Charity Begins In Government

I'd like to do dedicate a little ink (metaphorically of course) in a mid-week post this week to my friends in the Glass City.  You know who you are (Maggie Thurber).  You're the ones concerned (if not justifiably outraged) over the fact that your City Council is perfectly willing to donate tax dollars that don't belong to them to worthy causes, yet those very same elected officials seem unconcerned at their utter lack of personal contribution to these same supposedly laudable groups.  

I'm sure that knowing of your charitable nature, many of you can't help but feel warm (if not downright ill) inside to know that while you live in a city that's been balancing their budgets in ways that would make double entry bookkeepers weep in envy; the stewards of your public funding can still find it in their hearts to support those who come to them cap in hand.  Short of funds they may be, but apparently long on votes.  It must be inspiring to know that the same people begging to take money each year from the Capital Improvements Budget to balance the General Fund can still find it in their hearts to donate from that Fund that the city has none to spare.   It must make you feel all warm and fuzzy to hear the same elected officials who complain of a lack of funding for proper police and fire protection calmly dispense public checks to private charities.

While you're basking in the smug and self-satisfied feeling that comes from watching these fiscal watchdogs rob Peter to pay Paul (curious, when you're Peter) I must tell you however that Toledo's well-known level of public generosity may soon need to stand in line.  For this November, it's the intention of Jackson County, Missouri (Kansas City) to place a measure on the ballot which would create a 20-year, half-cent sales tax.  Now while county sales tax proposals are certainly nothing new to those in Toledo, the potentially laudable goal of this particular one might be viewed as rather unique (and potentially scary).

If passed, the expected $40 million in annual revenues would go to equip and provide staff to ... wait for it ... medical research.  Kansas City's Children's Mercy hospital would reap some $20 million, with at least another $8 million to go to both St Luke's hospital and the University of Missouri at Kansas City.  All three of these entities already receive private donations (tax-deductible, BTW) for such purposes, but it's thought that such major funding escalation would allow them to increase the size of their research programs, as well as to allow them to recruit top scientists for the effort.   (I wouldn't at all be surprised!)

Let me say first that medical research is a truly laudable endeavor, and one that I support through personal contribution.  But what kind of research are we talking about you here might ask.  "Why, medical research of course," (he said in his best Bill Murray "Stripes" imitation).  Actually, the particular type of research that will be supported by this funding hasn't been defined by those promoting the tax.  It could be anything from a cure for cancer or AIDS to one that's really important, like a cure for the common cold.  (It might even be Alzheimer's research, but I don't remember.)  Of course, it could be that they don't want to go into too much detail, since knowing what the money would go for might make such a taxpayer donation less charitable.   According to a piece in the Kansas City Star though, "Backers of the proposed county tax say it is adequate to make a major difference, medically and economically."   (my added emphasis)
  
Not surprisingly Kansas City's Mayor and City Council are fully behind this ballot effort.  After all, not only is none of it money from city coffers, but a specific tax like this one doesn't prevent the city from future tax request efforts for project it already has in mind like expansion of the recently approved $100 million, two mile-long streetcar system or the proposed $1.2 billion dollar airport terminal improvement project.  Oh sure, KC could use more police and fire protection as much as Toledo, has their own water and sewer system issues, and has a backlog of street repairs waiting; but pursuing such concerns wouldn't provide the same warm glow as supporting such worthy causes.  Sure, the three largest private foundations in the area could come up with $36 of the $40 million just by setting aside 1% of their assets (again according the the KC Star); but wouldn't that make the taxpayers feel ungenerous by comparison.

Besides, supporters of the tax tell us that if any of this research bears fruit, taxpayers will share in the rewards reaped by it.  Of course their not saying what our share of such research would actually be, but wouldn't taxpayers seem greedy for asking what their cut of this undetermined research would be before committing to funding it for the next 20 years?

Sorry Toledo.  It's not that you haven't shown yourself unfailingly charitable during some of the toughest economic times that any part of the nation has had to face.  Let's face it, you've failed to turn down any but the most ridiculous of tax requests over the years, and your continued tacit support of the city council regularly giving away the money they've torn from your grasp through taxation has all but redefined 'giving til it hurts'.  Kansas City however apparently seems fully ready to raise the bar on both the level of largess and the ridiculous nature of giving.  Like you, their generosity seems to know no bounds (or common sense) and their willingness to tax themselves to provide it apparently knows no limits.  As in the Glass City, here in the City of Fountains, it seems that Charity begins in government.

In the spirit of full disclosure, I am compelled to admit with a sense of mean-spirited gratitude and of greedy self-satisfaction that I live in Johnson County, Kansas and not Jackson County, Missouri.

    

Read more here: http://www.kansascity.com/2013/09/16/4486667/surprising-opponent-to-jackson.html#storylink=cpy

Read more here: http://www.kansascity.com/2013/09/16/4486667/surprising-opponent-to-jackson.html#storylink=cpy

Talk Is Cheap

Congress is talking about reducing the funding to the budget of the Internal Revenue Service.  They're also talking about continuing the investigative hearings into their spending practices and their method of granting (or lack thereof) 501C3 tax exemptions on a fair and impartial basis.  As you would expect however, our weak-willed, self-absorbed elected representatives are actually doing little more than talking where the tax cops are concerned.

Now I don't suppose that you can blame them for attempting to get a good soundbite, the IRS is a rather easy target of opportunity under the best of circumstances and the 2014 mid-term election is already in full swing.  Besides, nobody like taxes, so why should anybody like the people who collect them.  Even if they did like the people who collected taxes (there's no accounting for taste after all, I hear there are some people who even like White Sox fans), they might have earned your ire through through their rather un-American procedural philosophy that taxpayers are guilty unless and until they can prove themselves innocent.  If you hadn't already experienced this particularly egregious perversion of American jurisprudence, you might them find them worse than the run-of-the-mill government weasels for recent revelations of their wasteful spending at internal 'training sessions'.  (After all, there's nothing like a government agency committing sins that it wouldn't let you get away with to infuriate you.)  If you could get past their waste and abuse, you might dislike them instead for attacking Conservative groups attempting to get tax-exempt status.  If you didn't care whether they attacked Conservative groups or not, you might still want to work up a little preemptive antagonism as this government agency gets a boost in size and authority in order to take on its new role in the increasingly onerous Affordable Health Care Act.  (Maybe we can all be considered dead until able to prove that we're worth keeping alive.)

