some changes that I can be enthusiastic about. However, it seems like the more specific they get, the more I hear ideas that are, in my estimation, quite bad for the economic climate. For instance, I happen to think a great education system is our best route towards a more prosperous Michigan and that short-cutting environmental protections are grave threats to our tourism industry and our property values (not to mention our health). Although I'm joining the conversation late, it seems like most of the comments are focused on the question of equity in taxation. Admittedly, my quotation about 'balancing the budget on the backs of the poor,' is probably too imprecise, but I do believe that the generalization is a fair one. Most of the debate on here has been about federal taxes and braggslaw effectively stresses that when you look only at federal income tax, our most financially endowed Americans pay a very large percentage of that tax. The graduated schedule coupled with the EITC creates this result; but, as has been pointed out by many, income taxes are not the total picture. Payroll taxes for FICA and Medicaid as well as gas taxes and extensive borrowing fuel our federal budget. At the state level, we have sales, gas and income taxes bringing in most of the revenue. All of those taxes are applied at a flat rate, leaving Michigan with a tax structure that is much more regressive than the federal system. Incidentally, Id like to change that, by proposing a graduated income tax for state government. So, to be more precise, I believe that what I heard during the swearing in was a cogent speech in which our new Speaker rolled out his vision on which tax reforms would, in his view, benefit Michigans future. I was disappointed that the Speakers vision seems focused on ideas like eliminating tax credits for low income families and making deep cuts in schools, police and our safety net. I hope to persuade the Speaker and all of my colleagues to agree that we can't afford deep cuts in these programs. I anticipate that it will be quite a challenge. Thank you all for the opportunity to serve and I invite your ideas, comments and communications (phone and email is in the article).

braggslaw

Fri, Jan 14, 2011 : 2:01 p.m.

By the way David, I challenge your use of the word "given". I would replace it with the word earned.

braggslaw

Fri, Jan 14, 2011 : 1:58 p.m.

Oops To summarize the removed article. The unemployment rate as of today is 9.1% (high for the U.S. but normal for Europe) There are 3 million unfilled jobs in the U.S. because qualified people cannot be found.

David Briegel

Fri, Jan 14, 2011 : 12:22 p.m.

And many of them appreciate where they live and believe that the effective tax rates should reflect their fortunate status as they are more than willing to pay more for their privilege. To whom much is given, much is expected! With 10-20% unemployment, many qualified people simply cannot find employment. And that redistribution includes one foreign adventure folly after another and that is never mentioned. And one Perpetual War Profiteering boondoggle after another. Never a complaint. Only when it comes to serving the less fortunate among us is it an issue!

braggslaw

Fri, Jan 14, 2011 : 11:02 a.m.

David The US has relatively low unemployment compared to Europe. The US has a relatively high median income compared to Europe and Asia. Some people have become fabulously wealthy in the U.S. Bill Gates, Jobs, Facebook founder etc. I do not begrudge their wealth. Their vision created jobs and wealth for all of us. I also would point out again that the top 20% of income earners fund 80% of the operating budget of the federal govt. Recently a high tech company was sold in Ann ARbor that netted the owners 10's of millions of dollars. I don't begrudge their success they have hired a large number of well paid employees and have invested in the area. I would rather that happen than for the govt. to take their wealth and redistribute it to people who don't work. Let them decide who to pay (as employees.)

David Briegel

Fri, Jan 14, 2011 : 10:46 a.m.

Come on Bragg, you know very well that the "EFFECTIVE TAX RATES" are nowhere near the published rates. Corporations don't pay taxes. Billionaires don't pay taxes. "Only little people pay tax"! And children are hungry! And you state they need the money to create jobs. Where are the jobs? We extended every tax cut the Repubs wanted. They are now paying the lowest rates in the modern era. They are sitting on two trillion in cash. Where are those jobs? The only thing that has occurred is that they have accumulated vast sums of wealth and the poor are more poor than before. You believe in a Meritocracy yet we live in a Plutocracy/Oligarchy. Can you not admit that maybe, just maybe this trickle down nonsense is a myth?

braggslaw

Fri, Jan 14, 2011 : 10:15 a.m.

