Creating Poverty

Today, I read where economists warned that New Jersey, which already charges residents and businesses high taxes compared to other states, has been losing high-paying jobs and has a weaker economy than the rest of the nation. They said more taxes could hurt businesses and cause high-wage earners to flee the state.

I guess this will come as a real shocker to some people and at least to one New Jersey professor. The other day I read an article by Steven Pressman (picture at right), a professor of economics and finance at Monmouth University, on how New Jersey could easily solve its financial troubles by raising the income tax on the ‘wealthy’ and the gas tax on everyone. Pressman believes these measures would result in economic growth, low unemployment and the end of our state’s budget deficit.

You really need to read Pressman’s entire piece to fully appreciate his complete lack of understanding about economics and the realities of life in New Jersey. He’s trying to convince people that income tax increases result in economic growth and low unemployment. It’s bad enough he managed to get a newspaper to print his ridiculous ideas, it’s beyond pathetic that he’s teaching this drivel to his students.

He suggests raising the income tax rather than the sales tax because the wealthy save a lot of their money, implying I suppose that they really don’t need it. Pressman must think they save it under their mattresses as opposed to investing it in our economy, because I assume he must have read investment is what’s used to create economic growth and wealth. Then again, the creation of wealth is not one of his interests.

If that bit of muddled thinking isn’t disturbing enough, Pressman suggests the Governor should cut the present sales tax rate and boost the state’s income tax higher to really get the state humming with economic vitality.

He believes the ‘wealthy’ will just deduct the state income tax increase from their federal taxes. According to the professor, for every $3 in additional state tax they’ll get $1 back from the IRS. Apparently Pressman’s never heard of the Alternative Minimum Tax and how federal deductions for state income and local property taxes are greatly reduced or totally wiped out for ‘wealthy” New Jersey taxpayers.. Even Senator Bob Menendez and Congresswoman Nancy Pelsoi understand this tax trap.

I wonder how the good professor explains the record amount of income tax revenue the federal and state governments have been raking in since the 2003 ‘Bush tax cuts’? Or why he thinks New Jersey’s broke and other states have surpluses? So engrossed in his academic bubble he must have missed our country’s economic statistics for the past three years and the billions of dollars in new or increased taxes Trenton has imposed during that same time period.

I do think I have figured out the reason for Pressman’s delusional thinking. His B.A. and M.A. were in philosophy and his Ph.D. in economics was from the New School for Social Research. As bio states, his primary research interest is poverty and after reading his article it’s the only thing professor Pressman theories would create. Imagine spending $30,000 a year for college to be taught by professors like Steven Pressman. On second thought don’t.