Certainly if you are a member of the majority in a Republican-controlled House of Representatives, there are more than enough reasons in the above list for you to want to take a very public (and politically motivated) shot at this particular example of a bureaucratic nightmare when the other party controls the Senate and sits in the White House; especially at a time when it's particularly vulnerable (like when its popularity is one of the few things lower than your own).

Of course while your attacks are vitriolic, vocal and very public (a 'V is for Vendetta' moment), none of them are anything more than symbolic.  You say you want to very publicly cut this agency's budget, but not its power or  responsibilities; and for no better reason than recent revelations make you mad ... but you still have to find a way to collect taxes.  On the other hand, you refuse to punish yourself for creating the monstrosity of a tax code that requires this tainted bureaucracy of this scope and scale in the first place.  You refuse to admit that you've created a nightmare of a Biblical proportions that even the agency in charge of it doesn't understand, that you've spent decades filling it with special interest regulations that serve no one but the lobbyists that have cow-towed to you for decades, and that most much of it purposely (or out of plain dumb luck) a morass of self-contradictory bullshit that means whatever the government chooses it to mean.  You could certainly pull the teeth (and the budget) of the IRS all but entirely by going to a flat or fair tax, but of course that would mean admitting your previous errors of omission and commission; not to mention alienating constituency groups of Certified Public Accountants, software companies, tax preparers, and of course unionized federal employees at the IRS, all of whom contribute to political campaigns.

You're perfectly willing to stand on the floor in Congress with a microphone in your hand and call for punishment of IRS employees who are doing little more than emulating in their own bureaucratic abuses what they see in legislative branches that created them (at least, as long as the cameras are rolling).  In fact, in your ginned up indignation, you insist upon it.  If Legislators are upset with conference hotel rates however... where do they stand on those for members and their staffs while on Congressional junkets?  Are they unhappy with the travel budgets to get these bureaucratic drones to places where they can be educated in the latest special interest rule changes that Congress created ... perhaps we can deduct them from the the cost of flying members of Congress and their six-figure assistants on military aircraft to places around the world.  Are you one of those legislators now weary from standing on principle against the targeting of certain groups attempting to get 'tax-free status', ... perhaps it never occurred to you to solve the problem by doing away with the concept of tax-free politics in the first place.  Perhaps both parties should be reminded that its taxpayers pick up the tabs for primary elections used for no other purpose than as beauty contests for members of two rather exclusive political clubs in the first place.

Quite frankly, you in Congress can stick your phoney-baloney righteous indignation in the same dark hole where you've buried any attempts to make the tax code easy enough for anyone without a degree in economics to understand.  While you're at it, save your camera posing for the mug shots that deserve to be the only photo ops you deserve.  Why even when you've finally gained enough national animus to launch a truly bi-partisan effort to once and for all clean up the broken system that you created; you waste it by spending your time ignoring your own culpability and using the opportunity instead for the purposes of political grandstanding.  

Sorry people, but where this situation is concerned, the emperor has not a stitch of clothing on and it's about time somebody mentioned it.  The the sum total of current Congressional outrage amounts to little more than a stinking pile of natural fertilizer that doesn't even deserve a farm bill subsidy (and that's going some).  If you want to pull the teeth, reduce the budget, and fix the IRS once and for all, by all means go ahead; but do it by fixing the mess you made of the tax code in the first place.  Everything else is talk, and talk is cheap ....

The "Stuck On Stupid" Dictionary #40

The normally lazy lexicographers of the 'Stuck on Stupid' Dictionary have, to amazement of most of the staff, produced a second effort within the same month.  Some here at headquarters many are convinced that they felt that they were concerned at being out performed by the Department of Just Blowing Smoke Security: but I'm convinced that this latest effort is a challenge that they could not refuse, since it was a suggestion by Maggie Thurber, to whose inspiration they owe their miserable little positions.  Quite frankly, those in Senior Staff don't really care what the reason is as long as they don't have to continue to make excuses for their lack of control over this normally rogue department.

Such inconsistent production however, means that there may actually be those of you reading this who have somehow managed to miss previous postings on this subject (shame on you, now go back and search all of the postings under the label of  'Dictionary').  For those of you thus unfamiliar, the SOS dictionary is a reference guide to terms which nominally mean something to the rest of the English speaking world, but appears to mean something entirely different when looked at through the jaded eyes and rose colored glasses of the SOS dictionary staff.

Double Dip:
 
1. The achievement of getting a second (and sometimes equal or better) measure from the same source.

2. To earn a salary from the source of one position while collecting a pension from a similar source or especially from having held the same position previously.

3. The circumstance when a city charges taxes of every resident to create a police or fire department, then charges them additionally for the costs involved with using it (voluntarily or not).

4. The situation where utility company charges an individual at a standard rate for a provided service, then charges them additionally if the such usage is considered too much or too little service to make the utility profitable enough.

Heads In The Clouds, Faces In The Trough

Every city seems to have a pie-in-the-sky project or two that seems to outweigh common sense, financial sensibilities, and even political realities.  Through a little known branch of Einstein's theories which today's physicists have yet to properly recognize, let alone define; these projects usually turn themselves into a form of black hole that sucks in both political and financial capital in. 

In the City of Fountains, that project is for Kansas City to replace its user-friendly, three terminal airport  (one of which is currently being closed down from lack of use) with a new single terminal facility.  And the cost for tearing out an existing airport that many consider the most user-friendly in the country to put a single terminal monstrosity (Can you say Midway airport?), mostly for the purposes of streamlining the terminal security process and adding a few terminal shops and eateries to the mix is $1.2 billion before in-project changes, delays and increases in materials, and the cost overruns that are always involved with such massive government projects begin to have their way with it.  (Can you say "Big Dig"?)

Perhaps most bizarrely, the city and the Aviation Director in charge of the maintenance of the existing facility Mark VanLoh, is spending $117,000 of the taxpayer's cash on a PR campaign to show that he's apparently incapable of maintaining the existing 30 year-old facility in a move designed to push for its replacement.  He notes in an article in the Kansas City Star that, "the public doesn't see the many ways in which those terminals are deteriorating and can't be remodeled to meet the needs of the 21st century aviation world".  There are some who think that seems rather at odds with the Department's PR efforts only 9 years ago, when it was touting the success story of spending some $258 million in taxpayer funds designed to remodel and update those very same terminals.  And what about the millions spent to add underground parking garages to each of those terminals not so many years before. that  Where do both of these rather significant investments in the airports original future fit with this new plan for its eventual destiny?

