Missouri Senate Race Heating UP

Rasmussin Reports and Fired Up Missouri ^ | 01/25/2010 | self

[Just another Joe]

Missouri ping

Low volume ping list

FReepmail me to be on, or off, this list.

[Judith Anne]

Thanks for the ping. I do want to say that Purgason was personally helpful to me in a matter of my husband’s retirement pension.

I would say he has at the very least done his homework at the local level. Faithful in little, faithful in much, one might think.

[MHT]

Let's look at the average Missourian. The average Missouri family of four has an income of $63,847, 89% of the national average of $67,019. This profile consists of two wage-earners and two dependents. (Avg. MO salary per individual is $32,789). Without any deductions, a gross 6% state income tax takes out of that family $3830. The average family of four nationally spent $49,638 in 2007 including housing and insurance but not taxes or childcare. But that same family of four would only need to spend $31,000 on goods and services to end up paying the state $3875 in sales tax. At this point, the family is indifferent between a sales versus income tax. The typical budget pie at the $31,000 level would mean a food budget (in and out of the home) at $6500, $8500 for transportation (gas/new car/new transmission, etc.), $2500 entertainment, $3000 clothes and care (which for some families is low), and $8000 for "other" (new refrigerator, air conditioner, hot water heater, vacation to Branson, school supplies, letter jackets, golf clubs, lawn mowers, Christmas gifts, etc.). This doesn't include any housing, health care, repair services, donations, insurance premiums, local property taxes, tuitions, interest on credit cards [average family of four has $8000 in credit card debt], utilities, etc. Just easily taxable stuff. If the family spends more than $2583 a month, they are better off with the income tax instead of the sales tax. At some point, consumption will decline because of desire to save instead of pay a sales tax or because they can't afford much more. When they are no longer indifferent, they will stop spending and the state revenue will decline--and the revenue neutrality is gone, probably forcing the sales tax higher. This can be a vicious cycle.

Can the State of Missouri get the $9-billion it needs from this consumer profile? (The state currently has a shortfall of $200-345-million.) There are 5.8-million Missourians and 13% live below the poverty level of $22,000/family of 4; or 754,000 Missourians aren't going to pay any income tax due to poverty. Currently, there are 275,000 Missourians who are unemployed. These might be the same people; maybe, maybe not. There may be some overlap with kids, elderly, etc. These people don't tend to spend alot of money. It will be interesting to see how the pre-bate re-bate would work for someone just buying some snack food. Do you present your state credit card for exemption of taxes on your $2 purchase? Other guys in line are going to love him...Much like the food stamps person who wants to use them on some off-list product. To get to $9-billion at the 6% income tax rate, Missouri needs 4,687,500 average taxpayers ($1920/ind; $3840/family four w/ two incomes). About 789,000 are over 65 (13.6%--higher than the national average) and 24% are under 18, eliminating another 1,392,000, which gives us about 3,344,000 Missouri employees. We fall short by about 1,350,000 working people. Of course, the great unknown is the level of income of the over-65 demographic. Even if half have some sort of higher taxable income, we're still short about 1,000,000 wage-earners, about four times the number of unemployed citizens. In a perfect world of income tax only, we fall short. In a world of consumer taxation, we fall short at the 12.5% level of indifference. This could only mean that the consumer tax would have to be higher, unless it is supplemented by other taxes, just like the current income tax is.

[MHT]

Please support some of your assumptions with facts, if you have them. Thank you.

[MHT]

BTW, the “rich” get away without paying sales tax by having jewels and furs, etc., shipped out of state to other homes or friends or relatives who mail them back.

[buschbaby]

Thank goodness we have some else besides Blunt. That old horse has been in DC for ages. He is part of all that went wrong with the Repubs.

Heading off to check out the Conservative in this race and see what I can do to help him out!

[Southbound]

Don’t know anything about Purgason. Know a little about
Roy Blunt. Had a run-in or two with him back in 1990 over a noxious thing called the “Natural Streams Act”. Remember that? Prop. A, Gen. election of 1990. I pounded a hole about a foot deep in then-Sec. of State Roy Blunt’s desk trying to convince him that that obscenity was not a statutorial proposal, but was, in fact a thing which would have abrogated, violated or modified several parts of the state Constitution, as well as violating the U. S. Constitution. His response, “the people want it.” I’ll vote for Roy if he gets the nomination, but I may hold my nose.......

[o_zarkman44]

The Mo Tax Reform will be revenue neutral. The Show Me Institute has made projections of current tax collections, as well as past average annual tax collections.

We are in an economic down turn. Which means income tax collections are down. So are sales tax collections. The Fair Tax is not intended to make up any revenue shortfalls caused by the recession.
5.11% has been determined to equal current tax collections.
When the economy improves, so will sales tax collections, and so would income tax collections. The fluctuations in revenue would be neutral.

