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In a brief State of the State speech before flying to California to campaign for president, Republican Gov. Scott Walker said he was particularly proud that property taxes on a typical Wisconsin home were now $141 lower than they were four years ago, when he took office.
Like most of Walker’s tax claims, his boast needs quite a bit of qualification. But at least it’s closer to the truth than the shameless whopper Walker told about a month ago.
In a TV interview in December, Walker claimed he’d saved homeowners $816 over four years from “where things were headed.”
That last phrase was the tricky part, of course. Walker was claiming if someone other than him had been elected governor in 2010—which didn’t happen—some nonexistent, fictional, alternate-universe governor would have allowed Wisconsin property taxes to go up by the specific, imaginary amount of $816 over four years.
It can be difficult to see through Walker’s twisted rhetoric on taxes. The more modest $141 is a real figure over four years. But it’s based on a median-priced home of about $160,000. People in urban areas and small towns, where houses are valued at much less, got much smaller reductions.
Needless to say, people with homes valued in the millions got reductions in the thousands.
Walker has successfully built a political career on tax-cut politics that many voters believe benefits them when, in reality, the middle class and the poor pay a higher tax rate in Wisconsin than the wealthiest 1%.
That’s a real fact everyone should know. It’s documented in a new national study just released by the Institute on Taxation and Economic Policy (ITEP), a nonpartisan, nonprofit research organization.
In fact, ITEP’s report on state and local taxes by income levels in all 50 states completely blows out of the water the dishonest right-wing economic rhetoric of today’s Republican Party.
You’ve heard it. Congressman Paul Ryan, Walker’s political brother from another mother, spread it across this land when he was campaigning for vice president with Mitt Romney, the perfect Gilded Age Republican presidential candidate.
We’re a society of makers and takers. The makers don’t necessarily make anything real, but they do make lots of money. The takers are anyone who gets anything from the government.
And the evil plot of foreign-born socialists like President Barack Obama is redistribution of wealth by taking money away from the makers who make it and giving it to the takers who don’t.
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Rich Pay Less
Well, guess what? When ITEP examined the tax policies of Wisconsin and every other state, it turns out just the opposite is true.
Every state takes a higher percentage of income in local and state taxes from middle class and poor taxpayers and redistributes it to the wealthy in lower taxes. (The report excludes taxpayers over 65 because of wild variations among the states in how Social Security and other retirement incomes are treated.)
Here are the numbers for Wisconsin when family income is divided in fifths:
The lowest 20% in income in Wisconsin pay 8.9% of their family income in state and local taxes. The second lowest 20% pay 10%. The mid 20% pay 10.2%. So does the fourth 20%. That’s 80% of taxpayers.
Now look what happens to the top 20% in family income. The lowest 15% of that wealthy group pay 9.2% in state and local taxes. The next 4% pay 7.8%. And the top 1% pays only 6.2% in state and local taxes.
There’s a simple explanation for the gross—in every sense of the word—disparity. Most state revenue everywhere is raised through sales and excise taxes hidden in the price of every purchase.
Middle class and poor taxpayers spend most of what they make from paycheck to paycheck, paying taxes on almost every expenditure. The wealthy don’t.
As wealth at the top in this country continues to break records, the wealthy can’t possibly spend it all. They invest it to make even more money on their money, which is taxed at a lower rate.
At least Wisconsin still has a progressive state income tax from its fairer, more democratic past. Some other states have no income tax at all or a flat rate instead of different income rates based on ability to pay.
That’s why Walker has advocated either eliminating the state income tax or reducing it to a flat rate. He backed off elimination a bit when it turned out that replacing the lost revenue would require a sales tax twice the highest rate in the country.
Who says numbers are boring? The numbers on Wisconsin redistributing wealth from the middle class and the poor to the super rich are explosive.
If voters really understood those numbers, they wouldn’t just recall Walker as governor. They’d run him out of Wisconsin. And not to Iowa or New Hampshire to run for president, either.