What does the city's leader, Mayor Sly James (yes, that's his real name) have to say about this:  "I think what happened is that the concept got pushed out before we figured out how to push it out".  Yep, you guessed it ... bad PR.  Of course, every poll of local citizens shows that they are currently not in favor of building such a terminal, but what difference should that make?  (After all, no one listens to the people when they're not interested in letting the government spend their money.)  In fact, when a small local group started a petition effort to stop the city from pursuing the spending of taxpayer money in pursuit of the project, the City Attorney ruled such a citizen's effort 'premature' and invalid as a consequence.

Imagine the hubris!  It isn't about the fact that KC doesn't need a new terminal now in the wake of an ever-shrinking airline industry.  It's not that the city isn't already committed to building one of these black hole projects in the form of a 2-mile long streetcar system of doubtful use, except perhaps as a stepping stone to expanding it.  It's not even that like many other cities of its size, the city doesn't suffer grave infrastructure issues where streets, bridges, and water and sewer systems are involved; and that will only be solved by major increases in some form of equally massive projects funded by tax and fee increases to its citizenry.  The real problem with the airport project is that the Mayor and his minions have not been allowed to do the sales pitch for it at their own time in and their own way.

Unfortunately, those of you who live for the power, influence, and the vast amounts of cash involved with such projects should have no real fear however.  A new Kansas City Airport appears to have entered the event horizon of this non-Newtonian phenomena.  The shear mass of such a project will be difficult to slow down, especially as it gathers the mounting acceleration of taxpayer-funded, government-approved gravity well of a PR campaign and the refusal of government at any level to give up on such things until it gets it own way.  There's money to be made in such massive government projects for big contractors, for union workers, and for government bureaucrats who get to dispense these vast funds.  There's also a good bit political power and future fund raising to be garnered for any politicians who serve the purposes of these funding black holes.  There's little mystery to the result of question of the airport's future therefore, when those in charge have their heads in the clouds and their faces in the trough.

I'm Feeling Generous

I have to admit that I've been feeling rather good about myself this week.  Like most people, some part of my attention has been drawn to the 15th and tax day, and none of it had to do with the fact that I filed my paperwork months ago and even received a small refund. (Imagine, getting some of MY MONEY back from the government.)   Instead, the reason that I've been feeling rather proud of myself is because of realizing what a generous guy I've become.  

Now this may be a little hard for many to believe.  After all, I'm a greedy Conservative, and therefore have no heart.  (They're right about having no heart of course, but being Conservative probably has little to do with it.)  While filling out my taxes however, I reviewed a number of slips of paper that listed donations that I had made to various charitable organizations over the last year.  None of them individually might be worthy notice in the local media, and I was not asked to pose with an oversize copy of one of my checks for eventual media publication; but percentage-wise collectively, I think I did better than the nation's leader and his foot-in-mouth 2nd in command in my good works.  

Just as I was beginning to feel a bit smug about my munificence however, I realized that all of us paying taxes this year have every right to be proud of our generosity, regardless of the number of tax-deductible receipts that we're holding. You see, these days we're all making charitable donations on a fairly grand scale whether we know it or not, at least according to this chart from the Heritage Foundation.

See!  We're all paying a sizable portion of our tax dollars to pay for other people's medical bills (after paying an ever-increasing amount for our own health insurance).  We're paying for a "retirement insurance" program (a Government-run Ponzi Scheme) that's likely to be broke before we're able to collect anything from it.  Part of the 19% in income security includes food and housing assistance for those less fortunate, as well as that we justifiably owe in recompense for those who have more than honorably served in our Armed Forces.  As for the net interest listed in the chart, apparently we're all donating to nations like the Chinese, in a capitalist transaction with a Communist country to finance the sad fact that the US continues to spend more than the money than it takes in from the tax revenues we 'donate' to it each year.   It's was also great to find out that we're all so generous that we're willing to be rather charitable where other people's transportation or their kid's education is concerned (beyond what those of us who have to pay in local property taxes).

And while it really isn't broken out in the 7% that's listed on the chart, we're generous in ways that we don't even know (and couldn't comprehend the lunacy of if we did).  We are after all, paying oil companies to drill for oil that our government says is bad for the environment, and grain-based ethanol as a sustainable replacement that's even worse.  Speaking of grain, we're donating money to farmers not to grow crops in places that they could and other farmers for poor returns on those that they did plant at times or in places that they shouldn't. 

We're generous with green energy companies that go broke as soon as they run out of our charitable contributions, on maintaining government buildings that the government no longer uses, and on such needy causes as training Chinese prostitutes to drink responsibly (which falls under the category of foreign aid affecting US interests, I'm sure).  Let's face it.  The truth of the matter is that we're spending billions in charitable contributions to bad governments with worse leaders all around the world who really don't like us; in the misguided notion that 'buying friends' is a workable plan.  (Proving that while the US doesn't negotiate with terrorists, they're perfectly willing to fund those considered only part-time terrorists and full-time political leaders; who then work with or subsidize other full-time terrorists.)

You know, maybe too much generosity isn't such a good thing after all.  Maybe you and I are in fact donating far too much, and against our own best interests.  Maybe ....

Oh wait, we're talking about taxes after all.  Taxes are extracted at the point of a gun (or the threat of a federal prison sentence),  and their redistribution of our obligatory contributions fall under the same guidelines as most government operation.  Mostly begun with the best of intentions, they have morphed into a bureaucratic monstrosity whose only saving grace is the inefficiency of they're misguided efforts.  I suppose that as such, they cannot therefore really be considered generosity after all.  I feel better again ... sort of.

Donate Responsibly ....

 

Sky High Dreams

Kansas City is going to get a new airport that will cost it over $1.2 billion.  It really doesn't matter whether it needs one or not, whether the existing one gets the job done or not, or whether it makes any sense to build one or not.  What apparently is important to this situation is that the movers and shakers within city government want this new airport (as depicted to the left), and they're determined to get it.

Now for those of you who have never actually used KC's aerodrome, Kansas City currently possesses a unique three terminal design which was originally dedicated in 1972.  It has consistently ranked in the top five facilities in the country in terms of customer satisfaction (as tracked by J D Powers and Associates), for the last decade and in 2010 was rated as the top medium-sized airport.  (All of which appear to be good reasons to tear it down.)  

