Say Anything Blog

It appears that the Tax Foundation is using old information.  North Dakota’s top corporate tax rate is now 6.5% (it was reduced by the legislature during the 2005).  Assuming the other states’ information is correct, North Dakota would be tied with three other states for 31st highest - just a bit better than the nation as a whole. Still not good, but better.

I don’t disagree that the state could do something to improve the situation.  Although the primary issue is the Federal tax rate.  Even the states with no corporate income tax, such as South Dakota, only beat out three foreign nations (Japan, Canada, and Germany) in the analysis.

Even the states with no corporate income tax, such as South Dakota, only beat out three foreign nations (Japan, Canada, and Germany) in the analysis.

Yes, but here’s another fact: South Dakota is among the top ten destination states for people moving within the country.

North Dakota is among the bottom 10.

Coincidence?  I think not.

It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.

Teddy Roosevelt
“Citizenship in a Republic,”
Speech at the Sorbonne, Paris, April 23, 1910

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Actually, I think it may be coincidence or some other factors contributing to that, mainly because North Dakota usually ranks higher than South Dakota in many economic reports, including Beacon Hill’s Competitiveness Report and Kauffman’s New Economy Index report. In addition, despite the fact that SD has no income or corporate income tax, it is only three places higher than North Dakota in the Tax Foundation’s list of the most Tax Friendly States. All that separates them is .6 percentage points.

Besides, the rankings that you use come from the migration report by the United Van Lines, which is only based on the 212,917 interstate household moves that the company handled. That doesn’t seem to represent a very large sample. There could be a number of different influences: people who move themselves, who use u-haul, who just up and leave. My “moving company” is a borrowed horse trailer from the neighbors.

Actually, Renni, in Beacon’s last report SD ranked above ND.  Same for Kauffman’s.  I don’t know how “usually” ND beats out SD in these measures in the past, but it seems to me is that SD is beating ND right now.

And, interestingly enough, Beacon ranked North Dakota 46th in Government & Fiscal policy in the latest report.

46th.  That should tell you something.

And while the UVL index may not be perfect, it is consistent in its imperfections.  Not everyone uses UVL, but enough do that it represents a legitimate sample.

But really, what are you arguing for here?  Keeping North Dakota’s taxes high even as the state treasury bulges with funds?

It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.

Teddy Roosevelt
“Citizenship in a Republic,”
Speech at the Sorbonne, Paris, April 23, 1910

Rob’s recently listened-to songs:

Well, I suppose I’m trying to say that things aren’t exactly dire in ND. The state is moving in areas that really matter as we enter a more digital and information-based global economy. But I suppose I would also argue that taxes aren’t that high because I hardly pay any. I pay a fifth of what I pay in federal taxes.

SD doesn’t rank higher than ND in those reports. In the Beacon Hill Competitiveness report, ND is 4th and SD is 8th. In the New Economy Index report, ND is 37th (one of the top movers in the nation) and SD was 48th.

The Beacon Hill 2007 Competitiveness Index I looked at ranks North Dakota as 11th in Government & Fiscal Policy. 11th. I don’t consider that to be a poor ranking. Obviously we’re both consulting different reports. I’ll show you mine if you show me yours Just kidding. It’s at http://www.beaconhill.org/Compete07/Compete2007State.pdf

Well, I suppose I’m trying to say that things aren’t exactly dire in ND. The state is moving in areas that really matter as we enter a more digital and information-based global economy. But I suppose I would also argue that taxes aren’t that high because I hardly pay any. I pay a fifth of what I pay in federal taxes.

That all sounds...very anecdotal to me.  So you don’t pay a lot of taxes.  Big flippin’ deal.  We have no idea what the nature of your income is, or what deductions you get to take.

As for North Dakota moving into other industrial/commercial areas, that’s great.  But it’d be better if those new businesses didn’t have to pay one of the worst corporate tax rates in the world.

And yes, most of the problem is at the federal level, but some of it is at the state level and I don’t see what we accomplish by passing the buck.

As for Beacon Hill, my mistake was looking at the 2001 edition.  So my bad.

But even with all this sidetracking you’re doing, you’re not addressing the main point:

The state coffers are bursting with money, and legislators are using it to increase spending at drastic levels.  24% in general fund spending last session alone.

If we don’t do something to stem that spending we’re going to have problems down the road if tax revenues from the oil industry and sales taxes drop off.  It seems to me like cutting taxes is just the ticket to curb that spending given our state’s balance budget requirements.

Your answer to that seems to be “Let’s keep taxes high because I don’t pay a lot of them.”

Which strikes me as completely absurd.  Instead of spending billions on hit-and-miss economic development schemes we need to cut taxes.  Period.  That will attract more businesses - and thus jobs - while simultaneously putting more money in our pockets.

What’s so bad about that?  Outside of the fact that it’ll take money away from all the good-old-boy business interests that are getting fat on the Commerce Department teat.

It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.

Teddy Roosevelt
“Citizenship in a Republic,”
Speech at the Sorbonne, Paris, April 23, 1910

Rob’s recently listened-to songs:

Money like the $15,000 grant the state commerce department gave Basin Electric, for instance?

It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.

Teddy Roosevelt
“Citizenship in a Republic,”
Speech at the Sorbonne, Paris, April 23, 1910

Rob’s recently listened-to songs:

Hold on a minute.

So ND ranked 46th in Government and Fiscal Policy in 2001 and now ranks 11th? In other words, it got better ?

That should tell you something.

So ND ranked 46th in Government and Fiscal Policy in 2001 and now ranks 11th? In other words, it got better ?

According to exactly one economic measure.

And maybe it did get better.  So we moved up from 46th to 11th among the 50 worst business tax codes in the world.  Not much of an improvement, and is that really an argument against making our business tax environment even better?

Especially right now when we could certain afford the tax cuts?

It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.

Teddy Roosevelt
“Citizenship in a Republic,”
Speech at the Sorbonne, Paris, April 23, 1910

Rob’s recently listened-to songs: