Teachers’ union pursuing constitutional amendment to raise taxes

by Chris Kirk,  Oct. 16, 2015

Reasons will never be wanting for proposed augmentations; and there will always be a party for giving more to the rulers, that the rulers may be able, in return, to give more to them. Hence, as all history informs us, there has been in every state and kingdom a constant kind of warfare between the governing and the governed; the one striving to obtain more for its support, and the other to pay less. … we see the revenues of princes constantly increasing, and we see that they are never satisfied, but always in want of more.      −Benjamin Franklin (1787)[1]

The Massachusetts Teachers’ Association intends to pursue an amendment to the state constitution which would increase taxes by 4% on people with an annual income of $1 million or more.

This is likely the start of an effort to replace the state’s current flat income tax with a progressive income tax.

For years, state spending on health care – for Medicaid, state employees, retirees, etc. – has climbed relentlessly. The increase in spending on health care has come at the expense of other areas of the budget. So the state government’s spending on education – in dollars adjusted for inflation – has stagnated.[2]

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In 2006, Massachusetts adopted a major reform of health care. But if anyone expected that health-care costs would be reduced or even restrained, those expectations have been disappointed: in 2014, the costs of health care rose 4.8% – while inflation was 1.6%.[3] So it’s unlikely that health-care costs will decline or even stop increasing anytime soon. Hence there won’t be more state money for education anytime soon either.

Since voters aren’t likely to approve local overrides during the continuing Great Recession, where will teachers get money for their annual raises?

Answer: Raise taxes on the rich.

Presently, Massachusetts residents pay a flat 5.15% on their income. The Massachusetts Teachers’ Association – and a union / liberal coalition called “Raise Up Massachusetts” – want the state to adopt a constitutional amendment that would impose an additional tax of 4% on income above $1 million.[4]

The amendment is expected to raise at least $1 billion. However, since there are almost 72,000 public school teachers in the state,[5] and since there are about 14,000 people in the state with incomes of $1 million or more,[6] and since the money would be split between education and transportation infrastructure, the amendment is unlikely to meet its goal of providing enough new revenue to fund teachers’ annual raises indefinitely. (Advocates of income tax hikes also routinely ignore the facts that rich people can move out of state, and that someone who earns over $1 million during one year may not earn that much next year.)

The proponents of this proposal must realize this; consequently, the proposal will inevitably be followed by income tax hikes on more and more taxpayers. It’s obviously the first step towards replacing Massachusetts’ flat tax with a progressive tax.

 

[1] Benjamin Franklin, “Dangers of a Salaried Bureaucracy,” 1787. http://www.bartleby.com/268/8/12.html
[2] Data from: MassBudget, “Analyzing the state budget for FY 2016,” August 13, 2015. http://massbudget.org/report_window.php?loc=Analyzing_the_State_Budget_for_FY2016.html
[3] Privanka Daval McCluskey, “In a setback for Mass., health care costs spike in state,” Boston Globe, September 2, 2015. https://www.bostonglobe.com/business/2015/09/01/healthcosts/W470z61YbrKIhrS7xuDyVI/story.html
[4] See: • Massachusetts Teachers Association, “Tax amendment would mean big gains for public education,” 2015. http://www.massteacher.org/news/archive/2015/tax_amendment.aspx
[5] During the 2014-2015 school year, there were 71,806 public school teachers in Massachusetts. See: Massachusetts Department of Elementary and Secondary Education, “2014-15 Teacher Data Report (District)” http://profiles.doe.mass.edu/state_report/teacherdata.aspx
[6] See: