Tag Archives: taxes

Connect(icut) the Dots….

If nothing else, I am from Connecticut. My family background is 100% Italian-American, going back to the early 20th Century. One grandparent on each side was born in Connecticut, the other in Italy. Both sides settled in Southington, a mill town about halfway between Hartford and New Haven. Every immediate family member I have lived in Connecticut….

Point is, I don’t have another point of reference. I know other places, some pretty well, but my outlook is pure Nutmegger. Long, intense winters. Short but similarly intense summers. Our major industries are Wall Street finance, Insurance, and Higher Education, probably in that order. What is left of the military industrial complex and manufacturing is bringing up the rear.

You can drive across the state, the long way, in about two hours. You can drive from Connecticut’s capitol Hartford to Boston, NYC, Providence, Albany, or the Vermont border, in about two hours. The Canadian border is about 4 hours away. It is a compact region, is my point.

So you would think we have it made. Loads of highly educated people making a good living, cultural wonders in abundance, beautiful woodlands, rolling hills (no mountains, really), lakes, rivers, the ocean (aka Long Island Sound), etc… Not so fast.

We have staggering economic disparity, often in very close proximity. Fairfield County regulary battles for the highest per-capita income of any county in the country, but contains one of the poorest cities in the nation (Bridgeport). We have Metro-North, the most intensely utilized mass transit system in the nation, but the citizenry by-and-large considers any mass transit project to be something between a boondoggle and a mortal sin. Metro-North brings the wealthy and powerful into New York City every morning and brings them home every night, but it is basically a disaster waiting to happen due to being starved of maintenance funds. Simply put, the Gold Coast doesn’t call the shots in Hartford.

If the three bears came to Connecticut it would not be “just right”. We have massive overhead due to three interstate highways and sprawling suburban development. Connecticut has 169 towns, almost all with their own local governments, and no county government to fill out the middle of the state-local axis. The town budgets rely heavily on property tax which the state gets essentially none of. The state backfills the town school budgets with “ECS”, or Education Cost Sharing, so town taxpayers are often shielded from the actual impact of their largest cost, schools. The state has to fund itself with a mix of income tax, sales, tax, business taxes, use-taxes and fees, and an array of nickel/dime nuisance taxes. We still have not mentioned taxes paid to Uncle Sam. Connecticut is near the bottom in federal tax recovered per-capita. Our federal taxes are not coming back to fix Metro North, for instance, and nobody seems too sure why. Add in the high costs for housing and food/essentials, and it can be a very expensive place to live.

Day to day, this is the status quo. Often complained about, but never truly analyzed. That should change. If you take a step back, what I just described is “lossy”. A lossy system is one where efficiencies are abandoned in favor of tradition, or other “steady habits”. Not surprisingly that is the way we roll here. Which is a shame. What we really need is a top-down rebuild of many things we hold dear.

Once the villages and mill towns grew into one another in a petri-dish like explosion of suburban sprawl, the gig was up. Your quaint notions of sovereignty are vestiges of a time gone by. My favorite analogy is the “string of pearls”. In the beginning you had a “string”, let’s say Route 10, splitting the state in half from north to south. New Haven to Springfield on a ribbon of asphalt. Once you cleared New Haven you wold travel past farms and woodland between a series of village centers, the “pearls”. But those pearls were growing, and in time edged together. Where once there was string, it is now covered by overgrown pearls. It was originally a wagon route, and paralleled sections of a rail and canal system. Those wagons, barges, and boxcars kept the mills and factories running for a hundred years. It was host to a trolley line until, like everywhere else, it gave way to the supremacy of the automobile. With the car came the pressure of suburban development.

When those villages were isolated there was a logical case to be made for their fiefdom governments, but in time they used that independence to make decisions at the expense of their neighbors, or to the advantage of the town fathers. Suburbs with elbow room could depress taxes to draw home buyers away from their neighbors. They could also push up taxes to keep out low-income families. They could offer tax abatements to pull industry away from the cities. The cities watched their industrial base flee, to China as often as another state or city, yet they still had to feed a hungry city machine. As the cities crumbled, their taxes would rise, burdening an already underemployed citizenry. Due to “white flight” where city dwellers fled urban centers for the suburbs, his was not seen as a problem by a largely middle-class state. When it was confronted it was often seen as an “urban” problem.

That was then. The lack of long-range planning has handcuffed those towns. They thought they could build enough homes to satisfy their growing budgets but they were just digging themselves a deeper hole. School systems were expanded, as were snow plowing and other maintenance functions. Police and fire services grew, along with increasingly complex administrative departments. In short, the low mil rates that attract those real estate developers and home buyers mean that the property taxes they pay fall short of covering the costs of the services they use. It also means that the towns cannot afford to create tax-reduction zones or tax rebate/incentive programs for seniors. That has resulted in what might be called “grey flight” as retirees leave the state for less expensive surroundings.

