Third and State This Week: Zombies, Millionaire Taxes and Gas Drillers

This week, we blogged about New Jersey’s millionaire tax, taxes and Marcellus Shale drillers, zombies and much more.


  • On state budget and taxes, Steve Herzenberg explains that a millionaire tax didn’t chase the rich out of New Jersey. In light of that, Steve writes, Pennsylvania should consider enacting a higher tax rate on unearned income, which would mostly impact top earners in Pennsylvania. Kate Atkins, meanwhile, posts a short video of a Berks County rally for a better state budget.
  • On the Marcellus Shale, Sharon Ward invites each natural gas drilling company in Pennsylvania to release details on the state and local business taxes it pays. And Chris Lilienthal shares concerns about Senate President Pro Tempore Joe Scarnati’s proposed local impact fee on Marcellus Shale drillers.
  • Finally, Mark Price fights zombies who believe that only the rich pay taxes.

More blog posts next week. Keep us bookmarked and join the conversation!

Natural Gas Drillers Pay Little in Pa. State and Local Taxes

Natural gas drillers claim they have paid hundreds of millions of dollars in Pennsylvania taxes, but data from the state Department of Revenue tell a different story, according to a report released this week by the Pennsylvania Budget and Policy Center.

Of the 783 companies to file corporate net income tax returns in 2008, 85% paid nothing in taxes. Many other drillers, including nine of the top 10 permit holders in the Marcellus Shale, structure their businesses to attract investment capital from individuals who avoid the corporate  net income tax altogether and pay the much lower personal income tax.

“Drillers profiting from the rich gas reserves of Pennsylvania’s Marcellus Shale are getting a free pass,” said Sharon Ward, Director of the Pennsylvania Budget and Policy Center. “Federal incentives significantly cut their tax bills at all levels. Most drilling corporations pay no corporate income taxes, and the majority of all big oil and gas companies in the Marcellus Shale are paying the same tax rate as the person serving coffee at the corner diner.”

The industry claims Marcellus Shale production has generated more than $1 billion in state and local tax revenue, but the Pennsylvania Department of         Revenue data show the oil and gas industry paid only $38.8 million in state business taxes in 2008. That includes $17.8 million in corporate net income taxes, $13 million in personal income taxes and $8 million in capital stock and franchise taxes.

In 2009, oil and gas drillers in Louisiana, Texas and West Virginia paid considerably more in state and local taxes than they did in Pennsylvania. Drillers paid $44 million in Pennsylvania sales and business taxes, while in Texas, they paid $8.8 billion in drilling, property, sales and corporate taxes.

“Texas has about 34 times as much oil and gas drilling as Pennsylvania, but took in 200 times as much in taxes from the industry,” Ward said. “Clearly, drillers are getting big tax breaks in Pennsylvania that they don’t enjoy anywhere else.”

Read a press release about the report.

Read the full report.

News & Notes April 29, 2011

Somehow I managed to forget to set my alarm so I missed the Royal Wedding.  I did catch the balcony kiss and am wondering why Prince Harry didn’t think to comb his hair…  Of course had he just gone in a speedo no one would have noticed his unkempt hair…

The new Princess looked lovely in what seemed to me to be a very Vera Wang-ish gown though it wasn’t.  I suppose Will decided he needed to wed before he goes completely bald.  The bride managed to stay away from the “royal jewels” while on the balcony.  I’m sure Kirk can provide a blow by blow account of the ceremony if anyone is interested.

Sen. Bob Mensch was cited (you or I would have been arrested) last month for brandishing a gun while driving on Rt 78 in Berks County.  The GOP lawmaker probably is all for the castle doctrine so the next time he encounters an aggressive driver he can simply blow them away.  A reminder:   under the proposed law if he misses and hits you by mistake he has no legal liability.  You cannot sue him for recklessness.

Sen. Joe Scarnati is proposing a local impact fee for Marcellus gas drillers.  The funds wouldn’t go to the state but to local governments affected by fracking.  The PA GOP continues to frack the people.

THE NRA is meeting in Pittsburgh.  I hope they do the right thing and provide generous financial compensation tot he survivors of the cops who were blown away by the insane gun lunatic a few years ago.  The man, convinced Obama was going to come for his guns because of massive propaganda from the gun lobby, shot and killed five policemen.  Having the NRA come to Pittsburgh is an affront to their memory.

Lou Barletta is now having constituents escorted out of his events by police.  Are these the same cops who covered up the Shenandoah murder inspired by Lou’s racist comments about immigrants?  Imagine if a minority senior citizen dared speak up about Lou killing Medicare?