It breaks my heart to see children having children. More than 1/2 the kids born in Detroit are to single mothers. (Statistically dooming many to poverty)Children cannot choose their parents. How do you fix such a failure? My experiences are anecdotal and relate to where I grew up (not a very nice place) and my family members. These experiences have colored my opinion. I have seen many young women choose to have a kid because they want a kid. Typically they are not married but they have a boyfriend at that time. Inevitably that boyfriend leaves because the couple is not married and the male is young and lacks the backbone to head a family. Inevitably the young women gets another boyfriend and then has another child. The enablers in this situation are WIC,ADC, Medicare, Subsidized housing, and foodstamps. You can live on these govt. programs. $5 dollar rent (subsidized apt. including heat and water but not electricity), free medical care, I believe $100 bucks a month for formula from Wic, $300 a month in foodstamps. (again this is what the people I know tell me) I realize I met upset some people, but I believe these programs are enablers for poor young single women to have children. That is my personal experience. But for these programs, the single women would not have a child. Babies having babies and depending on govt programs is no way for a society to prosper. The govt. should not stand in for parents or a father. I don't have all the solutions, but at some point better parenting and morals(not christian right wing morals, but personal responsibility and an understanding that all decisions have consequences) need to stop this vicious circle.

dotdash

Fri, Jan 14, 2011 : 3:41 a.m.

There are a couple different issues here. Median income of Americans is high, no one should argue there. The more pertinent fact to this discussion is the difference in income between the rich (say, top 20%) and poor (say, below the poverty line). The ratio of income of the top 20% to the below-poverty-line is 14.5, up from 13.6 in 2008 and 7.7 in 1968. The rich are getting richer and the poor are getting poorer. A quarter of all children are raised in poverty. In this country with its vast wealth. That should make us all pause and reconsider our me-me-me trajectories. Since living in this country has benefited each of us enormously, surely we can look around for how we can repay rather than "bah humbug" our way through life?

larry kramer

Fri, Jan 14, 2011 : 12:22 a.m.

braggslaw-- you say:Middle class people need rich people to start businesses to create jobs. for 8 bush years, the rich have prospered and gotten richer--where are all those jobs they created? WHAT A BUNCH OF CRAP! The only people I know who started businesses and created jobs are middle class people who struggle daily, but still employ a few workers. They need capital, but the banks hoard it! Your rich can shove it!

braggslaw

Thu, Jan 13, 2011 : 11:16 p.m.

Federal tax rates are already progressive (which explains why the top 20% pay the super-majority of the Federal income taxes) bracket you are in: Tax Bracket Single Married Filing Jointly Head of Household 10% Bracket $0 $8,500 $0 $17,000 $0 $12,150 15% Bracket $8,500 $34,500 $17,000 $69,000 $12,150 $46,250 25% Bracket $34,500 $83,600 $69,000 $139,350 $46,250 $119,400 28% Bracket $83,600 $174,400 $139,350 $212,300 $119,400 $193,350 33% Bracket $174,400 $379,150 $212,300 $379,150 $193,350 $379,150 35% Bracket $379,150+ $379,150+ $379,150+ I believe you are referencing (objecting to) capital gains taxes which is 5-15% based on income tax level. People who make millions on capital gains do not pay a high percentage tax. BUT you are missing the point, businesses need capital, thriving businesess generate jobs etc. Middle class people need rich people to start businesses to create jobs.

David Briegel

Thu, Jan 13, 2011 : 10:15 p.m.

And what are the effective tax rates? That is where fairness enters the picture. We all pay the same tax on a loaf of bread or a six pack. Why do lower incomes get taxed at a higher rate? How do YOU justify even as it applies to you?

braggslaw

Thu, Jan 13, 2011 : 9:11 p.m.

The average American has a better life than most Europeans (excluding oil rich Norway and the diamond cutting guild in the low countries) Most people graduate college and earn less than the median, but by the time they retire they have accumulated wealth and are in the upper income brackets, thus most college grads will be in the top 20 percent eventually The top 20 percent is the average

braggslaw

Thu, Jan 13, 2011 : 9:11 p.m.

The average American has a better life than most Europeans (excluding oil rich Norway and the diamond cutting guild in the low countries) Most people graduate college and earn less than the median, but by the time they retire they have accumulated wealth and are in the upper income brackets, thus most college grads will be in the top 20 percent eventually The top 20 percent is the average

braggslaw

Thu, Jan 13, 2011 : 8 p.m.

