Michigan’s income gap is widening. Time for Democrats to soak the rich?

income gap

The income gap is growing in Michigan: The number of millionaires spiked nearly 60 percent from 2013 to 2017, while the state had the nation’s 15th highest rate of income inequality as of 2015. (Shutterstock image)

LANSING — Progressives like Bernie Sanders and Elizabeth Warren want a new tax on “extreme wealth.” Moderates like Joe Biden and Mike Bloomberg want to raise taxes on top earners and corporations. 

Democrats running for president offer sharp contrasts in their vision for the country and the party, but they have at least one thing in common: They all want to tax the rich to pay for ambitious plans to expand health care access, fight climate change, increase college affordability and more.

In a period of sustained economic growth, Democrats competing in Michigan’s March 10 primary are appealing to voters with broadsides against income and wealth inequality, arguing the rich have disproportionately benefited from tax cuts under Republican President Donald Trump.

The message may resonate because the income gap is growing in Michigan: The number of millionaires spiked nearly 60 percent from 2013 to 2017, while the state had the nation’s 15th highest rate of income inequality as of 2015, according to the labor-aligned Economic Policy Institute.

“Billionaires and even millionaires are an easy target, because the vast majority of people in the United States -- certainly here in Michigan -- are not in that income bracket,” said Dave Dulio, a political science professor at Oakland University. 

The push for higher taxes on the rich appears to tap into the same populist energy that fueled Trump’s winning campaign four years ago, said Adrian Hemond, a Democratic strategist with Grassroots Midwest in Lansing. 

Bernie Sanders

Bernie Sanders, the Vermont senator who won Michigan’s 2016 primary, last month released a tax plan that would fund some — but not all — of the $50 trillion to $60 trillion in new spending he proposes over the next decade.  He's floated the possibility of a new 4 percent income-based premium that would be paid by workers.

“We are at a very populist moment in American politics right now,” he said. “Both Democrats and Republicans in the U.S. feel like the economy is rigged against them.”

Trump, who is up for re-election, won Michigan by 10,704 votes in 2016 after courting working-class voters with proposals to curb illegal immigration and renegotiate international trade policies he claimed were stacked against them.  

“He made the case to a lot of white, working-class voters that, ‘You’re getting screwed.’” Hemond said. “There’s an audience for that on both sides of the aisle.” 

Experts are skeptical that taxing the rich alone will generate enough money to fund the kind of expensive plans proposed by Sanders and Warren, while Republicans contend the schemes amount to a dangerous form of wealth redistribution.

Michigan income gap is up

Income inequality is “a big fact — and a bigger fact than it used to be,” said Charles Ballard, an economics professor at Michigan State University. He noted research linking it to a number of societal ills, including poor physical health, discontent and even government distrust. 

“The top has pulled away from the middle, but the middle has not pulled away from the bottom,” said Ballard, who has analyzed income growth between 1976-78 and 2011-13 for an academic journal. 

“The hollowing out of the middle class is more severe in Michigan.” 

Michigan Treasury data back up his assertions.

In 2017, the most recent year available, the top 1 percent of Michigan filers — a combination of individuals and couples — reported average adjusted gross income of more than $2.3 million. The other 99 percent of filers averaged about $53,000.

 

That year, more than 17,700 state filers reported more than $1 million in taxable income, a collective $95.9 billion. Less than 0.4 percent of all state taxpayers, they accounted for 26 percent of all income. 

The number of millionaires is up 59 percent from 2013, when there were 11,106 filers. They made $54.4 billion total, 19 percent of all income.

Historic state data show that household incomes were essentially stagnant for the bottom four-fifths of Michigan residents from 1989 to 2018. 

But incomes rose by 22.7 percent for the top fifth and 38.2 percent for the top 5 percent of households over that span. 

In 2015, the top 1 percent of Michigan households made an average of $917,701, while the other 99 percent made an average of $42,825, according to the Economic Policy Institute.

“We basically have an economy that is by traditional measures hitting on all cylinders,” said Lou Glazer, president and co-founder of the Michigan Future nonprofit. “And yet the fundamental problem with the economy right now is it’s not producing enough good-paying jobs.”

While Michigan has continued to add jobs since the Great Recession, not enough of them have had high enough wages to bend the income inequality curve, he said. 

Inequality is harder to assess because wealth is a measure of all assets owned by an individual or family, including stocks, real estate and vehicles. That’s one reason experts predict the kind of wealth taxes proposed by Warren and Sanders would be difficult to administer.