Bethlehem is one step closer to passing an anti-discrimination ordinance and the creation of a Human relations Commission for its enforcement.  If the legislature would simply pass a bill protecting all minorities from housing, employment and public discrimination we wouldn’t need to do this town by town.

A reminder of sorts:  the term “stupid tea bagger” is redundant.

Corbett’s Funding Solution For Colleges: Frack U

Gov. Corbett said that colleges and universities should consider gas drilling on campuses to solve their funding issues.  He really, actually did this.  I suppose we can begin replacing Old Mains with well rigs?  How about if we change the name of Penn State to Frack U?  Better yet how about if we sell the Governor’s Mansion to Range Resources?  They already own the Governor so perhaps simply giving them the Mansion is appropriate.

Maybe we can tear down the Capitol building and drill for gas in the spot.  It might be a better use of the hot air in Harrisburg.

Random Thoughts

I released my birth certificate yesterday, admitting with shame, that, yes I am not a native born Pennsylvanian.  For those insisting on also seeing the placenta to insure I am a homo sapiens, I say bah, humbug, my Mom is gone and there is now no way to prove, absolutely, that I’m not some illegal alien.

The economy is slowing down just as economists predicted due to budget cuts.  Expect further deterioration and further job losses, foreclosures and business failures as a result of the Tea bag tail wagging the nation’s dog.  This is horrible economics and will result in a double dip recession.  First quarter numbers are 1.8%.

Meanwhile corporations are reaping record profits.  ExxonMobil reported $10 billion in earnings for the first quarter.  This is an increase of 69% over last year’s amazing level.  The President wants to eliminate the $4 billion in taxpayer subsidies for the industry.  How is Exxon spending their money?  On advertising here convincing us that natural gas drilling is good.  I haven’t purchased ExxonMobil gas since the Prince William Sound (Exxon Valdez) disaster so at least they aren’t getting a dime of my money.   Neither, ever, will BP.

Storms ravaged the South again yesterday.  This time over 200 people lost their lives.  Climate warming is producing more and more severe storms.  It’s poetic justice of a sort that the South, home of the oil industry and climate deniers, is getting hit. Don’t mess with Mother Nature.  ExxonMobil has spent billions funding the climate change deniers so perhaps they can part with some of those billions and provide aid to their victims.

If this wet weather continues here severe flooding along major rivers will be an issue.

Millionaire Tax Didn’t Chase the Rich From Jersey, So Why Not a Higher Tax Rate on Pa.’s Top Earner

A blog post from Stephen Herzenberg, originally published on Third and State.

Anti-tax advocates maintain that higher tax rates on the wealthy lead to millionaire flight. But a study of a 2004 “millionaire tax” in New Jersey shows that, in fact, the rich don’t move to avoid higher taxes.

The new study was written by sociologists at Stanford and Princeton and published in The National Tax Journal. Economist Robert Frank reported on it in The Wall Street Journal, writing that the study “provides some of the most detailed evidence yet that so-called millionaire taxes have little effect on the movements of millionaires as a whole.”

The 2004 New Jersey tax increased the rate on those earning $500,000 or more from 6.37% to 8.97%. After the change, high-earners not subject to the tax (with income between $200,000 and $500,000) migrated out of state at the same rate as those who were subject to the tax. “In summary, the new tax did not appreciably increase out-migration,” the study concluded.

Even before this study, we knew that Pennsylvania badly needs to raise revenue to maintain critical services and investments in the future. We also knew that the top 5% of Pennsylvania earners pay an overall state and local tax rate that is about one-half that of the lowest-income fifth of taxpayers (see Institute for Taxation and Economic Policy data for Pennsylvania).

Raising the Pennsylvania tax rate on “unearned income” (including capital gains, dividends, and other non-wage income) by just 2 percentage points – from its current 3.07% to 5.07% – would raise $635 million. The rate on earned income could remain the same at 3.07%. The increase in the unearned income rate would mostly impact top earners in Pennsylvania but still leave the tax rate on unearned income far below the tax rates in New Jersey and most other neighboring states.

News & Notes April 27, 2011

There has been a lot of news this morning.  An Afghan military officer opened fire and killed nine Americans in Kabul.  Isn’t it time we cut our losses and left this war ravaged nation?  Trying to instill democracy has never worked and it is failing there.  Democracy is something which must come from the people in a grassroots effort as we’re witnessing in many Arab lands.  It cannot be imposed.

The Federal Reserve announced it will not change the rate of interest.  The more I see of unfettered capitalism the more I like socialism.  The best thing for socialists is to simply sit back and watch capitalism implode.

