” New York’s the pits — especially when it comes to economic development, according to a new study.
The Empire State ranked dead last when it comes to its economic outlook based on Albany’s tax policy.
The report, authored by economists Arthur Laffer, Jonathan Williams and Stephen Moore, gives New York state, along with New Jersey (45) and California (46), low marks because of excessive tax and spending policies that hurt businesses and individuals.
“We hate to keep picking on California, New Jersey and New York, but they continue to be models of how not to govern a state,” the report warned. “These three states,” the report continued, “impose tax rates at or near the highest in the nation and about twice the national average.”
New York placed 50th for its high personal and corporate tax rates, 12.62 percent and 15.99 percent, respectively.
Which states did the report say had the best economic climate? The top five were Utah, South Dakota, Virginia, Wyoming and Idaho.”
Tag Archive: Tax rate
” The US economy is creating new wealth and growing employment, albeit at a slow pace. But uncertainty is the key word that describes the economic situation at mid-2013.There are major unknowns with respect to Fed policy, taxing and spending, the effects of the Affordable Care Act on employment, the implementation of Dodd-Frank financial reform, regulatory policy affecting the production of electricity, and the prospects for Europe’s recovery from an extended recession. Add to this pallid picture reductions in growth in China,India, and the developing world taking some of the edge off the global boom, which, in spite of that growth haircut, is still tugging away on America’s export growth.
With the closing of the books on the 2012 economy, real GDP growth registered 2.2 percent. But the current picture suggests we will be lucky to break 2.0 percent in 2013 and a bit more in 2014. This compares with the results of the Federal Reserve Bank of Philadelphia’s Livingston Survey in December 2012, which predicted 2.1 percent growth in 2013’s first half and 2.3 percent in the second half of the year. It will be a while before Livingston speak again, but right now, Economy.com’s dynamic GDP growth meter indicates the economy is expanding at 1.8 percent.
As Goldilocks might put it, “It’s not just right.” Not by a long shot. We can see images of the slowdown in the Institute of Supply Management’s indexes for the manufacturing and non-manufacturing (service) economies shown below. Both indexes are headed south of the border. Recall that 50 is the magic number that coincides with zero growth.”
” Now the bad news. Consider the next chart. It shows in nominal terms the level of federal receipts and expenditures for 1Q 1990 through 4Q 2012. Even with progress being made, there is a yawning gap waiting to be closed.
If the gap is to be closed, there is no doubt but that it will take more revenue and less spending. But when it comes to getting revenue, there is a never ending political debate regarding tax-rate fairness and which taxpayer income group, if any, should pay the higher or lower tax rate. (After all, there could be a flat tax.)There is hardly any discussion of revenues, which seems odd, to say the least.
But of course, there is reason to be concerned about fairness. People understandably rebel when they perceive they are being treated unfairly by government. (Consider the current IRS controversy.) But if revenues are the chief concern, then how much revenue is collected may be an equally important consideration when politicians talk about taxes.
Writing in 1924, treasury secretary Andrew W. Mellon said this about the political manipulation of rates:
I have never viewed taxation as a means of rewarding one class of taxpayers or punishing another. If such a point of view ever controls our public policy, the traditions of freedom, justice and equality of opportunity,which are the distinguishing characteristics of our American civilization, will have disappeared and in their place we shall have class legislation with all its attendant evils. The man who seeks to perpetuate prejudice and class hatred is doing America an ill service.
But why pay attention to the thoughts expressed by Andrew Mellon? Does he have credentials that command attention? Yes, indeed. As Secretary of Treasury during the Harding, Coolidge, and Hoover administrations, Mellon led a successful effort to reduce the size and debt of the federal government. In the earlier part of his government service, the nation was adjusting to a post–World War I environment, with lots of debt overhang. Sound familiar? His arguments about the relative merits of lower tax rates to produce higher revenues won the day. And he saw higher revenues when rates were reduced. He literally discovered the basis of what we now celebrate as the Laffer Curve. In all fairness, we should call it the Mellon-Laffer Curve.”
Read the whole thing for it’s glimmers of hope and dread .
” For liberals, this was not a moment of danger to be minimized but by far their best opportunity in a generation for increasing tax rates (which is the only fiscal reform they seem to want) and for robbing Republicans of future leverage for spending and entitlement reforms. And it is likely the best one they will encounter for another generation. Many on the left have seemed convinced lately that the politics of taxes had changed dramatically in their favor, and that the opportunity presented by the cliff could result in the kind of surge in revenue that could put off the coming fiscal crunch for years (until, they seem to think, it will just magically go away at some point) and so could save our entitlement programs from the need for reform. . . . ”
- Speaker Boehner: 2013 Must Be About Cutting Spending and Reforming the Tax Code (speaker.gov)
- Republican U.S. senator: Cut Medicare … or we’ll shut down the government (dailykos.com)
- Fiscal Cliff: Where Are Your Spending Cuts, Mr. President? (heritage.org)
- Tax Increases Won’t Solve Washington’s Spending Problem (heritage.org)
- The President rejects bipartisanship (gregmankiw.blogspot.com)
- Fiscal Cliff Poll Finds Divided Opinion Over Agreement (huffingtonpost.com)
- Corker: Tax Hike on Wealthy Could Give GOP an Edge (blogs.wsj.com)
- Shelby: U.S. becoming Europe (politico.com)
” So the Left is hysterical over the prospect that households who earn between $250,000 and $450,000 annually will only have deductions disallowed, and not see their marginal rates increase. The $250,000 level is purely arbitrary, of course. If the government robbed taxpayers down to that level, MoveOn would move the goalposts to $150,000. Or $100,000. Or $75,000. If you work for a living, they are coming after you; that’s the bottom line. “
- Trouble from the left: MoveOn nixes Obama fiscal cliff deal (blogs.suntimes.com)
- The Working Poor Pay High Taxes, Too – Bloomberg (bloomberg.com)
- If U.S. hikes taxes, high-income Californians might pay almost 52 percent (hotair.com)
- Wednesday Open Thread (jackandjillpolitics.com)
” (CNSNews.com) – Conservative members of the House of Representatives dealt a stunning defeat to the House Republican leadership on Thursday night, forcing Speaker John Boehner (R.-Ohio) to cancel a vote on his “Plan B” tax-increase proposal.