Since the income gap is being argued. I would just like to point out that the USA has one of the highest median (not mean/average) incomes in the world. For those who understand stats... median is not equal to mean. Country Median household income national currency units Year PPP rate (OECD) Median household income (PPP) Switzerland[4] (gross) 109,236 CHF, $100,387 2008 1.68375 $64,877 Connecticut, US [5] 64,851 USD 2009 1.00 $64,851 California, US [5] 56,134 USD 2009 1.00 $56,134 Canada [6] (After tax) 63,900 CAD 2008 1.23 $51,951 United States [5] 49,777 USD 2009 1.00 $49,777 Switzerland[4] (after taxes and health insurance) 77,580 CHF, $71,296 2008 1.640256 $47,297 Australia[7] 66,890 AUD 2007/2008 1.5162805 $44,115 New Zealand [8] 63,867 NZD 2008/2009 1.5881895 $40,214 United Kingdom [9] 24,700 GBP 2004 0.632 $39,000 Israel[10] 107,820 ILS 2006 2.90 $37,000 Mississippi, US [5] 35,076 USD 2009 1.00 $35,076 Ireland 35,410 EUR 2005 1.02 $35,000 Scotland, United Kingdom[11] 21,892 GBP 2005 0.649 $34,000 Hong Kong[12] 186,000 HKD 2005 5.96 $31,000 Singapore[13] 45,960 SGD 2005 1.55 $30,000

braggslaw

Thu, Jan 13, 2011 : 8 p.m.

Since the income gap is being argued. I would just like to point out that the USA has one of the highest median (not mean/average) incomes in the world. For those who understand stats... median is not equal to mean. Country Median household income national currency units Year PPP rate (OECD) Median household income (PPP) Switzerland[4] (gross) 109,236 CHF, $100,387 2008 1.68375 $64,877 Connecticut, US [5] 64,851 USD 2009 1.00 $64,851 California, US [5] 56,134 USD 2009 1.00 $56,134 Canada [6] (After tax) 63,900 CAD 2008 1.23 $51,951 United States [5] 49,777 USD 2009 1.00 $49,777 Switzerland[4] (after taxes and health insurance) 77,580 CHF, $71,296 2008 1.640256 $47,297 Australia[7] 66,890 AUD 2007/2008 1.5162805 $44,115 New Zealand [8] 63,867 NZD 2008/2009 1.5881895 $40,214 United Kingdom [9] 24,700 GBP 2004 0.632 $39,000 Israel[10] 107,820 ILS 2006 2.90 $37,000 Mississippi, US [5] 35,076 USD 2009 1.00 $35,076 Ireland 35,410 EUR 2005 1.02 $35,000 Scotland, United Kingdom[11] 21,892 GBP 2005 0.649 $34,000 Hong Kong[12] 186,000 HKD 2005 5.96 $31,000 Singapore[13] 45,960 SGD 2005 1.55 $30,000

braggslaw

Thu, Jan 13, 2011 : 7:48 p.m.

Johnny A2 I paid for my undergrad by co-oping. I went to multiple grad schools while working full time... Satisfied? And the numbers I am familiar with are 20% of the people control 85% of the wealth I don't know how to respond to your other rhetoric because you are wrong and it would be a waste of time.

braggslaw

Thu, Jan 13, 2011 : 7:48 p.m.

Johnny A2 I paid for my undergrad by co-oping. I went to multiple grad schools while working full time... Satisfied? And the numbers I am familiar with are 20% of the people control 85% of the wealth I don't know how to respond to your other rhetoric because you are wrong and it would be a waste of time.

dotdash

Thu, Jan 13, 2011 : 7:43 p.m.

Great post, johnnya2.

dotdash

Thu, Jan 13, 2011 : 7:43 p.m.

Great post, johnnya2.

John B.

Thu, Jan 13, 2011 : 7:17 p.m.

In the USA, the top 1% earn more than the bottom 90% combined. If you look at the disparity of the distribution of wealth in this country today, it's worse than many, many third-world dictatorships.

John B.

Thu, Jan 13, 2011 : 7:17 p.m.

