"Did I do it or not?"

"Not guilty by reason of insanity" appears to be a verdict that causes problems for the court. The term itself suggests a paradox. The person did do something but didn't do it too. Might the plea be more truthful if it were "guilty by reason of insanity" which admits to the act but acknowledges mitigation as well? It seems a much more realistic and honest plea.

A bit like expungement of criminal records where something that happened didn't happen.

We're sure confused.

"What Will it Take?"

What will it take to turn on the proverbial light bulb? Revaluations are at the heart of the property tax problem, not local spending. Revaluations are always responsible for the perennial outcry from tax payers, that their "taxes have gone up more than the tax levy", and they are right. Of course, the people whose taxes go up less than the tax levy are silent, as any of us would be.

The only reason to revalue is to assure a fair tax rate for owners who have just purchased their home, NOT for anyone else; market values are valid for taxation only for people who purchase at market value.

We will never be fair with property taxes until we admit this truth. For more see my website.

Maybe it's just me.

Special Interest v Common Interest

I read an editorial in the Providence Journal on Saturday, May 22, dealing with legislation that would "lock in place pension benefits for public employees..." My comments are not related to the relative merits of the legislation but rather to this part of the editorial - "Mr. Lally, for his part, said he repeatedly filed the bill, originally at the request of the teachers unions - The National Education Association and the American Federation of Teachers."

It is this latter part that caught my eye. Exactly why should a lawmaker submit a bill to become a law? Call me crazy but it seems to me that a lawmaker has as his or her duty, to do what's best for the people whom he represents - all of them, even those who voted against him.

When any group asks a legislator to introduce a bill, the only question to answer is, Is it in the best interest of all my constituents? In my own case, I have been active in promoting changes to property tax law in Rhode Island and was pleased, flattered even, when my town council directed our local representatives to introduce supportive legislation. I do not know if the bill's sponsors agreed with the proposal or if they even fully understood it but this morning's editorial reached me - they should have agreed with it's goals and actively supported it or they should have refused to introduce it.

How many bills are introduced solely for the benefit of the people who lobby the legislator? I cringe at the thought. Let's face it, special interests aren't even special any longer. They're common, too common.

Legislators can't be expected to know everything - their staffs have to help them sift through volumes of data and information. Lobbyists have to present the views of those 'special interests' and that's ok too. The legislator's obligation to his or her city, county, state, nation, is to process all this information and before deciding, answer the question - Is it best for us all? Only then should he or she act. Only then.

Sweet Tax is Sour

I too hate to see people abusing themselves by being so overweight so I can understand why legislators would like to curb obesity. But the tax proposals before the RI House and Senate miss the mark.

If we really want to improve Rhode Islanders' health the law would require that the tax money generated would be used solely for increasing education, nutrition and exercise programs. Adding a few cents tax to sweet drinks will simply further burden and mostly for the people who can least afford it.

It won't take too long for the added cost to become 'normal' and any possible behavior modification will slowly return to pre-tax levels.

Be honest. It's at least as much a fund raising effort as an effort to improve the public health. If we were seriously trying to improve health perhaps reducing the cost of those items we find beneficial would be more effective. How about targeted income rebates for milk, fruits, vegetables? I suspect it would be far more effective in changing eating habits in the long run.

We all know that the sweet tax will simply find its way into the general revenue stream for cities and towns and the people will remain overweight.

On a slightly different note I think there is a better way to inform people about the sugar content of foods. Instead of the abstraction of calories I'd recommend indicating sugar cube equivalents. It's much more impressive to see that a cup of apple slices contains 2 1/2 sugar cubes and a Snickers bar is like eating 13 1⁄2 cubes of sugar.

Why We Hate Property Taxes

Because Rhode Island has among the highest property taxes in the nation we expect that spending cuts will fix our high taxes.

Not so fast.

An overlooked but vital aspect of the property tax problem is that there are two principles of fairness regarding property taxes that are mutually exclusive.

#1 A person who buys a $1 million dollar home should pay a fair tax on a million dollar home.

#2 The taxes people pay should reflect the budget needs of their town; e.g. if a town eliminates tax increases, property owners should not expect tax increases.

These basic principles can not co-exist because of REVALUATIONS.

Existing owners' property taxes can reflect the tax levy (Principle #2) but only when there is no revaluation. Buyers of properties of (usually) increasing value however, are taxed too little on assessed values thus ignoring Principle #1.

