Tyranny of the Labels

There was a piece on the editorial page of the Providence Journal on Friday, November 2, 2012, “Another scary oversight failure” by JoAnne Fitzpatrick which caught my attention.  It dealt with the failure of quality control at a state run (Mass.) pharmaceutical monitoring lab, similar to the failure at Framingham, MA company, New England Compounding Center, (NCCC) resulting in up to 28 deaths throughout the United States from 328 fungal infections. 

When the problem was discovered new rules were swiftly put in place. At first read, the story appears to be a discussion of  too much regulation vs not enough regulation.

But I see a “Tyranny of the Labels”.

To illustrate, let’s call Label 1   “Big Government / More Regulations”. People with this label ordinarily respond to problems by creating new laws and/or more regulations, distrusting business to do what’s in the best interest of most or all the people. Business’ #1 priority is profit, everything else is secondary. 

Label 2 can be identified as “Small Government / Less Regulation”. Those with Label “2” believe that government regulations generally stifle innovation and entrepreneurship, that less government regulation is always better and that free markets, independent of government interference, will always provide the best and most economical solutions to problems.

Marketers have been paid many millions to convince legislators and the public that only one label is right and the other is pure evil. And it seems that millions of us have accepted it. 

In the above story, clearly there were laws in place before the contaminations were discovered. Do we really  need more laws and more regulation to address the failures, or do we need better people to administer the laws already in place? While new laws can give the appearance that legislators are doing their jobs, is it more of a “feel good” exercise that merely makes it harder for business to function and survive? 

On the other hand, by letting the marketplace decide what’s right, are we saying that we will tolerate some deaths and disease until the market can weed out the offending businesses and that we accept these tragedies simply as a cost of doing business? 

We have been conditioned by slick marketing firms to make choices according to the label that makes us more comfortable instead thinking deeper and deciding who or what is the best choice in each situation, thus avoiding the “Tyranny of the Labels”.  

A depressing instance of labelling is the “Straight Party Ticket” choice on our ballot which suggests that the individual means little, that the label is far more important. It's a shameful practice and should be abolished now. 

I recently attended a local candidate forum and was so disappointed to hear some good candidates suggest that the audience vote for the members of their party - a suggestion that it was the most important consideration. Ironically that party has been the victim of the “Party Ticket” choice at the state level for years.

This is not a simple issue. Until we choose the best individuals, regardless of labels, we will suffer from Tyranny of the Labels, and the United States will continue to lose respect even among its own people. 

Hard earned money

Is anyone else tired of hearing about how tax hikes will hurt "hard working" Americans and take your "hard earned" money?  Guess what.  There are lots of people who don't work hard for their money.  Donald Trump inherited a fortune from daddy; hard earned money? I don't think so.

Taxes take money from everyone, hard working and the not so hard working.  The most important thing is to know whether taxes are used for the benefit of the public or for the benefit of a chosen few who often aren't very hard working at all.  

Treat the disease not just the symptoms

When we experience symptoms such as pain, dizziness or shortness of breath, we seek medical help. We want relief from our symptoms but we also expect the doctor to diagnose the underlying illness and treat it.

Our state and communities have lots of serious issues; high unemployment, crumbling roads and bridges, high taxes, unfunded pensions, population loss and political corruption to name a few. Are they diseases or are they symptoms of underlying illnesses?

Like the doctor whose waiting room is filled with patients needing attention, legislators scramble to put out a myriad of fires all at once. Despite their efforts, (in some cases, because of them) the underlying illnesses are often never fully diagnosed or treated.

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PENSION REFORM's $2 billion unfunded liability. A symptom or disease? If we miraculously received $2 billion, the immediate problem would be relieved, but have we achieved a cure or just alleviated the symptom?

Governments and unions, when crafting pension contracts, MUST work together for the benefit of everyone instead of their own constituencies and narrow interests as they have often done in the past.

A start might be to publish the names of those people who craft all employee contracts so that the public always knows who was actually responsible for them.

Perhaps if people knew that their prior actions would not fade with time, they might think more carefully about their legacy and future reputation.

JOB  CREATION GOP director Patrick Sweeney said, “The ... issues I believe that are most pressing.... addressing the business climate in this state which means helping out small business to help create jobs”. I would respectfully disagree with this assessment. Businesses don't create jobs. They create services and/or products and if the public wants them and can afford them, businesses will hire more workers. In other words PEOPLE create jobs.

Any business that hires workers it doesn't really need because of a tax break will let them go when the tax break ceases or they'll soon be out of business. Yet another example of treating a symptom and not the disease.

EDUCATION: Rhode Island per pupil spending is higher than 45 other states but student performance is just in the middle of the nation. Symptom or disease?

