Morton J. Marcus is an economist formerly with the Kelley School of Business at Indiana University. His column appears in Indiana newspapers
“I can’t listen to more complaints about Trump.” says Hector Huevos. “There’s so much to be done locally and statewide, yet all we hear about is Trump and the adventures of his team.”
“Hmm?” I say. “Yes, but what are the priorities?”
“Redistricting our legislature, our congressional seats, our city and county councils,” Hector says. “And the distribution of income in our state is as cockeyed as the alignment of election districts.”
“I don’t hear any complaints about income distribution in Indiana,” I tell him. “Hoosiers seem pretty satisfied.”
“Right,” he sneers. “Satisfied like hogs preening for Easter. Don’t Hoosiers realize that 64 percent of Indiana’s federal income tax filers report less than $50,000 of income? And have only 23 percent of the income.”
“Hmm,” I say once more.
“You know what that means?” he asks. “It means those with $50,000 or more in adjusted gross income have 77 percent of the income even though they’re just 36 percent of tax filers.”
“Well,” I offer, “$50,000 is not that much.”
“Then look deeper,” Hector says. “Hoosiers with incomes of $100,000 or more reported 48 percent of the income, but they were only13 percent of all filing for 2015. Doesn’t that cry out of ‘inequity’ to you?”
Hector was heating. “Not necessarily,” I reply.
“Have you no conscience?” he demands. “Doesn’t it trouble you that in Jay County (Portland) 73 percent of the tax returns report only 35 percent of the income? Only six percent of filers in Jay County have incomes of $100,000 or more, and they account for 29 percent of the income.
Before I’m able to respond, Hector continues, “Boone County (Lebanon) has the greatest imbalance with 28 percent having 76 percent of the income; an imbalance of 48 percentage points. And Boone we know is just an outgrowth of Hamilton County where 32 percent enjoy 77 percent of income. Then we have Warrick (Boonville), Dubois (Jasper) and Floyd (New Albany) following with imbalances of 40 points or more at the $100,000 plus level.”
“And you think we can correct these imbalances?” I ask.
“Yes,” he says. “It’s not the people with incomes above $100,000 that trouble me. It’s the counties showing up well on the $100,000 plus list, that are also among the leaders on the under $50,000 list. It’s Dubois County where 62 percent of filers account for only 19 percent of income. Or Boone County, so much income, but half of all filers have only eight percent of the income. There’s serious poverty in counties that have the greatest affluence.”
“And tell me how we can balance things out?” I ask again.
“You’ll laugh,” Hector says. “But with a graduated income tax, we could increase subsidies for workers’ transportation. Likewise, we could increase subsidies for housing that encourage landlords and occupants to conserve energy.”
“Wow,” I say, “you are out of touch with today’s America.”