Chicago Teachers Union President Karen Lewis made headlines for telling the City Club of Chicago that Rahm Emanuel’s handpicked board of education is populated with “rich, white people [who] think they know what’s in the best interest of children of African Americans and Latinos.“ And no doubt she intended to do so. But the substance of her speech was an attack on Illinois’ unequal tax system.
Lewis declared her support for overturning the state’s flat income tax -- a regressive form of taxation that hits the poor twice as hard as the rich -- and replacing it with a progressive tax that would require the rich to pay a higher rate.
“Bold leadership declares an end to corporate subsidies and loopholes,” she said. “It calls for progressive taxation. In Illinois, while the poor and working-class pay an effective tax rate of more than 10 percent, the top 5 percent are systematically advantaged by the tax code, paying a mere 4.1 percent to 6.5 percent effective tax rate. If the tax rates for the top 5 percent wage-earners in Chicago were equalized, at least another $160 million in revenue would be made available for children’s education.”
That idea has also been embraced by gubernatorial candidate Bill Daley, a millionaire banker and political prince who’s as elite as it gets in Chicago. Daley has suggested a constitutional amendment to impose a progressive tax, which is used by 84 percent of states that impose income taxes on their residents.
But Lewis went even further and suggested that Chicago impose a municipal income tax, on both residents and commuters.
“In Illinois, while the poor and working-class pay an effective tax rate of 12 percent or more, the top 5 percent are systematically advantaged by the tax code," Lewis said. "At the city level, a combined city-income and commuter progressive-tax between just 0.5 percent and 1.5 percent can generate close to a $1 billion for the city, with half going to CPS. Imagine if CPS had $600 million more in revenue in addition to nearly $300 million a year from TIFs and Swaps? We would be having an entirely different conversation of improving early childhood programs, wrap around services, adult education, anti-violence initiatives, expansion of nurses, counselors and school social workers, etc.”
That one is going to be impossible. Illinois is one of six states that prohibits cities from imposing income taxes, and there’s no way suburban legislators will vote to change that law so Chicago can tax their constituents to pay for schools.
Still, Lewis made an important point. With a tax system as unequal as Illinois’, is it any wonder we also have an unequal education system?