Encouraging the Rich to Move Out of State

Even before Mike Madigan's Democrats moved to hike the state income tax these two United Van Lines trucks were parked in Crystal Lake's Main Beach parking lot.

Even before Mike Madigan’s Democrats moved to hike the state income tax these two United Van Lines trucks were parked in Crystal Lake’s Main Beach parking lot.

Illinois is not the place it used to be.

In the past, people said, “If you can’t find a job in Chicago, you can’t find one anywhere.”

With the better part of a half a century under Mike Madigan’s Democratic Party rule in the Illinois House, the state is effectively bankrupt.

Now Madigan has come up with his solution:

Tax the rich.

We now have a proportional income tax.

Everyone pays the same percentage of his or her income.

It’s not like the Federal income tax where the President and Vice President pay a smaller percentage of their incomes in tax that my family does.

Here is what has been proposed by Democrats:

Proposed income tax rates.

Proposed income tax rates.

Something Tribune columnist John Kass wrote is also relevant:

According to census reports, more than 100,000 people left Illinois last year, and almost as many left the year before. They don’t just leave for sunny Florida.

They run to other Midwestern states where they can find work, where they pay taxes.

“We continue to pass laws and put in place policies that are not good for people,” [State Comptroller Leslie] Munger told me. “And people vote with their feet. We’ve seen it for years.”

These refugees are the earners who’ve left.

And they represent the loss of billions upon billions of dollars in tax revenue each year.

What that means is there’s more tax pressure on those left behind in this economic wasteland of Madiganistan.

The highest earners pay a lot of the income tax.

They won’t have to pay it to Illinois if they move.


Comments

Encouraging the Rich to Move Out of State — 17 Comments

  1. @Martha. . . I’m not sure where you’re getting that figure and whether or not it’s correct really doesn’t matter.

    The simple truth of the matter is that whatever “solution” proposed by the morons in Springfield raises in additional revenue, they will simply spend 120% of it on “programs” and not touch the debt!

  2. I doubt that very much Martha.

    The very wealthy can easily relocate or make their vacation homes in WI, MI or FL their residences.

    Another stupid idea by Madigan who sees raising taxes as the only solution.

    Certainly taxes will have to higher but I stand with Rauner that any tax hike must be accompanied by public pension reform, for starters.

  3. This happened in Baltimore.

    They threw a tax on the rich, and started losing millionaires in droves.

    Don’t get me wrong, someone wealthy needs to pay their fair share, but that’s not the way to pull yourself out of this fiscal mess.

    The only places you could pull this off is New York, Singapore, or London.

    We are none of those.

  4. Below is copied and pasted. I haven’t vetted the numbers, it’s the concept that matters:

    “Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like
    this…

    The first four men (the poorest) would pay nothing.
    The fifth would pay $1
    The sixth would pay $3
    The seventh would pay $7
    The eighth would pay $12
    The ninth would pay $18
    The tenth man (the richest) would pay $59.

    So, that’s what they decided to do.
    The ten men drank in the bar every day and seemed quite happy with the
    arrangement, until one day, the owner threw them a curve ball.

    “Since you are all such good customers,” he said, “I’m going to reduce the cost of your daily beer by $20”. Drinks for the ten men would now cost just $80.

    The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free. But what about the other six men ? How could they divide the $20 windfall so that everyone would get his fair share?

    They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer.

    So, the bar owner suggested that it would be fair to reduce each man’s bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.

    And so the fifth man, like the first four, now paid nothing (100% saving).
    The sixth now paid $2 instead of $3 (33% saving).
    The seventh now paid $5 instead of $7 (28% saving).
    The eighth now paid $9 instead of $12 (25% saving).
    The ninth now paid $14 instead of $18 (22% saving).
    The tenth now paid $49 instead of $59 (16% saving).
    Each of the six was better off than before. And the first four continued to drink for free.
    But, once outside the bar, the men began to compare their savings.

    “I only got a dollar out of the $20 saving,” declared the sixth man. He
    pointed to the tenth man,”but he got $10!”
    “Yeah, that’s right,” exclaimed the fifth man. “I only saved a dollar too.
    It’s unfair that he got ten times more benefit than me!”

    “That’s true!” shouted the seventh man. “Why should he get $10 back, when I got only $2? The wealthy get all the breaks!”