This isn't to say that KC hasn't hasn't kept up the facility and indeed has spent considerable money on its airport to update it over the last 41 years.  In a move to upgrade the original design, additional millions were spent not that many years later to add underground parking garages at each of the three terminals for the convenience of travelers.  (What fate that underground parking would see after this latest revision has yet to be discussed.)  During the years of airline expansion, a fourth concourse was even considered (and delayed long enough to make it unnecessary).  Just nine years ago, the city spent a further $258 million to again update the very terminals that it now wants to tear down and replace. 

Of course airline traffic is down these days; and with the recent mergers led by American and United, KC is today using only two of those available three terminals.  Then again, flights all over the country are down as the airline industry attempts to consolidate in the face of years of incipient financial failure.  The ever-increasing cost of fuel, the compeititive nature of key air routes, and an economic slow-down that has only added to a significant reduction in non-business related travel all point to an airline industry that will be struggling for many years ahead to maintain any level of profitability and damned lucky to see anything approaching a full recovery any time soon.  But instead of seeing the closing of 33% of its gates as a warning sign against future infrastructure spending, supporters of the new design see this instead as an opportunity to build the new facility over the recently closed corpse of the A Terminal.

On top of the poor industry timing, one has to wonder about the timing involved with looking for bond financing during the tight budgets of a stalled economic recovery.  After all, none of this has been approved for state or federal grants that might provide any alternative.  That would leave the airlines largely responsible for picking up the cost of this project by increasing landing fees, a move which will likely see such costs passed on to consumers through increased fares.  The city, whose infrastructure budget is already stretched like many others around the country, would likewise have figure out how to pick up part of the tab, something likely to be offset by yet more in the way of a higher sales tax or increases in hotel taxes (or both).  

And yet all of this effort and expense is to be made fro no better reason than to simplify the current security process at the airport and add shopping and restaurant venues.  The current layout apparently requires more staffing than the single entry port model of many airports (though it does shorten potential security lines); a job which has been ably handled by one of the few privatized security forces instead of the standard TSA agents.  Of course the real boon, as it is for any other such big government project, are some really great high-paying 'union' jobs in the construction trades, along with the inevitable construction delays and cost overruns that go with such efforts.  Strangely however, part of the initial justification of moving forward with the project is that it would allow this new airport to operate with less in the way of both security and other operational personnel.

Not surprisingly, local residents are rather dubious of moving forward with what they see as unnecessary spending, and have said so repeatedly.  KC's City Council however, seems unfazed by such public opinion and have recently approved the spending of $117,000 of such taxpayer money for a public relations firm to attempt to sell local residents on the project that they don't appear to want.  Or at least, not yet ... 

The bad news about such a disasterous waste in government spending in such tough economic times is that none of this will be going to KC road, water, and sewer systems that are all but crumbling beneath their feet.  The good news however, is that when such collapse does eventually happen, at least KC residents will have a new and more efficient escape route.

April Fools

Here we are once again in the month of April. Now for those who didn't already know it, April is famous annually for two of its days, the 1st and the 15th.  The one is all about having a joke played on you that scares the hell out of you, while simultaneously making you look like an idiot.  The other is April Fools Day.  

I write regularly on various aspects of the national pickpocketing effort perpetrated by the government on all levels by way of taxation, so you'd think that I would have an increased level of immunity to machinations involved with such high jinks.  You would sadly be wrong.  (In my own defense, I also believe in the Easter Bunny, but couldn't likewise help but notice that I was without a wicker carrier full of chocolate-covered stuff and marshmallow peeps yesterday.)  

The truth of the matter however, is that there is no form immunity where this national caper is concerned, and the knowledge of its existence is no proof against falling for such annual antics.  In my case in fact, rather than wait until a mere two weeks before the mandated IRS deadline as we are now, I set myself as victim for the pratfall weeks ago.  While doing so, I in fact congratulated myself on beginning the process almost immediately after the tax rates had been firmly established by the delinquent efforts of Congress at dealing once and for all with the Bush Tax Rates in my apparent desire for victimhood.  Without a grumble and with nary a groan, I took up the process of self-abuse, dutifully took the deductions granted meby legislators and bureaucrats (legaleeze for additional crumbs of my own money that my government 'allows' me to keep) who saw it as their duty to impose their will upon me, and accepted my due as a 'tax serf'.  

Before I knew it, I had completed not only the required annual federal paperwork, but those required of me for the Sunflower State as well.  (Mission, KS does not yet have a city income tax, temporary or otherwise, a blessing for which I am pleased and grateful.)  Both were duly computer-checked and electronically submitted, courtesy of a nationally recognized tax firm, and I was feeling rather pleased with myself.  It was only as I began to think about putting together an effort this weekend (delayed so as not to impose on a religious holiday weekend) that I began to at last see the error of my ways.

Without realizing it, I had fallen into the trap expected of the very sheeple I often castigate.  Not only had I complacently and ungrudgingly conceded a significant part of my income to the waste, fraud, and thievery annually committed in the name of 'paying our fair share' through bi-weekly confiscation; but having done so, I had likewise fallen into the simplest of traps ... the now happy anticipation of a REFUND.  Ignoring what should have been bitter resentment not only for paying, but for overpaying for the few things absolutely required of government (and a lot of crap that these days seems must of necessity come along with it); I was instead happy and grateful for the return of that overpayment.  

That's the mindset that too many of us have in the increasingly subjugated serfdom into which we are born.  Like the illiterates of the Dark Ages, we are often little more than peasants burdened with a tax system that we've never had control of, whose complication is cunningly added to each year in the name of simplification, and which we now have no real hope of ever understanding (something I'm convinced is done by design) as we simply bow our heads in humble acceptance of the rules.  

Worse still is our pitiful reaction to any portion of our hard-earned money that's finally returned to us.  I in fact, was drooling over the prospect of such a government check (OK, direct deposit) as if it were a long-overdue Christmas gift; and not the grudging return of money by Washington and Topeka only weeks after asking for it back, as if it were theirs and not mine in the first place.  I was just beginning to become more angry at being the willing mark in this tired jest when it occurred to me in my complacency that I had yet to consider a potential audit.  I cowered once more while realizing that the government allows itself not only this second bite at the apple which could take away that which had chosen to bestow upon me; but has the ability and was more than willing to charge interest and penalty if it later discovered any underpayment, regardless of the reasons involved.  As for itself, there is of course no interest that accrues to any money that the government holds throughout the year in overpayment.  And in this fear I marvelled that we demand no redress of such disparity in treatment; because as victims of this now 100 year-old prank we've long-since accepted that the joke is on us, that the game is rigged so the house will always win, and that we'll never understand how and why this is or have the ability to change it.  

