My God, just raise taxes!

Chicago Public Schools is facing a deficit of $200 million. That obviously sounds like a lot of money, and that’s the only figure we ever hear. You never learn what that amount represents as a percentage of last year’s budget, or as a percentage of tax revenue — or basically any relevant contextual information.

Here’s another fun stat: the population of Chicago is 2.7 million. That means that this unbridgeable deficit, requiring massive slashing of crucial services, school closings, etc., could be closed by making everyone pay, on average, LESS THAN A HUNDRED BUCKS A YEAR in additional taxes.

And this is another area where we get no context: state and local taxes are trivial. If they went up by the amount needed, basically no one would notice the change in their take-home pay. Yet people hear the word “taxes” and immediately think of all the jobs that will be “killed” — and of course, to avoid that horrifying eventuality, we have to fire a bunch of public workers.

And the irony is that the “multiplier effect” for public spending is much higher than that for tax cuts, so that speaking simply on an economic level, it’s basically always a net gain to raise taxes in order to maintain spending rather than to cut spending in order to avoid raising taxes. Yet the simple and relatively painless step of raising state and local taxes by the small amount necessary is absolutely taboo.

As the man says: “My God, pure ideology!”

2 thoughts on “My God, just raise taxes!

  1. $50 million in 2014 was paid by Chicago in police abuse settlements. THAT the city can budget in (it was around $80 million in 2013). But somehow, not for this.

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