Let’s start with a baseline fact. According to 2016 U.S. Census Bureau records, Idaho’s median household income is about $51,800. That’s $6,000 below the national average and 37th in the country. Idaho has been in a rut for nearly a decade on this measure. Since 2009, Idaho has ranked between 37 and 41 in terms of median income, putting us among the poorest states in the nation.
The non-partisan, non-profit Institute on Taxation and Economic Policy breaks down the benefits of the U.S. House and Senate tax bills by income level. Under the House bill, the “middle 20%” of Idahoans – those of us who work full-time and scrap for every penny - would receive 10 percent of the total tax cuts in 2018. Idaho’s wealthiest 20 percent would get 66 percent - fully two-thirds! Meanwhile, nearly 50,000 Idahoans would lose deductions for medical expenses and 160,000 Idahoans wouldn’t be able to deduct the state and local taxes they already pay.
The House bill goes even further – it’s a roadmap for destroying working families. Remember, virtually everyone in Idaho agrees that improving educational outcomes for our kids is the key factor in growing our economy and increasing future wages. So, what does the House bill do? It eliminates the deduction for student loan interest. It penalizes students who excel by taxing tuition waivers (this is like taxing a coupon at the grocery store). The House bill also scraps the deduction (up to $250) for teachers who spend their own money on school supplies for your children. And my GOP colleagues wonder why there is a teacher shortage.
Under the Senate bill, Idaho’s “middle 20%” (those of us who work full-time and scrap for every penny) would get 11 percent of the tax cuts by 2019. The wealthiest 20 percent of Idahoans would get 64 percent of the benefits. However, within a few years, taxes on thousands of middle-class Idahoans would go up! As an added bonus, the Senate bill includes a provision to repeal a key piece of the Affordable Care Act which will drive premiums even higher – further strapping those of us who work hard for our families.
If this story sounds familiar, it should. In 2017, GOP state House members proposed a bill that would cut taxes on Idaho’s “middle 20%” (those of us who work full-time and scrap for every penny) by a whopping $32. Meanwhile, they ask you to raise your property taxes just to make sure your children’s school has a roof that doesn’t leak. Idaho’s wealthy would have gotten tax cuts of over $1,500.
Ham-handed giveaways to the rich cost those of us who work full-time and scrap for every penny. The last tax scheme at the state level would have cost us $50 million. That’s a lot of money that should be used to make sure every Idahoan gets a quality education, to ensure our roads aren’t riddled with miles of potholes, and to guarantee our retirees and veterans have the healthcare they need. Idahoans value stability and are tired of sucker-punches. Unfortunately, more are coming. Idaho House Republicans are gearing up for 2018 to stick it to middle class Idahoans again with a similar tax bill. I recently had a beautiful daughter. I value her future. I want stability for my family and opportunity for her future. Those are values that every Idahoan shares. These frivolous giveaways hurt people by creating economic instability and threatening opportunity for our kids and grandkids.
Perhaps the biggest whopper we’re being sold is that cutting the corporate tax rate will spur hiring and capital investment. The CEOs of America’s largest companies don’t even believe that. Recently, Chief White House Economic Advisor Gary Cohn asked a roomful of company leaders whether they intended to increase capital investment if the federal tax plan passed. According to a CNBC headline, Cohn got “crickets.” In other words, virtually none of the CEO’s indicated they would.
This shouldn’t be surprising. America’s corporations have been logging record profits for years. Guess who benefits? Shareholders, not workers. Just last month, Wal-Mart announced it would spend $20 billion buying back its own stock. That’s great if you own Wal-Mart shares, but it does nothing if you’re looking for work. Most politicians answer to their “shareholders” too. It’s just that corporations and special interests hold most of their stock. We all witnessed that sentiment this summer when Idaho’s own Secretary of State, Lawerence Denney, spoke indifferently about corporations buying legislators. They aren’t interested in providing opportunity for those of us who work hard and scrap for every penny. They’re only trying to please their “shareholders” – the people at the top.
Growing companies use their revenues to invest in the future of their business – new factories, equipment and employees. Stagnant companies don’t. Idaho has an opportunity (not to mention a constitutional mandate) to invest in education and infrastructure. If we want to pull ourselves up from the bottom and create a dynamic state where all Idahoans have the opportunity to get ahead, frivolous tax cuts for a few “shareholders” isn’t going to do it.
If you’re tired of being sucker-punched, call your congressmen and senators and tell them to stop holding your arms back.
Sen. Mike Crapo: (202) 224-6142
Sen. Jim Risch: (202) 224-2752
Rep. Raul Labrador: (202) 225-6611
Rep. Mike Simpson: (202) 225-5531
Rep. Mat Erpelding is the Democratic Leader in the Idaho House of Representatives. He is currently serving his third term, representing District 19.