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The State of Ohio

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Abortion takes the spotlight in the US Senate race after some comments from one candidate. Haitian immigrants hit back against false and racist rumors. And state tax policy is always a big issue - highlights from a debate on that. Guests are Bailey Williams, Policy Matters Ohio, Joree Novotny, Ohio Association of Food Banks, Greg Lawson of the Buckeye Institute, Amy Hanauer of ITEP.

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00:00:39	Abortion takes the spotlight
00:00:39	in the US Senate race.
00:00:41	After some comments
00:00:41	from a candidate,
00:00:44	Haitian immigrants hit back
00:00:45	against false and racist
00:00:45	rumors.
00:00:48	And state tax
00:00:48	policy is always a big issue.
00:00:50	Highlights from a debate
00:00:50	on that this week.
00:00:53	In the state of Ohio.
00:01:12	Welcome to the state of Ohio.
00:01:14	I'm Karen Kasler.
00:01:16	The issue of abortion
00:01:16	is front and center again
00:01:18	in the race for U.S.
00:01:19	Senate in Ohio,
00:01:20	thanks to some comments
00:01:22	that were quietly recorded
00:01:22	at a campaign event.
00:01:25	In a video captured
00:01:25	last Friday, Republican
00:01:27	candidate Bernie Marino spoke
00:01:27	to supporters in Cincinnati.
00:01:30	You know, the left has
00:01:30	a lot of single issue voters.
00:01:33	Sadly, by the way, there's
00:01:33	a lot of suburban women.
00:01:36	What is it?
00:01:37	Rural women that like,
00:01:37	listen, abortions?
00:01:40	If I can't have an abortion
00:01:40	in this country
00:01:41	whenever I want,
00:01:41	I will vote for anybody else.
00:01:44	Okay.
00:01:45	A little crazy, by the way,
00:01:45	but especially for women
00:01:48	that are like past
00:01:48	50 of the. SUV.
00:01:54	And there's another video
00:01:54	from more than a year ago,
00:01:56	just before Marino
00:01:56	launched his bid for the U.S.
00:01:59	Senate.
00:02:00	In a video posted on Facebook
00:02:00	by Republican supporter,
00:02:03	Marino talks
00:02:04	about how the landmark Roe
00:02:04	versus Wade case establishing
00:02:07	a right to abortion
00:02:08	was technically
00:02:08	the wrong decision.
00:02:10	Imagine.
00:02:11	Imagine if you could go back
00:02:11	in the delivery.
00:02:13	You popped in the door
00:02:13	and out there
00:02:15	you went back and met Madison
00:02:15	and Hamilton, and Washington
00:02:18	said, hey, you're in favor
00:02:18	of worshiping Edwin Byrd? You.
00:02:22	Are you kidding me?
00:02:24	These are the most Christian
00:02:24	people on earth.
00:02:26	You never even heard of them.
00:02:28	So, hey, by the way,
00:02:28	what do you say?
00:02:30	We're saying that the
00:02:30	concept version provides you
00:02:30	the right in front of worship.
00:02:33	You, like, now this, we're
00:02:33	going back to the invoking.
00:02:37	Those comments sparked
00:02:37	a firestorm of negative
00:02:39	reaction from Republicans,
00:02:39	including Republican former
00:02:42	presidential candidate
00:02:42	Nikki Haley
00:02:44	and former TV personality
00:02:44	Geraldo Rivera, who now lives
00:02:48	in Greater Cleveland.
00:02:50	Outraged Democrats have
00:02:50	jumped on the tapes as a way
00:02:52	to ensure the issue
00:02:53	of abortion
00:02:53	and reproductive rights,
00:02:55	which 57% of Ohioans
00:02:55	guaranteed in the Constitution
00:02:58	last year
00:02:58	stays in the spotlight.
00:03:00	U.S. Senator Sherrod Brown's
00:03:00	campaign brought together
00:03:02	Republicans who say they now
00:03:02	won't vote for Merino.
00:03:06	am, but I'm over 50.
00:03:09	Not only does
00:03:09	she want to disregard
00:03:12	women's rights to our private
00:03:12	personal medical decision,
00:03:16	but he's also making
00:03:16	fun of people for caring
00:03:19	about our rights
00:03:19	and the rights of others.
00:03:22	And frankly, I just
00:03:22	don't think that's very funny.
00:03:25	you don't have to be a woman
00:03:25	over 50.
00:03:28	To feel strongly about
00:03:28	women's reproductive rights.
00:03:31	That's why I find Mr.
00:03:33	Marino's, statements
00:03:33	very disrespectful.
00:03:37	Disrespectful to me
00:03:37	personally,
00:03:40	but really
00:03:40	to all women in my life,
00:03:42	as well as a large majority
00:03:42	of the Ohio voters.
00:03:45	In a statement,
00:03:45	Marino spokesperson
00:03:47	Reagan McCarthy said, quote,
00:03:48	Bernie was clearly making a
00:03:50	tongue in cheek joke
00:03:50	about how Sherrod
00:03:52	Brown and members of the left
00:03:52	wing media
00:03:54	like to pretend
00:03:54	that the only issue
00:03:56	that matters to women
00:03:56	voters is abortion.
00:03:58	So Bernie's view is that women
00:04:00	voters care
00:04:00	just as much about the
00:04:00	economy, rising prices, crime,
00:04:04	and our open southern border
00:04:04	as male voters do.
