A Rising Tide Swamps All Ships: Michigan Kills The Earned Income Tax Credit

Trickle down economics is a scam, plain and sample. Like so many pet projects pushed by the ultra-right and its shadowy denizens -- the American Legislative Exchange Council (ALEC), the Mackinac Center for Public Policy, and other Orwellian-sounding entities like them -- the premise never adds up. Over and over, we're told that if the upper classes were left to stash away as much as they wish, that money will float back down to those on the bottom...which is where you hear those same tired slogans, over and over. A rising tide lifts all boats. Not a hand out, but a hand up. And so on, and so forth.  Wash, rinse, repeat.

For the most part, the jobs never materialize, and those that do are typically of the low-wage, no-benefit, no-future variety. The tax breaks handed out left and right to businesses wind up as great going-away presents -- either when the management takes the enterprise offshore, or simply goes belly up, leaving the taxpayers stuck with the what-do-we-with-that-big-empty-white-elephant-now tab. And so on, and so forth. Wash, rinse, repeat.

Then again, it's not really about results, it's about shoving an ideology down everybody else's throat -- common sense be damned, objective review be damned, public opinion be damned. What else explains the Republican drive in Michigan to kill off the Earned Income Tax Credit (EITC) -- and justify it as part of a road funding package?  That's what happened earlier this month, when the Republican-led Senate put the icing -- or, should I say, the mayonnaise -- on top of the cake. And so on, and so forth. Wash, rinse, repeat.

The Senate version also includes a 15-cent increase in the gas tax, another regressive tax that those with modest means don't get to vote on -- and, in a commuter state where driving extended distances to work is the norm, will hit their pockets hard, too. Not to worry, though, because the Senate version includes a state income tax -- although only if the percentage increase from the previous fiscal year's general fund revenues exceeds a positive inflation rate. This "shift and shaft" approach is the hallmark of the Snyder era: "Businesses pay less, you pay more." And so on, and so forth. Wash, rinse repeat.

As the Detroit Free Press noted in its editorial (see below), one interesting aspect of the drive against the EITC is that its prime movers -- such as State Representative Jeff Farrington, for instance, of Macomb County, where 17.9 percent of its children still live in poverty. You can ead the nitty-gritty details for yourself below -- instead of me rehashing them here -- but, as the Free Press rightly suggests, whatever logic motivates these votes, "it's not concern for the constituents whose interests they're meant to represent. It's the noxious partisan principle that poverty is deserved, and that the impoverished require neither a hand up nor much compassion."  And so on, and so forth. Wash, rinse, repeat.

And, like most bills that Governor Rick Synder's zealous cohorts pass left and right, it's fair to say the average person isn't paying attention right now. The sticker shock will land next year with a hollow thud on the kitchen table, when folks realize that -- all of a sudden -- they'll owe  the state more than they're used to paying. In fairness, I'll note that Michigan's version of the EITC was much smaller than Uncle Sam's -- but, for people who are struggling, every little bit helps...until, of course, someone yanks the rug from under your feet. And so on, and so forth. Wash, rinse, repeat.

Don't think they'll return any money that you might accidentally leave on their table, either. At one time, The Squawker and I owed two years of state taxes, plus three years of federal -- until we were able to sign up for a voluntary tax preparer's help through the United Way, and learned (to our chagrin) that we could get a renter's credit to make Michigan's IOUs go away. It'll be interesting to see what happens next year, but you can bet on one other thing...with 40 percent of Michigan's residents still living in poverty, or stuck in jobs that don't cover basic needs, you won't hear a peep about this subject from the Republican zealots...or ALEC...or the Mackinac Center...or any of their shadowy ilk.

Like Erich Honecker in his twilight years, they'll shake their fists and chant, "Stay the course! Stay the course!" Only, instead of Honecker's fuzzy-minded brand of "consumer socialism" --one that required massive loans from the West to prop up his so-called German Democratic Republic -- we'll get served something far more insidious: socialism for Big Business. But, if you feel like calling them out, it might be fun to ask, "Where are the results?" Then wait for the sounds of crickets.  And so on, and so forth. Wash, rinse, repeat. --The Reckoner

Links To Go (Hurry, Before Your Tax Tab Skyrockets):
Detroit Free Press
Mich. Senate Road Plan May Be Worse Than You Think:
http://www.freep.com/story/opinion/editorials/2015/07/01/michigan-roads-plan/29543977/


MLive.com:
Michigan Can Improve The Economy
By Cutting Taxes For 95% For The People:
http://www.mlive.com/lansing-news/index.ssf/2015/05/graduated_income_tax_michigan.html