“If we focused on waste, we could provide more resources to our children in the classroom” says one party spokesperson.

But we're already spending much more than most every other state but with only mediocre results.

“We need to stop treating corporate education like it is special and we need to stop giving corporate CEOs tax breaks. Reversing these two trends will be key to revitalizing Rhode Island” says an NEA director.

Nearly every conversation about education focuses on money and taxes. These are extremely important but  the crucial element in a child's academic success is the attitude of parents and family. Until and unless this is addressed, financial "solutions" alone will fail to achieve the desired results. When our children grow up in a home environment that values education, nothing will hold them back.

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Changing our habit of treating symptoms instead of diseases isn't going to be easy and all sides need to listen to one another. We have to take the best ideas, regardless of whose they are, and working together, use them to do the right thing for all of the people.

These are only one person's ideas after hearing the same tune played over and over. I'm hoping we at least change the station. They did it in Tahrir Square. I hope we can do it here.

Continuing to take only aspirin for that chest pain symptom could be a killer.

Maybe it's just me.

Underwater mortgages

I'm confused. A person borrows money to buy something (if it's a house it's called a mortgage). If the value of the purchase drops, the lender is being asked to decrease or forgive the amount borrowed ("principal forgiveness").

But what if the value of the purchase were to increase instead of decrease, as it often did in the recent past? By the above logic, a lender should be entitled to get more than the amount that was borrowed. 

What does the change in the market price of the purchase have to do with the amount of money that was borrowed? It's a loan and needs to be paid back.

Now, if a buyer borrowed more than he or she could afford to repay in the hope that the value of the home would rise and be sold for a profit, that's gambling. Why should the lender be on the hook for the buyer's speculation?

On the other hand, if the lender deceived the buyer in some way, in order to make a sale or get a fee for refinancing a mortgage, the lender should be prosecuted.

Sensible, fair, regulation of banking (among other things), administered by honest and competent people is the only real solution to the problem that got us to where we are. 

Unfettered free markets as touted by the far right Tea Party and libertarian ideologues might eventually self regulate but not before destroying a lot of people in the process.

The right thing for the wrong reason

On Sunday, Dec 9, Pg B7 of the Providence Journal there was an article, "Ending death penalty on ballot".  California's Proposition 34 would change the death penalty to life without parole even for those those who are already on death row.

The reason stated is "the entire process is far too costly, and that scrapping the death penalty could save millions of dollars."  Excuse me, but that's a terrible reason to justify not putting a convicted murderer to death.  Using such logic, why not save even more money by limiting the trials for accused murderers to two days?  Now that would really save tons of money.

I have no emotional or ethical problem with the death penalty for someone who has demonstrated he or she is unfit to live among civilized people.

However there is a far more compelling reason to eliminate the death penalty and it has nothing to do with compassion or sympathy. Juries are people and one undeniable characteristic of each one us is that we can make mistakes. Even judges can make mistakes. Believe it or not even lawyers can make mistakes.

Until we the people become infallible, putting someone to death is simply wrong because courts can make mistakes. And saving a few bucks wouldn't hurt either.

The Real Problem, Look in the Mirror

The editorial in Saturday's, July 28th Providence Journal, while concerned primarily with the merits or lack thereof of Blue Cross Blue Shield's actions regarding Landmark Medical Center, it presents an opportunity to examine a much larger issue - the tug of war between two competing philosophies;  leave business decisions to the marketplace and all will be well, or allow government to become involved with private business and industry and the people will be better for it.

"Certainly, Lifespan, which operates Rhode Island and Miriam hospitals and works closely with Blue Cross, has a financial interest in ending competition with Landmark, particularly for lucrative, simpler operations."  This suggests that concern for the bottom line trumps concern for the public's health.

If the health and well being of the Rhode Island population is the goal then there would appear to be a conflict of interest, as you clearly state:

"We do not know whether Blue Cross has concluded that driving Landmark out of business is its most profitable course, but surely it has a duty to serve the health interests of the people of Rhode Island. As the state’s people and their representatives see it, saving Landmark is greatly in the public interest." 

While it is easy to see that business will always act in its own self interest and thus might hurt the public in the process, it is more difficult to accept the reality that our elected officials do not always act in the best interest of the people either, often favoring one favored group over another.

It makes a very strong case for term limits and for much more public involvement and thought during election season.  

I'll bet the Olympics captured far more attention than this dry, boring topic. 

My Property Taxes Did What??

The use of property values to pay for the tax levy has one fundamental quality that differentiates it from all other forms of taxation: it always produces the requested revenue.  Regardless of the total value of a community or the amount of the tax levy, there is a tax rate that will generate the determined amount, always. Income taxes or sales taxes can never generate a specified amount of revenue by their vary nature.

