Will Any Presidential Candidate Connect Federal Tax Policy and Police Killings?

[cross-posted from the IPS Government and Politics Blog]

By Bob Lord and Karen Dolan

An 18-year-old Mike Brown was walking to his grandmother’s house one summer afternoon in Ferguson Missouri. An officer stops him for jaywalking. He ends up lying dead in the road for four hours. Walter Scott is  pulled over for a broken taillight in a high poverty area in South Carolina. He flees- presumably out of fear of back child support owed to the state. Minutes later, he is dead on the ground, shot in the back. A 16-year-old girl is thrown across a classroom by a school cop for failing to relinquish her cell phone. A 17-year-old boy with a small knife, walking away from officers, is shot 16 times — 15 of those bullets pumped into his already dead body in the middle of the Chicago road.

The list of these tragic deaths is long. Over 1,000 deaths have occurred at the hands of law enforcement so far this year. Black males are 3.5 times more likely to become victims than their white counterparts.

Cell phone videos of police brutality have forced this country to confront the ways poverty and race play out in city after city, school after school, jail after jail.  We know the factors underlying America’s legacy of racism contribute to this crisis. But one factor largely has been overlooked.

When the U.S. Department of Justice investigated the shooting of Mike Brown, it found an excessive pursuit of revenue through over-aggressive policing of minor violations such as traffic and municipal code offenses. Further, it found racial bias on the part of authorities against the majority black population in Ferguson.

The connection between police violence and the reliance on law enforcement to raise revenue, however, is but the last link in a chain of causation that begins with federal tax policy.

Any county, city, or town relies both on funding sources it can control and those it can’t. The first category includes license fees, traffic tickets, and fines for violations of local ordinances, such as jaywalking. The second category consists of tax revenue that each state shares with its various subdivisions.

If revenue from state revenue sharing decreases, a city, town or county faces pressure to increase revenue from sources under local control. Will there be pushback from citizens? Yes, but that pushback will be weakest in poor communities. Increasing the cost of licenses or building permits requires official action by local government leaders. That carries a stiff political cost. But increased code enforcement in poor communities? That just takes a phone call or lunch at a quiet restaurant.

Changes in revenue sharing by the states, then, are the link preceding reliance on law enforcement to raise revenue. There are exceptions, but in order to balance budgets, states typically have squeezed their counties and cities. Arizona, for example, recently balanced its budget on the backs of counties, cities and school districts. Arizona has one of the highest rates per capita of killings by police. Phoenix, its capital and largest city, has been one of the country’s most dangerous cities for police killings.

So, why the shortfall in state tax revenue? Tax cuts. Over the past few decades, the states have engaged in a vicious race to the bottom, trying to lure businesses and wealthy individuals with low tax rates. That race originated with changes in federal tax policy that infected the politics of state tax policy.

Consider the federal estate tax. Prior to 2001, states shared in federal estate tax revenue simply by imposing an estate tax according to a federally established schedule.  The tax cost their residents nothing, since a person’s federal estate tax obligation was reduced, dollar-for-dollar, by the state-level estate tax he paid. Every state participated. Politically, it was free money.

The Bush tax cuts eliminated that revenue sharing structure, replacing it with one far less generous to the states. Consequently, 32 states have abandoned their estate tax – and the revenue derived from it.

The connection between federal and state income tax policy changes is less obvious, but the impact is the same. The federal income tax benefit associated with state income taxes has fallen, thus increasing the real cost of those state income taxes to those who pay them. That opened the door for anti-tax ideologues, most noticeably the American Legislative Exchange Council, to push for reductions in state tax rates, with an associated reduction in revenues.

The bottom line: ill-conceived changes in federal tax policy contributed to local revenue problems and the fraught atmosphere in which a teenager was shot dead over what started as a jaywalking violation. Structural and cultural racism can’t be addressed by tax policy alone. Nonetheless, because federal tax policy contributed to the increase in police violence, it also must play a role in reducing it.

Millionaires and billionaires and the corporations they own must face higher nominal federal tax rates, with an offsetting federal tax reduction for state level taxes they pay. Generous federal subsidies will force the hands of state legislators to impose higher taxes, which in turn could be shared with cities and towns. That can create the space for a reduction in the number of confrontations between poor people and police that end tragically.

Unfortunately, no presidential candidate recognizes the link between federal tax policy and police violence. The tax plans of both Trump and Bush would reduce the portion of state income tax payments offset by a reduction in federal tax liabilities. Marco Rubio’s plan is worse.  It eliminates the federal deduction for state income tax altogether. Don’t expect any better from the Democrats. They tend to treat the federal income tax deduction for state income tax as a loophole, so it’s unlikely they’ll seek to increase the value of that deduction to taxpayers.

Perhaps by 2020 our candidates will focus on this. Or maybe 2024. The question is: how many more Mike Browns who jaywalk on the way to Grandma’s house will be left dead in the street before presidential candidates make addressing this toxic blend of racism and revenue pressures a priority?

Bob Lord, an Arizona tax attorney and former Congressional candidate, is an associate fellow at the Institute for Policy Studies.

Karen Dolan directs the Criminalization of Poverty Project at the Institute for Policy Studies. She co-authored The Poor Get Prison: The Alarming Spread of the Criminalization of Poverty.

16 thoughts on “Will Any Presidential Candidate Connect Federal Tax Policy and Police Killings?”

