State shutdown -- thousands of Minnesotans will lose their jobs (law, rich)

[southernsmoke]

Originally Posted by Glenfield

Here's an article from last March in which a former economic forecaster for California talks about how that state's dependence on income tax for it's richest 1% led to some of its economic woes. Because the incomes of high wage earners are more volatile, the decrease in a state's revenues is falls disproportionately in times of economic downturn. This suggests that while "taxing the rich" is politically popular, a better course for the state's financial health would be to seek a steady stream of revenues such as sales and use taxes, and a flatter, less graduated income tax.The Price of Taxing the Rich - WSJ.com

Very interesting. That is a good point about the volatility. I also think it is worth pointing out that if there is any way to discourage fiscal discipline (and, for instance, put us in the situation we now find ourselves in), it is to allow people to vote for more spending without incurring any cost to themselves. Hence, I think we should have a flat tax for two primary reasons: (1) because of its fundamental fairness, and, at least as importantly, (2) so that everyone has some skin in the game (and feels the consequences of supporting more government spending, even if just a little bit). It is way to easy for 99% of the people to say, "Yeah, we should spend money on that--and the millionaires can pay for it!"

Originally Posted by rcsteiner

My own thought (not knowing the details of what happened beyond the sound bytes found in the StarTrib and various other news venues online) is that it takes two people to create an impasse.

Not sure who I blame in terms of being right or wrong on the issues, but I do blame both sides for being willing to put the general population through a real shutdown ... especially during such an economically stressful time.

May both sides experience the backlash they deserve...

It does take two to create an impasse on the contested line items, but it only takes one governor to veto the spending that both sides actually agree on and the legislature tries to authorize (which, in this case, is most of it)... and, of course, one Strib to help him get away with it from a PR perspective.

[ozzie679]

Originally Posted by Glenfield

Here's an article from last March in which a former economic forecaster for California talks about how that state's dependence on income tax for it's richest 1% led to some of its economic woes. Because the incomes of high wage earners are more volatile, the decrease in a state's revenues is falls disproportionately in times of economic downturn. This suggests that while "taxing the rich" is politically popular, a better course for the state's financial health would be to seek a steady stream of revenues such as sales and use taxes, and a flatter, less graduated income tax.The Price of Taxing the Rich - WSJ.com

The article used Illinois as one of their examples and they have a flat 5% income tax rate.

[Glenfield]

Originally Posted by ozzie679

The article used Illinois as one of their examples and they have a flat 5% income tax rate.

Yes, that's correct. The the article speaks of an over reliance on income taxes versus other sources of revenue as being a bad way to go. A graduated tax structure, like they have in CA and NY and we have here, just makes it worse.

[xandrex]

Originally Posted by southernsmoke

It does take two to create an impasse on the contested line items, but it only takes one governor to veto the spending that both sides actually agree on and the legislature tries to authorize (which, in this case, is most of it)... and, of course, one Strib to help him get away with it from a PR perspective.

Eh, they're all playing politics here. The "lights on" provision was another political play to keep anybody from feeling the shutdown to prevent a political backlash from the public.

It seems eventually Dayton will bow to the Republican demands for no new taxes. I just hope they don't use bookwork tricks to balance the budget. That is by far the most gimmicky way of kicking the can down the road for everyone to deal with later. If you must cut, make meaningful cuts that slice only the fat, while allowing services to continue functioning.

[southernsmoke]

Originally Posted by xandrex

Eh, they're all playing politics here. The "lights on" provision was another political play to keep anybody from feeling the shutdown to prevent a political backlash from the public.

It's just a "political ploy" to try to prevent unnecessary and painful government shutdowns?

[nick is rulz]

Originally Posted by my54ford

Nope..I'm already rich.I can only get richer but that's ok too.

I am super impressed.

[xandrex]

Originally Posted by southernsmoke

It's just a "political ploy" to try to prevent unnecessary and painful government shutdowns?

Nobody wants a shutdown. And with bare essentials of the government still running, most people are only inconvenienced. But to pretend the "lights on" bill is any less a political gimmick (as valiant as it seems) than the vetoes is silly. The GOP were pushing it to protect themselves from potential backlash. Would you be as forgiving of the legislature if this were back in 2005?

That said, I think the DFL would do the same thing. As much as politics fascinate me, they're crooked and corrupt on all sides.

[southernsmoke]

Originally Posted by xandrex

Nobody wants a shutdown. And with bare essentials of the government still running, most people are only inconvenienced. But to pretend the "lights on" bill is any less a political gimmick (as valiant as it seems) than the vetoes is silly. The GOP were pushing it to protect themselves from potential backlash. Would you be as forgiving of the legislature if this were back in 2005?

That said, I think the DFL would do the same thing. As much as politics fascinate me, they're crooked and corrupt on all sides.

I mean, I agree that keeping government services would prevent some political backlash, but it would prevent backlash against both the legislature and the governor. I find it odd that you think reaching consensus on some issues to minimize the negative consequences of the political gridlock is somehow undesirable and nothing more than a way for Republicans to avoid backlash. This is only true if people irrationally blame the Republicans for everything (which, sadly enough, they may). It is your attitude about this that makes me believe that Dayton vetoed those provisions for the sole purpose of inflicting pain on Minnesotans, hoping that they would naively blame the Republican legislature. I just find it incredible that you suggest it is "crooked and corrupt" to try to keep the vast majority of the state government running. I think just the opposite--Dayton is the one shutting down state functions and sending state workers home just to inflict pain and tick people off, trusting that the Strib can convince enough people to hate the Republicans for it.

[rkcarguy]

Originally Posted by xandrex

Nobody wants a shutdown.

I have to dissagree. I'd like to see more of these shutdowns, as much as a mess as they are. Reason being, is many states are so far in the hole there is no feasable way of getting out. No matter which way they decide, the raise in taxes or budget cuts are going to cost more jobs, reduce tax income, and further amplify the existing problems we are fighting nationwide.
I think it would be a real eye opener for alot of ignorant people, who would then... maybe...actually do something...like push to increase tarriff's on chinese goods....end energy speculation...push for a diverse selection of fuels to be readily available for the retail consumer.....so that maybe our economy will have a chance. Right now, all I see is our politicians being puppets for big business, who is doing a great job at fleecing the people of their money as much as they can while not quite causing economic failure.

[Glenfield]

Originally Posted by rkcarguy

I have to dissagree. I'd like to see more of these shutdowns, as much as a mess as they are. Reason being, is many states are so far in the hole there is no feasable way of getting out. No matter which way they decide, the raise in taxes or budget cuts are going to cost more jobs, reduce tax income, and further amplify the existing problems we are fighting nationwide.
I think it would be a real eye opener for alot of ignorant people, who would then... maybe...actually do something...like push to increase tarriff's on chinese goods....end energy speculation...push for a diverse selection of fuels to be readily available for the retail consumer.....so that maybe our economy will have a chance. Right now, all I see is our politicians being puppets for big business, who is doing a great job at fleecing the people of their money as much as they can while not quite causing economic failure.

That's the protectionist sentiment that led to Smoot-Hawley, now widely viewed as one of the main factors that led to the Great Depression.