I suspect that all of this will make me mostly immune to the petty pranks that I expect to occur on this first day of April.  Oh some may engender some mild form of temporary surprise, but nothing that compares with the more permanent shock of that whose damage whose deadline is now two weeks away.  While I'm sure that I'm as susceptible as anyone to the day's practicle jokes, it's that in the grand scheme, they mean little.  For more troubling to me is that I've discovered myself to be part of the lowing herd that finds itself the annual victim of the horseplay of the Internal Revenue Service.  The sad fact of the matter is that in this country there is no escape from the ill-favored escapades that constitute taxation in this country.  As a consequence, the sorry truth is that when it comes to the shenanigans that occur on the 15th, we are all of us ... April Fools.


 

Legislative Agenda Priorities

In another 'staged for TV event', President Obama stood in front of the cameras yesterday at the White House and clearly stated for the record, that the "time has come to fix once and for all" the broken system, according to an article in the UK Guardian.  Now many of you might have suspected that the leader of the free world was finally accepting his responsibility for failing to deliver a budget to Congress on time, as mandated by law, in five out of the last six years in which he has served; and to finally broker a budget passed by both Houses of Congress during his tenure in office.  The President's budget proposals have became rather famous (some would say instead notorious), not only for their consistent tardiness; but for being so out of line with political thought in this country that he has been unable to get even one of these proposals passed.  More telling though, is that he has yet to receive a supporting vote from even one of the legislative members of his own party, let alone that of his political opposition, during this same period.  If this was your assumption of his message however, like me, you would have been wrong.

Oh sure, you might have instead been looking at the President's statement as a goad to the United States Senate, a legislative house which his Democratic party has been in control of prior to and during his entire tenure in office.  The Senate, for those of you who might have missed it, is the only group in Washington that's done worse on the subject of the national budget than the President.  In violation of federal law themselves, Senators have consistently failed to pass a budget in each of the last four years, a record which they may finally be prepared to break.  This failure, aside from allowing next to no control over the national spending process, has lived on a consistent diet of 'Continuing Resolutions' in the last few years, which does little other than continue the business as usual of automatic increases to 'Baseline Budgeting'; with annual increases and no effective limits.  Budgets passed by the Republican (once known as the party of no) in the House of Representatives have been completely ignored and refused a vote by the very party that once so named them.  Sorry again folks if that's what you thought though, for this laudible goal likewise had nothing to do with the President's statement.

Perhaps the President was speaking to a broader financial situation in the nation.  It is once again after all, approaching another fiscal crisis as the National Debt Limit is about to be exceeded.  Now the Senate budget proposal is one that seems to ignore this situation, and instead looks to increase taxes another $1 trillion dollars over increases that have already occurred either at the expiration of the Bush tax rates and the imposition of the taxes that are beginning to take effect as part of the "Affordable Health Care Act"; while never once addressing the amount of the budget that's in the red.  The Congressional Budget proposal proposes no new taxes and seeks over ten years to instead balance the budget through the reduction of spending.  Strangely there are actual points of agreement between the two offerings that the legislative branch is working to make larger. 

Despite the claims by candidates on both sides of the aisle for both the executive and legislative branches in the last election that 'jobs are going to number one', nothing has yet been done or appears to be imminent in the budget plans in Washington DC to stimulate any other part of the economy than 'green energy'; and most of that has turned out to be throwing good money after bad to companies that only manage to provide a few temporary jobs before going bankrupt.  The government has yet to come up with anything that addresses that it's spending 30% more than it's taking in, that it's paying for the debt incurred by printing money at a furious pace, selling the debt that foreign countries don't want to The Fed, and lending money to big backs at what is effectively 0% interest.  Of course all of this will eventually lead to Inflation, but in the meantime the current batch of politicians is able to fiddle while the nation begins to burn; and continue to beat the dead horse of 'Sequestration' as the nag to blame for no better reason than it provides political cover for all the things that they're either too dense to recognize or too cowardly to address.

Oh, by the way.  I may have forgotten to tell you what the President was talking about during his recent public event instead of what he wasn't.  At a time when the President is late producing his own budget and doesn't expect to produce one until long after both the House and Senate have voted on their own proposals.  At a time when fiscal cliffs pop up more often than three-day holiday weekends.  At a time when the national debt has reached a level higher during his administration than at any time in its 237 year history, a debt that this President's Administration is responsible for accumulating faster than any other in its history; the President was instead looking at something entirely different than what should be the most important subject of his second term.  

This President was once again changing the priorities of his legislative agenda (and that of Congress), and castigating that legislative branch for not addressing a completely different subject to his satisfaction; in spite of the fact that both Houses are working to come with a compromise for it that will pass both Houses.  Instead of finally addressing an economy that the President has often called the worst since the Great Depression, the chief resident of the White House was instead attending a ceremony held instead to address something completely unrelated to the nation's economic malaise ... Immigration Policy.  

Bravo Mr. President, for keeping your eye on the ball ...

 

        

The Dark Side of Democracy

The voices of Democracy have spoken this week in Kansas City, and a new transit system will be implemented in a very small part of the downtown area.  According the Kansas City Star, voters approved, by a margin of 344 to 198, a 25 year property tax increase to fund a $100 million, two mile long streetcar system.  One might think that the only thing smaller than the size of what's being called a transit system is the voter turnout that approved it.  That turnout however, is not the result of voter apathy, but instead the result of what some might consider an abuse of the democratic process which created a 'special downtown tax district' to achieve its ends.  All well and good you might say.  If locals want to tax themselves for capital improvements of this nature, it's their right to do so.  Would you consider it equally fair however, if you knew that this property tax, and the 1 cent sales tax increase that's the other part of the funding for this project, could only be voted on by residents of the tax district? 
Then again, according to the KC Star piece, this isn't going to cost that much anyway.  "The owner of a $200,000 condo will pay $266 in additional taxes. That’s an 8.7 percent residential property tax increase.  Commercial property owners will see their property taxes go up an additional $1,500 for every $1 million in market value on their property. That’s a 5 percent commercial property tax increase.".   It's a song we've heard sung before.  Of course many of those residents voting were more probably tenants rather than owners, who though living in the special tax district would not be subject to the property tax imposed (at least, not right away).  Is it fair to you that owners of businesses in this new tax district, most of whom do not also live on the premises of the business they own, were not allowed to vote on the tax that was about to be imposed upon them?

