Unclear On The Concept

Sykes has an email from a listener (one of the five or six), which follows in its entirety, with my emphasis added:

The topic came up during out Insight 2008 show and I received this email from a listener:

Greetings Charlie from da UP,

To illustrate the tax haven for retirees in Michigan. We are 71and 70 and I retired 12 years ago. We built a home and moved to MIv in 1998. My wife and I have a combined income for 2007 of $95,008. Broken down as follows:

Interest & Dividens: $7,160
Social Security: $24,792
US Govt retirement: $ 43,308 ( I retired from the US Navy
and my wife had a short career with DOD Schools in Germany)
Company Retirement: $ 3,549
MRD from IRAs: $ 16,199

We have a Michigan State tax bill of $11.

Michigan is a good State to retire in, but I might not want to live here and be looking for a job!

By the way we live on the shores of Green Bay, looking across the bay at Door
County. Our Property tax on a $400,000+ home is a tad over $2,400 a year.

Doncha love it when Charlie shoots himself in the foot? He thinks he
is showing what a "tax hell" Wisconsin is when compared to our neighbor.
But there are some things that he overlooks.

One is that the emailer notes his salary, but most of it is in interest, and is not usually taxed at a high rate.

Second, the emailer compares income tax to property tax. That is apples and oranges. Related to this issue is that the emailer doesn't report the value of the property in Michigan. I have two acres in property in Central Wisconsin with a house, a broken garage and a large shed. The value of that entire property isn't half of a regular city lot in Milwaukee. How much would you want to bet the property isn't worth $400,000+?

But the best line is "but I might not want to live here and be looking for a job!" Sounds like a stagnant economy there. Maybe because there's no work, there's nothing to tax. So, to drive out business, don't tax, and don't provide services because you can't pay for them.

Thanks for the economics lesson, Charlie.