2012 will be yet another change election now that voters have seen the GOP agenda.  No jobs, just extremism in its naked form.  The tax cuts for the rich combined with program cuts for everyone else highlighted by the recent attacks on Social Security, Medicare and Medicaid, should be game changers.  Leave it to Democrats though to drop the ball.

The International union of Fire Fighters has announced it will no longer contribute to national Democrats.  Unhappy with doing so and then getting screwed they will focus on state races.  Smart.

Gov. Corbett is coming out against forced pooling as his poll numbers plummet.  He has to do something to placate angry Pennsylvanians.  The well blowout in Bradford County has people pissed.  The reaction times for notifying authorities and then capping the well were unacceptable.  People are asking why a team had to come from Oklahoma to stop the leakage.  With thousands of wells already drilled here why are their no response teams on the ground here?  The energy industry knows they own Corbett and other key lawmakers so felt they could do whatever they wished.  Corbett’s forced pooling decision is a warning he still has to answer to the people.

The five freshmen Republicans in Pennsylvania’s Congressional delegation plus swing district veterans such as Dent and Gerlach could be in trouble over their votes for RyanCare.  It is incumbent on Democrats to field strong candidates in these areas and support them well.  The opportunity exists to hang them with their votes.  Having Patrick Murphy running for AG takes one strong contender out of PA-08 however.  Who will step up?  

Rep. Gabrielle Giffords will travel to Florida to witness her husband shoot into space on the shuttle.  This is an amazing recovery thus far for the heroic woman shot in the head not long ago.  Why can’t we pack Sarah Palin on the shuttle and take her where she rightly belongs-space?

I’m not really worried about the debt ceiling vote.  The real masters of Washington (Wall Sreet) will never allow a default vote to happen.

Leon Panetta will succeed Robert Gates at the Pentagon.  General David Petraeus will succeed him at CIA.  Panetta should be a good fit at the Pentagon but I have serious misgivings about the CIA.  It has never worked well putting a military person in Langley.  This CIA is already too caught up and involved in paramilitary operations and putting a General in charge is a recipe for disaster.

Donald Trump has some serious baggage trying to carry the GOP nomination.  First of all his voting record is awful and The WaPo reports he has given more money to Democrats than Republicans over the years.  That should play well in Iowa…for the rest of the field.

Why are the feds going after internet gaming operators while allowing Wall Street criminals a walk?

Obama Trumps The Donald

President Obama released his official Hawaii birth certificate, the very one reporter after reporter has seen in the official state records, and revealed Donald Trump to be the man with no clothes.  Finally we can all see this issue laid bare, the Birthers for the crazies they are and lay it all to rest.

Of course the hard core conspiracy believers will never be satisfied.  Some folks don’t believe in evolution either, or that the earth is round.  They can never be swayed by facts because they’re lunatics.

I was surprised by the White House action.  They say enough was enough that the country has actual issues with which to deal but this was a huge political advantage for the President.  No sane, intelligent or rational person (Including The Donald) believed this nonsense and the more the Republican field embraced this the more they looked like clowns.  That advantage went to Obama and could have been played for another year before playing the trump card.  Timing is everything in politics and Obama didn’t time this well.  It was a well played hand but could have been used for checkmate. (to mix a metaphor)

Trump couldn’t even get his facts straight about the polls.  He claimed a CNN poll shows him even with Obama.  That poll (not even a CNN poll) was from February and recent polls show him getting thrashed.  The difference?  The general public thinks Birthers are crazy loons and won’t take them seriously.  Bad move The Donald, you’re fired.

Down for the Count: America’s Fascination With Royalty

By Walter Brasch

           In case you’re in a funk because you think the reason you didn’t receive an invitation to the royal wedding is because the Brits are still ticked off about that silly little skirmish back in 1776, the American media have a solution for you.

           The media had been pumping out news, features, and gossip about the wedding for more than three months. Almost every radio, TV, and cable network, except for maybe the Cartoon Channel, will be covering the wedding on Friday. All. Day. Long.

           Coverage begins at 3 a.m. EDT (8 a.m., British Standard Time) and finally ends before the bars close. In addition to extensive live coverage of the procession and wedding itself, ABC, CBS, and NBC are devoting five hours in evening prime time to reviews of the wedding.

           WE TV has four one-hour documentaries: “Prince William,” “Kate: The New Diana?”, “Will + Kate Forever,” and “William & Kate: Wedding of the Century.” Apparently, the cable network that brands itself as “the women’s network devoted to the wild ride of relationships during life’s defining moments,” believes there won’t be a royal divorce, and that the marriages of Charles and Diana (which did end in divorce), Grace Kelly and Prince Rainier, Elizabeth II and Philip, and Edward VIII and Wallis Simpson in the 20th century were only preliminaries. Lifetime, which bills itself as the cable network that “celebrates, entertains and supports women,” has several one-hour documentaries, including “A Tale of Two Princesses,” “William and Kate: A Love Story,” and “Kate’s Gown of Renown.” The network is also cablecasting two two-hour docudramas, “Prince William” and “William & Kate.”

