Right-wing media love stories that fit into their narrative that government is ballooning wildly out of control, taxing more than it should, getting away with all sorts of waste and fraud, etc. So it's no surprise that they pounced on the news this week that Illinois will be increasing state income taxes. Personal income taxes will go up from 3 percent to 5 percent, while corporate income taxes will increase from 4.8 percent to 7 percent.

This is certainly a newsworthy story deserving discussion and debate. It is not, however, what Fox used it as: a platform to telegraph its Chicken Little insistence that such increases mean the sky is falling out in the Midwest.

Fox & Friends ran several segments on the story during their January 12 program. In one, they invited Fox Business host Stuart Varney on the show to bemoan the rising tax rates. Varney had some pretty strong words about the great state of Illinois:

VARNEY: Well, I'm going to say that Illinois is as close as we're coming in America to a failed state. I mean, it is certainly the poster child for massive debt and irresponsible politics. In the dead of night, last night, they passed this 66 percent increase in personal income taxes. But there's more. They actually raised the corporate tax rate to the highest level in the industrialized world. That's what they did.

GRETCHEN CARLSON (co-host): So who the heck wants to live in Illinois anymore?

[...]

STEVE DOOCY (co-host): This should not surprise you. They're in this great big hole; they've got all the red ink. They're not going to cut spending. They're not going to cut pensions for those union members. What else could they do but raise taxes? [Fox News' Fox & Friends, 1/12/11]

On-screen text during the segment read: “A 66% increase in income taxes! Illinois to raise rates from 3% to 5%.”

First of all, it's pretty disingenuous to suggest that Illinois' only budget fix is to raise taxes. A January 12 AP article on Illinois' budget plan notes:

The tax increase will be coupled with strict 2 percent limits on spending growth. If officials spend above those limits, the tax increase will automatically be canceled. The plan's supporters warned that rising pension and health care costs probably will eat up all the spending allowed by the caps, forcing cuts in other areas of government. [Associated Press, 1/12/11]

As for the corporate income tax, I don't know what math Varney is using to back up his claim that Illinois “raised the corporate tax rate to the highest level in the industrialized world.” The bill indeed raises the corporate tax rate by quite a bit, from 4.8 percent to 7 percent. [Chicago Tribune, 1/13/11] But there are 24 states right here in the U.S. with top corporate tax brackets exceeding 7 percent, as this chart from the Federation of Tax Administrators (FTA) shows. Even including a 2.5 percent personal property replacement tax puts Illinois taxes at “the third-highest rate in the U.S.,” notes a January 12 Chicago Tribune article:

Corporations also pay a 2.5 percent tax on income, called the personal property replacement tax, which is collected by the state and flows to local governments. The two rates taken together come to 9.5 percent, the third-highest rate in the U.S., according to the Tax Foundation, a non-partisan Washington-based research group. [Chicago Tribune, 1/12/11]

So, it's high, yes, but it's not even the highest corporate tax in the U.S., let alone “the industrial world” (Denmark's national corporation tax is 25 percent, for example).

Which gets us back to the original story of Illinois' “66 percent increase!” on taxes. Again, personal state income taxes increased from 3 percent to 5 percent. Just how high is 5 percent, relative to the rest of the states?

Not very. Here's an FTA chart comparing the 2010 individual income tax rates of all 50 states, plus D.C.:

[Federal Tax Administrators, updated 1/1/10]

The lowest tax brackets for the majority of states are indeed lower than 5 percent -- but conversely, 31 states, of the 43 that have an income tax, plus D.C., have a top tax bracket greater than 5 percent. So 5 percent doesn't seem that outrageous, relative to many other states in the country.

Even Fox & Friends guest host Alisyn Camerota pointed out this very fact during today's edition of the show. She even got co-host Steve Doocy to agree with her. From the broadcast:

CAMEROTA: OK, so the personal tax has gone from the individual tax increase to 5 percent from 3 percent. OK? In Illinois.

DOOCY: Sure.

CAMEROTA: And, you know, OK, I understand that that is painful in Illinois. But in New York and New Jersey, it's like, cry me a river people in Illinois, because the personal tax in these states here on the East Coast are much higher, at about 9 percent.

DOOCY: So, this -- absolutely. And we -- we got that tax monkey on our back here. And it's -- OK, it's a gorilla in New York and New Jersey and Connecticut and places like that. [Fox & Friends, 1/14/11]

Watch: