Scott Walker’s benefits trickling down unevenly
In a recent TV ad, Scott Walker claims that the average Wisconsin family has received a big windfall as a result of his reforms.
Cue the all-you-can-eat disinformation buffet:
Walker: Hi, I’m Scott Walker. Thanks to our reforms, the average family will have an extra $322 to spend. What are you going to do with your savings?
Suburban mother: We’re going to buy more clothes and school supplies.
Suburban Zen master in stylish specs: 96 gallons of gas.
Suburban grandmother: We’re taking a trip to see the grandkids.
Actor who may or may not be the neighbor from Home Improvement (laconically, in a manner befitting a world-weary suburban dude): Getting new tires for my truck.
Another mother, arguably more suburban-y than the first: That’s over 2,700 diapers
Walker: My opponent criticizes the Wisconsin comeback. She wants to undo our reforms and keep your money in Madison. I want you to keep it.
No doubt the ad is inspired, as they say in the movies, by real events — and the fact that they appear to have simply bused the actors from an IKEA ad shoot to Whitefish Bay for the afternoon to save money on production costs shouldn’t poison you against its core message.
Unfortunately, the suburban guy who said, “That’s a giant glass boot full of tepid, mass-produced domestic lager; a pathetically desperate, bloated Hooters tip; and the digitally remastered DVD box set of Seinfeld!” hit the cutting room floor on final edits, but we get the point: The “average” Wisconsinite comes out smelling like a rose thanks to Scott K. Walker. And when we say “average” we mean middle class — give or take — and lightly pigmented. Nudge-nudge, wink-wink.
But there’s a bunch of stuff missing here. First of all, the word “average” hides all manner of sins.
Unless you’re Charles Koch and you’re reading this because you just Googled your own name + “Scott K. Walker” + “Whitefish Bay” + “Hooters” to see if there are any incriminating photos posted on Reddit from your recent visit to Wisconsin, your and Bill Gates’ average net worth hovers somewhere around $38 billion.
The average IQ of Texas is about 100, until Rick Perry puts on his glasses, and then it’s like 180 or something.
The average number of miles you and Thong Cape Scooter Man ride through Madison on a scooter each week while wearing nothing but a thong and a red-and-blue superhero cape is not known at this time, but it’s a fair guess that a large majority of those miles are logged by TCSM.
So when one says the “average” family has received a certain benefit, it behooves one to drill down a bit more and see what those numbers really mean.
Well, the folks at the Wisconsin Budget Project did that earlier this year, in a June 3 report titled “Missing Out: Recent Tax Cuts Deliver Little to People Who Earn the Least.” In the report, the WBP noted that the vast majority of the three large tax cuts passed in 2013 and 2014 went to high-income earners (the people who didn’t really need them), while very little cash went to the bottom 20% of earners — folks averaging $14,000 per year in income. The difference was not negligible. According to the WBP’s figures, the lowest 20% got an average of $48 back, the second 20% got $109, the middle 20% got $197, and the fourth 20% (those making an average of $76,000) got $323. Meanwhile, the very top earners really benefited. The top 1% (those averaging $1.12 million in annual income) got back $2,518, the next 4% (averaging $233,000) got $887, and the next 15% (averaging $119,000) got $504.
So there’s that.
But, you say, a tax cut is still a tax cut. Everyone got money back, right? Why should those low-income earners gripe about the 21,000 diapers the top 1% of earners can now buy as a result of the 2013-14 tax cuts when those same cuts allow the poorest Wisconsinites to buy a still-very-respectable 400 diapers? It’s just this sort of diaper envy that’s destroying our country.
Well, here’s the interesting part. Shortly after Scott Walker and the Republican Legislature took over the reins of government, they cut the Earned Income Tax Credit, which goes to Wisconsin’s working poor — you know, those people selling diapers, gas, and school supplies to all those comfy middle-class folks in Sheboygan, Wauwatosa, and Kohler.
In an April 2012 report, the WBP noted that the cut in the EITC would take a serious bite out of the disposable incomes of those who are living closest to the edge:
The cuts to the EITC mean a single mother with three children who works full-time at the minimum wage will see her tax credit reduced by $518 for tax year 2011, from $2,473 to $1,955. That is the equivalent of a week-and-a-half of her pay. For a family with two children, the credit will be reduced by up to $154, from $716 to $562, the equivalent of more than 20 hours of work at minimum wage.
More recently, in its “Missing Out” report, the WBP noted that cuts to both the EITC and the Homestead Credit resulted in “low-income individuals and families paying $170 million more in taxes over the last four years.”
So there’s that as well.
Meanwhile, the Act 10 reforms led to cuts in teachers’ and other public workers’ compensation. (You may have heard about this.) Talk to some teachers and see where their diaper budget stands in Scott Walker’s Wisconsin.
And you thought all that extra money was “staying in Madison,” lining the pockets of lifelong government bureaucrats and lazy, Hacky Sack-playing hippies.
There’s nothing magical about what Scott Walker did. As we now know, he didn’t eliminate the structural deficit. The Legislative Fiscal Bureau has estimated it at $1.8 billion for the 2015-17 biennium, and it could easily grow. It could even end up surpassing the $3.6 billion Walker led us to believe was a once-in-a-lifetime crisis back in 2011. (And don’t forget, it’s a lot easier to pile up a sizable debt when you’re at the tail end of a dismal recession than when you’re riding the coattails of a national recovery.)
Meanwhile, many folks have forgotten (or failed to notice) Walker’s tendency to borrow us out of trouble.
Wisconsin is on a comeback of sorts, but it’s been dragged kicking and screaming toward better days, no thanks to Gov. Walker. It would be remarkable if we were actually worse off than four years ago, considering the improved health of the national economy. Unfortunately, we’ve tended to lag behind other U.S. states economically, and Walker’s trickle-down tactics have hardly helped. Nor has the brain-dead decision to reject federal Medicaid dollars (i.e., our own tax dollars) under Obamacare.
So what should you do with your $322 (average) refund? You could buy those diapers, of course. Or you could give it to a food pantry, mail it to a public school teacher, or use it to help plug the impending budget hole.
Or maybe you could just help Scott Walker and the Republican Legislature buy a clue.
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