To correct this inequity for new owners, we revalue every three years. As a result, existing owners will pay taxes unrelated to tax levies.

In fact a town could even declare a moratorium on tax increases yet over 50% of existing property owners would pay higher taxes due to revaluation, violating Principle #2.

The typical reaction to high taxes is to look for spending cuts but as I've explained, the results would disappoint the majority of tax payers . This does not bode well for peace, harmony and enthusiastic citizen participation and cooperation.

Bernie "Madoff" with other people's money

The lead article in the Journal on Saturday, May 1, concerned investing West Warwick pension money and whether or not the pension board made a prudent decision. "The local unions whose pensions are a stake are taking a wait-and-see attitude".

Don't we get it yet? Investments are gambles. It's risky business. If you bet your pension money on a horse race and won would that make it a good decision? Come on people. These are gambles and it's the the risks not the outcomes that must determine whether the decision was appropriate or not, especially when you are responsible for other people's money to be available for their pensions.

Thinking out Loud

If we increase taxes somewhat on the wealthy they will cease working hard, produce less and the tax revenues will decline. This assumes that the wealthy, the successful, will change into low achievers and stop trying if they earn less.

That's as simple minded as the assumption that bestowing benefits on the poor will change them into entrepreneurs and high achievers.

We can't change the nature of people simply with money incentives alone.

"I'm shocked, shocked to find that gambling is going on in here!"

Just read an interesting piece in the NYT about the Goldman Sachs debacle. In it the author says: "Many more people now know that synthetic C.D.O.’s are a simple wager." Well, duh.

I'm reminded of the famous line in the Casablanca when Claude Rains feigns shock that there is gambling going on.

Capitalism has become so enmeshed and dependent on Wall Street that it risks transformation from a model of providing quality goods and honest services to a model based on simple (or not so simple) gambling. And sometimes the dice are even loaded.

Maybe it's just me.

It's a Choice

Theodore Gatchell's article in the Providence Journal on health care reform made several legitimate points that highlight the choices between the conservative right and the liberal left.

"Over time, however, rules become a way of shielding bureaucrats from having to use judgment. For every problem that arises, the answer is a new regulation."

Indeed. Who can deny the truth of this statement? The income tax code is a perfect example of government's infinite ability to complicate our lives. Of course it isn't only conservatives who pass these laws although one could get that impression from the article.

"More rules inevitably require more bureaucrats to interpret them with an attendant higher cost. If you think health care is complicated now, wait until the bureaucrats begin to crank out the reams of regulations that are certain to come."

Again, there is much truth in this statement which also serves as a mantra for those who resist and object to all governmental involvement not specifically mentioned in the Constitution. Tea Baggers?

It appears that the conservative right believes best arbiter of what's right and wrong is the free market and when bureaucrats interfere there results inevitably inefficiency, waste, corruption and a disregard for the Constitution.

Again, much is true.

When we consider which beer, which movie, which sneaker shall succeed in the market place, the free market is probably best left alone. The public should be allowed to make free choices in a free market to determine winners and losers in such contests.

If all decisions were only so trivial, so superficial. But they're not. In the process of free market competition the corporate bottom line dominates the decisions made by business executives and without government intrusion, important data may be hidden as people choose among things much more important than which oven cleaner, which detergent, which hairspray shall win out.

Was it the free market that publicized the link between lead based paints and brain damage? the link between tobacco smoke and lung cancer? the link between saturated fats and heart disease? Would corporations competing in free markets print this information on its products unless required by government?

Or is it more likely that millions of people would have to become ill or die before people could make informed choices in an unregulated free market?

The struggle between the right and the left seems to boil down to this:

Is it worth the cost in human sacrifice to respect the sanctity of privacy and let people, unfettered by intrusive and inefficient government rules and regulations, use their free market choices to provide the best ultimate decisions for themselves?

Or should we accept the inefficient, intrusive and expensive government bureaucracy to protect the public from harm that could otherwise result from a private sector where the fundamental obligation is to its executives and stockholders?

It seems that the right favors the first and the left favors the second.

Maybe it just me.

Property Tax POLL

I'd like to poll the sentiment of property owners and others regarding property values and fair tax bills. Perhaps ask some friends to read this too.

1. Assume your town has managed to freeze the tax levy indefinitely.
2. Assume your tax assessment is accurate.

The next year, after revaluation, your tax bill increased by 62%.

Question: Do you feel your higher tax bill is proper and fair? yes no

You can email your answer or just post a comment.

Thanks.