Would you find the whole process disingenuous then, if you realized that the burden of the sales tax as well would fall far more on industrial and commercial enterprises selling in the district than on residents, who still had the freedom to purchase outside of the area where the tax will be imposed? Would it likewise be considered voter disenfranchisement where KC residents outside the district were concerned that they weren't allowed to vote for the $2 million dollars annually that the city says it will now be contributing to the operation of this 2 mile transit system.  How about the fact that the city's water utility system, which like so many other metropolitan systems around the country is suffering from ill-kept and horribly out-of-date infrastructure, has announced that it will be contributing $4.5 million to the construction of the system?  When does a water department need to contribute to a transportation system, rather than their own desperately needed infrastructure improvements?  Why is it permissible, at a time when they are raising rates, for them to invest in anything other than their own needs?

But wait, there's more!  Without knowing whether this 2 mile system will garner any ridership, let alone enough to be able to come close to paying for itself, local politicians are already looking at expanding and incorporating this toy train system into a proposed $650 million dollar plan for two commuter rail lines to connect outlying areas with downtown.  These elected officials are right now pushing for yet another vote, this one for a county-wide 1 cent sales tax which could help pick up the slack (and spread the burden) of funding for these first street cars, with future tax revenues to provide a steady revenue stream for more to come. And of course, as with all public transportation systems, the federal government is supplying funding as well, contributing an initial investment of $18 million so far in (you guessed it, taxpayer funding) to prime the pump; something which none of the rest of us were allowed to vote on.

Now remember that this is a part of the city which currently has public transportation in form of buses.  All of the money being spent for this change will not provide something that currently does not exist, but merely a shinier version of it for a neighborhood.  And while each step of this process could ostensibly be considered the use of the democratic process to achieve a desired goal, somehow it feels like there's a taint to this particular use of the process that can't be easily removed.  While in theory nothing done has been illegal, what has been done cannot easily be considered admirable either.  Worst of all, the fact that a special interest group has successfully crossed over to the dark side of the democratic process here will no doubt inspire other groups to similar efforts in imitation of this twisted process.

I can't help but wonder if even the over 300 that voted for this toy transit system into being this week won't feel some doubts about it in the days and years ahead?  I wonder how thrilled they'll be while their streets are torn up and access to homes and businesses are restricted and the city attempts to lay track?  I wonder what commitment to upkeep and repair such street cars will continue to provide if the system remains an isolated anomaly and doesn't get to expand throughout the rest of the city?  Will this form of transit ultimately add or subtract to the value of homes and businesses in the area?  How happy residents will be with it, knowing that this performance of their civic duty will mean living in the highest tax district in the city?  Mostly however, I wonder if in the years to come, they and the city will be proud of the path that they've forged this week; or will they simply feel that they've sold their souls to the political Sith lords on the dark side of democracy? 

 
                  

Quotes of the Day

We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.
- Winston Churchill

A major source of objection to a free economy is precisely that it gives people what they want instead of what a particular group of people thinks they ought to want.  Underlying most arguments against a free market is a lack of belief in freedom itself.
- Milton Friedman


(And no, the picture shown above is not me trying on my Halloween costume a few days early to make sure it fits.  Then again ....)


    

TFP Column: Falling Leaves Falling Levies

Last night's marathon writing session started out as a simple attempt to do a mid-week rant, but almost as quickly as the Blob (Steve McQueen version of course) it had grown out of proportion and completely out of control; requiring topical separation surgery before it engulfed the computer I was writing in on.  The part that didn't couldn't fit on the blog here yesterday however, is linked here today for your edification and education.  Editor-In-Chief Michael Miller, in yet another example consistent misjudgment and blinding speed, had it put up on the TFP website almost before it reached him electronically.

"Falling Leaves Falling Levies" will no doubt become part of a recurring theme in the days leading up to the November election, as I try to point out some of the perils and pitfalls of these self-imposed taxes on the voting public of the Glass City.  There's a lot of smart people in the Glass City, and continuing to reach out to them with logic and reason might just sway a few voters.  Reaching out to them with half-baked humor, prose dripping with sarcasm, and barely veiled insults (you know, like I normally do) might have some effect as well. 

Speaking of smart people in the Glass City ....  All the really smart ones keep up on what's going on there and the rest of Northwest Ohio by reading Toledo's largest Sunday circulation and Ohio's best weekly newspaper for the last three years .... The Toledo Free Press     

        

Property and Taxation

There's been some public discussion in a number of places about the levies coming up in cities around the country.  This talk is not only about the worthiness of these efforts (or lack thereof), but about the levy process itself.  At issue is whether those not owning property, and therefore not paying their share of property taxes and their associated levies, should even have the right to vote on taxing their fellow citizens. While having pointed out a number of occasions that many of us not currently owning property do in fact pick up some incremental cost in these taxes (for they cannot be honestly called anything else), I can easily understand and agree with the point of view of someone saying that non-owners do not bear the same burden.  Something about the discussion kept nagging at me however, and I was forced to continue puzzling it out long after it ended.

The source of my discomfort was realized when I understood that levies, like property taxes themselves, are part of the over all annual tax burden that citizens in this country are extorted to pay under the threat of fines, seizure, and imprisonment at the hands of our own government (with the able assistance of its myrmidons at the IRS).  As such there are advantages and disadvantages to the status that we hold where each form of taxes are concerned.

Earn a high salary and you are likely to pay a higher tax rate.   Cash in stocks or sell property that those less fortunate don't own, and you'll pay a capital gains tax on the profits of such a sale.  Die rich and you'll be hammered with a large estate tax to add insult to the permanent injury.  In each of these situations however, the tax code (which started out at 504 pages and as of 2010 had grown to almost 72,000) is likely to provide you something in the way of a loophole or two if you've got a good enough accountant to find them.  In other words, there is often an offset achieved in some part between what has to be paid and what gets a pass.