00:04:07	And it's disgusting
00:04:07	that Democrats
00:04:08	wing media
00:04:08	and their friends in the left
00:04:10	constantly treat all women
00:04:10	as if they're
00:04:12	automatically single issue
00:04:12	voters on abortion
00:04:15	who don't have other
00:04:15	concerns that they vote on.
00:04:18	The struggle for illegal
00:04:19	immigrants
00:04:19	in Springfield continues
00:04:21	for both those migrants
00:04:21	and the city
00:04:23	where they've settled.
00:04:24	Ohio's Republican U.S.
00:04:24	Senator J.D.
00:04:26	Vance, the vice
00:04:26	presidential candidate,
00:04:28	was among the first
00:04:29	to share the unfounded
00:04:29	and racist rumors
00:04:32	about immigrants eating pets,
00:04:33	for which there is no evidence
00:04:35	talked about that
00:04:36	at a rally in Charlotte, North
00:04:36	Carolina, on Monday.
00:04:39	I wish the American media
00:04:39	was half as interested
00:04:42	in the stress on the local
00:04:42	schools,
00:04:44	the stress on the hospitals,
00:04:44	and unaffordable housing.
00:04:48	As they are,
00:04:48	and debunking a story
00:04:48	that comes from the residents
00:04:52	of Springfield.
00:04:53	Did you ever think about
00:04:53	listening to people
00:04:55	speak their truth
00:04:55	instead of listening
00:04:57	to some bureaucrat
00:04:59	and assuming that everything
00:04:59	that they tell you is true?
00:05:02	Former President
00:05:02	Donald Trump has said
00:05:03	he will bring his campaign
00:05:04	to Springfield,
00:05:04	but has not set a date.
00:05:07	Security was stepped up
00:05:07	at a Springfield City
00:05:10	Commission meeting this week,
00:05:10	and mayor Rob Rue says
00:05:13	ongoing threats have further
00:05:13	strained the city's resources.
00:05:16	So he's cautious about that.
00:05:18	If a presidential candidate
00:05:18	was going to come and
00:05:21	and bring a message of
00:05:21	of coming together,
00:05:24	trying to work
00:05:24	through problems,
00:05:26	talk about the real concerns
00:05:28	that why we're in the middle
00:05:28	of this debate,
00:05:30	immigration concerns
00:05:30	and immigration reform.
00:05:32	That would be great.
00:05:33	We would just
00:05:34	we'd like to see those words
00:05:35	from any presidential
00:05:35	candidate
00:05:37	that came to our town.
00:05:39	And so my concern is what
00:05:40	we've seen
00:05:40	on the national stage.
00:05:42	I really wouldn't
00:05:42	want that repeated.
00:05:45	From our community,
00:05:45	from in our community.
00:05:49	Meanwhile, a nonprofit group
00:05:49	representing Haitians
00:05:52	in Springfield
00:05:52	has used a state law
00:05:54	that allows private citizens
00:05:54	to file criminal charges
00:05:57	to do so against Trump
00:05:57	and Vance.
00:05:59	The Haitian Bridge Alliance
00:05:59	says the false and racist
00:06:02	rumors
00:06:02	shared by both candidates
00:06:04	have gone beyond
00:06:04	their First Amendment rights
00:06:06	because they have triggered
00:06:06	false alarms,
00:06:08	disruption of public services,
00:06:08	menacing and harassment.
00:06:11	A Clark County municipal
00:06:11	judge will determine
00:06:13	if warrants will be issued.
00:06:15	The Trump campaign said
00:06:15	in a statement
00:06:16	that the Republican ticket
00:06:16	is, quote,
00:06:18	rightfully highlighting
00:06:18	the failed immigration system
00:06:21	that Kamala Harris
00:06:21	has overseen and,
00:06:23	quote, and again,
00:06:23	claims thousands of Haitians
00:06:25	in Springfield are illegal
00:06:25	when most of them are not.
00:06:29	In Portage County,
00:06:30	the Board of Elections
00:06:30	has decided to exclude
00:06:32	the sheriff's office
00:06:33	from its security operations
00:06:33	for early in-person voting.
00:06:36	This comes
00:06:37	after Republican Sheriff
00:06:37	Bruce Koski made national news
00:06:41	for a Facebook post
00:06:41	that urged people
00:06:43	to take note of yards,
00:06:43	with signs
00:06:45	supporting Democratic
00:06:45	presidential candidate
00:06:47	Kamala Harris
00:06:47	so that quoting directly
00:06:50	when the illegal human locust,
00:06:50	which she supports
00:06:54	the places to live,
00:06:54	will already
00:06:56	have the addresses
00:06:56	of their new families
00:06:58	who supported their arrival
00:06:58	and, quote, the ACLU of Ohio
00:07:02	wrote him on September 17th,
00:07:02	asking him to delete the post.
00:07:06	It has been removed.
00:07:07	And in a follow up post,
00:07:09	Zukowski wrote that
00:07:09	his previous comments, again
00:07:12	directly quoting, may have
00:07:12	been a little misinterpreted.
00:07:15	I, as the elected sheriff,
00:07:16	do have a First Amendment
00:07:16	right, as do all citizens.
00:07:20	he continued with elections
00:07:20	there are consequences.
00:07:23	That being said,
00:07:24	I believe that those who vote
00:07:24	for individuals
00:07:26	with liberal policies
00:07:27	have to accept responsibility
00:07:27	for their actions.