In the USA, the top 1% earn more than the bottom 90% combined. If you look at the disparity of the distribution of wealth in this country today, it's worse than many, many third-world dictatorships.

johnnya2

Thu, Jan 13, 2011 : 6:19 p.m.

Interesting the braggshaw can not understand the shrinking of the midddle class. I guess you are ok with BILLIONAIRES paying a lower % than you? I would also like to know where you went to college that you did not have a federally subsidized loan? If that school took $1 of federal moeny for ANY person YOU were being subsidized. If you drove on a road that was paid for by another, YOU were subsidized. If you use the internet (that was designed by the military) you are using subsidized services. Did you watch any television, fly on a plane, eat safe food, drink clean water, buy a car with a seatbelt or airbag? All subsidized. I guess you would prefer no safety checks on cars (there was a time) airplanes (hey who needs regulations and training, let pilots do whatever the hell they want, buyer beware), unpaved roads (if you want to pave YOUR property go ahead, but I don't want to pave mine, and my neighbor prefers brick, while I want nothing, and the other guy wants asphalt. I will also be collecting a toll for my 30 feet of land that makes your morning commute. I charge $1, and my neighbor charges $3. Why shoudl a doctor be forced to be licensed, if somebody believes him, so be it. If Bernie Madofff decides to lie, that is the victims fault since they didn't check it out. The whole libertarian crap has been debunked and scoffed at for years. Go back to your Ayn Rand and Ron Paul life and get a clue.

johnnya2

Thu, Jan 13, 2011 : 6:19 p.m.

Interesting the braggshaw can not understand the shrinking of the midddle class. I guess you are ok with BILLIONAIRES paying a lower % than you? I would also like to know where you went to college that you did not have a federally subsidized loan? If that school took $1 of federal moeny for ANY person YOU were being subsidized. If you drove on a road that was paid for by another, YOU were subsidized. If you use the internet (that was designed by the military) you are using subsidized services. Did you watch any television, fly on a plane, eat safe food, drink clean water, buy a car with a seatbelt or airbag? All subsidized. I guess you would prefer no safety checks on cars (there was a time) airplanes (hey who needs regulations and training, let pilots do whatever the hell they want, buyer beware), unpaved roads (if you want to pave YOUR property go ahead, but I don't want to pave mine, and my neighbor prefers brick, while I want nothing, and the other guy wants asphalt. I will also be collecting a toll for my 30 feet of land that makes your morning commute. I charge $1, and my neighbor charges $3. Why shoudl a doctor be forced to be licensed, if somebody believes him, so be it. If Bernie Madofff decides to lie, that is the victims fault since they didn't check it out. The whole libertarian crap has been debunked and scoffed at for years. Go back to your Ayn Rand and Ron Paul life and get a clue.

David Briegel

Thu, Jan 13, 2011 : 5:36 p.m.

Bragg, a very small % of people have all the wealth and "earn" most of the income yet their "effective" tax rate is miniscule. Therein lies our problem! Warren Buffet discusses this on a regular basis to point out that basic unfairness in our system. Why can he see it and not you??

David Briegel

Thu, Jan 13, 2011 : 5:36 p.m.

Bragg, a very small % of people have all the wealth and "earn" most of the income yet their "effective" tax rate is miniscule. Therein lies our problem! Warren Buffet discusses this on a regular basis to point out that basic unfairness in our system. Why can he see it and not you??

braggslaw

Thu, Jan 13, 2011 : 4:47 p.m.

I was merely demonstrating the raw numbers. People can draw their own conclusions. I am just pointing out that a small percentage of people pay for a majority of the govt services that benefit all people. People can decide what's fair on their own. I think the voters of Michigan have made that call.

braggslaw

Thu, Jan 13, 2011 : 4:47 p.m.

I was merely demonstrating the raw numbers. People can draw their own conclusions. I am just pointing out that a small percentage of people pay for a majority of the govt services that benefit all people. People can decide what's fair on their own. I think the voters of Michigan have made that call.

Smart

Thu, Jan 13, 2011 : 4:46 p.m.

"The top 20% of income earners pays 78% of all federal income taxes." Refudiated by your own comments? Nice work! 78% does not equal 80%. As for the distinction between..." Are you kidding Ann Arbor Press! Read it carefully and use a 3rd grade education and you will see it is possible for 20% to pay a 78% amount of something. This is the most unprofessional bias Newspaper in the country.