My discomfort was the dirty little secret that no one talks about when this disparity in taxes is discussed .... the Mortgage Deduction.  You see while a homeowner makes a mortgage payment and a lessor his rent, the interest on a home mortgage is tax deductible.  For those buying the biggest place they're allowed to by the company financing it, mortgaging as much of it as they can possibly get away with, and staying less than seven years in the home purchased; in fact most of what they will make in the way of a mortgage payments will be interest on the loan and therefore tax deductible.  No part of the rental payment a lessor makes to his landlord during the same period will carry a similar deduction.

Imagine if you will that two people went to a car dealer to obtain identical new vehicles. Both handed over the same down payment money and both agreed to make monthly installment payments, but one purchased the vehicle and the other leased.  The person leasing may have reduced his monthly payment through his down payment, but that money was now gone forever and at the end of the lease there will be nothing to show for either it or his monthly payments; though the payments themselves would be less.  The person purchasing also reduced his payment through a down payment and established equity in his purchase.  Monthly payments made, though higher, would increase the equity in the purchase.  At the end of the loan, the purchaser would in fact own a car with some intrinsic value and the renter would own nothing.

Both would be freely made choices and the results of agreements fairly established however; in overall effect they would be virtually equal and neither would have the advantage.  Now consider these two people and add in a tax break for the interest on a car loan and ask yourself if the deals are still equal and you are likely to conclude that they are not.

So when we go back and look at the overall annual taxes paid by the property owner and non-owner, we can see that the property tax burden of the homeowner could be offset in some part (if not all) by the savings obtained on the income tax side of the equation.  The non-owner, while paying less of the property tax / levy burden; would pay a higher percentage of income tax on the money he earns, since there is no corresponding deduction to reduce their tax rate. 

This is not to say that property taxes are not an egregious burden on citizens; and that the continuing and increasing abuse of levy requests aren't adding insult to injury.  Living in a state that forces its residents to pay property taxes on vehicles before they can be legally licensed can't help but point that out to even those of us who rent.  Understanding however that as a renter I am able vote on levies (turning most of them down by the way), still seems reasonably fair to me in spite of the limited impact I bear from from.  After all, no one has yet offered me the chance to vote on limiting or removing the mortgage interest tax deduction and you haven't seen me bitching about it (even here).     

One might even add that the practices involved with the mortgage interest income tax deduction, coupled to the government encouraged sub-prime lending practices under which most 'too big to fail' lending institutions operated, and fed to borrowing public who has been told for years to buy the biggest barn of a home that they could and mortgage it to the hilt because real estate is one of the best and safest investments that they can make; largely fueled the bubble whose bursting caused the current economic downturn.  

And while there is still much discussion of government-subsidized refinancing for underwater mortgages which will further burden ALL TAXPAYERS, I haven't heard even one call to consider those locked in a lease and whose fortunes have likewise suffered.  You know, it might just be that it's we who aren't paying our 'fair share' property taxes who should be righteously pissed off.

                  

TFP Column: It's All A Bit Taxing

I guess I'll have to owe you one for a bit, as once more an attempt at a mid-week blog post has become yet another column for the TFP.  Since the media and the election campaigns for President seem to be caught up either calling for release of more of Mitt Romney's tax returns, or the refusal to do so; I decided to put my two cents in with "It's All A Bit Too Taxing".

It's not that I know any more about whether or why they should be released and why they're not; but I think that I'm capable of applying a bit of common sense to the situation while making fun of some the other out there purporting to do so.

Another thing I don't know any more about than anyone else is what's going to be going on in the Glass City for the rest of the week.  So while passing on the opportunity to read my own effort and discover the typos and grammatical errors that I've committed, you can bet that in order to find out what's going on I'll be reading today's 'Star' edition, as well as this weekend's edition of Toledo's largest circulation and Ohio's best weekly newspaper for the third year in a row; the Toledo Free Press.

    

TFP Column: The Little Bus That Couldn't

Someone on the staff at a recent editorial meeting had the temerity to bring up the thought that were a couple of things we hadn't done here at "Just Blowing Smoke" in quite some time: 


1. Release another Fracture Fairy Tale to the public
2. Pick on the Toledo Area Regional Transit Authority (TARTA)


After a bit of verbal abuse was exchanged over who would be held responsible for these lapses (someone must always be blamed in the end), it was decided to kill not two, but three birds with one stone (which was rolling by at the time, having not gathered any moss) and do a Fractured Fairy Tale on TARTA as our offering for the Toledo Free Press.  (The fact that doing so allowed the editorial staff to go back to their normal slacker ways, and to do so with rather smug expressions on their faces, I'm sure occurred to none of them.)  The result of these combined labors was an effort that came to be known as "The Little Bus That Couldn't".


If there's not time to talk TARTA down from the ledge of offering us a choice on this new misguided more egregious way into taxpayer's pockets, there's plenty of time to get the word out and vote this potential monstrosity into the seventh level of Hell that it came from.  


Of course because of the nature of this week's effort, I don't know when it will go into the TFP.  Have no fear however, the mid-week 'Star" edition should more than entertain; and come what may, there will be another weekend edition of Toledo's largest Sunday circulation Ohio's best weekly newspaper (for the third year in a row) to amuse and inform you. 

Hidden Taxes, Hidden Unions

Complaining about the amount of the taxes that we pay is perhaps the only real right not spelled out in the first ten amendments to the Constitution, though it could of course said to have been spelled out in the Declaration of Independence.  And while we all talk about Income Tax (at the national, state, and often municipal level), Social Security Tax, Property Tax, and Sales Tax; the list of ways in which government finds to tax us seems to go on forever.

Though many of us believe that this is the extent of that which we need complain about, there are many more hidden taxes that we also pay in our daily lives.  Rather than just list them however, let's take a bit of a literary license with a hypothetical situation of someone in 'pursuit of happiness':

Let's say for example that you want to start you own business on land that you already own (and are therefore already paying taxes on).  First of course, you'll have to pay to get a building permit issued in order to place a structure for your use on land that you own, paying a tax to the municipality for permission for the privilege of doing so.  Once construction is almost complete and regardless of the abilities, reputation, and even union affiliation (or lack of it) of the workers used; you will now need to obtain a Certificate of Occupation.  That certificate of course, will only be issued upon a city inspection for which a 'fee' (code word for tax) is required.  Having completed this process however, you might assume that you are done and can begin your actual pursuit, but you'd be wrong.  Still remaining is a Business License, yet another tax in fee form that you must pay in order to legally do business in a building that you now own, built on land that you own.

