dec Federal Tax Returns pdf
by matthew on Thu Feb 12 11:41:26 CST 2009
Alternate title: Stimulus? I’d settle for parity!
 
Recently Councilman Caulkins made a comment that seemed a little odd. The city had some proposal (I think it had something to how we plan to spend Federal CDBG money), and Greg Crowe was at the podium explaining why spending federal grant money on a local project was a good idea. After about 15 seconds of back-and-forth, I think everyone in the council chamber with half a clue was wondering who Caulkins was trying to impress. I found out…Missourians!!!
 
This got me wondering:  How much do we Illinoisans put into the federal tax system, and how much do we get back? 
 
Boy was I surprised!
For every dollar Illinois pays in Federal taxes, the state receives around 78 cents back in federal spending. Wisconsin receives $.88 for every $1 paid in, Indiana pulls back $1.07, Iowa $1.09, and Missouri take $1.32.  Illinois pays around $100billion in federal taxes, and we get around $78billion back. So, we come up short about $22billion a year. There are 12.8 million people in Illinois, and doing the easy math suggests we send federal government receives about $1,740 more-per-person than comes back to us in spending.
 
Apply that $1,740 per-person to Decatur (pop 77,000), and the governmental bodies that share the City of Decatur’s population (City, School, Parks, County, Water, Townships) would have a spare $132million a year for local projects. What infrastructure projects could we get done if we just reached federal-tax-parity? Once parity is reached, what local taxes can we reduce or even eliminate?
 
So members of the city council, local officeholders, administrators and candidates:  When the opportunity arises to use federal money for local projects, don’t turn it down! We pay our taxes in to the federal system, and we have every reason to see that money gets put to good use – right here!   
 
 
As for Councilman Caulkins, if Missourians, Iowans or Indianans could vote for Decatur City Council candidates, he’d have ’em all sewn up (more for them)… But last time I checked we’re in the middle of Downstate Illinois! 
 
The council should welcome and put to good use any funding from state or federal systems the city secures!  

What's more, the city, county, and state should all be agressively working on the feds - through our Congresspeople, Senators, and President!
 
by haydiz on Thu Feb 12 12:15:38 CST 2009
Those are interesting numbers.  So I guess we can assume that our state politicians are doing a lousy job bringing back federal funds???  Hopefully with Obama in the White House, more money will find its' way to Illinois - especially Decatur.

I agree that our city leaders should be shouting at the top of their lungs to bring funding to Decatur - and jobs.  But we also need to make sure that our city is attractive for prospective employers.  Low taxes, a trained workforce, ample water supply, and modern infrastructure all play a role.  I'm all for unions but they do turn off big business and they aren't exactly making Decatur an ideal location for new industry.  Our unions really need to reach out and change their image.  I know I'll get a lot of flack for that statement but if we're honest with ourselves, it's an issue we need to address.  It's no big secret why Firestone left Decatur or Caterpillar is moving many of their jobs to Arkansas.  We need to stress that we have a trained blue-collar workforce here that's ready to go to work.  How we go about doing that, I'm not sure.


by matthew on Thu Feb 12 14:38:17 CST 2009
Overall, I think the federal representatives are not doing that great a job of seeing we get a good return on our federal tax investment. 
 
I think my guy, Congressman Phil Hare is doing his best, and I’m looking forward to seeing what he can bring to our district now that we’ve got an Illinois Democrat in the White House.  Call me hopefully optimistic.
 
I think Congressman Tim Johnson needs to be shown the door – He can’t keep funding to the Jewel in his district: the UIC, and he hasn’t been able to keep FutureGen in Mattoon. I remember when he was elected in 2000 he pledged to serve no more than three terms. He’s now in his 4th. John Shimkus is another one that doesn’t seem to have done much – but admittedly I don’t know much about the 19th district. Aaron Shock – may be a boy wonder, but I think he’s in it more for Aaron Shock than the 18th District. He’s destined to be Washington’s youngest lobbyist-with-access-to-the-house-floor. Lol - I wouldn’t be surprised if he’s not already looking for office space on K-Street.
 