Smart

Thu, Jan 13, 2011 : 4:46 p.m.

"The top 20% of income earners pays 78% of all federal income taxes." Refudiated by your own comments? Nice work! 78% does not equal 80%. As for the distinction between..." Are you kidding Ann Arbor Press! Read it carefully and use a 3rd grade education and you will see it is possible for 20% to pay a 78% amount of something. This is the most unprofessional bias Newspaper in the country.

Dog Guy

Thu, Jan 13, 2011 : 4:39 p.m.

The Michigan legislature can turn the state's economy around by examining what it has done in the past and stop doing that. The only effects which legislation can have on economics are destructive--unless robbing Peter to pay Paul is considered to be the basis of Michigan's economy. As one of the Pauls, I can appreciate such an economy. There is, however a limit to Peter's resources--a moot point as Peter moved to Texas last spring.

Dog Guy

Thu, Jan 13, 2011 : 4:39 p.m.

The Michigan legislature can turn the state's economy around by examining what it has done in the past and stop doing that. The only effects which legislation can have on economics are destructive--unless robbing Peter to pay Paul is considered to be the basis of Michigan's economy. As one of the Pauls, I can appreciate such an economy. There is, however a limit to Peter's resources--a moot point as Peter moved to Texas last spring.

leaguebus

Thu, Jan 13, 2011 : 4:29 p.m.

I think Illinois has figured out it takes money to make money. When Michigan's budget is cut by 33% this year, how much money will there be to invest in startups, tax incentives for business, etc? If you raised corporate taxes by 10%, goodbye business, but 1%, it probably won't matter. By not raising the gas taxes for 20 years, look at our roads and bridges. The cost of road maintenance has gone up by 40% in the last twenty years but road taxes have not. The only large scale road maintenance I have seen around here was with Federal stimulus dollars. All the county road commissions have had to do with less for years. Eventually, things don't get maintained with no money.

leaguebus

Thu, Jan 13, 2011 : 4:29 p.m.

I think Illinois has figured out it takes money to make money. When Michigan's budget is cut by 33% this year, how much money will there be to invest in startups, tax incentives for business, etc? If you raised corporate taxes by 10%, goodbye business, but 1%, it probably won't matter. By not raising the gas taxes for 20 years, look at our roads and bridges. The cost of road maintenance has gone up by 40% in the last twenty years but road taxes have not. The only large scale road maintenance I have seen around here was with Federal stimulus dollars. All the county road commissions have had to do with less for years. Eventually, things don't get maintained with no money.

David Briegel

Thu, Jan 13, 2011 : 4:26 p.m.

Ok braggislaw, let's tell the rest of the story. Use those same percentages and figure the accumulated wealth and Earnings per year and then crunch the EFFECTIVE tax rate those that you defend actually pay. That is where the rubber hits the road. Then show those same pie charts from 30 years ago when the upper levels actually paid a more fair percentage. Even you will be amazed at the disparity of that "trickle down".

David Briegel

Thu, Jan 13, 2011 : 4:26 p.m.

Ok braggislaw, let's tell the rest of the story. Use those same percentages and figure the accumulated wealth and Earnings per year and then crunch the EFFECTIVE tax rate those that you defend actually pay. That is where the rubber hits the road. Then show those same pie charts from 30 years ago when the upper levels actually paid a more fair percentage. Even you will be amazed at the disparity of that "trickle down".

dotdash

Thu, Jan 13, 2011 : 4:17 p.m.

A lot of people would say that the person who paid $10,000 out of $50,000 was less tax-fortunate than the person who paid $100,000 out of $300,000. Some very basic expenses are not scalable, so it is very possible that $100,000 out of $300,000 represents a much smaller percent of a person's disposable income (and less of a burden to them) than $10,000 out of $50,000 does.

dotdash

Thu, Jan 13, 2011 : 4:17 p.m.

A lot of people would say that the person who paid $10,000 out of $50,000 was less tax-fortunate than the person who paid $100,000 out of $300,000. Some very basic expenses are not scalable, so it is very possible that $100,000 out of $300,000 represents a much smaller percent of a person's disposable income (and less of a burden to them) than $10,000 out of $50,000 does.

braggslaw

Thu, Jan 13, 2011 : 4 p.m.

