WSJ: Lie in the headline, bury the truth in the 3rd graph
This is a pretty despicably piece of editing, clearly attempting to attribute an effect ("disappearance" of millionaire taxpayers) to a cause (increased taxes on millionaires in Maryland.)
Millionaires Go Missing
Here's a two-minute drill in soak-the-rich economics: Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy...
Insert graph about class warfare, loss of revenue, lead readers to a false conclusion by summing it up: Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates.
Wow, pretty clear action and reaction, right? Well, they didn't actually say that I guess, they just seemed to say it. Why?
Because the truth is the contention they're trying to make (Millionaires left Maryland because of those high taxes, which shows why you shouldn't tax the rich, you stupid liberal communists...) is bogus. Only 3 graphs in do they grudgingly admit this.
No doubt the majority of that loss in millionaire filings results from the recession.
With the truth out, they carefully bury it by dutifully digging up someone to provide a soundbite, taken out of context, to imply that, despite the lack of evidence, that millionaires left anyway because of the law. Christopher Summers, president of the Maryland Public Policy Institute, notes: "Marylanders with high incomes typically own second homes in tax friendlier states like Florida, Delaware, South Carolina and Virginia. So it's easy for them to change their residency."
Then, despite that brief admission that the tax policy is not responsible for a measurable flight of millionaires, they conclude the article with the following, which is another clever attempt to say that the policy sent millionaires elsewhere, without actually saying it did:
All of this means that the burden of paying for bloated government in Annapolis will fall on the middle class. Thanks to the futility of soaking the rich, these working families will now pay Mr. O'Malley's "fair share."
Cleverly worded. And slimey. The WSJ used to be better than this.
The contention they're trying to make here is that the policy means the middle class pays more. Absolutely false. The middle class will pay less that it would have otherwise, though more than the taxers hoped.
If you admit that the disappearance of 1/3 of your millionaires is a result of the economy reducing the number of millionaires, then you admit that those folks aren't available to pay higher taxes. Thus, the shortfall has to be made up either way.
In other words, it's not "thanks to the futility of soaking the rich" that the middle class has a higher-than-the-government-hoped tax bill. It's thanks to the crappy economy. Now, because the remaining 2/3 of millionaires paid taxes at a higher rate, you still had more coming in than had you simply lost those millionaires as well as left your rates the same.
And I doubt the middle class will pick up the tab anyway. Borrowing and creative accounting are two great, traditional political tools you can use to magic away your budget problems. (See U.S. gov.)
The WSJ is the one "stoking class warfare" here. And doing it with carefully crafted words to draw readers to a fictionalized conclusion, even while admitting the truth, however briefly, in the article itself.
There may be good arguments for not raising taxes on the millionaires in Marlyand, but this isn't one of them.