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Lundy: Kasich's Cuts Hurt Schools, Communities and Middle Class Families

Governor's tax cut will disproportionally benefit the wealthiest Ohioans.

The most important bill we work on every two years is the Budget Bill. I wanted to update you on changes we have made in Finance Committee to HB 59.

I still have concerns because the latest changes continue to lock in cuts by Gov. Kasich which will hurt our schools, communities and middle class families. More money for school funding was promised, but the changes do not begin to solve the problems created by $1.8 billion in cuts in the governor’s last budget. By continuing to cut education, we are short-changing our future, limiting our long-term economic growth potential and forcing downward pressure on local property taxpayers.

The budget still includes a 7% income tax cut that will disproportionally benefit the wealthiest Ohioans. I believe that instead of more tax cuts that favor the rich, we should be prioritizing our schools, communities and our middle class families. I am pleased with a bi-partisan agreement to eliminate the governor’s proposal to expand the sales tax to over 80 services in Ohio. 

We must continue to work together to make Medicaid expansion work. It is estimated that over the next six years $2.3 billion dollars will be saved by getting Ohioans into doctor’s offices rather than emergency rooms. 

We must work together to find real solutions to the real problems we face. The new budget must be approved by the end of this June. 

Please make plans now to join us for our next “Lundy Listens” town hall meeting May 11 at 11 a.m. at The Sheffield Village Municipal Complex (4340 Colorado). You can always contact me with your concerns about state issues at 614-644-5076 or Rep.55@ohiohouse.gov. I work for you and look forward to serving you. 

 

 

 

 

