WMC Continues to Deceive With Partisan Nonsense

While the Greater Madison Area Chamber of Commerce  took the time to analyze the Bride of TABOR, the Wisconsin Manufacturers and Commerce  (WMC) plunges forward, spreading dubious data.

They falsely portray Wisconsin's tax status, over and over again.

Relying on: Wisonsin's State and Local Tax Burden, 1970-2006(sic) from a bogus outfit that calls itself the Tax Foundation, the WMC asserts Wisconsin Tax Burden Nearly 10% Above National Average :

Taxpayer Protection Amendment Needed for Relief

Wisconsin’s state and local tax burden is nearly 10 percent above the national average, which is further evidence Wisconsin needs the Taxpayer Protection Amendment, WMC said Wednesday...

...The non-partisan Tax Foundation in Washington, D.C. today reported that Wisconsin’s state and local tax burden is 11.6 percent, while the national average is 10.6 percent. That means Wisconsin’s tax burden is 9.4 percent above the national average.

Wisconsin’s state and local tax burden ranking is 7^th highest in the U.S., the Tax Foundation reports. Other states’ tax climate worsened in 2006, pushing Wisconsin down from 5^th to 7^th.

The Tax Foundation claims to be another one of those 'non-partisan foundations.'  About as non-partisan as Dick Cheney shooting tame quail, with Democrats used instead of dogs to bring back the dead and dying "game."

The foundation boasts praise from five Americans, Present John Kennedy, ultra Conservative economist Milton Friedman, someone claiming to be President George W. Bush, James M. Buchanan, another reactionary economist, Dick Armey, reactionary Republican Majority Leader in the House of Representatives, and Bush's Treasury Secretary John Snow.

Not a word of praise there from a liberal in at least 43 years, when President Kennedy was assassinated.

For a real indictment of the Tax Foundation, see the Center on Budget and Policy Priorities commentary, Tax Foundation Figures Produce Misleading and Inaccurate Impressions of Middle Class Tax Burdens, which documented in this 1998 report:

The Tax Foundation's methodology substantially exaggerates the amount of taxes that typical or average middle class families pay. Under the methods the Tax Foundation uses, an increase in taxes solely on high-income taxpayers is pictured as increasing the taxes the average taxpayer pays. This methodology can produce particularly sharp distortions when taxes are raised primarily on affluent taxpayers, as they were under the 1990 and 1993 deficit reduction laws, and when, as at present, large increases in the stock market cause wealthy investors to reap huge capital gains profits and pay more capital gains taxes on them.

In 2001, our own Wisconsin Council on Children and Families found:

Jon Peacock, Director of the Wisconsin Budget Project -- which is part of the Wisconsin Council on Children and Families -- noted that another problem with the Tax Foundation’s computations is that they do not give credit to states for money that is returned to taxpayers, such as Wisconsin’s $700 million sales tax rebate.

All of these flaws in the calculation of state tax burdens distort the figures in the same direction – they all make taxes look higher than they really are. Most importantly, according to Peacock “the Tax Foundation’s report is designed to lead the public to believe that the average American’s taxes have been steadily increasing; yet both the Congressional Budget Office and the Joint Committee on taxation agree that taxes on middle-income families have been declining in recent years.”

Enough. We now know the Tax Foundation and the accuracy of the drivel they feed to us via the WMC.

As for WMC, they claim that Wisconsin's tax burden is the 7th worst in the nation.

Wistax publishes an interesting document, The Tax-Rank Game, and notes that Wisconsin (for the year they did the study, could be ranked anywhere from 3rd to 22nd depending upon how census bureau data is used.

As I noted in a previous post, Deconstructing Paulson: "It Bombed in Colorado; Let's Try It In Wisconsin":

Time for the myth busters with a good dose of reality:

• Wisconsin relies more on taxes because it tries to avoid regressive user fees. When taxes and fees are combined Wisconsin is just about in the middle.
• Of the 50 states Wisconsin is 15th in terms of revenue per capita and 19th in terms of expenditures per capita. U.S. Census Bureau 
• "According to UW-Madison economist Andrew Reschovsky, who actually completed a formal analysis of the Wisconsin situation, our state ranks 23rd in the nation in terms of revenue collections in relation to personal income." (from In Effect)

WMC takes flawed data from a highly partisan foundation, repackages it in a highly partisan manner, and we are left with nonsense. My guess is that members of its Board of Directors would never allow such sloppy and shoddy work in their own businesses.

Comments

[Epilogue]

Should the WMC have cited numbers from the pillar of non-partisanship, The Center for Budget and Policy Priorities?

[Paul]

Yes they should. The Center for Budget and Policy Priorities has a progressive political view but they do not spew nonsense. Their analysis is honest and thoughtful. You can use their information in operating your business; the Tax Foundation foolishness would bankrupt you before you could say 'WMC.'

[Chuck Fitzgerald]

So why WMC is pushing TABOR and its many variations so hard, because they know that sooner or later the property taxpayers of Wisconsin are going to realize why their property taxes are growing so rapidly. In 1970 the homeowner paid 50% of the cost of operating out local services, in 2005 the homeowner paid 70% of these costs. WMC members in 1970 paid 20% of our local services, in 2005 5%.

Our local services are being cut, schools are being decimated and WMC members are laughing all the way to the out of state bank.

[Andrew]

The Tax Foundation is in fact nonpartisan -- each year they give out a "Distinguished Service Award" which in the last few years has honored as many Democrats as Republicans, including Max Baucus (D-Mont.), former IRS Commissioner Charles Rosotti, and Ben Cardin (D-Maryland): http://www.taxfoundation.org/events/show/98.html. They're economists, not political hacks.

Also, see the Tax Foundation's rebuttal of the CBPP here: http://www.taxfoundation.org/publications/show/1406.html. Note that CBPP recieved a $1 million grant from the Ford Foundation specifically to attachk the Tax Foundation. Is that what you'd call an objective source?

[Paul]

Andrew: The Tax Foundation is very partisan. I am well aware of their strategy of awarding Blue Dog Democrats; I don't care that they are a right wing driven, bash government, drown it in the bath tub political organizaton. What I do mind is their dishonesty. Dishonest political hacks; and some of the biggest ideological liars are economists.

As for the Ford Foundation, of course they are not neutral when it comes to shills like the Tax Foundation, but the work is honest.