00:07:30	I am a law man,
00:07:30	not a politician.
00:07:32	So Koski is up for reelection
00:07:32	this year
00:07:35	Well, reproductive rights
00:07:35	is a big issue this fall.
00:07:38	The economy is almost
00:07:39	always top of mind
00:07:39	for voters and taxes.
00:07:42	And what they're used
00:07:42	for are key elements
00:07:44	of any candidate's
00:07:44	economic plan,
00:07:47	whether at the federal, state
00:07:47	or local level.
00:07:49	I moderated a discussion
00:07:49	on state tax policy
00:07:52	with four experts
00:07:53	who have all been guests
00:07:53	on this show Bailey Williams,
00:07:56	A Policy Matters Ohio,
00:07:56	a progressive research group,
00:07:59	Lori Novotny of the Ohio
00:07:59	Association of Food Banks,
00:08:01	and a pair who have tangled
00:08:01	more than once on this set.
00:08:04	Greg Lawson from the Buckeye
00:08:04	Institute, a conservative
00:08:07	think tank, and Amy Hanauer,
00:08:07	formerly a policy matters
00:08:10	and now with a national left
00:08:10	leaning organization,
00:08:13	the Institute on Taxation
00:08:13	and Economic Policy.
00:08:16	but I have watched as Ohio
00:08:16	has just systematically
00:08:20	cut taxes for the wealthiest
00:08:20	people and corporations,
00:08:23	shifted taxes to lower
00:08:23	income taxpayers by cutting,
00:08:27	the income tax,
00:08:27	which is levied
00:08:29	according to ability to pay
00:08:29	and shifting to a sales tax
00:08:32	and reduced its ability
00:08:32	to invest in the very things
00:08:35	that make our economy strong.
00:08:37	So it's very hard to watch,
00:08:39	because I'm
00:08:39	looking at other states
00:08:41	that are doing good things
00:08:42	to make sure
00:08:42	that the wealthiest
00:08:44	and the corporations
00:08:44	pay their fair share,
00:08:46	and doing much more
00:08:46	as a result,
00:08:48	to invest in their kids
00:08:48	and invest in their families
00:08:50	and invest
00:08:50	in their communities.
00:08:52	So it's it's kind of hard
00:08:52	to kind of
00:08:53	come back to a state
00:08:54	that you like so much and feel
00:08:54	that so many legislators
00:08:58	are making decisions
00:08:58	that limit our future.
00:09:01	I want to ask Greg about that,
00:09:01	because this leads into
00:09:04	the whole discussion
00:09:04	about state policy.
00:09:06	The personal income tax
00:09:06	has been a target
00:09:08	for Republicans
00:09:08	going back decades.
00:09:11	At this point,
00:09:12	former Governor
00:09:12	John Kasich said he was
00:09:15	going to cut the income tax.
00:09:16	He wanted to move to
00:09:16	a consumption tax, sales tax,
00:09:20	the latest bill
00:09:20	that's out there,
00:09:22	and I mentioned it in
00:09:22	the intro,
00:09:23	would phase out
00:09:23	the income tax by 2030
00:09:25	and get rid of
00:09:25	the commercial activity tax,
00:09:27	which
00:09:27	is the largest business tax.
00:09:30	What would
00:09:30	be the result of that?
00:09:32	Why why would we want to do
00:09:32	this?
00:09:34	Well,
00:09:34	I think one thing is
00:09:35	we're gonna have
00:09:35	to be very cautious
00:09:36	about how anything
00:09:36	remotely like that is done.
00:09:39	We've seen states
00:09:39	move towards
00:09:42	eliminating, say,
00:09:42	the income tax.
00:09:43	Buckeye
00:09:43	Institute's on the record.
00:09:45	We're for that, but we're
00:09:45	for it in a long term sense.
00:09:48	It needs to have a long glide
00:09:48	path.
00:09:50	It can't be something
00:09:50	that's done short term.
00:09:51	It has to be done with revenue
00:09:51	triggers,
00:09:53	meaning that
00:09:53	if revenue targets aren't hit,
00:09:55	you delay some of the tax
00:09:55	reform or the cuts
00:09:58	so that you don't end up
00:09:58	with an unbalanced budget.
00:10:01	We have a constitutional
00:10:01	provision in Ohio
00:10:02	that you have to have
00:10:02	a balanced budget.
00:10:04	So we can't do what,
00:10:05	for example, my home state
00:10:05	I was born in Kansas,
00:10:08	Kansas screwed up royally.
00:10:09	They're a poster child for
00:10:09	how to do tax reform badly.
00:10:13	They cut taxes dramatically
00:10:13	without doing
00:10:15	any kind of budget reform
00:10:15	or anything like that to.
00:10:17	And they didn't do it
00:10:17	in a long term, perspective.
00:10:20	They did it much more quickly
00:10:20	and to rapidly.
00:10:22	So I think we need to be
00:10:22	very careful.
00:10:23	They had to repeal.
00:10:24	They did actually.
00:10:25	And they actually,
00:10:25	I believe it
00:10:26	even overrode their governor's
00:10:27	veto at the time, to do that.
00:10:28	So because it was so
00:10:28	so that is not the model.
00:10:31	The model is smart, strategic,
00:10:31	long term letting
00:10:35	growth happen long term
00:10:35	is six years long enough.
00:10:38	I mean, that's I would think
00:10:38	six years is a two short.
