The Norman Transcript

May 18, 2013

Tax cuts help wealthy and harm schools

By David Morgan
The Norman Transcript

NORMAN — Perhaps it’s old news by now, but I hope the controversy will live on.

The governor and Republicans in the Oklahoma legislature recently agreed to reduce the state’s personal income tax from 5.25 percent to 5.0 percent in 2015. This tax cut will take about $237 million from state schools and other vital state services.

For a variety of reasons this action is irresponsible, unnecessary, and regressive. The main beneficiaries will be the state’s well-off taxpayers. About two thirds of the tax reductions will go to the wealthiest 20 percent of Oklahomans. The vast majority of the state’s poorest taxpayers will receive nothing. Middle income families could expect only about $40 a year in cuts.

Others, including Norman’s Superintendent of Schools, have pointed out how harmful any tax cuts will be to Oklahoma’s public schools. Over the past five years, enrollment has increased as state formula funding has declined. Between 2008 and 2012, reductions in state spending per student for common schools in Oklahoma was the fourth largest in the nation.

And here’s the startling fact. These tax cuts were not supported by public opinion. Almost every poll shows that people like tax cuts in theory, but when they understand the potential consequences, many change their mind.

A recent poll by The Global Strategy Group shows that 52 percent of Oklahoma voters favored the income tax cuts in the abstract. But, when told that over 40 percent of Oklahomans would receive no tax cut at all, about 60 percent were opposed. Even a plurality of Republicans opposed cuts after learning how much this action favored the wealthiest taxpayers.

A majority of voters (56 percent) also opposed the plan when told that “Oklahoma will collect $125 million less in tax revenues to fund state services, such as education, public safety, and health care.”

When voters really understand what happens when tax cuts disproportionately benefit the rich and might harm vital state services, most folks respond rationally. Why don’t elected officials grasp this fact?

David Morgan, of Norman, is a retired professor of political science.