John, I think you have a problem with scale... Let's say a person makes 300,000 a year and ends up paying around 100,000 in taxes. Let's look at another person who makes 50,000 a year and pays around 10,000 in taxes. Who paid more? If we are to use the % system. Let's have businesses price things by what people make. A loaf of bread would be 1% of your income. Who cares what it really costs....

braggslaw

Thu, Jan 13, 2011 : 4 p.m.

John, I think you have a problem with scale... Let's say a person makes 300,000 a year and ends up paying around 100,000 in taxes. Let's look at another person who makes 50,000 a year and pays around 10,000 in taxes. Who paid more? If we are to use the % system. Let's have businesses price things by what people make. A loaf of bread would be 1% of your income. Who cares what it really costs....

braggslaw

Thu, Jan 13, 2011 : 3:55 p.m.

John you got me 78 is not equal yo 80

braggslaw

Thu, Jan 13, 2011 : 3:55 p.m.

John you got me 78 is not equal yo 80

John Q

Thu, Jan 13, 2011 : 3:48 p.m.

"The top 20% of income earners pays 78% of all federal income taxes." Refudiated by your own comments? Nice work! 78% does not equal 80%. As for the distinction between the percentage and the total, I think you would find few who would agree with you that a millionaire paying $10,000 in taxes is paying "more" than a single parent paying $5,000 in taxes. But keep trying to make that argument.

John Q

Thu, Jan 13, 2011 : 3:48 p.m.

"The top 20% of income earners pays 78% of all federal income taxes." Refudiated by your own comments? Nice work! 78% does not equal 80%. As for the distinction between the percentage and the total, I think you would find few who would agree with you that a millionaire paying $10,000 in taxes is paying "more" than a single parent paying $5,000 in taxes. But keep trying to make that argument.

nekm1

Thu, Jan 13, 2011 : 3:24 p.m.

Zero balance budget EVERY department that state funds flow to. Also create a multiple year budget (or atleast projection). Remove State employee unions, and privatize whatever we can. Begin a systematic rebuild of the most needed infrastructure, and begin to combine school districts to restrict the waste of too much administration. Pay teachers more on the front end (salary) and get rid of the pensions (install 401K's matching the first 3% of salary saved.) That would be a great start.

nekm1

Thu, Jan 13, 2011 : 3:24 p.m.

Zero balance budget EVERY department that state funds flow to. Also create a multiple year budget (or atleast projection). Remove State employee unions, and privatize whatever we can. Begin a systematic rebuild of the most needed infrastructure, and begin to combine school districts to restrict the waste of too much administration. Pay teachers more on the front end (salary) and get rid of the pensions (install 401K's matching the first 3% of salary saved.) That would be a great start.

braggslaw

Thu, Jan 13, 2011 : 2:23 p.m.

10% of 10,000 dollars is 1,000 dollars 10% of 100,000 dollars is 10,000 dollars. Who paid more in taxes? Yes the top 20 do pay 80 percent of FEDERAL INCOME TAXES Nice try The top 1% of income earners pay about 32% of all income taxes. The top 5% pays 51.4%. The top 10% of high income earners, pay 63.5%. The top 20% of income earners pays 78% of all federal income taxes.

John Q

Thu, Jan 13, 2011 : 2:03 p.m.

Let's do some fact-checking "BUT for federal income tax, the burden born by the top 20% of income earner is 80% of the federal taxes. Those are the taxes that fund highways, the military, federal agencies etc." No, they don't pay 80%. But they do have massive amounts of income that largely account for their share of income tax. By the way, gas taxes pay for highways, not income taxes. "Furthermore, as high earners buy more expensive products they will pay more sales taxes." But not as high a percentage of income as lower-income earners. "I believe medicare,SS are fixed rates (which are capped), thus since high earners make more they will pay more." Everyone pays the same rate so high and low-income earners are paying the same percentage based on income. More importantly, both are capped so as high-income earners exceed the cap, the percentage of their income paid towards those goes down. Keep trying!

dotdash

Thu, Jan 13, 2011 : 1:58 p.m.