And heaven forbid if that business is one that serves food and liquor; as these require not only an additional Health Inspection and yet another fee, but additional permission and license to sell a legal beverage (alcohol) in the business you own on the property you own.  More paperwork and permission, and of course more fees for permission to do so.

Perhaps you'd like to leave a dog at this premises to guard your investment while you're not there.  All well and good my friend, but that pet / guard had better have a dog license (at what is no doubt a reasonable fee) or you'll have trouble with either the city or county, depending on which has their hand out.

Now perhaps before putting your nose to the grindstone and knowing that they'll be little leisure time in the days ahead if you're to make a go if it, you decide to take a vacation. You'd better watch out before clicking on that deal of an airfare.  In a recent Bloomberg report, travelers found that the $150 transatlantic deal they just got may prove to be $800 by the time the taxes and fees are added in.  In a specific trip mentioned on Delta from Atlanta to London Heathrow, the $338.40 base airfare had almost double that amount in taxes and fees added to it (another $599.20) before any bags could be packed.  And while the hidden nature of some of these fees and taxes are now no longer possible, the taxes and fees yet remain.

__________________

Taxes are not the only thing going on more or less out of sight though.  There are also Unions which, though not acknowledged by their members, restrict membership to drive up wages just as surely as if they were the UAW or SEIU.

Do you want to become a doctor?  Fine, but in order to do so you must first train at an accredited institution for such a purpose, then serve an apprenticeship (commonly known as residency) before getting your diploma and being allowed to hang out your shingle.  Why even the Hippocratic oath speaks to this restrictive principle involved, "Those things which are sacred, are to be imparted only to sacred persons; and it is not lawful to impart them to the profane until they have been initiated into the mysteries of the science."  (This certainly sounds like the basis of a closed shop to me.)

There may be differences between the AMA and the IBEW (International Brotherhood of Electrical Workers), but you'd be hard-pressed to discover them from the way they operate.  It should likewise be noted that such practices restrict membership and drive up the level of compensation, or at least they did until government bureaucracy took its place in the equation and mandated price controls through what it paid in fees by Medicare and Medicaid.


But doctors aren't alone in such secret membership.  One might just as easily point to lawyers and their State Bar Associations.  Study at an accredited institution as long as you like, but you can't become a practicing lawyer until you pass an exam and become a Journeyman (or as they put it, are "admitted to the Bar").  Even then, you are required to pay dues to the State Bar Association where you've been admitted, and get yourself tested and admitted in every other state in which you wish to practice.  Here too has restricted membership kept fees fairly stable (and high) and allowed those laboring in this covert trade union to maintain a relatively high rate of recompense.  

One can, without stretching the point too finely, include most Political Parties in this country in the mix.  Members do in fact pay dues, and by so doing do gain voting rights within their organization, even when the voting is in primary elections paid for not by the party, but by the taxpayer.  And while not every state holds to such restrictions, most favor closed shop elections for those running for public office.  If this were not so, why are Independent candidates, or those from other parties (like Libertarians) forced to operate under different petition rules and often kept from participating in the public debates for these public office.

It's hard enough dealing with the frustration caused by restrictive taxes and restrictive rules imposed by the partnership of government and unions on many parts of our day-to-day existence that we can clearly see in this country.  It's particularly confounding however, to find out how much of the money being taken and how many of the strings being pulled are being done through Hidden Taxes and Hidden Unions.


  

New Year's Resolutions - 2011 (Part I)

The end of the year is fast upon us, and for many of us it's once more time to make those time honored 'resolutions' of expectations that we have for ourselves for the coming year.  

I find myself on the eve of the election year of 2012 looking at the process much as I did in 2009 in a New Year's Resolution effort for the Toledo Free Press, and added to here in Just Blowing Smoke. I find that in the intervening years, I have held surprisingly firm to those resolutions; so perhaps it's time now to offer a few more serious ones and let you who have lost far too many hours reading the nonsense of JBS decide whether they have value, and whether I stick to them in the days ahead.

• I resolve to treat the pronouncements of Republicans and Democrats (and even Libertarians) with equal disdain, knowing such pronouncements can often be little more than the empty noise of political expediency at best and despicable political pandering at worst.
• I resolve to speak out whenever the opportunity arises against the unjust practice of forcing taxpayers to pay for primary elections in this country. If D's and R's require such ballots to pick candidates, let them pay for the process themselves.  If however, taxpayers are going to be forced to pick up the tab for these increasingly irresponsible organizations, let suffrage be universal and not restricted to club membership.
• I resolve to ignore most of what the 'pundits' say most of the time.  Most of this group is becoming just as guilty of self-serving bullshit as the politicians that they attempt to mold opinion on as they build them up, take them down, and pronounce them suitable for election (or not).
• I resolve to similarly ignore the polls, as they have become similarly tainted by their constant repetition and ever-changing results.  Polls may be of some use to candidates in determining their relative position in a given field or the sound bite that will get them the most media attention, but they are no basis for voters to use in choosing a candidate.  In fact, their influence on recent election process has probably done more harm than good  (at least according to my recent polling numbers). 
• I resolve to call out any misuse of the term 'spending cut'.  No longer allowing those in power to call a reduction in the increase in spending a cut. If you're spending more this year than you did last, and if you're planning on spending more next year, you haven't "CUT" anything. 
• I further resolve to call out any of the accounting trickery used to raise revenues (taxes) now in exchange for spending cuts later for the deceit that they are.  It has long been apparent that in this form of 'Wimpy Economics', taxes do increase, though no spending cuts inevitably occur.  Only changes that take effect immediately on both sides of the equation have equality.
• I resolve to highlight and attack any increase in the federal bureaucracy in this country.  Not only does it increasingly place the real power of government in the hands of people who are at no time responsible to the electorate, but the increasing restriction of their mandates is currently the greatest threat to freedom in this country.
• I resolve to continue to highlight the hypocrisy of politicians on both sides of the aisle talk about the reforms required in government union pensions and entitlement programs, while doing absolutely nothing to reduce the costs of their own compensation packages and pension programs.

At the very least, this should keep me busy enough to stay out of trouble in an election year that promises to be a truly 'target rich' environment.

Happy New Year!

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