Elizabeth Warren

Elizabeth Warren proposes a 2 percent “ultramillionaire” wealth tax on anyone with at least $50 million in assets and an additional 4 percent “billionaire surtax” on household net worth above $1 billion.  

Michigan is home to at least 10 billionaires, according to a 2019 report by Forbes Magazine. The list included Grand Rapids grocers Hank and Doug Meijer, Detroit businessman Dan Gilbert and Ronda Stryker of Portage, director of the Stryker Corp. medical equipment supplier. 

“Wealth is much, much, much more unequally distributed than income,” Ballard said. “The bottom half have no wealth. For upper-middle class people, most of their wealth is equity in their home. And then the wealthy, what they have is stocks and bonds.”

Add it up

Trump cut tax rates for corporations and for individuals, but “most of the benefit went to high-income people because high-income people pay most of the taxes,” said James Hines, an economist and research director at the University of Michigan’s Office of Tax Policy Research.

Rather than slash spending enough to match reduced revenue, the federal government has taken on additional debt. The annual deficit is expected to top $1 trillion this year, according to the Congressional Budget Office. The national debt is projected to climb from $17.9 trillion at the end of 2020 to $31.4 trillion at the end of 2030.

The wealthy can and perhaps should pay higher taxes to help fund government services, Hines said, but Democratic proposals are generally “incomplete” because they are unlikely to generate enough money to fully pay for proposed spending initiatives. 

“It’s just not realistic to think you’re going to get it all from the rich,” Hines said. “There’s only a certain amount of revenue potential there.”

Sanders, the Vermont senator who won Michigan’s 2016 primary, last month released a tax plan that would fund some — but not all — of the $50 trillion to $60 trillion in new spending he proposes over the next decade.  

The self-avowed democratic socialist has admitted middle-class families would pay more taxes under his Medicare for All program. But he insists they’d ultimately save money because they’d no longer have to pay health insurance premiums. 

Sanders has floated the possibility of a new 4 percent income-based premium that would be paid by workers. The plan would exempt the first $29,000 in income for a family of four.  

In Michigan, about 55 percent of total filers — nearly 2.7 million  — reported reported earnings of $30,001 or more in 2017. 

Like most of his peers, Sanders has spent far more time discussing ways to tax the rich.

Democratic hopefuls combined to reference billionaires 16 times in their recent Nevada debate and 11 times during the South Carolina debate. They mentioned the middle class six times across both debates. 

Tax the wealth

Warren proposes a 2 percent “ultramillionaire” wealth tax on anyone with at least $50 million in assets and an additional 4 percent “billionaire surtax” on household net worth above $1 billion.  

Sanders’ proposed wealth tax would apply to anyone with a net worth of $32 million or more.  His campaign claims it could generate $4.35 trillion over the next decade and halve the collective wealth of U.S. billionaires over that span.

Experts have questioned the revenue assumptions of both plans, and some have even questioned their constitutionality.

Former Treasury Secretary Lawrence Summers and University of Pennsylvania Law School finance professor Natasha Sarin project Warren’s proposal would generate, at the most, $75 billion per year, less than half the $187 billion predicted by economists who developed it. 

Wealth taxes are not a great way to raise revenue because they “cause people to spend or give away their wealth,” said Hines, the University of Michigan economist.

The United States has had a kind of wealth tax since the 18th century: the estate tax, a tax on inherited wealth that is paid just once a lifetime. Trump and the Republican-led Legislature temporarily cut that tax in 2017 by doubling allowable exemptions through 2025.

Accountants and attorneys have devised complicated strategies to help wealthy clients avoid the estate tax. The rich are “not going to just shrivel up and go away if there’s an annual wealth tax,” Ballard predicted. “This is going to be really good for the Cayman Islands.” 

Warren is proposing a unique way to discourage residents from fleeing the country to avoid the wealth tax: a 40 percent “exit tax” on net worth above $50 million for those who renounce their U.S. citizenship. She also wants additional spending on IRS enforcement and additional audits for wealth tax payers. 

“People don’t have to renounce their citizenship to hide their money,” Ballard said. “There are Americans now, U.S. citizens, who have their money in Swiss bank accounts.”

Some European countries have abandoned wealth taxes after they produced less money — and more administrative headaches — than expected. Experts say it can be difficult to assess wealth, especially for those who own businesses that aren’t publicly traded. 