00:10:42	And I would say that long term
00:10:42	a long term strategy
00:10:46	to decimate your ability
00:10:46	to raise revenue
00:10:48	from those most able to pay
00:10:48	and decimate your ability
00:10:50	to deliver the things
00:10:50	that your communities need
00:10:52	is not a strategy at all.
00:10:54	I mean, it's a strategy
00:10:54	for Ohio
00:10:55	to continue
00:10:55	the path it's been on,
00:10:57	which is lack of growth
00:10:57	and population
00:11:01	growth and wages
00:11:02	that is far behind
00:11:02	the nation, growth in jobs,
00:11:04	that is far behind the nation
00:11:05	and culture wars,
00:11:05	which is what the junior
00:11:07	senator from Ohio is
00:11:07	wanting to deliver right now.
00:11:09	So I think it's it's really,
00:11:09	you know, based on
00:11:12	some of the best research
00:11:12	on the on the tax plan.
00:11:15	But it's not a plan.
00:11:17	It's a, it's a plan
00:11:17	for disaster for the state.
00:11:19	I want to ask you about that.
00:11:20	What, the research
00:11:20	that you have on this.
00:11:22	What what would be
00:11:23	the practical effect
00:11:23	in Ohio in terms of how people
00:11:26	how people pay?
00:11:28	Well, we're, as Amy has said,
00:11:28	the income tax is the one
00:11:32	tax in
00:11:32	Ohio is based on your ability
00:11:33	to pay,
00:11:33	eliminating that as long or
00:11:35	as well as what
00:11:35	the commercial activity tax.
00:11:37	We're looking at over
00:11:37	$10 billion in lost revenue.
00:11:40	I think it's closer.
00:11:41	About 13,
00:11:41	about half of our total state
00:11:43	tax revenue would be gone from
00:11:43	eliminating these two taxes,
00:11:48	just trying
00:11:48	to recoup half of that
00:11:50	through sales tax revenue,
00:11:51	and assuming that increased
00:11:51	economic activity will,
00:11:55	some of that revenue.
00:11:55	will help boost
00:11:58	That is very wishful thinking.
00:11:59	We'll have to increase
00:11:59	our sales
00:12:01	tax to some of the highest
00:12:01	in the nation,
00:12:03	above 8%,
00:12:03	just at the state level,
00:12:05	just to get back
00:12:05	half of that revenue.
00:12:08	And that's a big shift
00:12:08	towards, shifting that tax,
00:12:11	balance from,
00:12:13	again, the income tax
00:12:13	being based on your ability
00:12:15	to pay to the sales tax
00:12:15	being a very regressive tax
00:12:18	act, will take up more income
00:12:18	for lower earning Ohioans.
00:12:21	Greg,
00:12:21	I want to ask you to weigh in
00:12:23	on that briefly, that
00:12:23	the sales tax is regressive.
00:12:25	It hits people who make
00:12:25	less money harder.
00:12:28	I will also say that
00:12:28	a lot of staples of life
00:12:30	are exempted from the sales
00:12:30	tax base,
00:12:32	as it is, like groceries.
00:12:34	I mean, the different things
00:12:34	in the checkout
00:12:36	line and stuff like that,
00:12:36	but staples are exempted.
00:12:38	But I'll tell you
00:12:38	the here's the issue.
00:12:39	When you look at academic
00:12:39	literature on economics,
00:12:42	when you tax more of
00:12:42	something,
00:12:43	you're going to get less
00:12:43	of whatever that item is.
00:12:46	Now, you
00:12:46	still have to tax things
00:12:47	because you still have to
00:12:47	raise revenue.
00:12:49	So what you want to do is
00:12:49	you want to have the least
00:12:50	distorting tax possible
00:12:52	at tax,
00:12:52	that that doesn't influence
00:12:54	the decision
00:12:54	making of individuals
00:12:56	or the decision
00:12:56	making of businesses.
00:12:58	So you want to try to find
00:12:58	that a low rate, broad based,
00:13:01	consumption
00:13:01	tax makes more sense.
00:13:03	One thing
00:13:03	Ohio needs to think about,
00:13:05	if they're going
00:13:06	to get serious
00:13:06	about doing something on
00:13:07	the income tax side, is
00:13:09	they're going to have to
00:13:09	eventually look at broadening
00:13:11	the sales tax base
00:13:12	so that we can ameliorate
00:13:12	some of the issues
00:13:14	with some of the rate
00:13:15	increases,
00:13:15	because I agree, the rate
00:13:17	increases that you would have
00:13:17	to do to to do this
00:13:20	in a very short time
00:13:20	period would be usurious.
00:13:22	Doesn't make sense.
00:13:23	Plus, counties have piggyback
00:13:23	sales taxes,
00:13:25	which would make,
00:13:25	especially anywhere
00:13:27	that's on the state border,
00:13:27	a problem and stuff like that.
00:13:30	So we'd have to do it.
00:13:31	But we need to start thinking
00:13:31	about base expansion.
00:13:33	You want to tax? More or less.
00:13:34	I can just jump in as well,
00:13:36	because pushing or expanding
00:13:36	the tax base
00:13:39	means that Ohio will have to
00:13:40	start taxing things
00:13:40	such as groceries,
00:13:42	such as things
00:13:42	as prescription drugs.
