Ortman and Leidiger fudge the facts on the payroll tax increase

The release of Governor Dayton’s budget produced the expected responses from members of Carver County’s legislative delegation, pointing out the sales tax changes (focused on the tax on clothing over $100 and services) as the main enemy in the proposal.

Interestingly enough, though, both State Senator Julianne Ortman and State Representative Ernie Leidiger took another shot at Democrats over taxes — this time at the federal level.

From Ortman’s January 23, 2013 Capitol Report:

In addition to Governor Dayton’s proposed tax increases, President Obama has two major tax increases that will take even more money out of the pockets of hard-working Minnesotans.

This month, wage earners will notice an increase in the amount that they pay for the federal payroll tax. Since the first of the year, most Minnesotans have already seen this happen on their paychecks.

From Leidiger’s January 28, 2013 e-mail to constituents:

Look at it this way: a hardworking middle class family will not only have diminished take-home pay because of higher social security taxes, but they will also have to dig deeper in their pockets for everyday items and services.

Ortman and Leidiger are referring to the expiration of the payroll tax cut on January 1, 2013.  This change increased the Social Security payroll tax rate by 2%, back to its statutory rate of 6.2%.  The rhetoric of the two legislators — particularly Ortman — might lead you to believe that this tax increase was just another way that so-called tax-and-spend Democrats are out to get the middle class.

Well, that just isn’t so.  In fact, when it comes to payroll taxes, Democrats have been the defenders of giving taxpayers a break.  The temporary payroll tax cut was passed in the lame-duck session following the 2010 midterm election and was designed to be a one-year only provision, expiring at the start of 2011.  Over the objections of his caucus, Republican Speaker of the House John Boehner agreed to another one-year extension in the 2011 showdown over the debt ceiling.  And as we approached the fiscal cliff, we should recall that no Republicans were standing up for continuing the extension.  Not Boehner.  Not Mitch McConnell.  Mitt Romney didn’t support extending the payroll tax cut, either.

And while President Barack Obama didn’t make the extension of the payroll tax cut a “must-have” in fiscal cliff negotiations the way he did in 2011, he was forced to scrap plans for an alternative middle- and lower-class tax cut in order to secure the needed Republican votes for passage.

So, let’s recap:  Republicans are blaming Barack Obama for adopting the policy they themselves insisted on.  Ain’t politics grand?


16 Responses to “Ortman and Leidiger fudge the facts on the payroll tax increase”

  1. They are not fudging the facts. Both merely state that Minnesotans have less money in their pockets. It’s a true statement.

    • You can’t assert — as Ortman plainly did — that raising the payroll tax is solely an Obama policy. It isn’t. Heck, even you acknowledged that Republicans supported ending the payroll tax cut.

      • So she leveled the charge where the buck stops. Not a big deal. He certainly didn’t fight for it. It only serves to bankrupt Social Security quicker with the cut. While it did give most folks some extra in their pocket to help drive economic recovery.

        The point that we’ve already experienced a reduction in net pay is a valid one to raise when looking at also raising sales tax revenue. Minnesotans have less NOW. Another increase to the government take is unwanted.

        When you pair the cuts to everyone’s bottom line, several times, it’s going to start to hurt. That’s the larger point here.

        So it seems you are really upset with Ortman, but couldn’t resist dragging Ernie into your rant as well, eh? Even when he does nothing wrong you have to railroad him. How petty and small.

        Given the way the GOP has been treated by your party, I don’t think Ortman is out of line at all. Dayton claims the GOP did all of the cuts last session in defense of none this time, yet refuses any credit for the ever growing surpluses we currently enjoy due to the GOP’s efforts. No wonder this sort of statement occurs. Your party is made up of petty leaders. You reap what you sow.

        • So this is the new GOP line: Blame that darn Barack Obama for giving one more year of the payroll tax cut than we would have!

          Gosh, it’s a wonder you guys had such a rough go of it in the 2012 election with messaging like that…

          • Just like Dayton can’t give credit for the surplus. He sure likes to tout how we slashed everything nder the sun, but can’t seem to make the connection as to how we ended up with such a big surplus. You can’t either. Do you really believe that Dayton’s budget last time around would have brought forth this surplus? In his statement that you highlighted on this very blog, he talks about how the GOP delivered 4 billion in overall cuts, far more that the school shift they implmented, and now we have triggered an automatic pay back, or Dayton wouldn’t have done it. He likes that we have debt. It’s the Democrat’s way of life. Spend, spend, spend.