Sanders and Warren both argue their proposals would break up wealth and generate new revenue to fund government programs, but “if you break up the wealth, you don’t get the revenue,” Hines said. 

“They’re talking about both, and that’s why presidential campaigns are kind of silly.”

Bloomberg

Mike Bloomberg, himself a billionaire, proposes an additional 5 percent surtax on annual income of more than $5 million, which would create a new top income tax rate of 44.6 percent that his campaign says would apply to less than 0.1 percent of filers.

Tax the earnings

Biden and other top Democrats want to reverse Trump’s income tax cut for the wealthy by increasing the rate from 37 percent to 39.6 percent for the top bracket, which last year included single filers who earned at least $510,310 and joint filers who made at $612,351. 

That could impact many of the roughly 44,700 Michigan filers who reported at least $500,000 in income during tax year 2017. 

Bloomberg, himself a billionaire, proposes an additional 5 percent surtax on annual incomes of more than $5 million, which would create a new top income tax rate of 44.6 percent that his campaign says would apply to less than 0.1 percent of filers.

Several candidates also want higher earners to pay the same tax rate on capital gains investment earnings as they do on other forms of income. 

That’s sound policy, according to Hines, who has advocated for higher capital gains taxes on the wealthy in his own academic research. 

“It’s a good idea to collect taxes from people with the greatest ability to pay, and you’re not doing that if you’ve got very high-income people with a lot of capital gains,” he said.

Biden’s plan would increase the capital gains tax rate from 20 percent to 39.6 percent for million dollar earners, which could have impacted more than 17,000 Michigan filers in 2017. He also wants to scrap a “step-up basis” provision shielding inherited capital gains from taxation. 

The former vice president is among the Democrats proposing to raise corporate income tax rates that were slashed under Trump. And he’s proposed a minimum corporate tax of 15 percent to ensure firms like Amazon cannot use deductions and credits to avoid any tax.

Sanders proposes an “income inequality tax” on large corporations who pay their chief operating officers 50 times more than their average workers. That could impact Michigan firms including General Motors, Ford, DTE Energy, Consumers Energy, Whirlpool and Stryker. 

Promising to tax the rich could be a winning primary strategy, but the volume of tax-and-spend proposals could hurt the eventual Democratic nominee, said Dulio, the Oakland University professor, noting the estimated price tags for Sanders’ plans. 

“For some folks the math isn’t going to add up, and I think Republicans will message on that,” he said. “They’ll say this may sound great, but there’s no way you can tax this small a number of people and get that kind of money. So where else is it going to come from?”

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Comments

Matt
Wed, 03/04/2020 - 8:34am

When Bernie was railing on Bloomberg about the money he made, the question occurs, would we be better off if he didn't make it? If as Bernie wishes we had a 100% income tax over a million dollars to prevent Michael Bloombergs or whomever from existing would our nation be better off? Does he even care about this?

Bones
Wed, 03/04/2020 - 10:54am

Bloomberg got rich fleecing Wall Street cokeheads with a fancy computer that costs $25k a month to help them screw the American working class before using his wealth to buy the mayorship of NYC and turn it into a police state for POC. So yeah, on the whole, we'd be infinitely better if Bloomberg had never existed

Matt
Wed, 03/04/2020 - 1:29pm

So because you don't approve of how someone, in your narrative, used a Bloomberg machine in a way you don't approve of you think we'd be better off if Mike didn't achieve success. So, who wouldn't this apply to? Henry Ford? has to! Bill Gates? Thomas Edison, on and on. Look at all the misuses of computers and electricity, Gone! Do you think we'd all be better off living a medieval lifestyle where none of these evils ever came out, (as you use your computer)? Interesting Bones.

duane
Wed, 03/04/2020 - 10:35pm

Bones,
Do you ever think about how the 'wealthy' accumulate their wealth? Do you ever consider how little the richest in the world start with little or no money and acquired their riches? Do you ever think about what they are doing with their money, or why they don't give it to the government to spend? Do you ever consider how many others have prospered by supporting/investing with them?
Do you ever think beyond the idea of money, do ever consider impact, achievement, quality of life? Do you ever try learning form others?