00:13:44	So are we really going to ask
00:13:44	seniors
00:13:46	who are trying
00:13:46	to afford their medications,
00:13:48	or mothers
00:13:49	trying
00:13:49	to afford their groceries
00:13:50	to pay more, instead of
00:13:50	just having the rich pay
00:13:52	a little bit more through income
00:13:58	And I would just
00:13:59	piggyback a little bit
00:13:59	on what Bailey said.
00:14:01	The,
00:14:02	my organization
00:14:02	is the Institute
00:14:03	on Taxation
00:14:03	and Economic Policy. It
00:14:06	and we work with policy
00:14:06	matters, Ohio,
00:14:09	to to do the
00:14:09	the numbers for the tax plan.
00:14:12	It accounts for the items
00:14:12	that are exempt
00:14:15	from the sales tax.
00:14:16	And we still find that
00:14:16	it is a massive shift
00:14:18	from the wealthiest Ohioans
00:14:18	to working class and low
00:14:22	income Ohioans when we
00:14:22	when we shift to a sales tax.
00:14:25	So the fact that some things
00:14:25	are exempt, great.
00:14:28	But it doesn't change the fact
00:14:30	that this is a shift
00:14:30	from the wealthy
00:14:31	who can most afford to pay
00:14:31	on to the lowest income.
00:14:34	And as as Jory said,
00:14:36	I mean, I guess we'll get into
00:14:36	our earned income tax credit
00:14:39	and our lack of a child
00:14:41	tax credit in Ohio,
00:14:41	which so many states
00:14:43	are moving to start having.
00:14:45	But we just are doing
00:14:45	so many things in this state
00:14:49	to shift taxes from those
00:14:49	most able to pay to those
00:14:52	least able to pay and reduce
00:14:52	our ability to invest.
00:14:55	But there's also
00:14:55	another effect here of tax
00:14:58	shifting to local communities
00:14:58	aren't
00:14:59	don't
00:14:59	they have to start making up
00:15:02	for the revenue
00:15:02	that they're losing?
00:15:04	Well, potentially some,
00:15:04	but I'd also say that
00:15:07	one of the things that Ohio
00:15:08	has not done
00:15:08	a very good job of,
00:15:09	and this is a little bit
00:15:09	outside tax policy.
00:15:11	So I'm not going to go down
00:15:11	that rabbit hole too far.
00:15:13	But how do we structure
00:15:13	local government?
00:15:15	How many layers
00:15:15	of local government,
00:15:16	how many services, duplication
00:15:18	of services, various
00:15:18	things like that.
00:15:19	One thing
00:15:19	that I've worked on ever since
00:15:21	I've been a Buckeye,
00:15:21	and I think it's something
00:15:21	we need to continue to talk
00:15:23	about, is
00:15:24	the very structure
00:15:24	of local government
00:15:25	is, is is very complicated
00:15:25	in Ohio, more
00:15:28	so than some other states
00:15:28	because we're a home
00:15:29	rule state.
00:15:30	A lot of this goes back
00:15:30	to how the state was created,
00:15:32	Northwest Ordinance,
00:15:32	things like that.
00:15:34	But the problem is, is that
00:15:36	because
00:15:36	we have so many layers,
00:15:37	we have layers of taxation
00:15:38	that kind of build upon
00:15:38	each other.
00:15:40	And the question is,
00:15:40	are we always getting the bang
00:15:41	for the buck of the services
00:15:41	at the local level?
00:15:43	I would argue
00:15:43	that we haven't done
00:15:45	a very good job
00:15:45	on the structural basis
00:15:47	of things,
00:15:47	because really the taxes
00:15:49	are downstream
00:15:49	of the services.
00:15:50	People want services.
00:15:50	That's true.
00:15:52	People are going
00:15:52	to want to pay for services.
00:15:54	I think that's
00:15:54	absolutely correct.
00:15:55	But the question is
00:15:56	how much are you paying for
00:15:56	those services?
00:15:58	If you lower the state income
00:15:58	tax, you lower the revenue.
00:16:01	You and also
00:16:01	the other element here
00:16:03	is the lowering of money
00:16:03	that goes
00:16:05	from the local government fund
00:16:06	that goes to local
00:16:06	governments.
00:16:08	Jerry, I think you wanted
00:16:08	to speak here.
00:16:10	I mean, you
00:16:10	you rely on local governments.
00:16:14	Sure.
00:16:14	Many of course, broadly,
00:16:16	your health and human services
00:16:17	sector, among many other
00:16:17	sectors, among basic needs
00:16:19	that we all rely on every day,
00:16:19	right?
00:16:21	When we talk to food
00:16:21	pantry visitors,
00:16:23	we talk to
00:16:24	we surveyed
00:16:24	2300 food pantry visitors
00:16:26	earlier this year about why
00:16:26	they're coming to our lines.
00:16:28	What are their experience
00:16:28	right now?
00:16:29	They're telling us
00:16:29	about the choices
00:16:31	they're making between
00:16:31	affording transportation
00:16:33	or affording food, affording
00:16:33	child care, or affording food.
00:16:36	We need revenue
00:16:37	to be able to fund affordable
00:16:37	child care for low
00:16:41	wage workers so they can
00:16:41	continue to get to work.
00:16:43	Right.
00:16:43	And all of that rolls
00:16:44	into a conversation
00:16:44	about making sure
00:16:46	that we have work
00:16:46	that pays long term.
00:16:49	And when I think about a tax
00:16:49	base, I'm
00:16:50	thinking about
00:16:50	we're seeing 1 in 5 to 1 in 4
00:16:54	or more in
00:16:54	some places of Ohio,
00:16:56	of our food pantry visitors
00:16:56	that are over 60,
00:16:58	they found themselves
00:16:58	in their golden years.
