Thursday, March 26, 2009

Something Is Happening And You Don't Know What It Is

Long ago, if you wanted to put on a good taxpayer revolt, you marched in the streets, waved flaming torches, and maybe dumped a load of British tea into the harbor…Today, you go on the "John and Ken Show."…John Kobylt and Ken Chiampou have roused the masses, and their show on KFI-AM (640) talk radio has become Southern California's rant room for those who are fed up with government spending, government bailouts and government tax hikes…There’s a Tax Revolt in the Air, John Weeks, Whittier Daily News, 3/21/2009

Between this kind of radio talk show and the Tea Party movement, something is going on out there. Because of the concentration of attention by the major media on tax relief from the federal government, that 95%-of-the-workers’ relief plan that Obama promised (and that Congress is turning away from, perhaps seeing it for what it is, wealth transfer from taxpayers to non-taxpayers), the real tax horrors are ignored. What are they?

In a northern town, at the very tip of Westchester, property taxes on a fairly modest house are pushing toward $15,000 a year. On top of a mortgage payment, however much deductible, just maintaining that sample house requires over $50,000 a year. Westchester County is not the best example, as it has a high average income, pushing $120,000. But, one should note that, after taxes, that’s not much money. $50,000 represents more than half of the after-tax remainder, and doesn’t include utilities and maintenance of the house, not to mention food, costs of commuting, clothing, that fund to get the kids through college, insurance for car, house, life, etc., etc., etc.. Property taxes in New York, New Jersey, California, and many, many other states are the proverbial straw. And, it’s getting to be a pretty damn big straw. Why?

To be fair, police, fire, sanitation, sewage, highways and schools are not free. The days of heroic volunteer firemen are pretty much gone. Somebody’s gotta pay those people. But there are also huge federal and state mandates for services no town ever thought of having to pay for (nor did they have representation in Congress for their side of an argument that mandated them to raise taxes), not to mention arrays of compliance officers to assure that towns were meeting regulations and mandates from the state and federal government. With a marked unwillingness at higher levels to raise taxes (not to mention the risk of political risk), the job of paying for a Congressional or Presidential cause has increasingly been forced onto localities. In New York, it’s led to taxpayer flight. That’s when someone living on the border of Vermont, for instance, notes that it’s cheaper to live there and work in New York State than to live and work in New York. And it’s also when companies, plagued with taxes from localities and the state, which are as high in New York as in any other state, move across borders, sometimes national borders, so that they can afford to do business, make some money, and pay their taxes.

You can only do so much of that. The option to leave is not available to everyone. And, when the pressure is at its high, whether in the days of Howard Jarvis or now, citizens, noticing that their wallets are about empty, start asking questions and raising hell. It’s about time. Governments that assume their citizens are always rich enough to pay more taxes usually find themselves at the wrong end of change when the people start to speak.


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