The amount you are saying, 12.5% is inaccurate. Some people have been including the current 4.225% sales tax, and in addition adding the 5.11% Fair Tax rate, plus local sales taxes, which will not change. The only amount of change in the sales tax is moving from the 4.225% to the 5.11%.

So if your current state tax rate is 4.225% and your local sales taxes, county etc are 3.75% the total you are paying now is 7.975%. The Fair tax will raise that sales tax rate .885% to 8.86% and not the 12.5% you mentioned. In your example the costs are overestimated and the revenues are underestimated.

Remember now, the sales tax we pay is taken out of what we have left on our paycheck after state income tax is taken out and then we still pay sales tax on our after tax income.
With the Fair Tax, You keep your entire check and only pay a tax when you make a purchase.

Economist Joseph Haslag, a MU Economics Professor and Executive Vice President of the Show Me Institute has completed a case study comparing neighboring 5 states and their economic growth. Missouri ranks barely above Illinois for GDP and Jobs creation but just about half the growth experienced by Arkansas. There is a completed study by Americans For Prosperity foundation WWW.AFPMO.org that breaks down income demographics. Also there is a Study compiled by the Show Me Institute www.showmeinstitute.org
that refutes the inaccurate figures quoted in your posts.

Look there and then come back and tell me how abolishing the income tax is bad.

[o_zarkman44]

What is your aversion towards the rich? Oh I know, rich people are evil, big corporations are bad. That kind of demagoguery towards people with wealth creation capabilities is right out of the Communist Manifesto, Obama’s official play book.

You don't think people are finding ways to avoid paying the current state income tax now? Drug dealers, selling stolen goods. Are they paying income taxes? NO.
But they do buy things. A sales tax penetrates the underground economy. Frankly I don't think a few “rich” people are going to go out of their way to save one cent's worth of sales tax. But if they don't pay state income tax, they may save thousands if they only buy basic necessities.
And so will the middle class save. And lower income gets the prebate exemption based on the poverty level.

You are so consumed by rich people “getting away” with paying taxes. I guess you think taxes need to be redistributed by the government so only the rich pay and the poor get checks.

[MHT]

I have no aversion to the rich. They are not evil nor are corporations bad. But the idea of re-creating a tax structure so that drug dealers have to anti-up is beyond belief.

Taxes happen for two reasons--Yes, they are the price of civilization and the state of Missouri has a budget that must be met--whatever amount it is, whatever services it does or does not offer. More importantly, people need to keep what they make so that capitalism can continue. The power of a dollar kept in the private sector outperforms a dollar sent to government. However, I do not think that, because of my numbers presented in an earlier post, either the state will be able to make its budget goals nor will the average citizen be better off if we go from income to fair tax. Worst of all, there is no incentive for saving or investment, the foundation of future economic growth.

[Man50D]

Please support some of your assumptions with facts, if you have them. Thank you.

Which facts in post #20 are you claiming as mere assumptions?

[Artemis Webb]

Blunt has a lifetime rating of 93% from the American Conservative Union. While that doesn't make him the MOST conservative member of congress it's a proven record on a national level.

Tell me what Chuck Purgason’s (I had to keep checking the spelling since nobody has ever heard of him) lifetime record is? Oh yeah, he doesn't have one! He can say anything he wants but it doesn't mean crap. He's an unknown and unelectable. I'm sure that won't stop you from pissing into the wind though so go ahead.

If this state would elect Robin Carnahan’s momma to be in the Senate, replacing the GREAT John Ashcroft for no better reason than they felt sorry for her because Mel died then we need to bring our A game to the November election. Now maybe Roy Blunt is an A- or a B+. Regardless though he is a pretty dependable conservative vote and has the organization and skills to beat Carnahan.

If your candidate is good enough to win the GOP nomination that's great! I'll vote for him, gladly! Because taking the nomination from Blunt would be a pretty amazing feat and I seriously doubt your guy has a prayer in hell.

Last of all don't be one of those whiners who goes, “Well the press won't cover him because he's a REAL conservative”. Cream rises to the top. Let's see it happen.

[MHT]

If the Fair Tax doesn't make up any revenue shortfalls, from what other source can future shortfalls be met? More people moving in? To work for new businesses?.....

There is no way that Missouri will meet its budget goals at a 5.11% rate. We have too many failing businesses. Furthermore, the vacancy rate of commercial property nationally will approach 18.5% this quarter. There are 800-million square feet of commercial property standing vacant throughout the country and a trip through St. Louis is enough to remind us that this recession may not be over, nor have we necessarily seen the bottom of the commercial real estate market. If more defaults occur, local governments will see shortfalls. The losses of car dealerships have completely undermined local budgets. Within 20 miles of my house, there are two empty grocery stores with 35,000 and 40,000 square feet of empty space, anchors for dying strip malls. Within two miles are two other new strip malls standing vacant. Why make a commitment to open a new store anyplace now? There are even empty Wal-Mart buildings. They relocated but nothing replaced them in the space.