Tax cuts only promote economic growth if they go to people or organizations whose spending promotes economic growth. Cutting the taxes of people or entities who are already saving/investing/hiding their extra dollars overseas does little for the economy. Putting dollars in the hands of people who will spend it here on the things others of us produce and sell -- now that promotes economic growth. Tax cuts for the rich? Just money that has to be repaid by poorer people in future generations. With interest.

Top Cat

Thu, Jan 13, 2011 : 1:48 p.m.

Incentives matter. President Obama now joins with Presidents Clinton and Kennedy in supporting tax cuts to promote economic growth. And now, we have a Governor that understands that as well.

dotdash

Thu, Jan 13, 2011 : 1:32 p.m.

I don't mind paying taxes. I would even say I am proud to pay taxes. There are things I want in a place where I live: I don't want others to starve, I want all children to go to school, I want old people to have a comfortable old age, I want a fire department and police protection, I want there to be trained surgeons waiting if I need a heart transplant. So yes, I am happy to pay for those things. I would rather live with less in a community where others are fed and comfortable than have a castle surrounded by slums.

David Briegel

Thu, Jan 13, 2011 : 1:23 p.m.

xmo, so how many jobs were created by those Bush Tax Cuts. You know, the tax cuts we just extended. How's that working for job creation? Kinda hard to explain that one, eh? GE and Exxon paid no corporate income tax last year. Economic Justice? The top 25 hedge fund managers each made a billion tax free. Fair? Many millionaires paid little to no tax last year. Some even drew unemployment and other benefits. I've never heard any of my fellow posters here who complain about government or union employees ever mention any of these inconvenient truths! And the next words will be the dreaded "class warfare" argument. Who has won the class war? According to the "logic" here it is the poor and the middle class. And I've got this bridge I want you to look at.......... And meanwhile the banksters are having their way with us as nothing has changed in their world. Not one person committed any crime. Business as usual!

braggslaw

Thu, Jan 13, 2011 : 1:19 p.m.

Speechless, fortunately for the state of Michigan, fiscal conservatives are no in office. I believe they were voted in by the citizens of this state. I don't remember a military coup last fall.

Speechless

Thu, Jan 13, 2011 : 1:17 p.m.

If the lowest possible taxes for the wealthy and for corporations constitute our main criteria for success, then places like Indonesia or Hondouras must obviously be among the finest economies that planet Earth has to offer.... Also, since European history after WWII demonstrates that the practice of democracy can rudely interfere with 'unregulated' market economics, maybe it would be best to abolish all voting. If the Fortune 500 could form a junta... Well, Irwin is correct to call out the incoming 'leadership' in the state legislature for threatening to balance the budget on the backs of the poor. Too many of the wealthy are all about increasing their special entitlements and forcing greater social burdens onto the poor and lower middle classes. The GOP, maybe with the cooperation of a few Democrats, plans to put on a rather nasty dog & pony show which ends in ritual sacrifice for programs that mainly serve the least privileged. The country clubbers intend to celebrate.

braggslaw

Thu, Jan 13, 2011 : 1:11 p.m.

There is not doubt that everyone pays sales taxes, medicare, medicaid etc. BUT for federal income tax, the burden born by the top 20% of income earner is 80% of the federal taxes. Those are the taxes that fund highways, the military, federal agencies etc. Furthermore, as high earners buy more expensive products they will pay more sales taxes. I believe medicare,SS are fixed rates (which are capped), thus since high earners make more they will pay more. I pay in the neighborhood of a 40% tax rate for the income I earn. My sibling who works at Applebees might pay 10% after she receives her refunds. ( dropped out of high school) I paid around $250,000 for my education. I paid to participate in a few ventures. The govt. never game me a cent. The loans I used for my grad school degrees were unsubsidized. So you tell me what is fair? Should people be punished for working hard and paying their own way?

braggslaw

Thu, Jan 13, 2011 : 12:55 p.m.

The overall tax burden is the issue. In some states like California, income tax is the primary tax vehicle. It appears that Illinois it going to use every tax lever it can pull. Illinois is in the top 10 for tax burden. Indiana is 39th. I could not find the information for Wisconsin. that being said, Michigan has an opportunity to attract businesses and concomittantly jobs.

John Q

Thu, Jan 13, 2011 : 12:43 p.m.

