Lunch, Listen and Learn: Big Names on Economic Club Lineup

One venue, nine top-notch speakers. Congratulations to the Economic Club of Indiana program committee for putting together a very intriguing lineup for the 2009-2010 season.

A strong mix of Indiana leaders (Angela Braly, WellPoint, and Thomas Snyder, Ivy Tech Community College); former Hoosiers coming home (C-SPAN founder Brian Lamb and school reformer Kevin Chavous); more media giants (Steve Forbes, John Stossel and Gwen Ifill); and leaders in business (Patrick Michael Byrne of Overstock.com) and education/politics (Harvard economics professor Martin Feldstein).

All will be at the Indiana Convention Center for the monthly luncheon programs, starting with Braly on September 1. Not familiar with the Economic Club, an Indiana fixture for 35 years? Check out this excerpt from the organization’s 25th anniversary for some history on how it all got started and some of the big events over the years.

Fort Wayne area leaders, we’re not forgetting about you. John Norquist, former Milwaukee mayor and urban design/school reform authority, comes your way on August 28 to wrap up the inagaural summer series. Merrillville and Evansville enjoyed earlier visits from Scott Hodge (Tax Foundation) and Jim Morris (Pacers Sports and Entertainment and longtime civic leader), respectively.

Check out some or all of the upcoming events. Thought-provoking presentations are assured.

Tax Foundation: Corporate Taxes Hit Workers Hardest of All

A new special report from the Tax Foundation finds that when businesses are targeted with tax hikes, it’s actually the workers who end up being hit hardest. They conclude:

This study examines this correlation between corporate tax rates and wages, and it finds a causal relationship. States with comparatively low corporate taxes have seen wages rise beyond what they would have otherwise. Specifically, a one percent drop in the average tax rate leads to a 0.014 percent rise in real wages five years later. In dollar terms, that means wages rise $2.50 for every onedollar reduction in state-local corporate income taxes.

The reverse is also true: A one percent hike in the average tax rate leads to a 0.014 percent drop in real wages, or roughly a $2.50 loss in wages for each one-dollar rise in corporate tax collections. These results add to a growing literature in the international arena that compares changes in corporate tax rates and workers’ wages. Altogether, this body of work draws into question the conventional wisdom that corporate taxes add to the progressivity of the tax system. If instead of burdening capital, the corporate tax primarily burdens labor, as this study finds, then the corporate income tax does not add to the progressivity of the tax system.

Key Findings:

  • States with high corporate income taxes have depressed their workers’ wages over the long term, while states with low corporate taxes have boosted worker productivity and real wages.

  • This finding is consistent with other research focusing on the international trend towards lower tax rates: high corporate taxes tend to depress real wages.

  • According to this study, on average, between 1970 and 2007, a one-dollar increase in the average state-local corporate tax rate caused a $2.50 dip in wages five years later, compared with lower-taxed states.

  • A growing body of literature is showing that the burden of corporate income taxes falls predominantly on labor.

Find the full PDF of the report here. Thoughts?

Economic Club Hits the Road, Bringing Speakers to More Indiana Cities

The Economic Club is pleased to announce a series of presentations throughout Indiana during the summer months of 2009. These events, dubbed the "Economic Club Summer Series," will feature the same high-quality speakers that the regular season events have become known for.

"We are very excited to be bringing the (Economic) Club, in a physical sense, to other parts of the state," comments Steve Walker, president of the Economic Club.

An arrangement allowing WFYI to produce statewide broadcasts of current presentations has helped generate a great deal of interest outside of Indianapolis over the past two seasons. Hosting events in other cities is part of the continuing effort to bring the Economic Club to all Hoosiers.  

The first stop on the 2009 Summer Series tour is set for June 9 in Merrillville — featuring tax policy expert and nationally published opinion leader Scott Hodge. Indiana Pacers president Jim Morris will be the keynote speaker for a July 14 event in Evansville, and Fort Wayne will play host in August. Details for the August event and other specifics are still being finalized but will be announced soon.   

Current sponsors for the 2009 Summer Series include Ivy Tech, ProLiance Energy, Franklin College, Schmidt Associates and ESW Inc. Speaker’s Reception sponsors include NIPSCO – June; Old National, Regency Commercial Associates – July.

A variety of sponsorship opportunities remain. Contact Jim Wagner for details at [email protected].

Hodge at Economic Club: U.S. Tax Policy More Progressive Than You Think

Scott Hodge, president of the Tax Foundation, spoke to the Economic Club of Indiana today in Indianapolis. He offered some enlightening quotes:

  • "According to the Paris-based Organization for Economic Cooperation and Development (OECD), the U.S. has a more progressive tax system than Sweden or France or many other European countries we associate with oppressive tax systems. The U.S. already places a higher income tax burden on the top 10% of taxpayers than any industrialized country."
  • The irony is this:  "Despite the fact that we try more than any other country to use the tax code to reduce inequality, the OECD found that we have one of the highest levels of inequality among industrialized countries. Only Portugal, Turkey, and Mexico have higher levels of inequality."
  • "According to Gallup, 68% of Americans think wealth should be more evenly distributed and 51% think that should be done via higher taxes on the rich. Yet in 1939, only 39% favored higher taxes on the rich."
  • "One-third of all so-called taxpayers pay zero in income taxes because of the generosity of the credits and deductions that are currently in the tax code. Many of these folks not only don’t have an income tax liability, but they receive generous cash payments through “refundable” tax programs such as the Earned Income Tax Credit. In fact, the government gives out more than $50 billion in these refundable tax credits each year; in essence, we’ve turned the IRS into an ATM machine for welfare benefits." Continue reading