I wonder if you have ever considered where innovation comes from and why/how it happens, if you have ever wonder why/how jobs are created and sustained, if you have ever looked around and wondered how the quality [ever longevity] has been so drastically improved in such an ever shortening time, wondered how the safety and health in the workplace has so improved in America.
The list of things [relative to people striving to acquire wealth] that I wonder if you have ever considered when you complain about the accumulation of wealth grows longer and longer.
The reality is that our marketplace economy has harnessed the nature of acquisition in disciplined way that provides the most benefit to the whole of society. If you wonder a bit why America is the most exceptional country on the planet, starting with nothing and raising the quality of life for the whole of society, you would see all others have a caste system [royalty, government position, agency position] that facilitate the luxuries of life without raising the quality of life for those whose money they spend.
It is sad that you distill life/society/economy to money and all the other elements of each are ignored. What Michigan could benefit from would the creation of a culture that encourages/facilitates/reveres those that acquire wealth, those that put that wealth to work in their community, that help others to acquire wealth.

Al Churchill
Fri, 03/06/2020 - 2:52am

Ending with an appeal for the creation of "a culture that...reveres" the wealthy, specious is the kindest word to describe Duanes response to one who had a contrary opinion. We have had that culture and it led to the inequities of the Gilded Age. Let me digress

"The rich will strive to establish their dominion and enslave the rest. They always did...they always will. They have the same effect here as elsewhere, if we do not, by the power of government, keep them in their proper sphere."

Those are the words of Gouverneur Morris, the most prolific speaker at the Constitutional Convention in 1787. Morris was a member of the committee that wrote the final draft of the present constitution. He, alone, wrote the Preamble and significant other parts of our primary legal document. In writing those words, Morris refuted, not only the existence of an inherited aristocracy, but a moneyed aristocracy that is present in America today. The well to do need no outside assistance, as Duane suggests. They are doing quite well all by themselves.

Kevin Phillips, once the chief campaign strategist for Richard Nixon, was one of the first to assert, based upon Fed data, that the richest 1% were in possession of 40% of total wealth in the country. If there is no credible economic theory that can justify that reality, it is exacerbated by many of the 1% having inherited their wealth.

Those folks have, absent imagination or labor, have not contributed one, single product or service, to our society. On the contrary, they have fought, tooth and nail, tax policy adverse to the accumulation of additional economic advantage. For example, it is not by coincidence that an estate or inheritance tax, glaringly missing from Michigan tax law and disemboweled at the national level has been a target of the political right and their backers .

Kudos to those, from small beginnings, who have been successful in our capitalist economy. Ideally, that is the system at its legitimate best.

Others have supplied the data indicating how the tax system has been rigged to the disadvantage of ordinary Americans, while wingers point to the federal income tax as evidence of the wealthy paying a disproportionate share of taxes overall. On the contrary, the Institute on Taxation and Economic Policy indicates that, within 5%, we are all paying the same proportion of our income in taxes when all taxes, federal, state and local are considered.

I doubt that the rich have ever been "soaked". What is at issue is the ability of the well to do to pay their way without their quality of life being negatively affected, as it is with the less fortunate among us when they are taxed at the same proportion as an economic elite.

Duane asks of a dissident opinion, "Do you ever try learning from others?" He might try that himself, starting with a reading of A Wealth of Nations, published in 1776, the same year that the Declaration was written. A primer on what was, then, an emerging capitalism, the author, Adam Smith, declared "self interest" to be the motivating factor in economic affairs, not the social consciousness of economic elites deified by duane, who, by rigging the tax system in their favor, are acting in their own narrow "self interest".

That's going to continue until Gouverneur Morris' understanding of governmental purpose becomes a reality.

Matt
Fri, 03/06/2020 - 8:16am

Al I believe you disregard the fact that the richest 1% is a fluid population. What's the likelihood that the children of the 1% are in the 1% themselves? My general reading is that it is low and lower still for the next generations strictly by function of division and that children of extreme wealth rarely have the mind set that made these fortunes possible let alone maintain them.

Al Churchill
Fri, 03/06/2020 - 11:27am

Whether or not the top 1% economically are always the same people or not is meaningless. Whoever they are, they, historically, have followed self interest to rig the system in their favor.

There is no need to look beyond Michigan, where, at Constitutional Convention and with subsequent legislation, the politicians that they finance have put in place a tax system whereby the lesser among us pay a higher percentage of their income in taxes than the very well to do. Or one might revisit a former chair of the Republican party attempting to garner a $20 million grant of public Michigan money in order to embellish a private development project that would financially enrich him personally. One might remember, also, how irregular was the legislative process that passed judgement on those grants and made it almost impossible to determine the sponsors of said legislation. We might also comment on gerrymandering, an attempt to dilute the political power of ordinary citizens, thereby increasing the ability of the wealthy to generate legislation favorable to them alone.