           If you don’t have access to a TV set, You Tube is transmitting the events live to computers and every handheld device known to technology. Add in all the newspaper and magazine coverage-look for multi-page photo spreads in all major entertainment magazines in the next week-plus a million or so blogs, and there’s no reason why anyone shouldn’t know important details, including how many canapés were ordered for the after-wedding reception.

           Americans have always had a fascination with royalty. Although we organized a revolution to overthrow a monarchy, and created a president not a king as head of State, we have spent more than two centuries trying to regain a royal image.

           Our fast food restaurants are called Burger King and Dairy Queen.

           Somewhere at any moment during the year, American girls (infants through senior citizens) are practicing their wave so they can become a beauty queen. Schools have prom queens and homecoming queens, each with their court of princesses. Every college football bowl game parade has a Miss Something and her Court. And, every winner wears a tiara.

           The media and the public dub almost every new celebrity singer a “pop princess.” Just about any young ice skating star is known as an “ice princess,” but the media in 1989 derogatorily dubbed Deborah Norville an “ice princess” when she took over for popular Jane Pauley on NBC-TV’s “Today Show.”

           Princess Cruises has the “Love Boat,” but there was no love lost when Donald Trump sold his 282-foot Trump Princess for about $40 million in 1991 after he, mistress Marla, and wife Ivana had formed a Ménage a Tabloid.

           Among googobs of literary and movie princesses have been Cinderella, Snow White, and Leia who helped Han Solo, Luke Skywalker, and that giant furry thing make the world safe for high-tech special effects. And, of course, there’s the Lion King that made the Disney company rich enough to devour all other media companies, and take on the corporate shape of Jabba the Hut.

           The greatest baron, pursued by ace aviator Snoopy, was the Red Baron. However, for some reason the media prefer to use the title “baron” to refer to evil “kingpins”–as in “drug baron,” “robber baron” and, understandably, “media baron.”

           The music industry abounds with royalty. Bessie Smith was the Empress of the Blues; Roger Miller was King of the Road. Among other kings are those of Ragtime (Scott Joplin), Blues (W.C. Handy), Swing (Benny Goodman), Waltz (composer Richard Strauss or bandleader Wayne King), Pop (Michael Jackson), and, of course, Elvis, the king of rock and roll. One of the best singers was Nat “King” Cole.

           Aretha Franklin is the Queen of Soul. Rap singer Queen Latifah may think she’s royalty, but British rock group Queen truly has a better shot at sitting in Buckingham Palace than she does.

           Among singing princes are the Fresh Prince of Bel-Air, who doesn’t do much singing or rapping any more, and Prince Rogers Nelson, who became known simply as Prince, and then the singer-with-the-unpronounceable symbol, who later regained a pronounceable moniker, and has the ability to predict purple rain.

           The most famous duke is the “Duke, Duke, Duke of Earl, Earl, Earl, Duke of Earl” who proved in the late 1950s that anyone can grow up and write song lyrics.

           Other less royal dukes have been baseball great Duke Snider and musical genius Duke Ellington who, had he gone to baseball games, would have had to sit in segregated seating in most ball parks. Sitting with him would be the Dukes of Dixieland. Upset there are no more segregated “colored” seats, drinking fountains, and rest rooms is David Duke who once cornered the market on pointy white hats and dull-witted Whites.

           Babe Ruth was the Sultan of Swat. But no royal monikers were attached to Roger Maris who broke Ruth’s single season record or to Hank Aaron, who broke Ruth’s lifetime record, and had to put up with numerous racist comments. So far, no one has given royal titles to Barry Bonds, the current leader in single season homeruns, lifetime homeruns, and steroid usage accusations.

           Nevertheless, the only royalty that matters are the Counts–Tolstoy, Dracula, and Basie.

[Walter Brasch is an award-winning journalist. His next book is Before the First Snow, a look at America’s counter-culture and the nation’s conflicts between oil-based and “clean” nuclear energy. The book is available at]


On Happy-ing Their Gilmores, Or, Will Body Bags Be The New Gold Watch?

We are continuing a recent theme here today in which two of my favorite topics are going to converge: Social Security and in-your-face political activism.