A Lifetime Resident of Avon Lake April 17, 2013 at 03:23 PM
Here we go again, another politician who can't resist the urge to put his hand into our wallets and decide what we should spend "our" money on! This class warfare has got to stop. The rich will receive a "disproportionate" benefit through tax cuts? Maybe it is because they are already paying a disproportionate amount! Medicaid expansion will save money? When was the last time any government program saved money? Name just one...never happened. The thinking that expanding Medicaid will save Ohioans $ by receiving federal dollars is laughable. All federal dollars come from taxes, it is their sole source of revenue. Don't we all pay federal taxes as well. This is nothing more than a shell game. The CBO has already confirmed the ACA will cost 3x what was estimated, and we have not even instituted it yet. So Mr. Lundy, I ask...in this time of "share sacrifice" exactly what is my fair share. No one can ever come up with a number, except to say it is always more. Everyone's income taxes just went up 2%, despite being told they would not go up a "dime" for the middle class. The schools are asking for a huge tax increase, Medicaid will not save anyone money ,healthcare premiums are projected to rise by 80% in Ohio next years and you still want more? Are you serious????
A Lifetime Resident of Avon Lake April 17, 2013 at 03:58 PM
A Simple Example: If every U.S. taxpayer purchased a gallon of milk, each person would pay $2.49, and the total cost would be 140.5 million times $2.49 — or $349 million. Now let’s assume the government treated milk like government services and determined its price the same way it determines tax rates. The pricing would change as follows: When the bottom 40 percent of earners buy their milk, they won’t pay a dime for it. In fact, the government would give them $1 in reverse payments (tax credits) for every gallon of milk they purchase. The total cost of providing one gallon of milk to each person in this group would be $196.1 million. The cost of providing milk to the remaining 60 percent of the taxpayers would be $209.9 million, bringing the total cost burden of all taxpayers’ milk to $406 million. Under our existing tax rates, instead of paying $2.49 a gallon, the top 1 percent of earners would pay 38 percent of the total milk burden or $109.81 for a gallon of milk. The current tax system is unfair, but not because the wealthy don’t pay enough. It’s out of whack because it doesn’t acknowledge that the rich are paying more for their government milk than it’s worth so most others can pay less. And instead of saying thank you, we’re milking the "rich"cash cows dry.
Terska April 17, 2013 at 04:30 PM
Pity the poor billionaire. Their gallon of milk costs as much as their liter bottle Champagne. People in the top 1% don't pay 38% of their income in income taxes. People that make more than $200 million per year pay less than 25% of their income in income taxes. Almost all that income is not subject to payroll taxes such as Social Security and Medicare. These taxes do not apply to dividends, capital gains income and rents for example. They are only applied to labor. The richest 1% own 40% of the nation's wealth. They are not suffering from an unfair tax burden. They have it pretty easy.
william April 17, 2013 at 04:49 PM
The tax rate is the same for everybody at a specific income. The super wealthy pay the same tax rate at $ 10,000 , 20,000, 50,000, etc ... as everybody else does.
A Lifetime Resident of Avon Lake April 17, 2013 at 05:53 PM
Terska, Please read again. Never said the top 1% pay 38% of their income in taxes. They pay 38% of all taxes, a big difference. william, The tax rates may be the same, but the vast majority of those making under $50,000 per year pay no federal income tax, therefore have a tax rate of 0%!! It is about how much you contribute, not the percent. Percentages do not pay bills, dollars do. We should take a lesson from the plight of the people of Greece, Ireland, Portugal, Spain and Italy. They are rioting in the streets, it is on the news nightly, because their governments have not been able to fulfill their promised social obligations to the people due to a lack of funds, despite unbelievably high tax rates. We could not ask for more timely examples. Eventually, the government became so big, with a ravenous appetite for tax money, coupled with a population that expects too much, it became unsustainable. The United States is falling prey to this same problem. This is why our Constitution calls for limited government and individual responsibility. Once you tax all the money from the "rich", it is only a matter of time until they target the middle-class, which I am a part of, as that is where the largest pool of money resides. Be careful what you ask for. You should have learned on January 1 of this year when middle-class taxes went up, despite government's promise it would not.
rgnocp38 April 17, 2013 at 05:57 PM
Mr. Lundy is correct!! Every decision made starts from a baseline point. It is really amazing that many act as if there is an adversarial relationship or mal-intent by boards of education that are trying to cover the cost of providing a good education. None of us want to pay more taxes but sometimes you have to bite the bullet and pay what something costs, not try to bash those providing the service by maligning them as extravagant spenders. Education is the backbone of our society and should at the top of the priorities list in terms of funding.