What we have now is a restless middle class looking longingly at lower taxes in the southern states, the mid-Atlantic, and beyond. The Connecticut promise was that those hyper-local policies had no downside. Flee the city for the suburbs, trade up and get better schools, move over one town and halve your property taxes… The idea was that all was fair and all decisions were equal. The triangulation of housing, job, and commute was supposed to be zero-sum. If not equal, they were not to be questioned. What we actually built is a landscape of bloated suburbs dependent on the retail and service economy, with secondary education and government jobs replacing the manufacturing and white-collar business positions that built the suburbs in the first place. All those kids need to go to school, they all need electricity, police, fire, road maintenance, parks, recreation, drinking water, clean air, cellular phone coverage, and so much more. The overwhelming reaction, regardless of your political bent or income, is that smaller government is the solution. In our current situation it is an easy conclusion to draw. Even easier if the alternative is wholesale regime change.

At one point, a time I can barely remember (the 80’s), it seemed like a numbers game. Residential development went unchecked on the premise that it generated revenue. Even when the numbers showed that the tax revenues were dwarfed by the costs of educating the kids in those houses you were better off barking at the moon. Towns were going to build their way out of budget shortfalls and no egghead was going to spoil the party with “math”. The battle lines were drawn between town councils padded with developers, bank presidents, realtors, and insiders who bought in to their cause on one side; and good-government types and academics on the other side who lacked the connections and financial motivation to gain even a board seat. But the numbers didn’t lie. Towns privatized services like trash collection, moving the costs off the books. Road maintenance was deprioritized, along with parks and recreation. We have built a rift between parents with kids in the schools and empty-nesters. With Connecticut schools averaging about $8,000 per student per year to educate a child, $4,000 in property tax seems like a steal. If you stay around for an additional 13 years for each kid you put through the system it probably works out. Otherwise it is just the price of living in a community with educated children. That price is born equally across the community, but burdens fixed-income elderly in a way that hardly seems fair.

If I had a tidy solution I would have laid it out by now. I know that there needs to be a discussion. I know it will be divisive. But I know also that our current system has outgrown itself. That bucolic “string of pearls” with country roads, mill towns, farms, and tidy urban enclaves is now a memory. Mementos exist, but that’s all they are. The steady habit should have been cooperative improvement and long-range planning but instead it has been greed, isolation, and finger pointing. A good long look in the mirror might be the first step we need, even if we aren’t thrilled with what we see.

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Do the Aftermath

Romney should get specific.  Now that he has lost the election and doesn’t plan to run for President again, I think it would only be sporting of the chap to come clean about some of the questions he refused to answer during his campaign.  There are a few whoppers that I would love to see cleared up:

What tax deductions was he planning to eliminate?  [obviously I mean deductions eliminated for the middle class, since there was nothing but great news if you rake in seven-plus figures] The smart money was on scramming the mortgage interest deduction and make some kind of half-measure buy-off gesture to make it appear palatable.  It may have actually passed with enough palms greased along the way.  The reality is that millionaires could give a flying F@$& about mortgage interest, so it is a direct hit on the middle class.  What was his idea of balance?  We were never let in on the secret.  Now would be a great time.

What was his alternative to FEMA?  While he and his campaign bitched that Obama got a tailwind from Superstorm Sandy, what really happened is that it put a searchlight on His Romness and his advocacy of eliminating FEMA.  To a lesser degree it raised questions about Paul Ryan’s House Budget and its effect on disaster aid funding. With Romney suddenly and curiously silent when asked directly about his previous public statement to that effect… I wondered… What better time to put some detail on your plan than when millions of US Citizens are gripping the rails waiting for some disaster relief?  Oh?  Was it Halliburton, maybe?  Uh, sorry, wrong answer.  Thanks for playing.  Dick Cheney will hand deliver the home edition of our game to one of your trophy homes.  C.O.D. [extra credit: when he asks you to go duck hunting, say you have a family matter to attend to]

While he was remarkably specific about cutting the corporate tax rate, including actual numbers (rolling it back to 25%), and that tax rates on “job creators” should be cut, and so on… what programs of any real consequence was he planning on cutting?  Talking shit about cutting funding for PBS was just the worst kind of “red-meat to the lions” bullshit.  Kinda like telling a cancer patient “free haircut”.  As well, who the fuck heard that bluster and switched their vote to the Romney column?  Some kind of PBS-hating swing voter?  Nice job, campaign nerds.  Body-punching big bird is pure political comedy GOLD!

