January 11th Marks National Human Trafficking Awareness Day

April 16, 2008

Tax Freedom Day Underscores Ohio’s Economic Woes

COLUMBUS , OH – Congresswoman Deborah Pryce (R-Columbus) today submitted the following editorial:

The focus of the nation will soon again turn to Ohio for its pivotal role in the helping to decide the 2008 Presidential Election. And as we saw during the primary election race, Ohio’s economy will undoubtedly be front and center of the discussion.

There are numerous reasons for Ohio’s anemic economy and for the tragic exodus of more than 200,000 manufacturing jobs from Ohio, and these factors have worked in concert to keep our state struggling relative to the rest of the nation. Economists can debate those reasons, pundits can opine on them, and politicians can exploit them. But Ohio has no chance to ever reclaim its strong and vibrant economic past until its current system of taxation is fundamentally overhauled – gutted, rethought, and rebuilt. Our state’s system of taxation is an anathema to economic growth, and we will continue to suffer until politicians understand what potential employers have long known: Ohio is hostile to job growth and prosperity.

High-paying jobs are the tonic to so many societal and economic problems. Health care, college tuition, housing, energy prices – all of these issues become less daunting when high paying jobs are in abundance. When our state is bleeding out jobs or job creation is stagnant, these issues become unmanageable for many Ohioans.

According to the non-profit think tank, the Tax Foundation, in 1970, only three states in the U.S. had a combined state and local tax burden lower than Ohio’s. Today, only four states have a more oppressive state and local tax burden. Only two states have a higher individual income tax burden. A mere six states have higher property tax rates. Sixteen states pay more in gas taxes. Ohio imposes the third highest corporate income tax rate in the nation. Most tragic, because of Ohio’s suffocating tax environment, a mere four states have worse overall business climates.

Businesses are in business to make money. And under our current system of taxation, they will make less of it in Ohio. We can try to promote our intangibles like our productive and hardworking workforce, our state’s geographic advantages, and our fantastic colleges and universities. But we will not lure a significant number of companies to locate or relocate to Ohio when both the employer and the employees can earn a better living in forty-six other states.

April 17, 2008, represents “Tax Freedom Day” in the Buckeye State – the day when Ohioans finally have earned enough money to pay off their total tax bill for the year. In other words, every dollar the average Ohioan earned from January 1 st to April 17 th has gone to a government -- federal, state, county, local, or some other taxing entity. After April 17 th, Ohioans finally begin to punch a timecard to the benefit of their families, mortgages, health care, college tuition, and retirements. As you filed your taxes for April 15 th, you were still two days shy of your tax obligation. The heartburn continues.

At the federal level, I continue the fight to try to reduce the tax burden on Americans. Unfortunately, in the present environment, I am swimming upstream against a current of massive tax hikes on workers, parents, married couples, seniors, small businesses, entrepreneurs, and farmers. Last month, over my opposition, the House majority passed a record $683-billion tax increase impacting all the aforementioned, and dealt the American economy and job creation major setbacks. Tax increases only exacerbate a slowing economy, and few can argue with a straight face that sending more money to Washington can alleviate the economic plight facing many of us here in Ohio.

During the presidential primary, many a perpetrator was identified as the cause for Ohio’s hardships, but free trade in general, and the North American Free Trade Agreement (NAFTA) in particular, were eviscerated by the candidates as the culprits for Ohio’s slumping economy. This message was received warmly in northeastern Ohio cities like Youngstown, home to countless steel mills and other industries that have been shut down, their massive buildings left to rust into their foundations. But as a native of Warren, Ohio, I know that the bulk of these jobs were lost years before NAFTA was even a consideration. In reality, since 1998 and under NAFTA, Ohio is the only state in the union that has seen exports grow every year, and only Texas and California have more jobs linked to manufacturing exports than Ohio -- supporting more than a half million Ohio jobs and topping $42.4 billion in 2007 alone. While a convenient scapegoat on the campaign trail, NAFTA is not the cause of our woes. The fact is that Ohio has lost a significant competitive edge on other states for its adversarial attitude toward business, when we should be embracing these businesses for their ability to create jobs and income for Ohioans. Government, in turn, will never create this kind of wealth with your tax money.

No nation and no state have ever taxed its way into prosperity, but a good many have taxed their way into the economic abyss. Ohio can again become an enviable economic force in America but only through comprehensive tax reform, coupled with reasonable regulatory policies and a predictable litigation system. Until then, be prepared to hear countless candidates professing to hold the solution to our economic plight, when, in fact, they may be part of the problem.

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