Heartless Attempt to Patch Roads by Making the Working Poor of Detroit & Michigan Pay

I have heard much whining over the elimination of the film credits but very little about the cynical ending of the state earned income credit EIC. With the Sales Tax increase referendum on road funding in ashes, our state legislature has cobbled together a new funding bill that eliminates both.

The EIC is a tax credit created as an incentive/reward to the working poor with children for working instead of throwing up one's hands and going on public assistance. If your income is low enough you become eligible for a credit against taxes or may even get a return if no money is owed. Mind you, you still pay FICA taxes of between 7.65 and 15.3% of your income and other taxes such as the sales tax.

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Roughly 780,500 taxpayers qualified for the Michigan EITC in 2013, according to the state treasury, with the average credit totaling $140. Larger credits are given to families at or near the poverty line with children.
From mlive.com

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Along comes Rep. Farrington of Utica who has the audacity to say EIC does little to help the working poor! to justify its elimination.

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Farrington testified the EITC "goes beyond being a credit -- it's a subsidy," because it can be paid to residents with no income tax liability. He said the average Michigan payout is only $143 a year, meaning it does little to help the working poor, but he said it is based on a federal EITC, which a federal audit suggests is rife with fraud.
From Freep.com

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I am very comfortable in life now but not without struggle and lean years in my past when I qualified for an EIC and never took a cent of assistance. I know that $143 is just supper at Joe Muir's for Mr. Farrington, but for those struggling as I was it can be the difference between keeping one's lights on, getting gas for work or just taking your kid out the buck movies. I know.

This elimination will hit Detroit, and other jurisdictions, where the working poor reside, the hardest. $115 million will be taken out of those pockets and put into the pockets of road contractors. Shameful.

Not related to the unfortunate and typically mean-spirited legislation Lowell mentioned, is this other gem passed by the Michigan GOP.

http://www.freep.com/story/opinion/e...tion/71074414/

So now LGBT taxpayers get to fund adoption agencies that will refuse to deal with them. Fairness, GOP style.

Michigan seems hell-bent in becoming the Mississippi of the Midwest.

http://www.ew.com/sites/default/file...4/22/gif_1.gif

Elections have consequences, unfortunately.

Last Novemeber MI said it likes where it's going.

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Originally Posted by DetroiterOnTheWestCoast

Not related to the unfortunate and typically mean-spirited legislation Lowell mentioned, is this other gem passed by the Michigan GOP.

http://www.freep.com/story/opinion/e...tion/71074414/

So now LGBT taxpayers get to fund adoption agencies that will refuse to deal with them. Fairness, GOP style.

Michigan seems hell-bent in becoming the Mississippi of the Midwest.

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Yep, it has even earned itself the honorary nickname "Michississipi."

And to pile on top of these half-ass backwards political events that have taken place recently, since the auto industry collapse, I think this state is now one of the poorer and lesser-educated in the nation.

780500 X $140 = $109,270,000. That's a lot of money the rest of the taxpayers have to make up, not counting all the other assistance, social, educational, rehabilitative, and medical programs.

The GOP couldn't wait to eliminate so-called "freebie" programs that help the disadvantage in this state. In a nutshell, Michigan sucks. We have to suffer with this "clown" administration, another 3 years.

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Originally Posted by Honky Tonk

780500 X $140 = $109,270,000. That's a lot of money the rest of the taxpayers have to make up, not counting all the other assistance, social, educational, rehabilitative, and medical programs.

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Latest population for Michigan per Wikipedia: 9,909,877

9,909,877 - 780,500 = 9,129,377 : Population minus the # who qualify for EITC

109,270,000 / 9,129,377 = $11.97 : EITC cost paid by rest of population

Rest of the population has to make up $11.97 per person per year.

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Originally Posted by archfan

Latest population for Michigan per Wikipedia: 9,909,877

9,909,877 - 780,500 = 9,129,377 : Population minus the # who qualify for EITC

109,270,000 / 9,129,377 = $11.97 : EITC cost paid by rest of population

Rest of the population has to make up $11.97 per person per year.

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Population = 9,129,377

Number of tax returns with positive input to the state = a number significantly less. Your denominator is off.

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Originally Posted by Honky Tonk

780500 X $140 = $109,270,000. That's a lot of money the rest of the taxpayers have to make up, not counting all the other assistance, social, educational, rehabilitative, and medical programs.

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so repeal the tax cut to corporations [[payed for with ANOTHER tax increase for the working poor) and institute a tiered, progressive tax system

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Originally Posted by rb336

so repeal the tax cut to corporations [[payed for with ANOTHER tax increase for the working poor) and institute a tiered, progressive tax system

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Yeah, state tax of 91% on anything over $500K a year. That will really fill the state coffers. No? Tennessee, North Carolina, New Hampshire, Texas, and Florida will gladly welcome those high income people.