On a personal level, I remember Laura Cox, the current chair of the Republican party, who pulled herself up by her husbands bootstraps, stating at a candidates debate that, essentially, she was in favor of gerrymandering. If I remember correctly, she said, relative to gerrymandering, something to the effect that it was working pretty well so far.

Gouverneur Morris was and is right. The rich have always had their class warfare cannon pointed at the general populace.

That can only happen when the purpose of government is twisted to their advantage as it is in America today.

duane
Sat, 03/07/2020 - 1:40am

AI,
I am struggling to figure out who’s comments you are responding to.
My comment was about today’s reality/marketplace and your remarks seem to be about the realities 100 to 200 years ago. In the 18th century wealth was accumulated by the government [royalty] and handed down to family, while today the overwhelming majority of those who you are so jealous of crossed over the ‘gap’ by their own efforts and creativity.
You seem to only see money as the distinguishing concern in society, you ignore quality of life, choices in life, impact of the individual no matter where they are starting from. You miss how capitalism, the structural capacity to accumulate ‘wealth’, delivers innovation and makes it accessible to all.
What is most disappointing you fail to appreciate the nature of today’s world economy and what is necessary for people to do to become an advantage to an employer and directly influence the results they strive for.
The recent Democrat primary process highlighted the flaw in your concern for the influence of money, over a half billion dollars spent in only a matter of months couldn’t make one of those on the far side of the ‘gap’ be competitive in trying for the Party nomination to run for President.
In Michigan time and again we see people cross over the ‘gap’ by staying in school, studying, and acquiring knowledge and skills, and yet you would rather have a culture that disparages such efforts by targeting their earnings/successes. In my community the ‘heroes’ in high school are the athletes, not the valedictorians, not those that go off to college and achieve academic success.
I wonder if you are purposely obtuse when reading others remarks. You feel I need to you back a couple of hundred years to find someone to learn from, while I’m suggesting that we learn from those who have succeeded by crossing that ‘gap’ you distain so we can share with others how they can take that same path to financial success.
If you doubt the ‘wealthy’ have been ‘soaked’ I guess your plan is for a 91% income tax rate as there was in the 1950s.
You again either obtuse or trying project on others what you hope them to be, I have only one God and it is not someone because of their money. My belief that what the 'wealthy' have achieved is possible for the vast majority of us, and the means/methods they use we can use to achieve the level of wealth we want and are willing to work/sacrifice to achieve.

Robert Honeyman
Wed, 03/04/2020 - 8:41am

"Soaking the rich?" The wealthy benefit disproportionately from the commons (infrastructure, government services, education, etc.). They should expect to pay higher taxes for their maintain and improve those commons. After all, without them, the American dream would not be possible. The wealthy once did, up until Reaganomics took complete control of the American economy and tax regimen. Returning to tax levels that appropriately assess cost sharing based on wealth and income is necessary to achieve sustainable budgeting and to mitigate some of the income and wealth disparity plaguing the nation and the state. Just drive down any road to experience the impact of foolish tax minimization, the effects be damned.

Lennie
Thu, 03/05/2020 - 8:47am

Stupid pander for stupid people. Those that work harder, smarter, have more assets, all that and make more money already pay more taxes. Anybody that says or believes that isn't the fact is just an idiot. Let's face it, Errol Flynn was a great Robin Hood. Trying to elect another one is just a waste of time. Instead of falling for this lunacy, those in public office need to be held accountable for their spending.

Susan D.
Wed, 03/04/2020 - 9:18am

Raising the wealthiest's taxes would certainly be helpful but to bring back the middle class wages, particularly minimum wage, need to increase...a lot! That way people can help themselves rather than depending on the whims of government.

duane
Thu, 03/05/2020 - 12:30am

Susan,
Have you consider that our economy has changed from one that leverage strength and stamina to one that leverages knowledge and skills and judgement?
Employers pay for the value employees provide each workday. In my youth, Michigan was a manufacturing state, employers invested in machines that needed people to operate those machines and since those machines produced more than a single person could without the machines that paid more for those who operated the machines. The technology of what is produce and how much is produced and how it is produced has changed what/how employees can provide value so the employers can succeed in the marketplace.
It the past employers only needed to show-up and employers could quickly bring them to a productive level of performance. Today, the employees need to bring a higher level of knowledge and skills to be productive for an employer. The other and more value contribution an employee can offer to an employer is their judgement. Employers will pay a higher wage for those that bring the wider breath of knowledge and skills and especially more for good judgement.
To grow our middle class, Michigan needs to do three things; Michigan needs to elevate the value/status of knowledge and skills in our state, needs to integrate decision making into school courses as early as middle school, and Michigan needs to focus government agencies in supporting the middle class and those providing middle class jobs [infrastructure].

