From the Senator's Desk . . .
December 10, 2009
Grover's Tub: "The Real Joe the Plumber Meets the Real Grover Norquist"
What happens when Joe the Plumber meets Grover Norquist? What happens is this—Joe’s kids pay more to go to college and Joe pays more in taxes. Joe, welcome to Grover’s Tub. Welcome to Texas.
Written by Senator Eliot Shapleigh, www.groverstub.com
What happens when Joe the Plumber meets Grover Norquist? What happens is this—Joe’s kids pay more to go to college and Joe pays more in taxes. Joe, welcome to Grover’s Tub. Welcome to Texas.
Joe the Plumber is of course John McCain’s small business prototype—a hard working, self-employed Ohioan who makes $47,930 a year for his work and sacrifice.
A Joe the Plumber, like many Texans, wants the best for his children. He makes less than a thousand dollars a week, pays a quarter of that on a home note, wakes up early to get to work, and makes the hard decisions every day to keep a small business going. During the course of every day, the real Joe decides what jobs get done when, what happens when credit dries up, and how to keep a family warm when the heater goes out.
His wife works another job to make ends meet—she’s a teacher in a local high school. One of his children plays football; another marches in the band.
Back in 2003, the real Joe took a Texas size hit. In the halls of Austin, state leaders pulled a fast one on Joe—and he never knew it.
Grover Norquist is the guy up in DC who is famous for saying his “goal is to cut government in half in twenty-five years…to get it down to the size where we can drown it in the bathtub”—only he never told Joe that his kids were headed to Grover’s tub.
Since 1917, Texas has had an estate tax. The estate tax started during World War I, an era when the U.S. government needed money to fight a war. Back then, Texas millionaires paid their taxes as patriotic Americans, to support their country when she needed them the most. By 2002, under the system, Texas millionaires delivered over $334 million to the Texas treasury to support our highway system and universities like UT and Texas A&M.
Then came Grover Norquist.
The heart of the Grover Norquist philosophy is tax cuts. But what most Americans don’t know is that those tax cuts go mostly to the rich. Under Bush’s tax cuts of 2001 and 2003, the average millionaire saved $120,000, while the poorest 20 percent saved $20 in 2007. During the Bush-Perry years, the rich got richer faster than at anytime in American history since the Gilded Age of the 1920’s.
In 2006, six years living under George W. Bush, average pre-tax incomes for the top one percent jumped an astounding $60,000 (5.8 percent), while the bottom 90 percent saw a mere $430 (1.4 percent) increase after adjusting for inflation, according to economists Thomas Piketty and Emmanuel Saez. According to the Center for Budget and Policy Priorities, the highest-income one percent of households in 2006 held a larger share of total pre-tax income that in any year since 1928. Want to see how that works? Here is a chart that shows the share of the nation’s total wealth held by income quintile:
So how do tax cuts work in Texas? In 2005, under Rick Perry’s ‘property tax reductions’ proposal, the wealthiest 10 percent would have received $331 million tax reduction, while the poorest 10 percent would have seen an $88 million tax increase. Grover’s tax cuts are money in the bank for the same guys who then fund the next campaign to deliver the next tax cut.
Later, in 2006, during the school finance debacle in Austin, the initial Republican plan to “solve” the school finance challenge cut taxes by $920 million for everyone making more than $104,000 and hiked taxes by $10.8 million on everyone making less than $33,000. Do you see a pattern here?
How does all this affect Joe’s kids? Well, in 2003, Grover’s disciples began phasing out the collection of the estate tax in Texas. In 2002, $334 million that used to come into the Texas Treasury to support UT and TAMU stopped. Instead, those same disciples decided that ‘tuition de-regulation’ was the way to go and unelected Regents—many of whom are millionaires who will benefit from estate tax cuts—then made the decision to hike tuition, books and fees by as much as 73 percent.
What was the end result?
By fall 2009, a few short years later, total academic charges at UTEP will have been hiked by 73 percent. Between 2003 and 2007, total tuition is up 86 percent at UT-Austin. At Texas A&M that number is 70 percent.
Here’s the bottom line—dollar for dollar, tax cuts for the wealthiest Texans were paid with tuition hikes on Texas university students. So for schools, Joe now pays more, and for college, much more. For more and more Texas families, college is now a distant dream.
During the 81st Session, bills to rein in tuition died in the Texas House. Joe will get no relief on his college tuition bills. Meanwhile, with $10-13 billion deficits looming next session, tax cuts to keep $675 million off property tax bills for America’s largest corporations sailed thru in .For the real Joe the Plumber, Grover’s tub is a tough place to be.