Could it be that this has come home to roost?

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2011 tax code re-write was projected to save businesses $1.6 billion annually by 2013, mostly by repealing the oft-derided Michigan Business Tax.

It was also projected to boost individual income tax collections by $1.4 billion, mostly by reducing earned income and homestead credits while phasing out and scaling back a long-standing exemption on pension income.

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Again with this new bill business profits most, the working poor, lower income earners and pensioners pay.

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Originally Posted by Lowell

Could it be that this has come home to roost?



Again with this new bill business profits most, the working poor, lower income earners and pensioners pay.

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Don't worry, it will all trickle down.

My partner and I have actually talked about spending a big chunk of the summer in Michigan, but for reasons such as the political climate we have decided to spend more of it elsewhere.

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Originally Posted by Lowell

Could it be that this has come home to roost? Again with this new bill business profits most, the working poor, lower income earners and pensioners pay.

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And in 2014, all of the legislators who voted for the bill were turned out of office in a massive landslide as the working poor, lower income earners, and pensioners retaliated?

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Originally Posted by Lowell

I have heard much whining over the elimination of the film credits but very little about the cynical ending of the state earned income credit EIC. With the Sales Tax increase referendum on road funding in ashes, our state legislature has cobbled together a new funding bill that eliminates both.

The EIC is a tax credit created as an incentive/reward to the working poor with children for working instead of throwing up one's hands and going on public assistance. If your income is low enough you become eligible for a credit against taxes or may even get a return if no money is owed. Mind you, you still pay FICA taxes of between 7.65 and 15.3% of your income and other taxes such as the sales tax.



Along comes Rep. Farrington of Utica who has the audacity to say EIC does little to help the working poor! to justify its elimination.


I am very comfortable in life now but not without struggle and lean years in my past when I qualified for an EIC and never took a cent of assistance. I know that $143 is just supper at Joe Muir's for Mr. Farrington, but for those struggling as I was it can be the difference between keeping one's lights on, getting gas for work or just taking your kid out the buck movies. I know.

This elimination will hit Detroit, and other jurisdictions, where the working poor reside, the hardest. $115 million will be taken out of those pockets and put into the pockets of road contractors. Shameful.

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So you find someone who has different ideas than you do, and instead of a discussion on ideas -- you decide they are 'heartless'.

Not everyone agrees with you.

In this case, I do agree. The EIC is a fine program for wealth redistribution -- and it does so in a very positive way.

Some don't agree with us. Let's work to change their minds. Not to belittle them as individuals with moral flaws -- although it may well be true.

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Originally Posted by Wesley Mouch

The EIC is a fine program for wealth redistribution -- and it does so in a very positive way.

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Ah! I think that's called 'communism'. Am I wrong?

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Originally Posted by Ray1936

Ah! I think that's called 'communism'. Am I wrong?

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Except my friend John Galt, everyone is in the wealth redistribution [[WR) game.

Communists more want to eliminate private wealth. WR really is more socialist.

WR is a fact of life even in America. Entitlements provided by tax dollars already take lots of money from more wealthy to less wealthy.

So the question isn't so much whether we should redistribute, but how much. Lowell thinks any reduction in government-mandated redistribution is cold-hearted. I disagree. There are a lot of ways we can help those in need. Government-mandated wealth redistribution is probably the least effective tool in the toolbox.

Given a choice, I'd rather see Bill Gates help the poor. Thank God that he does. It shows us what can be done when government gets out of the way.

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Originally Posted by Wesley Mouch

Except my friend John Galt, everyone is in the wealth redistribution [[WR) game.

Communists more want to eliminate private wealth. WR really is more socialist.

WR is a fact of life even in America. Entitlements provided by tax dollars already take lots of money from more wealthy to less wealthy.

So the question isn't so much whether we should redistribute, but how much. Lowell thinks any reduction in government-mandated redistribution is cold-hearted. I disagree. There are a lot of ways we can help those in need. Government-mandated wealth redistribution is probably the least effective tool in the toolbox.

Given a choice, I'd rather see Bill Gates help the poor. Thank God that he does. It shows us what can be done when government gets out of the way.

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^ that is funny you mention Bill Gates helping the poor. A class mate of my daughter is a Gate Millennium Scholarship Winner. Funny thing is she was also NHS president who was caught for plagiarism but it was swept under the rug by the school system and given a second chance because they did not want the fact that they kicked a minority out of NHS to hit the media, etc. The school teachers were set to replace her as NHS president but the principal over ruled it after getting heat from central office.

She obtained the Gates scholarship by submitting on her paperwork that she is the child of single unemployed mother. What she did not state is that her dad is noted physician here who 100% supports the family and basically provides them with an upper middle class lifestyle.

This child has totally played the system. She is very good at test taking but otherwise is a intelligent as a piece of cardboard.