00:17:00	They don't have the savings
00:17:00	that they expected
00:17:02	that would stretch
00:17:02	far enough to afford.
00:17:04	And when I think
00:17:04	about property
00:17:05	tax burden on them, sales
00:17:05	tax burden on them,
00:17:08	you know, we need a base
00:17:08	of, of tax revenue
00:17:11	that's going to support
00:17:11	services
00:17:12	for the life of a population
00:17:12	in Ohio that has aged.
00:17:15	I think we
00:17:15	we all want our older adults
00:17:18	to live
00:17:18	with dignity in place,
00:17:18	and that's part
00:17:20	of raising adequate revenue
00:17:20	to do so.
00:17:22	It's been mentioned
00:17:22	a couple of times here
00:17:24	the earned income tax credit.
00:17:25	I want to talk about that
00:17:25	a little bit.
00:17:26	And Bailey, I want to ask you,
00:17:27	Ohio has a nonrefundable
00:17:27	earned income tax credit.
00:17:31	What's the benefit
00:17:31	of having it be refundable.
00:17:35	Why do that. Right.
00:17:36	So, the benefit of having it
00:17:36	be refundable.
00:17:39	So if you have a negative
00:17:39	or you don't
00:17:40	have a tax liability at all,
00:17:40	you don't have to pay any tax.
00:17:43	You've already paid too
00:17:43	or too much,
00:17:45	through withholdings,
00:17:45	whatever the case may be,
00:17:47	if it's refundable,
00:17:47	you still get the value
00:17:49	of that credit
00:17:49	through a refund.
00:17:51	And that's the best way
00:17:51	to ensure
00:17:52	that lower income individuals.
00:17:55	Again,
00:17:55	as I mentioned earlier,
00:17:57	people who, benefit
00:17:57	from the standard deduction
00:18:00	and other tax credits
00:18:00	that lower their,
00:18:01	their tax liability
00:18:03	get making sure that these,
00:18:04	credits are refundable
00:18:04	gives them
00:18:06	the value of that credit
00:18:06	here in Ohio.
00:18:08	Are, EitC is a 30%
00:18:08	nonrefundable credit.
00:18:12	So it's it's
00:18:12	completely worthless of,
00:18:15	Ohioans who do not have
00:18:15	a tax liability.
00:18:18	And it kind of goes against
00:18:18	the entire basis of the SEC
00:18:21	when it's trying to give
00:18:21	incentives to various people
00:18:24	and trying to give them
00:18:24	various why not do that?
00:18:26	Right.
00:18:26	Well, I think the well,
00:18:26	the first thing is
00:18:28	a lot of folks,
00:18:29	part of it is we've dropped
00:18:31	a lot of people off
00:18:31	of the income tax period.
00:18:33	So that's one of the issues
00:18:33	is if you're not paying
00:18:35	an income tax,
00:18:35	which is was bad.
00:18:37	So we've lowered it
00:18:37	and I want to jump in here.
00:18:39	But but I'd say, look,
00:18:39	the federal one is refundable.
00:18:43	I think that there probably
00:18:43	needs to be
00:18:44	some conversations
00:18:44	in the childcare space.
00:18:46	I know those are
00:18:47	happening at some level
00:18:47	at the General Assembly,
00:18:49	so we probably are going
00:18:49	to have to talk about that.
00:18:51	And depending on
00:18:51	how we want to structure
00:18:53	something like that,
00:18:54	we're going to have to be
00:18:54	a little bit careful
00:18:55	because unlike the feds
00:18:55	who essentially can
00:18:58	kind of monetize
00:18:58	that and do things like that,
00:19:00	we the state doesn't
00:19:00	able to do that.
00:19:02	So we got to be careful
00:19:03	if we're going to start
00:19:03	moving in the direction
00:19:05	of making the state
00:19:05	income tax or,
00:19:06	having the refund
00:19:06	ability there.
00:19:08	But if you have a liability,
00:19:10	it should be able
00:19:10	to zero it out.
00:19:11	That is what the that's what
00:19:11	a non refundable one does.
00:19:14	But again
00:19:14	we have a lot of people
00:19:16	that are already off
00:19:16	of the income tax rolls.
00:19:18	And I think what
00:19:18	we probably really need
00:19:19	to start focusing on in
00:19:19	Ohio too, is
00:19:22	and this is why taxation
00:19:23	gets so complicated,
00:19:23	is it's not just the state
00:19:25	level of the federal level
00:19:25	is the local level, too.
00:19:27	The municipal income tax
00:19:27	in the state of Ohio
00:19:30	is a tax that everybody pays
00:19:30	who makes money,
00:19:33	no matter what.
00:19:34	Everybody pays in
00:19:34	and it's a flat rate.
00:19:36	So when we talk about that,
00:19:36	there's
00:19:38	no progressivity
00:19:38	to the local income tax.
00:19:40	Now we can argue about
00:19:40	whether that's
00:19:42	a necessary revenue stream
00:19:42	for local governments.
00:19:44	But let's understand what
00:19:44	that means for individuals.
00:19:46	So I want Amy to jump.
00:19:48	So for those of you
00:19:48	who don't know it,
00:19:50	Greg and Karen
00:19:50	and I used to do this
00:19:52	regularly
00:19:52	when I when I lived in Ohio.