    “Wait a minute,” yelled the first four men in unison, “we didn’t get
    anything at all. This new tax system exploits the poor!”

    The nine men surrounded the tenth and beat him up.
    The next night the tenth man didn’t show up for drinks so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

    And that,boys and girls, journalists and government ministers, is how our
    tax system works. The people who already pay the highest taxes will
    naturally get the most benefit from a tax reduction. Tax them too much,
    attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.”

    David R. Kamerschen, Ph.D. — Professor o

  5. Martha, soon, no one will be left to pay for your free stuff.

    What will you do then?

    Move to where they did, and continue leeching?

  6. McHenry County has been brainwashed that the rich create jobs but only with subsidies paid for by the middle class and poor.

    In Minnesota we see it can work.

  7. Wealthy people, generally, are not wealthy because they are stupid.

    Mikey has a tax the masses think is a fantastic idea so he gets votes while the wealthy don’t ever pay an extra dime into Illinois coffers.

    These types of money grabs are 100% red herrings.

    If taxes go up on businesses they pass it through to consumers.

    If taxes go up on executives they raise their pay to offset the loss and the business raises prices to consumers.

    The retired offshore their income to another state or tax shelters.

    The DINK’s move money out of Illinois.

    Or one billionaire leaves for Florida and leaves a 148mm hole in the state budget ala NJ just to make a point.

    Only the most crass or uneducated person doesn’t understand Mike is grandstanding on a horrible regressive tax and those most negatively affected by his politics will be the working poor.

    Those he likes to lie to constantly by saying he is working to protect them.

    At what point do the Unions, special interests and those below middle class incomes wake up and toss this dictator out so progress may be made in this state?

  8. Just so “DA BOYS” know, we the people have not forgotten!

    And, either has Governor Bruce Rauner.

    In fact, the people of the State of Illinois are becoming increasingly resentful of the “THREE STOOGES”…

    MAD MIKEY MADIGAN,

    FRANKS FROM THE DUO OF JACK AND JILL, AND

    CULLERTON THAT BROWN NOSED FOLLOWER!

    THE THREE STOOGES ARE THE LAUGHING STOCK OF MCHENRY COUNTY AND THE STATE OF ILLINOIS.

    BELIEVE, ME THE PEOPLE WILL NOT FORGET WHEN PROPERTY TAXES ARE DUE.

  9. Not just income tax but property tax drive people away.

    After the proposed tax on mileage (YES, I know the proposal was withdrawn) I gave up on Illinois after 120 years of family here.

    Downsizing out of state now…and NOT to Minnesota.

  10. Problem seems to be only one bar to drink at, no price competition for beer.

    There used to be more bars but this one was given tax abatement and TIF money.

    Everyone is so distracted by the “raise revenue” mantra that nobody thinks to question the price, quality, amount, or necessity of the beer.

  11. Illinois is the poster child for how NOT to run a state and what policies you should NOT enact.

    We can do something about local property taxes if we want to… if we work together.

    Seems to me karma should not run for office but instead move to Minnesota.

  12. karma, Minnesota is actually seeing wealthy taxpayers fleeing the state:

    http://tcbmag.com/Industries/Politics-Public-Policy/Minnesota-s-Great-Wealth-Migration

    Here’s the key take away:

    “During the last two years, Minnesota lost or began losing an estimated $2.1 billion in taxable income from 3,099 taxpayers, according to a research study on wealth migration conducted by Twin Cities Business with help from research firm The Morris Leatherman Company.

    “These same individuals have $17 billion in median net worth and $31 billion in median gross estate value.”

  13. Occam, Priest and Serwatka offer real words o’ wisdom.

    Too bad they are not legislators.

    I don’t really like the disastrous neo-conish editorial bent of National Review of the 2 decades, yet this 2015 article about NJ and productive-taxpayer flight, bears scrutiny.: http://www.nationalreview.com/article/421625/states-new-jersey-south-taxes

    … here’s another very recent insight about Bernie Sander’s Vermont Soviet: http://townhall.com/tipsheet/mattvespa/2016/04/04/vermont-residents-leave-state-as-it-becomes-riddled-with-high-taxes-n2143564

    But here’s the topper …. about Madiganistan, aka Illinois SSR: https://www.illinoispolicy.org/reports/still-leaving-illinois-an-exodus-of-people-and-money/

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