short comments on some current events

[cellio]

County property taxes are currently the subject of a fracas. The county executive wants to cap increases in assessments at 4%, because school districts aren't allowed to gain more than 5% a year and if they do, they have to lower the tax rate to compensate. This cap sounds like a win for the taxpayer at first glance, but actually, what it means is that under-assessed properties will remain under-assessed while everyone else picks up the difference. Accurate assessments and the resulting changes in millage rates are more fair, and the current scheme might violate the state constitution. (Fairer still, of course, is to not tax property, or savings. If you have to tax something, taxing consumption (sales tax) seems fairer, with exemptions for food, heat, etc. But don't penalize people for trying to save for the retirement no one else will provide.) But the part I like is that when approving this plan, the council mandated that tax bills would show whether you gained or lost from this scheme. So at least they have to tell us. :-) (Well, that said, how many homeowners see their tax bills? They go to the mortgage company.)

According to CNN, a CA prosecutor and judge conspired to keep Jews off capital juries because "no Jew would vote to send a defendant to the gas chamber". I find this curious. Yes, I know a lot of liberal Jews who are anti-capital-punishment, but that's because they're liberal, not because they get it from their religion. Lots of non-Jews are anti-capital-punishment, too. I actually wonder what the proportions supporting capital punishment are in the four groups represented by these two divisions: Jews and Christians, and religious versus non-religious. (Non-religious, in this case, means identifying with the religion but not doing much of anything about it, like the bagels-and-lox Jews and Christmas-and-Easter Christians.) I suspect that religious Jews are the most likely to suppor the death penalty.

Finally, Terry Schiavo. The situation is tragic, but I don't see how it's any business of the federal government to intervene in a specific case. If you have an issue with the way the state courts are structured, address that (if you can, constitutionally -- which I doubt). But you don't get to pick and choose interventions like that. So purely on legal-purity grounds, I hope this current effort fails. On non-legal-purity grounds, I feel awful for everyone involved but it's a sucky way to live and if she did express an opinion on that, her family needs to honor it. And this should serve as a wake-up call for everyone to put these things in writing; she was only 26 when she was struck down. I had a living will by then; do you now?

Comments

[ralphmelton.livejournal.com]

I agree about accurate assessments being more fair, but I'm not sure I agree that it's fairer to tax consumption. Consumption taxes tend to be heavily regressive, so they are proportionally heavier on the poor.

[cellio]

Regressive taxes are bad, which is why I would exclude necessities. (Obviously this invites arguments about what is a necessity.) Property and income taxes are also hard on the poor and thus penalize savings. I think I'd prefer a tax system (if one must have one at all :-) ) that supports people who choose to live frugally so they can save money against future needs. If it's taxed on the way in you never get a shot at that; if, instead, we tax it on the way out, at least you decide when to pay that tax.

It's not ideal -- no system is -- but I think it would be better than what we have now. Also much less expensive to administer, which means more tax money goes toward the actual tax goals instead of to administrative overhead. (Which won't make the folks with those jobs happy, but oh well.)

[goljerp]

The problem that I have with a consumption tax is this: poor people tend to live pretty much hand-to-mouth, so they're spending pretty much everything they make. Middle class... well, nowadays, they're probably also spending a large proportion of their earnings. The rich, on the other hand, while they may spend more than the poor or middle class, spend a smaller amount of their net worth... so I don't see how a consumption tax could ever be particularly progressive. (It's also easier for rich people to do stuff like leave the country to buy things, making it easier for them to avoid a consumption tax.)

[cellio]

poor people tend to live pretty much hand-to-mouth, so they're spending pretty much everything they make.

This might get better if you take away the portion of their rent that goes for property taxes (everyone pays property taxes, directly or indirectly), reduce or eliminate income tax, and don't apply sales tax to the essentials. No, I don't have a specific proposal to crunch numbers on.

The rich, on the other hand, while they may spend more than the poor or middle class, spend a smaller amount of their net worth...

I'm not after a proportion of someone's net worth. If he never spends it it hasn't really done him much good, now has it? I think the taxes on the mansions and yachts and Carribean vacations and BMWs and the like would dwarf what poorer people would ever get hit with (and get hit with now).

But granted, I'd also like to lower the tax burden overall by eliminating a lot of government waste, because individuals do a better job of keeping spending under control than bureaucrats with patronage jobs. Hmm, I think I feel a rant coming on. :-)

[goljerp]

because individuals do a better job of keeping spending under control than bureaucrats with patronage jobs.

Now, I'm not going to argue that there's no such thing as government waste, because obviously there is.

The thing I don't understand is why when two companies merge, that's always good, because of "economies of scale" and the advantages of things being "centralized". How come it's good for companies to be large, but government to be small and fragmented?

[goljerp]

I'm not after a proportion of someone's net worth. If he never spends it it hasn't really done him much good, now has it?

OK, first of all, my mistake: I suddenly started talking about net worth with rich people, which confused the issue. Forget about net worth; on average, rich people spend a smaller amount of their net income, thus my argument that a move to a consumption-based tax would hit them less than the present taxing system.

Also, mansions and yachts and BMWs are optional, but the things poor people buy aren't. So, what's to prevent the smart rich people from putting off their BMW purchases for a few years until they can buy, er, influence, the powers that be to change the tax system again?

You also appear to be unconcerned (as, apparently, are the powers that be) with the accumulation of wealth in the richest fraction of the population. This actually worries me, because there are all sorts of ways in which the mere existance of wealth leads to power. (Bill Gates' children will probably get into Harvard, no matter what their SAT scores are.) And if you believe that wealth is a zero-sum game, allowing some people to accumulate massive amounts of it hurts others. (Even if wealth is not zero-sum, it's possible for the richest to accumulate wealth so quickly as to deprive others of it.)

In my mind, the estate tax is the best tax there is. OK, maybe it could use a little bit of tinkering, but I think it's good to tax the transfer of wealth from one generation to another.