Terska April 17, 2013 at 06:15 PM
What is the source of your assertion that the 1% pay 38% of all taxes? I'd like to see the source of the statement. Spain and Ireland both ran healthy budget surpluses until the real estate bubble collapsed. The reason they are suffering now is that their governments forced their taxpayers to bailout the private banks to protect the share holders and debt holders of those private banks. Their governments forced the public to absorb the losses of private shareholders. Austerity is causing their economies to continue to contract. Amazing isn't it? Contractionary policies cause economies to contract. Who would have guessed it? Eurozone countries are also unable to manage their own currencies. They are forced to follow German monetary and fiscal policies when they have different needs.
A Lifetime Resident of Avon Lake April 17, 2013 at 07:13 PM
Terska, "Internal Revenue Service (IRS) data, compiled from income tax returns, as reported by the Congressional Budget Office (CBO) shows that in 2009 the top 1% of income earners paid 39% of all federal income taxes." This can be fact checked on the IRS website if you choose. Google it. This is a widely known fact. Also, you mentioned above that most income of the wealthy is not subject to Medicare Tax. This is incorrect, as there are no income caps on Medicare taxes. Social Security taxes yes, not Medicare. In fact, for 2013 the tax rate for the "wealthy", singles over $125,000, will go up an additional 0.9% above a certain amount. So they will be paying a higher rate on Medicare taxes for the first time. Government forcing the taxpayers to bail out private companies in Spain? Sounds vaguely familiar, like the U.S. did for our own banks, automotive manufacturers and green energy companies, Fannie Mae, Freddie Mac etc., to name a few. In Spain, this happened in 2008, I wish we would have learned from their experience. Now they have to cut back on their entitlement programs, under a program of austerity. Spain's debt was simply too high and they could not tax their way out of it. They tried, but it did not work. Spending had to be cut. Given our nearly $17 trillion debt, how can we expect a different result? I guess we can at least continue to print money, which no doubt will lead to inflation with even more disastrous results.
Arena Gardener April 17, 2013 at 07:15 PM
Here is a good source to show what Lifetime Resident of Avon Lake is talking about: http://www.aei-ideas.org/2012/12/top-1-of-american-taxpayers-pay-almost-as-much-in-taxes-as-bottom-95-and-half-of-that-group-paid-nothing-in-2010/
rgnocp38 April 17, 2013 at 07:55 PM
I think it is correct that, regardless of your financial status, all have the same ability to benefit from our excellent public schools. Those IRS figures are correct, but being one of those who happen to be blessed with an income in those brackets, I have many avenues to reduce the effective rate I pay. I'm guessing the boo-hoo comments are coming from idealogues and Tea Party members trying to pretend they know what is going on.
A Lifetime Resident of Avon Lake April 17, 2013 at 07:56 PM
Arena, Thanks. That is a good site. Also where I got the "gallon of milk example." I enjoy the discussions here, we can have a difference of opinion, but do so in a respectful and open-minded manner. Bottom line is we are far to concerned what others earn, how much they pay in taxes and less concerned about spending. Personally, I could care less if someone makes more money than me, pay more or less taxes. I have no class envy, but am tired of others saying we do not pay our fair share. The fact is we do. I also have no issues with helping out others during tough times, but am tired of supporting generations of people simply because they choose not to work. We all know the problem in this country is spending, when we question it, we are referred to as uncaring and callous. The politicians, Republicans, Democrats, white, black, male or female are addicted to spending and unless we stand up now, our kids will be forever paying for their mistakes. Those who favor the school levy because it is "best for the kids" are often the same people who are willing to leave their kids with a huge debt which no education will ever get them out from under. Money is always better in the private sector, out of the government's hands. How many more examples do we need of government waste before we all stand up and say No More!!! I would prefer to give to the schools, but the federal government is taking it. Keep our money at the local level.
william April 17, 2013 at 07:59 PM
Once again , for the first $ 50,000 the vast majority of the super wealthy did not pay any federal income tax also. It is because of the deductions and exemptions. The people making under $50,000 did not get anything that the super wealthy did not get !!!!
rgnocp38 April 17, 2013 at 08:11 PM
Gotta agree with Lifetime Resident's comment about keeping it at the local level. Private sector is more efficient but the schools in middle class and wealthy communities have been forced into efficiency within the past five years. I think all decisions must be made based on value and what what is or has been received as a community. One problem to consider is that, my generation, the baby boomers, have been the worst for saving and this is affecting everything from the amount required to provide them healthcare and what we now have to ask present and future employees to provide to maintain solvency, eating into incomes which should be able to fund public programs at an acceptable rate. http://blogs.wsj.com/economics/2008/06/05/spendthrift-boomers-face-perilous-retirement-mckinsey/
