NORTH CAROLINA ON ROAD TO RUIN

For years, I wore a lapel button on my lab coat saying, “Too bad ignorance doesn’t hurt”. In North Carolina, I am beginning to think that it does but no one cares. There is no way “all the people” in this state can be “ignorant” of the so-called George W. Bush tax cuts and the philosophy behind it did to the Untied States economy.  In summary, The Republican philosophy was to lower taxes on the rich and put on cost of government on the backs of the middle class and poor.  Increase the cost of government by cutting corporate tax rates while increasing corporate subsidies. McCrory, Tom Tillis, Speaker of the State Assembly and Phil Berger, senate leader proudly announced that the new tax legislation will increase sales taxes and decrease income taxes. Here are some of the details:

Lower income tax rates from 6, 7, and 7.75 % and replace them with the rates 5.8% in 2014 and 5.75 in 2015.

Eliminate personal exemptions, but increase standard deduction and eliminate $4,000 deduction on government retirement income and $2,000 private retirement income. Allow the greater of the standard deduction or itemized deductions equal to mortgage interest and property taxes capped at $20,000, plus all charitable contributions allowed by federal tax law. Raise child tax credit from $100 per child to $125 for tax filers with adjusted gross income below $40,000.

Reduce current corporate income tax rate of 6.9 percent to 6 percent and eventually to 4 percent in 2016 and 3 percent in 2017 if revenue growth targets are met (thus, they claim they can lock the barn door after the horse is stolen).

Expand sales tax to include service contracts. Double taxes on lower end homes at full 4.75 percent state sales tax rate. Repeal current 3 percent franchise tax on electricity sales, replacing it with 7 percent combined state and local sales tax rate. Cap sales tax refunds for individual nonprofit hospitals, universities and other charities to $45 million annually. The combined sales and local sales tax that consumers pay in most counties remains 6.75 percent.

Repeal estate tax, what they call death taxes.

Projected decrease in revenue of $86.6 million less in state revenues during the 2013-14 fiscal year and $437.8 million less in 2014-15 compared to current revenue levels. The amount extends to more than $600 million annually through mid-2018.

Even if you just skimmed through the above information it should be obvious, if you lower government income and increase government spending especially by giving it to corporations, you soon go broke. Everyone will agree that what the State of North Carolina is doing is consistent with Republican philosophy, which precisely parallels George W. Bush trajectory to 2007-2008 ruin. I cannot figure out why they want to trash the middle class. Can it simple be childish greed? Can it be ignorance of the legislators? Or, do they think they are going to gather enough riches to protect themselves even if they ruin the country? The biggest question I have relates to the people in North Carolina; are they so ignorant they could not know what Republican would do based on what George W. Bush did when they gave him the power. Has this state government hurt the voters enough or do they want more to be hurt more. They have cut unemployment insurance for thousands, they have refuse to take care of health issues of poor people with federal money, they have allowed utility rate hikes, have they suppressed their right to vote, and now they put the state on a clear trajectory to absolute  ruin.

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