  1. For thirty years starting in the 1980’s, the City of Phoenix did periodic quality of service surveys. In each of these surveys, anywhere from 12 to 16% of the citizens rated the quality of service “Excellent”. Absolutely no correlation with cost whatsoever. I had the state retirement system run the numbers on State, County and City employees. Ongoing employees (red apple this year, exact same red apples next year) at the state averaged a 6% increase in their salaries from one year to the next, ongoing employees at the county level averaged an 8% increase in their pay. Ongoing employees at the city level averaged an eye popping 11% increase in their pay from one year to the next. Retirement system data doesn’t lie, budgets and reports easily deceive.

    Now having said that, leadership does matter. The city of phoenix has been on the move – finally. Crime is way, way down – they may have had something do do with that, I am trying to tease out the causes. And, they are paying more attention to poor people and poor neighborhoods. The 5 highest crime source (where the criminal comes from, not where the crime occurs) zip codes are in South and west Phoenix. When I drive those zip codes, which I do once a month, the difference is palpable from just a few years ago. The graffiti has disappeared and the streets are being repaired.

    Someone, the Mayor and his energy or leadership in staff is focusing on helping poor people and poor neighborhoods.

    Money has nothing to do with it.

  2. There is a difference between something actually causing another thing to happen, something contributing to another thing happening and things being merely coincidental. I think that your analysis connects “causal dots” to quickly and too tenuously.

    I also believe that your statement, “The connection between police violence and the reliance on law enforcement to raise revenue, however, is but the last link in a chain of causation that begins with federal tax policy,” involves too many dominoes and even reliance upon the “butterfly effect.” (The flap of a butterfly’s wings changed the air around it so much that a tornado broke out two continents away. – Urban Dictionary.)

    That said, I believe that in some cases, but only a very small number of cases, revenue seeking through fine-generating policing contributed to but did not cause incidences of police-citizen violence and even deaths. I say contributed and not caused because, were the link causal, many more people pulled over for minor, fine-seeking offenses would be involved in violent encounters with the police. That is not happening.

    I also believe that you need to present data to establish the causal link you claim occurred in Phoenix. Did the budget cuts actually increase police traffic stops significantly? Was there a coincidental increase in police-citizen violence during such stops? Can you rule out other causes for the violence, if present at all?

    If you have such data, then a conversation on causality can begin. Until then, the CAUSAL claim is unsupported speculation and risks unnecessarily confusing and alarming people, especially minorities.

    • Only in a world where nobody understands the behavioral ramifications of public policies does sole reliance on “data” become the only measure of legitimacy.

      There are other ways to make sound, valid arguments that support the thesis of this op-ed.

      Btw, John, have you found any more of those lucrative ways to sell your influence to campaign donors lately? Oh, I forgot, you’ve also spent time this week with the strokers at ALEC (as reported by your fearless leader, Debbie Lesko).

    • john I need you and herr huppenthal to play anti-immigrant nazi bikers in my movie thealamoisavenged.com this could be your big break! you get to shoot the mexican women and children as they sit on the road singing my country tis of thee.

  3. I have come across speed traps in small towns to gain revenue for over 60 years. in chicago they shortened the yellow lights causing accidents and deaths to gain revenue. janet napolitano did the same thing on the freeways to gain revenue when she saw how much money scottsdale was making by shortening the yellow lights. revenue disbursement is based on who has the political pull not on needs.

  4. Really? Take our cities in Arizona for example. Cities were unscathed by the unrelenting tax reduction at the state level. They took advantage of this to put in steady increases in property and sales taxes. So, we can do a side by side comparison of cities and school districts. Take for example, the city of chandler and the chandler school district. Since 1996, the Chandler school district has moved up steadily in the percentage of parents rating their child’s school an “A” school to well over twice the national average in that rating coming in at 61%. The city of chandler has done the reverse, in 1995, Chandler had the highest Excellent rating in the state at 55%, today, that has dwindled to 32%. On a national ranking, the city of chandler is an expensive city while the chandler school district is inexpensive. Absolutely no correlation to quality at all, in fact the reverse.

    Government just grows without end and the high fees have no connection to other revenue.

  5. The thesis of this post is simple common sense and arithmetic.

    As a former government accountant and observer of state government in Arizona, I believe Lord and Dolan hit the nail directly on the head and that nail was aimed squarely at the root of the problem.

  6. “An 18-year-old Mike Brown was walking to his grandmother’s house one summer afternoon in Ferguson Missouri.”

    No mother should have to worry that their sons risk being shot on the way to grandma’s house every time they rob a store or assault a police officer!

    • NidanGoju, you do realize how easy it is for rogue law enforcement officers to manufacture justification for murder, don’t you?

      Michael Brown did not rob a store. At worst, he may have attempted to shoplift a petty amount of merchandise.

      Are you suggesting that to be reasonable for police to, bypassing the judicial system, impose immediate capital punishment?

      • Further to your point, Steve, my recollection is that the cop did not even know about the shoplifting at the time he shot Brown.

      • Two things Az, first:
        “Michael Brown did not rob a store. At worst, he may have attempted to shoplift a petty amount of merchandise”
        Bwaaaaaaahahaha! You may wish to consult with Blue and Bob on the definition of robbery and, second, it made NO difference wether officer Wilson was aware of the robbery on not once Brown assaulted him and attempted to aquire the officer weapon! The incidents are totally septet at that point.
        Furthermore, a grand jury disputes your point regarding manufactured evidence!

Comments are closed.