On the jobs thing…Looking back at the figures, Kentucky receives $1.51 for every $1 put into the system, and Arkansas receives $1.40. These states also “incentivize” relocating manufacturing to within their borders. In effect our federal taxes are subsidizing these states’ “corporate welfare” programs that are sapping us of jobs!
 
And at the risk of wandering pretty far afield, if you ask me, the solution to the jobs relocation issue is to pass a Federal Employee Free Rights act and normalize manufacturing wages, and seriously investigate adopting reflexive trade tariffs.  The goal is fair trade, not just profit.
 
Oh yeah, here’s my source for the state ROT (Return on taxes) data: http://www.nemw.org/
by haydiz on Thu Feb 12 16:14:12 CST 2009
"On the jobs thing…Looking back at the figures, Kentucky receives $1.51 for every $1 put into the system, and Arkansas receives $1.40. These states also “incentivize” relocating manufacturing to within their borders. In effect our federal taxes are subsidizing these states’ “corporate welfare” programs that are sapping us of jobs!"

The playing field is not level.  I agree we need some way to normalize the wages for manufactures but it's difficult because there's such disparity from one location to another.  If you make $18 an hour in Decatur, you're doing pretty good.  If you make the same wages in California, you're living in your car.  Manufacturers can pay less in cities that have a lower cost of living.  Decatur should be ideal for manufacturing jobs but we're not anymore - mainly because southern states are selling us out.  (With our Federal tax dollars!)

The state incentive thing bothers me a lot.  It's the same as coveting your neighbors wife, in my opinion.  Stealing jobs from one location of the country doesn't really benefit the country as a whole in the end.  Sure it benefits the companies and investors but as we know, sooner or later taxpayers are going to have to cough up the dough to help those who had their jobs stolen from them.  This is an issue that needs some serious discussion by our lawmakers.
by matthew on Fri Feb 13 10:51:06 CST 2009
I’m with you Kris –
 
The thing is I wouldn’t mind if Illinois and Indiana and Missouri and Iowa and Wisconsin got back .98 cents on the dollar and a post-Katrina Louisiana got 1.20 on the dollar during the rebuilding period, or sparsely populated Kansas got 1.05 back as they build an interstate highway, or build an intergovernmental subsidized irrigation system….That’s what the feds are for…We’re all one family of States (lol – you could say we’re United States); and circumstances beyond our control happen, and there are some jobs that are just too big for local and state agencies to complete on their own…
 
What bothers me is that some states have come to rely on getting significantly more than their share, and some state (like us) accept getting much less back than we contribute.  
 
 
by pastorwick on Tue Feb 17 14:36:03 CST 2009
For what it's worth, the Tax Foundation did an article a few years ago, when rates were still very similar, to explain the differences in Taxation to Spending from State to State.  I recommend reading it.  Of course our return per dollar is going to be much smaller.  We send out a ridiculous amount of dollars when compared to lower population states.  Note the table at the bottom of that article that shows what the US would have to pay California to match the percentage New Mexico got in 2004 (2.00 return on every dollar).

In 2006, the est. population of Illinois was over 12.8 Million.  The population for Missouri?  Over 5.8 Million.  So even if we were doing this by population, we should get twice as much as Missouri, right?  According to the documents on the site you gave, Missouri received 48,273 Million.  Illinois received 80,778 Million.  I know, we're still lacking some...but lets do better than point fingers.
by matthew on Tue Feb 17 17:01:47 CST 2009
I take your point Pastorwik, but the target is not to match New Mexico’s 2:1 spending ratio, but to come closer to a $1 in to $1 out sum for every State – with the expectation that some states may get slightly more than others.
by pastorwick on Wed Feb 18 12:34:24 CST 2009
But if we were simply aiming to get $1 from every $1 with no regard for population, etc.....it would mean a state like Mississippi would get $13 Million while a state like Illinois would get over $100 Million.   I realize we have a much larger population, but I'm not sure the difference there is quite what we should be aiming for.
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