Maybe it could be a billboard in The Hamptons or some other enclave of the wealthy: "Move to Mississippi - where the rich live cheap."
Well, it's not exactly true, but since when have billboards had to tell the whole truth?
Here's the nugget: A new report from the John C. Stennis Institute of Government shows people in Mississippi making $228,000 or more per year pay 5.3 percent of their annual income in state taxes. At the same time, households subsisting on $11,000 per year pay a dime of every dollar, or 10 percent, in state taxes.
Why is this so?
The main culprit is the 7 percent general sales tax. Economists call it "regressive" because when a lawyer and a laborer each buy dollar loaves of bread, they each pay the same amount in taxes - regardless of the fact that the $200,000 lawyer feels the tax pinch much less than the $20,000 laborer.
What can be done about it?
Well, that's easy, too. "Rebalance" the tax burden.
Charles A. Campbell and M. Kathleen Thomas, both with doctorates, gathered the data and wrote the analysis for the Stennis Center at Mississippi State University after being commissioned by The Children's Defense Fund through a grant from the Kellogg Foundation. Their work provides ammunition - ample ammunition - for the CDF to use in upcoming legislative budget hearings and during the 2004 session.
Despite unprecedented increases in state revenue since 1990, the last two years have been lean. Competition for dollars for programs - and defense against tax increases - are both expected to be intense.
As Gov. Ronnie Musgrove has pointed out, all states around Mississippi have raised taxes while Mississippi has not. He, nor his rival Haley Barbour, have said they think that's needed - but that won't stem the tide come January, regardless of which of them voters choose.
The premise of the study was to look around and find out if there was an undiscovered pot of gold government could tap and spend on people - especially to meet the surging demand for Medicaid and education dollars. And, said CDF Southern Region Director Oleta Garrett-Fitzgerald, "If there's not a pot of gold, then who should be sharing the pain?"
The study says (1) there's no pot of gold, and (2) lower-income people in this state are already paying not just larger shares of their income in state taxes, but the bulk of state taxes overall. Translated, that means that come January, if the first notion of lawmakers is to raise the general sales tax rate to 8 percent, expect Garrett-Fitzgerald and Campbell, who talked about the report at a press luncheon, to take all 42 pages of it and beat lawmakers over their heads - justifiably.
As Campbell pointed out, in state-by-state rankings, Mississippi has to have its own color on the "misery index chart." That doesn't mean people are unhappy here, just that needs for government services are so high and average incomes are so low. A fourth of the population is on Medicaid.
So, where to go?
"We are asking the state to look beyond crisis management," said Garrett-Fizgerald, "to look beyond robbing Peter to pay Paul."
Their specific recommendations are:
- Not to target poor families by making a higher sales tax the first choice to raising more money.
- Add a 6 percent bracket for higher incomes to the existing 3, 4 and 5 percent brackets to the state's income tax forms.
- Adopt higher per-pack cigarette taxes that could raise $128 million per year, and
- Review corporate income tax laws, especially given that the state's income from corporate taxes was falling while taxes from all other categories were rising.
To have been completely honest, the study should have included a total-tax overlay. Tossing federal taxes into the calculations would likely have shown that the burden carried by those "rich people" everybody loves to hate is not as out-of-whack as it might appear. There is no federal sales tax - and the federal income tax is "progressive," meaning taxes triple when a workers' wages only double.
Give the Children's Defense Fund major-league credit. Too often, those who work for social programs and causes are written off as whiners and do-gooders who don't know economics. That's just wrong.
The Stennis study not only shows the imbalance, is shows that adjusting the burden will help more people rise into the upper-income ranks. And the better off all people are, the lower the demand for social services - which should make the hard-hearted happy, too.
Charlie Mitchell is managing editor of The Vicksburg Post. Write to him at P.O. Box 821668, Vicksburg, MS, 39182, or e-mail firstname.lastname@example.org