Cliff Yankovich
Wed, 03/04/2020 - 9:34am

What a poor choice of a title for the article. "Soak the rich" - really? Didn't read the piece yet, hard to get over the piss poor first impression.

Terry
Tue, 03/10/2020 - 7:00pm

Cliff, you're right about the poor choice of the title "Soak the rich". Democrats don't discriminate. They soak everybody. Rich and poor.

Linda MacDonald
Wed, 03/04/2020 - 9:47am

Friends at Bridge. The headline you chose to publish is really an insult and does more to sow division than to figure out what to do to address not only income inequality in the state and the nation, but the huge gap the state budget has been facing for years and years, especially with so many advantages with regard to taxes going to the folks at the top of the income ladder. The last time I looked the people at the top benefit quite handily from a flat income tax but lower income people are constantly being nickeled and dimed by low wages and fewer benefits or protections. Maybe your headline should read: How the rich are soaking low income and poor Michiganders. That would at least lead to another angle of vision. I will not share this article with anyone because the headline is so off base.
Linda MacDonald (dissatisfied)

Arjay
Wed, 03/04/2020 - 9:59am

The article would be more comprehensible if some actual figures were used rather than percentages. It is also very easy to move a residence to a more tax friendly state, and most rich people already have a second or third residence located elsewhere. The only decision to be made is which is a lesser tax, the loss of the MI homestead exemption and increase by 18 mils of property tax, or the elimination of the MI income tax by moving to a more friendly state.

David Waymire
Wed, 03/04/2020 - 11:48am

More of this canard. The fact are pretty simple: States with graduated income taxes have higher incomes and higher shares of college grads in them (because folks want decent services) than states without. And states with graduated income taxes have a higher share of millionaires in them than states without...it's not even close. The top states for millionaires (as a share of the population) are New Jersey, District of Columbia, Connecticutt, Maryland, Massachusetts and Hawaii. All have more than 8 in 100 persons who are millionaires. At the bottom: Mississippi, West Va., Ark, Kentucky, Idaho...poor states, with few millionaires (fewer than 5 per 100). Wealthy folks like to live where schools are decent, streets are kept up, parks and museums work, etc. In the Midwest, Indiana (low tax) has the fewest millionaires per 100 residents. Low tax Michigan is second fewest. High tax Illinois and Minnesota are tops in the Midwest in share of millionaires. Texas ranks 19th...middle of the pack. High tax California: 8th. Data is your friend. These rankings have not changed substantially in at least a decade.

Matt
Wed, 03/04/2020 - 2:39pm

Speaking of data why do theses all these high tax state face an exodus of mid plus income residents vs low tax states? Millionaires has little to do with this since it's driven by other factors. Since I know the Connecticut’s story well, they were a very rich state way before they had any income tax at all! People moved from NY to CT to escape taxes and high costs. Since they have enjoyed a couple decades of Lefty high tax governance and the place has become a dumpster fire. Same in NJ and NY. Why is Gov Cuomo having fits about his wealthier residents leaving (while the poor remain)? This is the modern case everywhere - the poor don't often move out of state! Same with CA, been losing upper middle and plus income residents for a couple decades and few mid income people moving in there, they can't afford it! While they lead the nation in homelessness. And again, you refuse to consider wages and wealth vs. cost of living in these places in your story along with misconstruing high and low tax states, which wrecks much of your picture.

Kevin Grand
Wed, 03/04/2020 - 5:37pm

I'm lost here?

What's preventing people who claim that they aren't "paying enough", from turning around and just writing out a check to their favorite local government and simply send them more money without all of the hoopla?

This is a question that apparently no one want to ask of TPTB.

duane
Thu, 03/05/2020 - 1:16am

Kevin,
People give their money where they have more confidence in getting value for the spending. Which candidate do you trust, which do you believe can best deliver claimed results, which do you feel is most accountable for programs and spending, which do believe is committed to solving problems, which is most willing to listen to innovative approaches?

