Tea Party Reality Check: Government Costs the Same Today as in 1980

By admin / On / In Local 88

April 15 is, of course, “Tax Day” across America — the deadline day for turning in federal and state tax returns — and for several years now ultra-conservative groups have used the day as their bully pulpit for complaining about how overtaxed everyone is. This year the whole “Tea Party movement” has only added to the cacophony.

Even as corporate taxes have dropped dramatically, taxes overall have remained flat.

But according to a study from a major independent Oregon research group, it turns out that Oregon’s public sector is not growing disproportionately at all.  In fact, despite the rhetoric you might hear from the Tea Party and others, the Oregon Center for Public Policy (OCPP) reports that Oregon revenue and spending have remained stable when measured as a share of Oregonians’ income for the past 30 years.

In other words, the often-maligned “public sector” has cost exactly the same over three decades, when measured including the logical additions of population growth and inflation.

Corporate Taxes Have Dropped Dramatically

“The public sector is no more expensive today than it was back in 1980,” said OCPP Executive Director Chuck Sheketoff. “It costs Oregonians roughly the same share of their total income as it did 30 years ago.”

That share is 15 percent of Oregonians’ pocketbooks, according to the OCPP’s analysis of U.S. Census Bureau data from 1980 through 2007, the most recent available. With some fluctuations, in each of those years roughly 15 of every 100 dollars of Oregonians’ combined income went to state and local governments in the form of “own-source general revenue.”

Own-source general revenue encompasses all state and local taxes (including income and property taxes), fees and charges (such as college tuition and sewer fees) and certain “miscellaneous” revenue such as lottery receipts, according to the report. It does not include funds received from the federal government or “non-general revenue” such as the investment returns generated by the Public Employee Retirement System (PERS) trust fund.

The level of spending by state and local governments, in turn, hovered around 15 percent of Oregonians’ income from 1980 to 2007, the report found. Sheketoff says the fact that Oregon taxes and spending have remained stable for three decades is something that so-called Tea Party members are unlikely to acknowledge.

“If Tea Party political rhetoric matched reality, T-E-A would stand for ‘Taxes and Expenditures are Affordable,’ ” Sheketoff said. “The relative cost of the public sector has not changed.”

What has changed is who pays for public services, according to the OCPP. Their report shows that over time corporations have shifted their responsibilities onto Oregon families.

Specifically, the report said that in 1980 corporate income taxpayers contributed 4.6 percent of total own-source general revenue in Oregon. By 2007, their share had declined to just 2.2 percent. Conversely, in 1980, personal income taxes — paid by Oregon households — constituted 22.6 percent of Oregon’s own-source general revenue. By 2007, that share had grown to 26.5 percent.

“The shift in taxes away from corporations and onto families is something worth protesting, in the spirit of the Boston Tea Party of 1773,” said Sheketoff. “When you take the time to check the facts you learn that Sam Adams and the other American patriots revolted against a tax break granted to a multinational corporation that supplied tea to the American colonies.”

Sheketoff also stressed that the Tea Party protestors ignore the public sector’s “vital role” in enhancing Oregonians’ quality of life and fostering economic opportunity for families and businesses.

“April 15 — Tax Day — is a day to celebrate how Oregonians pool their resources to advance the common good, as reflected in our schools, courthouses and other public structures,” said Sheketoff. He noted that tax dollars created, and continue to maintain, the public spaces at the Oregon State Capitol that hosted the April 15 Tea Party protest.

“It’s unfortunate,” Sheketoff concluded, “that the protestors ignore the reality that revenue and spending have remained stable and they refuse to celebrate the common good our taxes support.”

[Click Here for Full OCPP Report]

Leave a Reply

Your email address will not be published. Required fields are marked *