            You yourself are happy to blame GW Bush for every single thing that happened under his watch. I guess when we blame Obama in kind, that’s off-base. Liberals. Does the buck stop with Obama or not? We know it doesn’t. Hell he’s blamed ever single thing that went wrong in the first 4 years on GW Bush. I don’t know who he’s going to blame for the next 4 years of misery. But we’ll be there to remind him. This time, it’s all on him. Time to lead big guy. Blame time is over. Step up and lead, or get the heck out of the way. Blame is for losers. If he wanted the job, he should have relished the challenge. Stepped up and got things done, instead of crying about it like a little girl.

            Now someone calls him on the carpet, and it’s out of bounds. Like saying GW crashed the economy in 08. Which of GW’s policies crashed the economy? Sure there is one on another you can point to? Or maybe two or three? Can you point to how Obama saved us? I can’t. He didn’t do anything but blame others for his failure to live up to his own promises. And know during his watch, when we have less money in our pockets, whom are supposed to blame? If GW was President, you would blame him in a second. As petty as you are? Are you kidding me? Ernie didn’t even mention Obama in this instance, and still you had to drag him into it. And you want to claim a high road? Get realistic and get a mirror.

            • When we still have $1.1 billion owed to the schools and spent over a billion to get $700 million in tobacco revenue, the notion that we have some sort of “surplus” is, while technically true, kind of absurd.

              I guess I’m not sure where you see that Dayton “likes” debt. His 2016-17 budget is balanced, including a school shift payback.

              I don’t feel the need to go around in a circle yet again about the national economy. You know my position on these issues.

              • And there you have it. Again, you reap what you sow.

                • So, John, if the feds were to magically balance the budget next year, would the $16T in debt already run up no longer be a problem?

                  • No, we’d have a big problem still.

                    And Dayton’s 2016 budget? I guess he now has some crystal ball as to whether or not there will be projected deficits, when we don’t know what it will be for February?

                    We don’t even know what’s going to pass this time around yet, so claiming he’ll address this in future is meaningless, given his track record.

                    So I say he likes debt because he always opts for delaying the repayment of the shift. Well, that and is a Democrat afterall, and those guys like to spend money. I mean he vetoed the first attempt, for purely policial reasons, that he ignores it for this budget, in favor of more spending. Yeah, I’d say he LOVES debt over being fiscally resposible. No doubt in my mind. Actions have consequences.

                    • Well, there you have it. The budget may be “in surplus” today, but there are still big problems out there.

                      The facts on the shift repayment are this: Republicans had a plan, and Dayton vetoed it. Democrats had a plan, and Republicans didn’t let it come to the floor. No one compromised and nothing got done. By your standard, then, both parties like debt.

                    • Dayton vetoed are plan for the sole purpose of denying our side any inkling of acknowledgement oh how effective the reforms we put into place were in regard to spending versus revenue.

                      Dayton did that. He, himself put politics over our schools.

                      Then he gives us billions in tax increases, in HIS budget, and ignores the schools shift yet again. But, he gives the schools more funding? So, yes, he loves the debt over fiscal responsibility.

                      You see, if our side had more revenue to work with, as we saw ended up to be the case now that we’re seeing results from this fiscal responsibility, our first goal would be to get rid of that looming debt. Wipe it out. No spending increases un til it’s gone. Fiscal responsibility. Dayton doesn’t have it. Not with our money. He does with his. It’s in South Dakota, away from our heavy taxes. Follow his actions. He’s not good for Minnesota. His actions show us who he is.

                    • That was the sole purpose? Really? Did your reliable sources feed you that line, too?

                      Republican behavior on the school shift sure has changed now that there’s a DFL governor in charge. Funny how that works.

                    • Nope. That’s right from Dayton’s mouth. Oh he cloaked by saying it would be irresponsible to pay it back now, (back then being now). We all now full well, now meant before the elections. It was a game he played with our school funding. Thankfully, the revenues continued to outpace expectations, and the payback was automatically triggered, making him look like an idiot, which isn’t very hard to do. His failure, which still exists to this day, is a failure to understand how the GOP’s reforms would sweeten rather than harm goverment reserves. He seems to have no preactical understanding of public finance, other than to raise taxes, and spend more money. And he has the nerve to call our side irresponsible.

                    • The game played with school funding was the doing the shift in the first place. What we need to do now is make sure that we’ve got a sustainable budget so we can avoid these messes in the future. As I’ve said before, I think there should be a partial shift payback this biennium, to be completed in 2016-17. But ensuring sustainable funding is more important than trying to force down this money as a 1-time bubble at this point.

                    • As we are likely to see, with the Feb numbers, the reforms put in place nearly get us there so that we won’t have to play these games in the future. And it could be accomplished without raising a single tax, with fiscally responsible leadership. I see little or no indication of fiscal leadership in this budget.

        • There’s plenty of other stuff in Ernie’s letter that’s questionable, but I thought I would give your outrage meter a break and not go through it point-by-point.

          I merely found it interesting that both Ortman and Leidiger used this same talking point, though. No grand conspiracy, John.

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