I left Minnesota in 2010 to pursue my Ph.D. in political science at Southern Illinois University after living there for 17 years — longer than I lived in New York City, where I was born and raised. My time in Minnesota conjures lovely memories and, truth be told, I would return to Minnesota in a New York minute if and when the opportunity arises. After living in a total of seven states over my nearly half-century of life, such a decision would not be difficult.
It is because I miss Minnesota that I take umbrage with the oversimplistic case made by John Phelan in his Community Voices commentary about whether the Minnesota taxpayer gets high value for their high taxes. His answer is no, and he marshals some understandable quantitative evidence to support his claim. I get it. No one likes paying taxes – I don’t care if you’re a Democrat, Republican, Green, Libertarian, or None of the Above – and the notion that tax rates drive businesses and high-income earners out of the state for lower tax states has reached mythological proportions. However, as I tell my students, it’s a bit more complicated. After living a couple of years in a state with no income taxes, I would still return to Minnesota if given the chance.
No. 2 on quality-of-life metric
In my first year in Texas, I earned a salary slightly less than I was earning in Minnesota the previous year, but I took home more thanks to Texas’ lack of a state income tax. Sounds great, right? Sure, if the amount you pay in taxes is directly related to your quality of life. But how can Minnesota score so highly on the quality-of-life metric used by U.S. News & World Report, which listed the Land of 10,000 Lakes as No. 2 (behind North Dakota), if citizens get such a lousy deal from the high taxes they pay? Again, as I tell my students, correlation doesn’t equal causation. Despite the anti-tax zealots time and again heaping scorn onto Minnesota’s high taxes, its core cities still attract businesses and new residents.
While I’m not going to lay out an empirical case to show how Minnesota compares to low-tax Texas, I’ll provide some much-needed context to Phelan’s gloomy piece.
Low wages, not taxes, keep people from getting ahead
First: Taxes don’t keep people from getting ahead. Yes, they account for a percentage of our earnings, but in Minnesota, median income is higher than in low-tax Texas and many other low-tax states, particularly in the south. It is low wages that keep people from getting ahead and most mainstream economists would agree that wages have remained relatively flat for at least the last few decades.
Second: Citizen participation in government is much higher in Minnesota than in Texas. That’s due to a number of factors, but at least part of the explanation is that the political culture of Minnesota is more focused on egalitarian principles rather than top-down governance by distant elites at the state Capitol. Minnesotans appreciate the superior public goods created by those high taxes – like mass transit, green spaces, and environmental protection – while folks in Texas are reluctant to tax themselves to create those public goods. We’re not necessarily undertaxed in the Lone Star State, of course; here, they like to call things “fees” instead of “taxes,” and the ruse works well to keep the anti-tax narrative afloat.
Support vs. ‘rugged individualism’
Finally, it’s much better to be an employee in Minnesota than it is in Texas. We spend a lot of our lifetime working for a living. A big difference I’ve seen between Minnesota and other states is that the employee enjoys broader support from the institutions of democracy there than in a place like Texas. “Rugged individualism” runs rampant across Texas — until, of course, some tragedy occurs that is outside of the individual’s control. Then the complaints about the lack of assistance for those in crisis flow freely.
Are there ways to use the taxpayer dollar more efficiently and effectively? I’m sure there are. And in a state like Minnesota where government is not viewed as the enemy – thanks again to the political culture – people can come together to solve problems and engage in continual improvement. Government is not some alien interloper constantly looking for ways to take a few more dollars out of your pocket. It’s just what we call it when the community does things together. The low-tax / anti-government mantra perpetuated by organizations like Phelan’s Center of the American Experiment just don’t get it.
Robert W. Velez is a member of the political science faculty at The University of Texas Rio Grande Valley.
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