The critical "if" is "when the economy improves...." There is more to making that happen than shifting the tax burden. Missouri has lost businesses to neighboring states because of its unwillingness to give them tax credits and incentives that neighbors are willing to fork over. The cost of labor, climate, and utilities also play a role. Furthermore, our cities aren't that great. The airport at St. Louis is a disaster. In spite of its turn around, the crime rate in that city is still nationally high and its school district is unaccredited, as is Kansas City's. Kansas has seen Missouri businesses move over because people want their kids out of the Kansas City school system. The business followed the employees, not the other way around. The St. Louis earnings tax is another barrier to business. If the business climate causes Missouri to continue to lose rather than increase population, there is no way that the showme numbers would work. We will just have more unemployed people left behind who can't afford to go elsewhere. And, so far, the trendline is not working in our favor.

[Man50D]

BTW, the “rich” get away without paying sales tax by having jewels and furs, etc., shipped out of state to other homes or friends or relatives who mail them back.

Why would anyone participate in such a ridiculous plan when their overall tax burden will be considerably lowered after the Fair Tax takes effect and have more money to spend by eliminating the state income tax? Please buttress this claim with data proving this is currently happening with the existing state sales tax. This ludicrous hypothetical scenario ignores the fact in order to ship these items out of state a person must first make the purchase and therefore will have already paid the tax!

Your arguments to maintain the existing, more burdensome tax system are becoming more nonsensical with each post.

[listenhillary]

It punishes those who can least afford it.

The poor are not harmed financially by the fair tax with the prebate that refunds taxes on spending up to the poverty level. They actually come out better off than the current plan.

It is user controlled taxation that can be controlled by the taxpayer buying used items. Saving money, investing for the future is no longer penalized.

[listenhillary]

The numbers have been run on new house purchases in Missouri. 3% increase over current costs. We still seem to have an adequate supply of used houses that are tax free.

Food and clothing.

What do you see many poor people buying? Many that I see are buying Nike air shoes and pre-packaged, processed to death food. If they had any sense, buying used clothing and making more of their own food would result in a tax savings for them.

Massachusetts doesn’t have the pre-bate. We currently exempt much of food purchased in a store right now. That excemption is going away if we get the fair tax in Missouri.

Cross border
Kansas in watching closely with the fair tax. Oklahoma might just beat us in the race to get the fairtax in place. Going to Illinois, I would guess will not be any bargain.
Tennessee has never had a state income tax. How many car production plants have they gained? How many automotive jobs have we lost?

We are talking about 9/10th of a cent in increased taxation, to be rid of corporate taxes, individual income taxes. The economic growth and more employed Missourians is a heck of a deal in trade.

[Turbo Pig]

But there is no victory in electing a Rino.

And that, my FRiends is the big question. If, after you voted for them in the primaries, the Conservative candidate does not get the win, do you withhold your vote and let someone like Carnahan waltz into a postion of power, or do you select the lesser of two evils.

Personally, after the last year, I'll vote for the conservative candidate in the primaries, then I will vote for the candidate who comes closets to representing my views in the general. If the two are the one in the same, then that is just a bonus. If not, I'll not be abdicating the election to someone who will not represent anything I beleive in; like Carnahan.

If the Conservative candidate doesn't win the primary, and you throw a temper tantrum and sit out the general vote to show your displeasure, and the state of MO gets another obama fawning politician, like Claire McCaskill, then you need to just shut up about the course the country will take over the next decade or so, because you are as much the problem as the lib who votes for them.

[Eric in the Ozarks]

Chuck needs to be more vocal, make more appearances and take more public positions. The last thing we need is a Blunt RINO rerun in the senate.

[o_zarkman44]

Chuck is currently busy with the Missouri Senate, having numerous committees going, and making outstate campaign appearances when possible. I fully expect him to start becoming more visible with some events he has in the works.. But he has a job to do right now. chuck isn’t liik other candidates who essentially abandon their job to campaign.

[Eric in the Ozarks]

Agree. Chuck takes his job more seriously than a few others in Jeff City. There were opportunities missed prior to the legislative session, tho.

I would have preferred to see Chuck take aim at Ike Skelton vs. the about to be open seat in the US Senate.
btw, Ike is due in Osage Beach on Friday to accept an award from the local police for bringing home a grant. Maybe he'll take the opportunity to apologize for his vote in favor of the carbon tax.