[PEN-L:33372] Re: The new economics

["Alan Jacobson"<ajacobson@xxxxxxx>]

In Michigan it is unbelievable. The legislature voted 3 to 1 not to suspend a
scheduled personal income tax reduction for 2004 despite the fact that a 1.8
billion deficit is forecast for the FY03 budget.  This .1% tax cut will mean
approx $25 less taxes for the avg household but will be millions in less rev
for the state. The incoming Democratic governor-elect was quoted several times
during the campaign that she wouldn't raise taxes.

When you factor in the shift from progressive to regressive taxation in nearly
state (reduction of income taxes and increase in consumption-based taxes) and
how a lot of these budget cuts will disproportionally effect lower-income
populations (ie., less funding for higher education leading to higher tuition
= regressive transfer), and factor in stagnant real wages, are we moving into
another period of massive wealth polarization a la the 80s? Or is this just a
bad bump in the road?

Alan Jacobson