"Stand with Walker" Trolls say Higher Taxes a Job Killer!!! Wrong Again.

Even Republican Governor Arnold Schwarzenegger couldn’t convince his party to eliminate the states massive deficit hole. That no tax pledge wasn't just a killer, it was a reason to cut the required spending that would lead to a Democratic economic recovery. And they couldn't let that happen.

My reason for bringing this up came from this ridiculous bubble world tweet from the usual list of “stand with Walker” trolls:

Okay, let's ask California. Just call me the troll killer. And yes, I've also asked these guys to provide proof, a link, anything to back up their fictions. Nothing.

They would be shocked, knowing the truth below:

California's budget surplus soars to new heights; schools to benefit: The state's revenue has climbed as much as $8 billion in the last four months.  The surplus was originally projected to be about $2 billion. California's financial outlook couldn't be more different now than it was just a few years ago in the depths of the state's fiscal crisis -- at one point the budget deficit hit $26.6 billion.

You can thank California Republicans for holding up tax increases that created that $26.6 billion deficit. Once they lost the ability to hold up their legislature, Democrats went back to work and made up for lost time, adjusting their progressive tax brackets and sales tax.

Did higher taxes make the wealthy give up trying? Did the wealthy flee the state? Of course not.

But getting back to the trolls preposterous tweet: Did high taxes kill job creation?

According to the numbers, job growth was concentrated in places that raised taxes, such as California … where voters in 2012 elected to increase both sales and income taxes beginning in 2013. Last year California ranked third in job growth at 2.9 percent, much better than the national average of 1.8 percent. Every 13th new job in America was created in just four California counties.

Here’s how Gov. Jerry Brown and the Democrats led California down the path to recovery:

This highly concentrated growth occurred after the California tax increases, Proposition 30, took effect for all Californians, but especially the top 3 percent. The new “millionaire’s rate” is a 29-percent increase in the marginal rate compared with 2012. In dollar terms, the cost is an additional $33,000 on each million dollars for those already making $1 million or more.

What made the "Stand with Walker" troll lie about California, and "job killing" higher taxes, were the following two charts in a Daily Kos post. Supply side economics is not easy to defend, now that we're able to see the results from GOP dominated states:

Rich still spending money, saving even more, despite warnings against recent tax increase!!!

As it turned out, that "job killing" tax increase on the wealthy didn't decrease their spending at all, and didn't hurt their ability to still put away huge amounts in their savings accounts.

Business Insider: In a new note to clients, UBS's U.S. economics team led by Maury

Harris and Drew Matus (say) people making more money save a bigger chunk of their paychecks. Harris and Matus … believe this buffer will blunt the impact of recent tax hikes. "We believe that the recently legislated higher household sector taxes in 2013 considerably overstate the related negative consumption impacts," they write.

Higher Federal income taxes on relatively wealthy taxpayers should be accompanied by a drop in savings … Saving rates increase sharply at higher income levels…

The Bad News we Already Knew: I received this interesting note from my Wonkblog email:

Obama wants businesses to raise pay. Here's why they probably won't listen. "Companies have discovered that precisely by keeping wages lower, they have been able to boost profits to record levels and fulfill their ultimate goal: rewarding shareholders. In a report released earlier this month, Goldman Sachs chief U.S. chief economist Jan Hatzius noted that the strength in corporate profits is "directly related to the weakness in hourly wages."" Jia Lynn Yang in The Washington Post.

Raising Taxes kills jobs, business? Myth! California proves Republicans Wrong.

Ed Schultz talked about this the other night, and now Wonk Blog picked up the story. It's a big one, because it proves once and for all, tax increases boost state revenues, making them healthy. And isn't that what business is looking for?

California raised a bunch of taxes this year. Its economy hasn’t collapsed: Six months ago I wrote that California was diving into an interesting political and economic experiment: Could it keep adding jobs even after slapping its wealthiest residents with the highest state income tax rate in the nation?

Most of the economists I talked to in the state predicted the tax hikes wouldn’t matter much. A lot of conservatives wrote me to predict the opposite.

What’s happened since? Well, California kept adding jobs, and at about the same rate as the nation overall. The analysts at Beacon Economics in Los Angeles noted recently that California accounted for a quarter of the nation’s net job growth last month. 

One thing, at least, seems clear: The doomsday predictions haven’t come true. California is still recovering. We’ll check in again in a few months to see if the data give us any better idea of whether, and/or how much, higher taxes have dampened that recovery.