Since the Military and Other Stuff We Are Too Weak Minded to Know Too Much About budget is the lion’s share of the federal ledger, how in the name of Charles Montgomery Burns was he going to cut the Federal budget to 20% of GDP while increasing military spending?  The list of financial experts, politicians, wonks, non-partisan think tanks, and livestock who have figured out that Romney’s plan wouldn’t work is impressive.  It would be nice to hear from the candidate himself about what cards he was holding close to the Armani vest.

That is just a first cut, off the top of my head kinda list.  Truth is that we will never know.  The American people are left to speculate.  Radical restructuring of things like the tax code, Social Security, Medicare, and Medicaid [and those other things that the defenders of the rich over at Faux News call “entitlements” as long as millionaires don’t benefit from them] are a sure way to ruin one’s chances in any election (just ask a Libertarian), but once in office…. well, who knows?  George W Bush created the largest new branch of Government since the IRS, and put two or three full blown wars on his imaginary credit card (while cutting taxes), privatized huge portions of the US military, and ran the US economy into a ditch*, took more damn vacations than Brad Pitt, and the GOP still pretends that none of it happened and we were on a rocket-ride to prosperity until Obama’s inauguration.  Since then W has spent the past five years in an undisclosed location, out of sight out of mind, as they say…. The Republican Party seems to think everyone just plain fergot.  Well, not inviting your sitting two term president to the 2008 Republican national Convention was surely a kick in the nads for the most famous fake Texan since Clayton Moore.  Making it two in a row was positively catty.  Dear W, they REALLY aren’t that into you.  Note to GOP: Most People Remember Who Left That Pile Of Steaming Dogshit on the White House Foyer.

One last thought: while parsing the Republican post-mortems that clog each day’s news feed, keep in mind one very real possibility: Republicans have now spent a full decade acting as if their shit didn’t stink one bit.  Just like W’s multiple wars of corporate aggression, a decade of running on tax cuts for the rich, balanced with cuts in services for everyone else, is bound to get people’s attention eventually.  It stinks.  Loudly.  It is possible that in 2012 just enough American’s identified the source of the smell, and it could be a really tough 2014 for the GOP if they don’t take a deep whiff themselves.

*I still can’t figure out how you pump that kind of money into the hardware and personnel required to wage multiple wars and can’t find a way to benefit the national economy… unless the money was getting misspent or off-shored in a huge way. Nahhhh

The Enemy Within

When processing the anti-organized-labor diatribes from these supposed defenders of The American Way, at least consider that the motivation for stripping unions of their rights has much more to do with lowering the bar than lowering any deficit.  These are the same people who have shipped our industrial base to third world sweatshops, and have reneged on their “promise” of a full-employment high-tech wonderland.  What they have delivered is a nation based on retail sales of cut-rate goods from countries with very low wage and benefit standards.  They have collected massive subsidies, both tax relief and direct payments, from the same governments and in many cases have returned *nothing*. In Wisconsin, you have a situation much like we faced in Connecticut 10 years ago under convicted felon John Rowland.  The real problem with unions is that they didn’t contribute sufficient campaign cash to the Republican party.  Wealthy individuals, on the other hand did.  They would like the tax dollars that go to the public sector to be directed into their pockets.  They have a Governor who agrees.  Everything else in the argument is complete bullshit.

Speaking of Connecticut, when you see folks like the Connecticut Business and Industry Association (CBIA) crying about how overpaid the public sector is, do consider that what they really want is a lower bar for their own employees wages and benefits, lower degree of protection for our environment, less enforcement of workplace laws, less enforcement of tax collection…. It is self serving in the most crass and harmful way.  State subsidies to the private sector have risen from $3million 20 years ago, to over $330 million today.  And *nowhere* in the discussion of budget cutting will you hear that sacred cow asked to accept less.  The working poor, the middle class, the sick, the abused, and so on… they will be asked to give, and give again.  The working-class heavy tax hikes hit the mostly working-class state employees in a way that the millionaires of the state love to call a “double hit” when it applies to them.

As much as I agree that state governments should be looking to eliminate branches wherever the work can be transferred to the private sector without a decline in service, we have seen much more graft an sub-par work under private contractors that by public employees.  The breakdown of the motor-vehicle emissions inspection program, and the failure of the privatization of highway construction inspection program for the I-84 “little dig” are just the peaks.  And peaks they are.  The emissions inspection program has been reduced to nothing (the intent, I believe) and every day thousands upon thousands of motorists travel over a highway in Connecticut with improperly constructed drainage and culvert systems.  More privatization, or less State oversight, is simply not what the public needs, though it might be exactly what wealthy patrons of our elected officials were promised.