rgnocp38 April 17, 2013 at 08:15 PM
This is the real reason that deserving public entities are facing a tax revolt. It is hard for me to feel sorry for those who didn't save and are now facing those consequences of not having done so. My grandchildren deserve the same educational programming as that which was provided for my children. http://www.mckinsey.com/insights/economic_studies/talkin_bout_my_generation
Arena Gardener April 17, 2013 at 08:23 PM
School districts cant rely so heavily on the state to keep them afloat. I understand the teachers unions are sucking the life out of school systems and it isnt easy to keep up with their nonsense but we have to do a better job of keeping budgets under control. Some services need to be privatized and others re evaluated to where it isnt comfortable. Hell it isnt comfortable for a majority of tax payers and many folks are sacrificing at home.
A Lifetime Resident of Avon Lake April 17, 2013 at 08:40 PM
William, Please define "super wealthy". Be exact. Is it $200,000? $1 million? $5 million? Factor in four in college, whom receive no financial aid. I do not take money from the government to pay my kid's way. It is an individual responsibility. I pay $90,000 per year in college expenses, 29.6 % effective tax rate after deductions(all taxes), moderately priced home ($250,000). Let's see....bring home about $140,000.00, $90,000 for college costs, leaves me with $50,000. $1800 in mortgage and taxes, leaves about $28,000. Cars, food, gas, clothes...basically leaves nothing! I live modestly and pay my own way. So, what is your definition of a "super wealthy" person? It must be more than $200,000, which is in the top 3% of all wage earners in this country. So even at $200,000, which most would consider a high wage earner, an increase in taxes has a dramatic impact on my basic quality of life, not on the type of champaign I can buy, as others here have stated. Maybe I should just feed at the public trough and let others pay my way too. I would likely be ahead. As for your comment above that someone who pays no taxes pays the same amount at the $50,000 level is nonsense and represents illogical thinking. My tax rate is across all income, including the first dollar I make. They pay nothing! I paid from dollar one!
Terska April 17, 2013 at 09:19 PM
Lifetime resident you just scolded me for talking about income taxes when you said you were talking about all taxes. Now you are supposedly quoting a site about income taxes but you didn't provide a link. You just said Google it. Well here you go. http://www.ctj.org/pdf/taxday2011.pdf Your tax data is refuted in many places including this chart from 2010. Medicare has no income limit but it is not applied to dividends, capital gains and rents. It only applies to hourly income and salaries. In other words it taxes work or labor. Social security does not tax capital gains or dividends either. If you're poor you pay it. If you're wealthy you don't. Just take most of your income as dividends and other types of income instead of wages and salaries. Look, I know this scam of complaining that poor people don't pay much in taxes. It's nonsense.
Arena Gardener April 18, 2013 at 12:02 AM
The lower income Americans dont pay any Federal income taxes. There is no denying that the rich are paying more in taxes in this country. Like it or not we need the rich. We would be in real trouble if there werent rich people in the U.S.
A Lifetime Resident of Avon Lake April 18, 2013 at 12:32 PM
Terska, My source is the Congressional Budget Office, a nonpartisan group which provides independent analyses of budgetary and economic issues to support the Congressional budget process. Your source is the Citizens for Tax Justice which was founded by labor unions and other special interest groups and is well-know for presenting misleading views of taxation in America to serve their own agenda. Your comment that the “rich” do not pay Social Security is ridiculous. The fact is not only do they pay it, but I am sure you know that up to 85% of their Social Security Benefits may be subject to income tax? Most high-income retirees will have 85% of Social Security benefits taxable. Again, the “rich” pay for something they will likely never benefit from. So Lundy and others say they're gonna raise taxes on the “rich,” with union workers, middle class, lower middle class taxpayers repeating the familiar chant, "Yeah, we’re gonna show them." The lives of these people doesn't change, their taxes don't change, their income doesn't go up just because you raise taxes on the “rich”. In fact, the more you do that, the worse off the lower income person is going to be. But nevertheless you are happy. Made happy through the suffering of others, not through any improvement in their own lives. We need to get out of this policy of revenge. You simply get off on the fact that other people are being hurt. And we wonder why kids today have a sense of entitlement?
A Lifetime Resident of Avon Lake April 18, 2013 at 12:58 PM