There is very little disagreement about what property taxes should be used for; public schools, fire protection, police protection, road maintenance, libraries, parks etc.  However, there is a subtle effect of a tax on property which is rarely considered, most likely because this tax has been in use for so long that it is assumed it must be the right thing to do. But is it?  

Consider;  after every revaluation, in any city, thousands of property owners will actually pay a significant portion of their tax increase solely to lower the taxes of other property owners.  Is this also a legitimate purpose for one’s property tax dollars, to lower taxes for other property owners, often as not, owners of the more expensive properties?  

The best way to appreciate this phenomenon is to observe what happens when a community does not increase its tax levy and has a revaluation in the same year. The following example uses Barrington tax data for the revaluation year 2009 (but similar results can be seen with any town data). Taxes were recalculated after reducing the 2009 tax levy to the 2008 level.

Despite no tax levy increase, 33% of property owners would have received tax bills with an average increase of 41%!  The extra $2,900,927 paid by these unlucky people would have in essence, been paid to the 67% of property owners whose taxes fell due to the revaluation. Nearly $3,000,000 paid by one group to another with no benefit to the community which neither requested nor received additional funds. Can this be called a fair tax distribution?   

However, if towns don’t revalue, a new owner can buy a property and be taxed on an old, most often lower assessment - that too is clearly unfair yet it happened year after year. Revaluations correct this unfairness, but in the process create their own injustice for all existing owners, as the above example demonstrates. 

This is a dilemma that can’t be corrected with more accurate assessments or lower budgets, both of which are important in their own right.  

The challenge is to acknowledge this defect and to devise a tax system that addresses it.  The proposed “Property Owners Tax” (1) provides the needed revenue, (2) taxes new owners fairly every year, not every third year, and (3) taxes existing owners fairly and rationally every year.

It can be done. Please visit righttax.org to learn more.

Lower taxes will create jobs. Baloney!

"Lower taxes for the job creators". Really? The idea that business owners, especially small business owners, will create jobs if their taxes are lowered is a fantasy.

I might be considered a "small business" owner, (I had my own dental practice for forty years). In the beginning I had one employee, me. When I retired we were 12 including my partner, four hygienists and six auxiliary personnel. Taxes had nothing whatever to do with my so called "job creation". As we got busier we needed more people. That's not hard to understand, is it? If I had hired people because I got a tax break I'd have been a fool.

A small business doesn't actually "create jobs" - it responds to needs. If the need for its services increases it hires more people. If it has new products that the public wants it hires more people. A business owner who hires more people simply because its taxes are lowered won't be in business for long.

Lower taxes might increase profits, might make it easier to buy needed equipment, but create jobs? Nonsense.

Maybe it's just me.

Cardiac rehab before the heart attack

Gary Sasse and Robert Flanders wrote a sobering commentary piece in the Providence Journal on the options available to Rhode Island communities, more of which are facing the reality that they can’t pay their bills. They’ve made it painfully clear that the only option left might be Chapter 9 restructuring.

The comprehensive article describes in detail some of the important considerations and protections of a Chapter 9 filing that can bring them through their fiscal catastrophe without permanent stigma.

Among them are:

1. Bond holders, the people that actually lend the money to towns, are protected from loss,
2. Local governments have professional and accountable management,
3. Efficient and transparent communication with rating agencies and state government,
4. Cooperation from stakeholders,
5. Effective monitoring of negotiated agreements.

It would seem that if every municipality had been following the above prudent policies all along, few would have to face bankruptcy today.

It’s like people who suffer a heart attack; had they done their cardiac rehab activities in the years BEFORE their heart attack, far fewer would suffer one.

In addition, I would encourage that the names and votes of all those involved in municipal contract negotiations, both union and non-union, be made available on the web. If people know that their participation and actions will be permanently known to all, they might be more careful in making their choices, which now play such a huge role in the fiscal disaster that faces Rhode Islanders today.

Why all the fuss about Marriage?

The term marriage broadly means a blending of two separate entities into one. The difficulty we are having with the term marriage might be from the biblical interpretation - that the only acceptable reason for marriage is procreation, therefore only two individuals of the opposite sex should be allowed to marry. Since it makes an exception for heterosexual couples who are sterile, it blatantly discriminates against gay people.

Perhaps we could resolve this by recognizing two marriages. The first, a Civil Marriage, currently referred to as a civil union. This marriage would be available to any two unmarried individuals. The second, a Religious Marriage, performed by a priest, minister, rabbi or imam. In this marriage the religious institution would determine the requirements according to its precepts and beliefs.

Religious and Civil Marriages would be legally identical in every way except for where and by whom the marriage service was performed. Perhaps in this way we can respect the feelings and beliefs of both sides of this controversy.

But maybe it's just me.