My money goes where I know the operations and know the people and can see a willingness to innovate/change. Charities are more accountable for spending and practices than government agencies, people's money flows to where accountability is best.

Anonymous
Wed, 03/04/2020 - 10:48am

Oh I'm sorry, I missed Mr. Biden's plan. Sort of like his platform. What are you people doing????

David Waymire
Wed, 03/04/2020 - 11:28am

This focuses on national policy...we need to look at state policy, too...This is from the Michigan League for Public Policy. Right now, our state and local taxes soak the poor...an overall flat tax that had the rich paying what the poor pay would be an improvement: "In Michigan, taxpayers in the bottom 20%—those having less than $17,600 in annual income—pay an effective state and local tax rate of 10.4% while the top 1%—those making more than $422,100 a year—pay only 6.2% of their income in state and local taxes. The middle 20% of Michigan’s taxpayers—literally the middle class—pay 9.2% of their income in state and local taxes. What’s more, taxpayers in the top 1% and the next 4% (combined top 5%) pay lower effective rates (6.2% and 7.5% respectively) than the effective rate for all Michigan taxpayers (8.4%)."

Ben W. Washburn
Wed, 03/04/2020 - 6:33pm

David: Thanks for bringing some serious focus to this article. I don't doubt your facts. I've seen them before and they come from reputable sources. Rather than a headline of "How Democrats want to soak the rich", the headline should have been "How the Democrats Want the Rich to Just Pay Their Fair Share!

Matt
Thu, 03/05/2020 - 7:41am

When you throw federal income taxes, benefits and credits in on top of state taxes this picture turns on its head. You only present only one smallish part of the picture.

Barry Visel
Wed, 03/04/2020 - 3:53pm

“So where else is it going to come from?” I suggest two places.
First, end all tax credits, deductions and incentives. This is a big chunk of tax avoidance schemes, and would make the tax code much more fair.
Second, at the Federal level, stop spending money on anything not authorized by Article 1, Section 8 of our Constitution...and that’s a lot of spending!

Ren Farley
Wed, 03/04/2020 - 3:55pm

Thank you very much for the essay about income inequality. Since 2006, the Census Bureau has annually published the Gini Index of Income Inequality for all states. In both years, the District of Columbia had the most unequal distribution of income and Utah the
most equal. Here are the numbers from the Census Bureau:

2006 2018
District of Columbia 54 52
Michigan 44 47
Utah 41 43

Total USA 46 48

Income inequality in Michigan increased from 2006 to 2018

Mark
Wed, 03/04/2020 - 4:57pm

Good informative article and the OU professor was fair in his remarks. I have trouble with the Labeling of the Dept of Treasury Chart. It says "Michigan's top 1 percent has watched its portion of the state's total income grow at the expense of the least wealthy. " Who can make that judgement?! It is a wrong Assumption and it is dangerous to assume. My wealth hasn't come from the least wealthy, it comes from decades of investment and spending wisely.

Matt
Thu, 03/05/2020 - 7:59am

They, most all of the above, view economy as a zero sum proposition. If you make a buck you took it from someone else. Individual choices and preferences of what you do with your resources be damned. You took it from the less fortunate.

jesse atwell
Thu, 03/05/2020 - 8:34am

The truth is that our gov't representatives always have something else they want to spend more money on. The problem isn't how much more can the gov't get in taxing. The problem is gov't spending is out of control. Why is it that every pet project politicians can dream up to enhance their electability by offering us something for free always ends with the statement let's tax somebody else? Somebody else must always pay for it because they're greedy and we're not. The word "fair" should be banned from use by all politicians because it always relates to somebody else, not them or us. Confiscating somebody else's money doesn't stop stupid politicians or bureaucrats from spending other people's money to get re-elected which is the real problem. Use of the word "fair" is nothing more than a trap for us unwitting mice.

Lennie
Fri, 03/06/2020 - 9:20am

When politicians constantly makes "promises" to "get" somebody else, what's to stop them to eventually getting to me or you? Income equality does not and never will serve any purpose but to benefit those that want to "enforce" that policy. I realize the mentality that failure is a blame but the truth is it more often is about lack of effort than it is a sinister plot. Sorry but that's capitalism and unless you've got something better solution than voting in a pandering liar, don't bother.