Treska, As a correction, I did intend to use the phrase "all income taxes" above. I can assure you my tax liability is much higher than 29.6%. Interesting that Lundy cites the savings of expanding Medicaid as "it is estimated that over the next six years $2.3 billion dollars will be saved by getting Ohioans into doctor’s offices rather than emergency rooms." My question to him is simple. Why then did the president just put the $500 million in cuts to hospitals to treat these patients back into the budget? It can only be because he realizes that his Obamacare will not reduce hospitals' uncompensated costs. They will continue to still seek treatment in the emergency rooms. Of course, this is only for one year. Right!! We have seen this every year since 2002 under Medicare. Why can't we simply learn from our mistakes, admit we were wrong, and move on, instead of repeating the same errors over again, at a cost of trillion of dollars to the taxpayers. This is going to be a medical and fiscal train wreck! The way it is presented is dishonest and disingenuous. The Affordable Care Act is anything but "Affordable", but a power grab to control 1/6 of the U.S. economy. Mr. Lundy's omission was intentional, as he continues to bow at the alter of socialism.
Terska April 18, 2013 at 04:09 PM
Rich people really don't pay Social Security. You know its a fact. Social Security only taxes the wages and salary to a maximum of a little over $100,000. Wages and salary above that are exempt. Dividends and capital gains taxes are totally exempt from Social Security and Medicare taxes. Look you have a partisan agenda that doesn't require you to tell the truth. When you count your total tax bill you count sales, state, property and other taxes but when you complain that poor people don't pay any taxes you don't count those same taxes that burden you. If you are truly bringing in $250,000 per year you are doing very well. You just need to live within your means like everyone else. An $1800 house payment is a lot of house. $400,000? Such suffering.
A Lifetime Resident of Avon Lake April 18, 2013 at 04:53 PM
Really, "Rich people really don't pay Social Security"?? Since you are big of referencing sources, I offer the following one directly from the SSA: http://www.ssa.gov/pressoffice/factsheets/colafacts2013.pdf I pay a combined 15.30%, up to wages of $113,700.00 for 2013. This is the fact! How can you possible consider this NOTHING!! It is $17,396 per year! "Rich" people not only pay it, they pay more since they hit the upper limit. When they retire, they pay taxes on it again! I do wish you would read my posts more closely. I said my mortgage AND taxes were approximately $1800 monthly. This equates to a home value of $250,000, not $400,000. Hardly a mansion given home prices in Avon Lake and four children living under one roof. Also, I never stated my income was $250,000. Where did I say "poor people don't pay any taxes". Where did that come from? Agenda. Yes, but it is not partisan. It is simply that we are overtaxed by a federal government who has absolutely no desire to control spending. This I believe we can all agree on. One needs to look no further than the federal deficit. Republicans and Democrats are both to blame. This money would be better put to use at a local level, not continually fed into the federal bureaucracy where there is enough waste and fraud to pay every school levy in this country until the end of time. Class warfare is the politician's tool to distract taxpayers away from the real problem, SPENDING. Don't fall for it!
Terska April 19, 2013 at 01:38 AM
Again you are being deceptive. The employee only pays 1/2 of the SS payroll tax. If you are bringing in a million dollars per year only you only pay SS on the first $100k or so The rest is exempt from SS tax. $900,000 of income on the top 1% that has no SS tax. Not that they would ever declare that as ordinary income anyway. Few people pay the entire 15% because self employed people take a large share of their income as dividends which are exempt. You most certainly said poor people don't pay taxes in your bogus milk parable.
A Lifetime Resident of Avon Lake April 19, 2013 at 03:58 AM
This is my final post on this matter. For the record, I pay not only the 15.3% combined SS and Medicare tax, since I own my own company, I also pay the other half for all my employees. I am considered self-employed by the IRS. Last year I paid over $120,000 in these taxes as an S Corporation. Where we differ is that I am a capitalist. I believe in a social system based on the principle of individual rights, free-markets and the freedoms guaranteed under our Constitution. I will never apologize for making "too much money" and providing employment for others to support their families. Making money is not immoral, as long as it is earned honestly, despite what you may think. Your views, by definition, are those of a Socialist. Wealth redistribution so that everyone in society is given equal shares of the benefits derived from others’ labors. Your class envy and desire to punish the “rich” is obvious to the point of being disturbing. Yet another farm example: Capitalism: I own two cows, I sell one to buy a bull so I can build a herd and produce milk , which I then sell to others would choose to buy. Socialism: I have two cows. The government takes one and gives it to my neighbor. Now we both have a cow, but cannot produce anything! Redistribution of wealth, government mandated and controlled healthcare, excessive taxation and limited personal property ownership. Sounds like the guiding principles Karl Marx and Hugo Chavez to me. Sounds like you!!

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