I have been encouraging folks to take advantage of the recent Congressional recess to have a few words with your CongressCritter about the proposed Death Of Medicare and all the proposed cuts to Social Security…and you have, as we’ll discuss…and now we have an opportunity to do something on a national scale, just as we did a few weeks ago in support of Social Security.

This time, we’re going to concentrate on fighting the idea that retirement ages should go up before we become eligible for Social Security and Medicare (and elements of Medicaid, as well), and that Americans should just keep right on working until the age of 67 or so-which isn’t going to be any big problem…really…trust us.

Now that just makes no sense, and to help make the point we have a really cool video that you can pass around to all your friends-and your enemies, for that matter, since they’ll also have to worry about what happens to them if they should ever make it to old age.  

“…Art can create a climate of sensitivity in which it is possible for change to occur…”

Shabana Azmi, on Riz Khan’s Al Jazeera program One on One

Members of Congress are at home this week, and they love to go out and meet the voters-but it hasn’t been as much fun all of a sudden for some of them, and there are several videos out on the Web right now where it looks like Members wish they hadn’t been hanging out where the public could see them so easily.

Now some of these videos are loud and boisterous-but the one that should really scare Republicans was Charlie Bass’ appearance in Hillsboro, NH on the 4/20 holiday.

If you look at the crowd, they’re older, for the most part-and for the most part they came to the meeting with their own information, meaning that they weren’t so much looking for the Congressman to tell them what was up as they were looking to tell Mr. Bass (who represents the State’s 2nd District) that they weren’t too happy with him about this “entitlements reform” deal.

Now they weren’t there with pitchforks and torches by any means, and a lot of them were supportive of many of the Congressman’s other positions-but they were extremely unhappy about the idea that Medicare would become a voucher system (just so you know, Bass would insist that it’s a “premium support system” whenever the word “voucher” came up), and they did not find the argument that “this won’t affect you” very convincing, either.

In addition to the obvious question (basically, “why would the plan be better if it only sticks it to our kids and grandkids?”), a woman from the crowd asked a question I don’t think Karl Rove ever thought would come up: you might not be sticking it to senior citizens today…but she wondered what’s to prevent conservatives from coming back in a few years and asking those under 65 why they should be supporting those old people and their “Cadillac plans”-at which point it will be “stick it to the old folks” season, and Medicare will officially die, along with a lot more old and disabled people, sooner than they should have.

And he wasn’t the only one to have a bit of a tough week at what used to be really friendly Town Halls: Pat Meehan (PA-07) got himself into a shouting match with his putative employers, so did Lou Barletta, he of Pennsylvania’s 11th…and so did Catfood 2.0’s architect, Paul Ryan, who had to face what he politely described as an “enthusiastic” crowd in Milton, Wisconsin.

“Happy learned how to putt! Uh-oh!”

–Adam Sandler, from the movie Happy Gilmore

To put it bluntly, the Members are hating it, big-time, as it appears that their 2009 “Town Hall Goose” has suddenly become just a little too good for the gander.

And if we’re already making life hot for these folks…why not just keep on pushing?

That’s the idea behind “Don’t Make Us Work ‘Til We Die“, which is an effort of the fine folks at Strengthen Social Security to highlight the fact that a lot of people right now are proposing to raise the retirement age; either to 67, or to something north of that…for the good of America, of course.

After all, if you’re a firefighter, or a nurse, or maybe you work in the trades, or a restaurant kitchen, or you drive a gasoline truck…or maybe you’re a smokejumper for the Forest Service…why would working until 67 be a problem for you?

Here’s a video that makes the point very nicely:

(By the way, they would love for you to spread this video far and wide; grab the embed code and just go nuts-or, if you prefer, email the link-and in the interests of Full Disclosure: I’m associated with the Campaign for America’s Future and they’re one of the members of the Strengthen Social Security coalition.)


On Wednesday and Thursday all of this goes outside and hits the streets all across the country, and to make it easy, the same website can help you find an event near you-or, if you live in Wyoming or something, you can attend the “virtual event”-either way, just visit the handy website and go from there.

So there you go: we have Republicans feeling mighty uncomfortable all of a sudden, we have a chance this week to get out in public and make the point in a bigger way-and now you even have the perfect video to send to that one relative who always forwards you Michael Savage’s latest missives.

Now get out and keep the momentum going forward-and don’t forget, it’s really easy to look at the person next to you in line at the grocery store and say: “Can you believe how they’re trying to screw us out of Social Security?”

That’s about all it takes to get a pretty good conversation going…and if you repeat that process, about a million times…well, that’s how politics gets done.

FULL DISCLOSURE: This post was written with the support of the CAF State Blogger’s Network Project.

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