Instead of everybody grappling for a skinny piece of a stale old pie, can we just make more pies?

That is to say, REALLY make Michigan an attractive place to do business. Not just time-release band-aids on bad policies. I mean truly scare the beejesus out of Texas [[where I now live), Tennessee, etc. Sorry to say, but Michigan has a reputation of being pro-labor and anti-business, to the point of running businesses out of town. What business wants to relocate to that environment? We used to have so many small businesses in Detroit; it's become a nightmare just to start one now.

BTW: Laugh at Mississippi if you want, but they're laughing at "y'all" all the way to the bank. Biloxi is the hot new vacation destination in the South. Their slot machines are loose and their beaches are beautiful. We went there in 2013 and they told us they got fed up with the good-old-boy way of doing nothing and elected pro-business candidates. I was there in 1996 and what a difference!

I think that the public's taste for redistribution waxes and wanes along a spectrum:

Who thinks we should give food to the hungry?
Money for food to the hungry [[food stamps)?
Money for living expenses to the poor?
Money to the poor to use however they'd like?

What's interesting is that there was a research novel I read in college that argued that the most efficient program was just to give money to the poor [[which is correct, on an economic basis), because we'd avoid the cost of all the government bureaucracy that goes along with heavily-regulated programs. But it's clear that is the least palatable, politically anyway.

Nothing is ever going to be done about this and other topics but more jaw-jacking, so it's all a moot point. Greed is here to stay.

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Originally Posted by BankruptcyGuy

I think that the public's taste for redistribution waxes and wanes along a spectrum:

Who thinks we should give food to the hungry?
Money for food to the hungry [[food stamps)?
Money for living expenses to the poor?
Money to the poor to use however they'd like?

What's interesting is that there was a research novel I read in college that argued that the most efficient program was just to give money to the poor [[which is correct, on an economic basis), because we'd avoid the cost of all the government bureaucracy that goes along with heavily-regulated programs. But it's clear that is the least palatable, politically anyway.

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In total agreement. I don't know that it's politically palatable. I do know that it's bureaucratically palatable.

There is a whole lotta people making money because of the poor. Think of it existing all across the spectrum from Government Bureaucracy, Walmarts to the Medical Industry and beyond.

Then you got the worst of the worst, the finance/insurance industry taking advantage of the poor.

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Originally Posted by BankruptcyGuy

I think that the public's taste for redistribution waxes and wanes along a spectrum:

Who thinks we should give food to the hungry?
Money for food to the hungry [[food stamps)?
Money for living expenses to the poor?
Money to the poor to use however they'd like?

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What we have seen over the last 30 or so years has been the largest wealth redistribution in history - from the working classes and poor to the top 1%. It is time to justly redistribute said wealth.

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Originally Posted by Dan Wesson

In total agreement. I don't know that it's politically palatable. I do know that it's bureaucratically palatable.

There is a whole lotta people making money because of the poor. Think of it existing all across the spectrum from Government Bureaucracy, Walmarts to the Medical Industry and beyond.

Then you got the worst of the worst, the finance/insurance industry taking advantage of the poor.

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I agree, but also recall reading that the more important unintended consequence of Johnson's Great Society program wasn't the actual fruit of the project -- but that the project itself significantly created the American black middle class by bureaucratic employment. Like the Space Program of the 60s. Not much gained by being on the Moon. Lots gained by the effort of going there.

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Originally Posted by kathy2trips

Instead of everybody grappling for a skinny piece of a stale old pie, can we just make more pies?

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I'll agree with that as the preferred outcome, but what's the best way to make that happen?

Republicans have slashed business taxes, passed RTW, gutted public services, raised taxes on lower and middle-income people, and what's the result? Pretty meh job growth [[accounted for by an improving national economy increasing car sales), no flood of new businesses into the state, and a deteriorating physical environment.

What else needs to be done? Eliminate public schools? Privatize the highways? Abolish DEQ and MIOSHA? Take the UAW leadership out back, line them against a wall, and have them shot?

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Originally Posted by Not In MI

^ that is funny you mention Bill Gates helping the poor. A class mate of my daughter is a Gate Millennium Scholarship Winner. Funny thing is she was also NHS president who was caught for plagiarism but it was swept under the rug by the school system and given a second chance because they did not want the fact that they kicked a minority out of NHS to hit the media, etc. The school teachers were set to replace her as NHS president but the principal over ruled it after getting heat from central office.

She obtained the Gates scholarship by submitting on her paperwork that she is the child of single unemployed mother. What she did not state is that her dad is noted physician here who 100% supports the family and basically provides them with an upper middle class lifestyle.

This child has totally played the system. She is very good at test taking but otherwise is a intelligent as a piece of cardboard.

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Yet when the third richest man in the state, worth more than $3 BILLION plays the system to get a $240 MILLION subsidy for his new arena, he's called a shrewd business person.