00:19:54	And I have regularly missed
00:19:54	Greg because, we,
00:19:58	we enjoy mixing it up, but,
00:19:58	but he's saying some things
00:20:01	that I think
00:20:01	are a little bit confusing.
00:20:02	First of all,
00:20:03	one of the good things
00:20:03	that that
00:20:05	one of the good things
00:20:05	about the earned income
00:20:07	tax credit is, is designed
00:20:09	not only to offset income
00:20:09	tax payments,
00:20:11	but to offset those tax
00:20:11	payments,
00:20:13	those precise tax payments
00:20:15	that Greg is advocating go up
00:20:15	that are disproportionately
00:20:18	borne
00:20:18	by lower income families.
00:20:20	So the earned income
00:20:20	tax credit doesn't just offset
00:20:23	income taxes, it also offsets
00:20:23	sales taxes, property taxes,
00:20:27	and other more regressive
00:20:27	forms of taxation
00:20:29	that lower income
00:20:29	people pay more of.
00:20:31	And that hasn't gone away.
00:20:33	Almost every state, you know,
00:20:33	earned income tax credits.
00:20:36	I was so proud
00:20:36	when Ohio passed that.
00:20:38	But other states
00:20:39	have really leapfrogged us
00:20:41	because most of those
00:20:41	earned income
00:20:42	tax credits at the state
00:20:43	level are refundable now
00:20:45	because it doesn't
00:20:45	make any sense to say
00:20:47	we want to help people work,
00:20:47	but we're going to leave out
00:20:50	the lowest
00:20:50	income people when we do that.
00:20:53	And there's a similar debate
00:20:53	on the child tax credit.
00:20:55	And I'll just say
00:20:55	one more thing,
00:20:57	because Greg mentioned
00:20:58	wanting to lower the rates
00:20:58	and broaden the base.
00:21:00	That's something that anti-tax
00:21:02	people always say when they
00:21:02	when they want
00:21:04	to shift taxes away
00:21:04	from the highest income,
00:21:06	they say,
00:21:06	we're going to lower the rates
00:21:06	and broaden the base,
00:21:08	but then they don't
00:21:08	broaden the base.
00:21:10	And we saw that
00:21:10	at the federal level
00:21:13	with the 2017 tax cuts,
00:21:13	that the base wasn't run,
00:21:16	that 55 profitable
00:21:16	corporations paid zero taxes.
00:21:20	After the passage of that
00:21:20	supposedly rate
00:21:24	lowering, base broadening.
00:21:25	So I, I and I will just say
00:21:25	one more thing is that
00:21:29	I think they should thank you.
00:21:29	I'm going to go in there.
00:21:31	There we go.
00:21:35	And I
00:21:35	would just say one more thing.
00:21:36	I think it's interesting
00:21:38	that Greg wants to be
00:21:38	so cautious
00:21:40	about the potential costs
00:21:40	of refund ability
00:21:42	of the earned income
00:21:42	tax Credit,
00:21:43	but doesn't want to be
00:21:43	cautious
00:21:45	about the cost of delivering
00:21:46	more and more
00:21:46	and more tax cuts
00:21:48	every year to the wealthiest
00:21:48	Ohioans.
00:21:50	I think
00:21:50	if we want to be cautious
00:21:52	about helping the lowest
00:21:52	income Ohioans thrive,
00:21:55	we want to be
00:21:55	certainly cautious
00:21:57	about continuing to reward
00:21:57	the wealthiest Ohioans.
00:21:59	There's another area
00:22:00	where I think you folks agree
00:22:00	the LLC loophole,
00:22:03	and that is where, LLC
00:22:03	can exempt the first 250,000
00:22:08	of $1 million in income
00:22:08	and then pay a low tax
00:22:10	rate on the rest.
00:22:11	It costs the state $1 billion
00:22:11	a year, approximately.
00:22:15	And there doesn't seem to be
00:22:17	a whole lot of evidence
00:22:17	that it creates jobs.
00:22:19	I mean, Bailey, have you seen
00:22:19	any evidence of that?
00:22:21	Not any. Nope,
00:22:21	not in our research here.
00:22:24	There's really no good excuse
00:22:24	for it, in my opinion.
00:22:27	So yeah, let's look that up.
00:22:29	Costing us $1 billion.
00:22:30	That could help us pass
00:22:30	a, completely refundable
00:22:35	child tax credit
00:22:35	that could help us fund
00:22:37	a, refundable
00:22:37	EitC at 10% four times.
00:22:41	We could do that
00:22:41	with this money.
00:22:43	And it's a much better
00:22:43	investment
00:22:45	in, working in everyday
00:22:45	Ohioans, right?
00:22:48	Why not? Well,
00:22:48	why do we have this so?
00:22:50	Well, and
00:22:50	the idea is that
00:22:50	it was meant to be for
00:22:52	small business owners
00:22:52	to be able to get to it
00:22:54	because you see,
00:22:54	that they can make investments
00:22:57	back, hire people,
00:22:57	do things like that.
00:22:59	I'm not sure that it's as well
00:22:59	targeted as it should be.
00:23:01	That's basically
00:23:01	what we're hearing here.
00:23:03	So, you know, lawyers
00:23:03	typically can use this.
00:23:05	A lot of folks like that,
00:23:05	you know,
00:23:07	they don't necessarily hire
00:23:07	somebody else
00:23:09	just because they made
00:23:09	some of that.