Earlier in the evening, the Republican House leadership had been confident they could make the members of their caucus vote for the tax increase. But they miscalculated.
“Plan B” would have violated the pledge almost all House Republicans have made to the American people to oppose any and all efforts to increase the marginal income tax rates. It would have done so by increasing the tax rate on income over $1 million after Jan. 1.
“The House did not take up the tax measure today because it did not have sufficient support from our members to pass,” Boehner said in a statement released late Thursday.
“Now it is up to the president to work with Senator Reid on legislation to avert the fiscal cliff,” Boehner said. ”
- Republicans reject Boehner’s fiscal cliff Plan B, House breaks for Christmas (dontmesswithtaxes.typepad.com)
- Obama, Boehner Move Closer on Taxes (fox8.com)
- John Boehner Offers Millionaire Tax Hike (alan.com)
- Boehner Tax Stance Shows Reluctance to Give In Too Soon (bloomberg.com)
- Boehner says Obama’s ‘cliff’ concessions aren’t enough (dailykos.com)
” Until then, we have to suffer through a mind-numbing series of non-sequiturs in which the decline in marginal tax rates over the last 50 years is responsible for … well everything that has gone wrong in the real or perceived world, including the supposed failure of the electric grid during Hurricane Sandy, A Failed Experiment:
In upper-middle-class suburbs on the East Coast, the newest must-have isn’t a $7,500 Sub-Zero refrigerator. It’s a standby generator that automatically flips on backup power to an entire house when the electrical grid goes out.
In part, that’s a legacy of Hurricane Sandy. Such a system can cost well over $10,000, but many families are fed up with losing power again and again…. “
- NICK KRISTOF WRITES A LOT ABOUT FOREIGN COUNTRIES. But given this dogs-breakfast of a column about A… (pjmedia.com)
- Tax cuts for wealthy? It’s a failed experiment (wnd.com)
- RESPONDING TO MARGINAL TAX RATES: Reader Alex Clay writes: After the election, my wife and I are… (pjmedia.com)
- Hurricane Sandy (jadulski.wordpress.com)
- Some Homeowners Unexpectedly Hit With ‘Windstorm Deductible’ (insurancejournal.com)
To The Over The Fiscal Cliff
” Lawmakers kicked off negotiations over the so-called fiscal cliff at the White House on Friday with both sides expressing optimism that a deal could be reached before the end of the year.
Republicans in Congress say they understand their political leverage is diminished after the election and are largely resigned to a compromise that would force wealthy families and small businesses to pay more in taxes.
However, GOP leaders have insisted that any new revenue come from closing tax loopholes and other special interest deductions for the wealthy as opposed to raising tax rates which they said would undermine economic growth. “
- Fiscal cliff negotiations begin – Washington Post (washingtonpost.com)
- Obama, GOP’s Ayotte: On fiscal cliff, find common ground (cbsnews.com)
- Elections have consequences, redux (economist.com)
- Fiscal Cliff Deal? Don’t Hold Your Breath (swampland.time.com)
- McCaskill pushes tax increase for wealthy to avoid ‘fiscal cliff’ (kansascity.com)
- President, Congress meet to avert “fiscal cliff” (cbsnews.com)
” One of the most dangerous myths that has infected the current debate over the direction of tax policy is the oft repeated claim that the tax increases under President Bill Clinton led to the boom of the 1990s. In their Wall Street Journal Op-Ed last Friday, for example, Clinton campaign manager James Carville and Democratic pollster and Clinton advisor Stanley Greenberg write the increase in the top tax rate to 39.6% “produced the one period of shared prosperity in this past era (since 1980).”
While this myth is now a central part of liberal Democratic folklore, it is contradicted by the political disaster and poor economic results that followed the tax increase. The real lesson of the Clinton Presidency is the way back to prosperity lies not through increased taxes on “the rich,” but through tax and regulatory reform and a return to a rules based monetary policy that produces a strong and stable dollar.
The 1993 Clinton tax increase raised the top two income tax rates to 36% and 39.6%, with the top rate hitting joint returns with incomes above $250,000 ($400,000 in 2012 dollars). In addition, it removed the cap on the 2.9% Medicare payroll tax, raised the corporate tax rate to 35% from 34%, increased the taxable portion of Social Security benefits, and imposed a 4.3 cent per gallon increase in transportation fuel taxes.
If these tax increases were good for the middle class, then they should have been popular. Yet, in the 1994 elections, the Democratic Party suffered historic losses. “
- James Carville Says 80% Of Democrats Are Politically Clueless | THE JEENYUS CORNER (jeenyuscorner.com)
- Obama Would Push Taxes on Top Earners Above Clinton Level – Bloomberg (bloomberg.com)
- Fiscal Cliff Tax Rate Hikes Will “Greatly Impact Small Businesses” (speaker.gov)
- Republicans Seek Fiscal Cliff Delay With Debt Card: Taxes – Bloomberg (bloomberg.com)