Up, Down, or About the Same
July 1, 2013 - by
The Republican powers-that-be in Raleigh – the House, Senate and Governor – locked horns last week in a three-way tug-of-war, each offering their own road to economic salvation.
In a matter of hours the conflagration (over tax reform and whose loopholes to close or not close) spawned a welter of statistics and charts even Einstein couldn’t understand – and while economics is generally a less reliable science than voodoo, one chart seems to sum it all up. (If I’ve got it wrong, I expect I’ll be hearing from the aggrieved parties shortly.)
As a tribe, in a way, the Senators are very old-fashioned. They can be blunt. And tough. And they’ve been accused of being hard-headed. But they’re also a tribe of ‘purists’ with an old-fashioned creed – they believe in their bones the road to economic salvation starts with less government and lower taxes. And that’s what the ole bull mooses set out to do – cut taxes. And their plan does just that: It cuts taxes $170 million next year.
The House tribe is more modern. And diverse. And it’s mechanically minded. Like a tribe of modern day gnomes with abacuses, before taking a single step they measure, analyze, and calculate (the gain and loss and risk) of any bill that lands on their doorstep. For months they’ve been watching the Senators offend folks by closing tax loopholes or slashing programs like The Rural Center and, at the end of the day, when they were done weighing and calculating they decided the whole thing was too needlessly reckless for their taste – so they produced their own plan to raise taxes $45 million next year. (To give House tribe full credit, they also took one more step: They cut taxes further down the road, in future years. But of course it has to be said future tax cuts aren’t written in stone.)
And finally, there’s the Governor’s plan – his reforms allow taxes to increase by $345 million next year but, then, like the House, he too reduces taxes in future years.
Amid all this arguing and yowling, there seems to be one number – called “Consensus Revenue Growth” – all three tribes agree on. That magic number tells how much people would pay to Raleigh in taxes if the legislature simply left the current tax laws in place: It’s $20.46 billion.
So here’s the whole picture boiled down as simple as I know how:
|
|
Total Taxes Paid
Over the Next Year
|
|
Under Current Tax Law
|
$20.46 billion
|
|
Senate Plan
|
$20.3 billion
|
|
House Plan
|
$20.5 billion
|
|
Governor’s Plan
|
$20.8 billion
|
And, in a nutshell, that’s what the rhubarb comes down to: Should taxes go up, down, or stay about the same?
Up, Down, or About the Same
July 1, 2013/
The Republican powers-that-be in Raleigh – the House, Senate and Governor – locked horns last week in a three-way tug-of-war, each offering their own road to economic salvation.
In a matter of hours the conflagration (over tax reform and whose loopholes to close or not close) spawned a welter of statistics and charts even Einstein couldn’t understand – and while economics is generally a less reliable science than voodoo, one chart seems to sum it all up. (If I’ve got it wrong, I expect I’ll be hearing from the aggrieved parties shortly.)
As a tribe, in a way, the Senators are very old-fashioned. They can be blunt. And tough. And they’ve been accused of being hard-headed. But they’re also a tribe of ‘purists’ with an old-fashioned creed – they believe in their bones the road to economic salvation starts with less government and lower taxes. And that’s what the ole bull mooses set out to do – cut taxes. And their plan does just that: It cuts taxes $170 million next year.
The House tribe is more modern. And diverse. And it’s mechanically minded. Like a tribe of modern day gnomes with abacuses, before taking a single step they measure, analyze, and calculate (the gain and loss and risk) of any bill that lands on their doorstep. For months they’ve been watching the Senators offend folks by closing tax loopholes or slashing programs like The Rural Center and, at the end of the day, when they were done weighing and calculating they decided the whole thing was too needlessly reckless for their taste – so they produced their own plan to raise taxes $45 million next year. (To give House tribe full credit, they also took one more step: They cut taxes further down the road, in future years. But of course it has to be said future tax cuts aren’t written in stone.)
And finally, there’s the Governor’s plan – his reforms allow taxes to increase by $345 million next year but, then, like the House, he too reduces taxes in future years.
Amid all this arguing and yowling, there seems to be one number – called “Consensus Revenue Growth” – all three tribes agree on. That magic number tells how much people would pay to Raleigh in taxes if the legislature simply left the current tax laws in place: It’s $20.46 billion.
So here’s the whole picture boiled down as simple as I know how:
|
|
Total Taxes Paid
Over the Next Year
|
|
Under Current Tax Law
|
$20.46 billion
|
|
Senate Plan
|
$20.3 billion
|
|
House Plan
|
$20.5 billion
|
|
Governor’s Plan
|
$20.8 billion
|
And, in a nutshell, that’s what the rhubarb comes down to: Should taxes go up, down, or stay about the same?