00:23:11	I will say, though, that
00:23:11	you do need to be cautious
00:23:13	because there again,
00:23:14	and I know I use that word,
00:23:14	but this is why tax reform
00:23:17	is obviously
00:23:17	a very challenging thing.
00:23:18	Because if you raise
00:23:18	that on certain
00:23:20	like contractors
00:23:20	and things like that,
00:23:22	you could have
00:23:22	some real negative impacts
00:23:23	on some small businesses
00:23:25	that do have potential job,
00:23:25	impacts downstream.
00:23:29	One thing
00:23:29	I think that
00:23:30	if you're going to
00:23:31	move towards
00:23:31	this income tax
00:23:31	elimination idea, like
00:23:33	some members of the General
00:23:33	Assembly are pushing for,
00:23:35	you would,
00:23:35	I mean, at some point
00:23:37	you wouldn't
00:23:37	even need to have the
00:23:39	small quote
00:23:39	unquote business loophole
00:23:40	because you have
00:23:40	no income tax.
00:23:42	So you would probably want to,
00:23:42	reduce things
00:23:45	as you phase it out.
00:23:46	So I would not I'd be careful
00:23:46	about trying to jack it up.
00:23:49	As you're facing down
00:23:49	the income tax as well,
00:23:52	because at some point
00:23:52	that doesn't make sense,
00:23:53	to do it that way.
00:23:55	But we have to be careful.
00:23:57	I think we could have been
00:23:58	a little more cautious in
00:23:59	how we initially put
00:23:59	some of this stuff together,
00:24:01	because
00:24:01	what we've ended up doing
00:24:03	is, if you're really serious
00:24:04	about
00:24:04	getting rid of the income tax,
00:24:05	as some members
00:24:05	of the legislature want to be,
00:24:07	they've made it really hard
00:24:07	for themselves to do that
00:24:09	because of how they structured
00:24:09	previous rounds of tax.
00:24:11	And there have been efforts
00:24:11	to try to get rid of this
00:24:13	loophole that have gone on
00:24:13	to pay for lowering rates.
00:24:15	You can make an argument
00:24:15	that if you phased it up,
00:24:18	you could lower the rates
00:24:18	commensurately for everybody.
00:24:21	Something like that.
00:24:22	It's kind of pulling
00:24:22	the different levers.
00:24:23	Amy's going to say something.
00:24:24	Well, I, I've actually lost
00:24:24	a little track of the Ohio
00:24:28	LLC loophole.
00:24:29	But what I will say
00:24:29	is like backing up
00:24:31	from a federal level,
00:24:33	what I see is that
00:24:33	is that the states
00:24:35	that are doing
00:24:36	the most for their families
00:24:36	and the states
00:24:38	that are growing the quickest,
00:24:38	and this is states
00:24:40	that are really diverse
00:24:40	in terms
00:24:42	of where they are geographic
00:24:44	and where they are
00:24:44	economically,
00:24:45	are the states
00:24:45	that are recognizing that they
00:24:48	that they have to tax
00:24:48	the wealthiest more in
00:24:50	that they have to
00:24:50	tax corporations more,
00:24:52	because that is actually
00:24:52	what enables them to invest
00:24:55	in things that enable
00:24:55	corporations to thrive. Right?
00:24:57	Like if we don't have a good,
00:24:59	K-12 education system,
00:24:59	if we don't have a
00:25:01	good college system,
00:25:01	if working class kids
00:25:03	can't afford to go to college,
00:25:05	then how our business is going
00:25:05	to thrive in that state.
00:25:07	And so I think the states
00:25:07	that are growing fastest
00:25:10	and seeing the fastest
00:25:10	income growth
00:25:12	and the fastest population
00:25:12	will not always the fastest
00:25:14	population growth,
00:25:14	but the fastest income growth
00:25:16	are the states
00:25:16	that are choosing a more,
00:25:19	investment
00:25:19	oriented approach to taxation.
00:25:22	I You can see
00:25:22	the full conversation
00:25:24	in the City Club
00:25:24	of Cleveland's archives
00:25:26	at City Club Talk.
00:25:28	And that is it for this week
00:25:28	for my colleagues
00:25:30	at the Statehouse News
00:25:30	Bureau of Ohio
00:25:31	Public Radio and Television.
00:25:31	Thanks for watching.
00:25:34	Please check out our website
00:25:34	at State News Talk
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00:25:39	You can also hear more
00:25:39	from the Bureau
00:25:41	on our podcast,
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00:25:47	time for the State of Ohio.
00:25:56	A. Support for the Statehouse
00:26:08	News Bureau
00:26:08	comes from Medical Mutual,
00:26:09	dedicated to the health
00:26:09	and well-being of Ohioans,
00:26:12	offering health insurance
00:26:12	plans, as well as dental,
00:26:15	vision and wellness programs
00:26:15	to help people
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00:26:17	and remain healthy.
00:26:19	More at Med mutual.com.
00:26:21	The law offices of Porter,
00:26:21	right, Morris and Arthur LLP.
00:26:24	Porter Wright is dedicated
00:26:24	to bringing inspired legal
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00:26:30	More at porterwright.com.
00:26:31	Porter Wright
00:26:31	inspired Every day
00:26:34	in Ohio Education Association,
00:26:34	representing 120,000
00:26:37	educators who are united
00:26:37	in their mission
00:26:39	to create the excellent
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00:26:41	Every child
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Note : Transcripts are compiled from uncorrected captions