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Fallin Debris: Simple Tax Cut Approach Masks Reality
Submitted by dochoc on Mon, 03/25/2013 - 09:02
The political calculation behind Gov. Mary Fallin’s proposal to lower the state’s top income tax rate from 5.25 to 5 percent seems simple enough.
The cut is relatively small so its impact on the state budget—a loss of revenue of around $100 million a year—is minimal on one level, and thus it hasn’t produced much pushback from state agency heads and educational leaders. It also doesn’t “pay” for itself through eliminating deductions or credits so no specific groups are protesting the cut based on their special tax statuses.
It’s a small, generic proposal that will allow Republicans to say they have, indeed, used their supermajority to cut taxes and are on a path, albeit slowly, to eliminate the state income tax altogether. Those who oppose the cut, such as myself, can cringe and think, well, it could have been worse.
But two issues muddy this simple assessment: (1) The cut doesn’t really do anything significant with the tax code, except reward the state’s wealthiest citizens with a tax cut. Why, for example, pass such a small cut without a serious overhaul or at least discussion by the governor of unneeded tax credits? Why do anything at all? The millionaires in this state aren’t openly clamoring for a tax cut. (2) The loss of $100 million in revenue a year comes after a period of state budget cuts that have left our educational institutions and agencies like the Department of Corrections woefully underfunded. It will still simply hurt.
The Oklahoma Policy Institute, using calculations from the Institute on Taxation and Economic policy, has shown that 43 percent of Oklahoma households wouldn’t even receive a tax cut under the plan. Meanwhile, the state’s top income earners would receive 25 percent of the overall cut. The overall average is just a $39 cut a year.
Only the top 1 percent of income earners, who would receive an average cut of $1,870, would get much of a break. Tellingly, state budget cuts or stagnation that could affect the other 99 percent of Oklahomans could wipe out any small tax cut. Higher college tuition, for example, would easily wipe out, say, a $4 annual tax cut for students making less than $18,200.
Note the 1 percent and 99 percent dichotomy, which has been used by protesters in recent years to complain about income inequality. Fallin’s tax proposal definitely favors the top 1 percent.
Fallin and members of her party make the argument that tax cuts spur economic development and that Oklahoma has to compete with neighboring states with no income tax or lower income tax rates. But that argument has never been proven empirically, according to the Center on Budget and Policy Priorities, which points out, “interstate differences in tax levels, including differences in personal income taxes, have little if any effect on relative rates of state economic growth.” The state GOP argument is a sweeping generalization that masks the true intent to widen income inequality between the state’s wealthiest citizens and everyone else.
Fallin outlined her proposal in her State of the State speech, and it has been carried forward in House Bill 2032 by House Speaker T.W. Shannon, a Lawton Republican, and Senate President Pro Tempore Brian Bingman, a Sapulpa Republican. The Oklahoma House has passed the bill, and it’s now under consideration in the Senate. Fallin’s plan appears to be gaining momentum, according to media reports.
Another tax cut plan, Senate Bill 585, advanced by Senate Republicans, would cut the top income tax rate to 4.75 percent, but its implementation would be delayed until 2015. It also tinkers with tax credits and deductions that its supporters claim make it revenue neutral, which is disputed by OK Policy.
It’s still possible that the supporters of the two plans, and supporters of even other tax plans or taxation philosophies, could argue themselves into another tax-cut stalemate, which happened last year. I hope that comes true.
The bottom line for both plans, however, is that Republicans want to lower taxes primarily for rich people and pay for it by limiting government spending. Widening income inequality is not sustainable as a GOP political policy as we’ve seen on the national level. State budget cuts, including cuts in education, have already reduced the overall quality of life here. What major corporations, besides oil and gas companies, will want to move here if our schools’ classrooms are horrifically overcrowded, our roads marred with potholes, our historic poverty glaringly apparent with even a cursory glance?
The major symbol of the GOP’s governance since its sweeping, historic victories in recent years remains the crumbling and erosion of the dilapidated state Capitol building, which Republicans refuse to repair. The loss of revenues caused by the tax cut plans offered up this legislative session would sink the state even further into its self-imposed exile from rationality. Watch out for the falling debris.
Hate’s Hangover: Will Obama Hysteria Fuel State Decline?
Submitted by dochoc on Fri, 03/22/2013 - 07:28
I want to spend my last post of this week focusing once again on GOP extremism here in Oklahoma and how it continues to prevent rational discussion of issues important to both Republicans and Democrats.
I know it’s the third post in a row on this topic, and it might be a stale issue for some progressives here, but I can’t stress enough how discouraged I’ve become with the current political Oklahoma scene. It’s telling that even The Oklahoman editorial board, the ultra-conservative machine that keeps going and going, has come out against state GOP overreach here and here.
I fear that conservatives here will do much damage to the state before there’s a power shift, and, yes, eventually there will be a power shift, but those of us living here during this era will suffer a price, whether through lack of educational opportunities, shoddy infrastructure, poor medical access or neglect of many other practical, quality-of-life issues.
At the root of the conservative rage in Oklahoma seems to be the fictional, hate-filled mythology of President Barack Obama, the nation’s first African American president. It’s generated constantly by the right-wing media, which includes Fox News, Rush Limbaugh and even The Oklahoman to some extent.
Obama does represent a changing country, one that’s slowly—far too slowly for me—becoming more diverse and open-minded. I recognize how change can be difficult. I get it. On the other hand, Obama has reached out to conservatives over and over again, and he has frustrated liberals and his party over and over again for his tendency to compromise. I’m in this group of liberals so Republican extremism here, such as the Obamacare nullification effort or the gun-obsession paranoia or the Agenda 21 nonsense, seems completely divorced from reality to me.