In Lansing, Republicans are proposing to repeal tax credits that help poor, low-income families to fund tax breaks for businesses. That's what we can expect for the next two years.

Ignatz

Thu, Jan 13, 2011 : 12:13 p.m.

@xmo: Income taxes are not the only taxes we pay. Things like sales tax have a more adverse impact on those whose income is not to the level of paying income tax.

John Q

Thu, Jan 13, 2011 : 11:41 a.m.

"Jeff about 50% of the residents in the US do not pay INCOME TAX so, how can you balance a budget on the backs of people who do not pay taxes?" The people who pay no taxes? That would be news to the people who pay payroll taxes and Medicare taxes and state income taxes and property taxes and sales taxes and gas taxes. In fact, the lower your income level, the more of your total income goes to pay taxes like this. No rich person is paying anywhere near a percentage of their income for sales or gas taxes as those who are at the bottom of the income ladder.

John Q

Thu, Jan 13, 2011 : 11:29 a.m.

"Maybe it won't be Michigan, Maybe it will be Wisconsin or Indiana." Illinois's corporate income tax rate will be 7 percent. Wisconsin's corporate income tax rate is 7.9 percent. Indiana's corporate income tax rate is 8.5 percent.

xmo

Thu, Jan 13, 2011 : 11:22 a.m.

I like Democrat, Ann Arbor, Jeff Irwin's remark "Irwin said "balancing the budget on the backs of poor folks" is not something he's interested in." Jeff about 50% of the residents in the US do not pay INCOME TAX so, how can you balance a budget on the backs of people who do not pay taxes? My concern is they the budget will be balanced on the backs of the rich, Those who create jobs!

AvidReader

Thu, Jan 13, 2011 : 11:16 a.m.

It's about time! Since its inception, annarbor.com has been when it comes to covering what goes on state government. But, what happens in Lansing affects us all! An uninformed electorate is easy to ignore. May this article - on the front page no less - indicate an expansion of coverage that will include timely updates on the business of government and its impact on the Ann area.

Epengar

Thu, Jan 13, 2011 : 10:26 a.m.

"...work begins *now* on turning around Michigan's economy" (emphasis mine) Really? Are we to understand that nobody in Lansing before this year was working to turn around the economy. Regardless of what you think of their methods, it's silly to suggest that the previous administration or legislation wasn't trying to do the same thing.

braggslaw

Thu, Jan 13, 2011 : 10:08 a.m.

John Q, Maybe it won't be Michigan, Maybe it will be Wisconsin or Indiana. I just hope Michigan can take advantage of socialism in Illinois. From CNN" "But neighboring states are already trying to capitalize on the Illinois tax hike, hoping to lure businesses to their side of the border. Wisconsin's new governor, Scott Walker, is urging Illinois companies to "escape to Wisconsin," promising to enact tax relief, a job-friendly legal environment, fewer regulations and expanded tax credits. Meanwhile, Indiana Gov. Mitch Daniels, who has long tried to entice firms across state lines, is ramping up his message of the welcoming business climate in the Hoosier State. His latest tactic: Making fun of his neighbors for hiking taxes. "It's like living next door to 'The Simpsons', you know the dysfunctional family down the block?" he said on a radio show this week.

John Q

Thu, Jan 13, 2011 : 10:02 a.m.

Keep wishing folks. The Illinois corporate income tax will go to 7%. Synder has stated he wants a 6% corporate income tax rate for Michigan but there's no guarantee that he'll reach that goal. Personal income taxes in Illinois will go to 5%, slightly higher than Michigan's income tax rate. Are companies going to uproot their operations and their employees to save 1% or less in tax payments? Highly unlikely.

braggslaw

Thu, Jan 13, 2011 : 9:35 a.m.

I think Grand Rapids may benefit from the tax hikes in Illinois/Chicago. I imagine some smaller growing firms will look for greener pastures after that crazy tax hike in Illinois

Soothslayer

Thu, Jan 13, 2011 : 8:16 a.m.

Hopefully MI can woo those recently burned in Ill increase.

braggslaw

Thu, Jan 13, 2011 : 7:31 a.m.

Looks like the mbt will be gone, which is a great result for the working people of Michigan There will be more economic activity and more jobs.