I wrote about the ”Obama effect” on Oklahoma back in October, 2009 in which I outlined how extreme conservative personal animosity against the president would dictate the state’s future political development, making it even more conservative and extreme. I was exactly right, which is not such a great achievement because it was so utterly predictable. The obsessed fixation on one person, elected by clear majorities for two terms, has distorted the political debate here and isolated the state from national trends as Republicans have grown their local legislative and executive power.
Is it racist? I’ve always contended that racism has played a part in the Obama hysteria here and elsewhere, but I’ve always conceded that many Republicans are genuinely fighting for a certain “vision” or, really, a primordial political urge to take the country back to a romanticized past that, in reality, I think they probably wouldn’t much like if it could even happen. I’ve also conceded many state Republicans, who are otherwise lifestyle liberal, simply like the winner-takes-all mentality of the market or, in broader terms, capitalism. They don’t spend too much time on the broader, global ramifications. What I can’t accept, however, is the proselytizing of right-wing religious folks in the legislature, who are dishonest about their intentions and hide behind disingenuous bills, such as the Religious Viewpoints Antidiscrimation Act or the anti-evolution bills proposed year after year.
But let’s return to Obama. It would be difficult to find a leading Republican politician more representative of misplaced Obama anger than Oklahoma’s U.S. Sen. Jim Inhofe, who is 78 and plans to run for reelection in 2014. Inhofe relentlessly criticizes the president with sweeping generalizations. According to The Hill, Inhofe told conservative radio host Laura Ingraham what he thought about Obama’s recent outreach to Republicans for compromise:
This is the same guy [Obama] that is ... over-regulating all of our businesses, he has a war on fossil fuels, he is keeping us from being energy independent, he is defunding the military.”
So he's destroying this country, but yes he's charming.
Destroying the country? From one of our state’s United States Senators to the Oklahoma Legislature, it’s Obama-hate all the time, and it’s going to cost us. After all, Obama is only in the first year of his second term. Where does all this anger lead? How will it affect our quality of life as Oklahoma GOP legislators use the hate to easily pass legislation that ignores cultural reality and the state’s future?
Some national Republicans, as I’ve noted, want to rebrand and become more culturally progressive, but the Oklahoma GOP has doubled down on its Obama hate binge.
I urge leading state conservatives, including Gov. Mary Fallin, to separate their voter mandate, which I accept, from the craziness. Repair the state Capitol building, fund education, fix the roads, try to deal with the state’s mediocre medical outcomes, among just a few of many practical issues. By all means, push income tax reduction and worker’s compensation agendas, which I will no doubt oppose, but, please, think about what Oklahoma will be like in five, 10 or even 20 years when all this extremism will be but a blip in time.
Obama won’t be president then, and the hangover of hate could be brutal for us all, Republicans and Democrats alike.
Old GOP “Stunned” By Cultural Change
Submitted by dochoc on Wed, 03/20/2013 - 07:32I’ve been focusing lately on the extremist, ideological legislation offered up by some state Republicans in Oklahoma this year.
It’s a cornucopia of crazy that overflows with paranoia and cultural divisiveness, but, meanwhile, the national GOP leadership seems to have recognized there’s a problem with Republican extremism and wants to rebrand, especially given the party’s dismal showing in the 2012 presidential election.
Basing a political platform on the demonization of one man—President Barack Obama—and ignoring obvious demographic and cultural change has an electoral price. Yes, ultra-conservative legislatures, like the one here in Oklahoma, have a mandate developed through fear mongering, but passing senseless, ideological bills on the state level only further isolates the GOP from any chance for national success.
State Rep. Sally Kern, infamous for her mean-spirited, conservative views attacking gay people, can win lopsided votes for her bills in Oklahoma, but, and this is an understatement, she doesn’t play well to a national audience.
The GOP can pass all the crazy bills it wants in places like Oklahoma or Kansas or Texas, but the feds are still going to be making the call on many important issues, especially in poorer, fed-dependent southern states. Democrats are going to control that in the conceivable future.
Reince Priebus, the chairman of the Republican National Committee, supposedly recognizes the Democratic triumph on the national level. The RNC just recently issued a report about conservative rebranding that includes the need for the GOP to support immigration reform. The growing Hispanic voter population is growing, and it is clearly rejecting Republican xenophobia.
It’s also clear that younger voters are far more accepting of gay rights than older voters, especially in the GOP, and that Republicans are losing voters because of the party’s bigoted, official positions on same-sex marriage. The RNC report notes this conundrum. Are the Republicans serious about changing?
But let’s return to Oklahoma politics. No one symbolizes the so-called “old” GOP more than U.S. Sen. Jim Inhofe on many issues, and one of them is gay rights. Inhofe once claimed proudly on the Senate floor, for example, that there was never a “homosexual relationship in the recorded history of our family.”
Inhofe made the national news recently over his non-comments about Ohio’s U.S. Sen. Ron Portman, a conservative Republican who recently said he now supports same-sex marriage. Portman’s son is gay.
When Inhofe, 78, and running for reelection in 2014, heard the news, according to a radio show host, he seemed to have a “stunned look on his face” and said he was “surprised.”
Determining a “look” of a face, of course, can be ambiguous and arbitrary, but given the state GOP craziness, Republican national rebranding and the changing cultural paradigms, such as the growing acceptance of gay rights and the growing ranks of minority voters, the visual symbolism is just too difficult for me to pass up.
There’s the stunned face of Inhofe, and there’s the world marching on without him and the old GOP.







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