The Scranton Times: Legalizing Marijuana Editorial

The Scranton Times posted an editorial on August 29th regarding the legalization of recreational marijuana use in Pennsylvania.  You can read the editorial at the following link:

https://www.thetimes-tribune.com/opinion/editorial/at-minimum-debate-wolfs-pot-proposal/article_fa135465-3fbe-51c9-97b9-9bb2c3d7579e.html

If the link doesn't work/is behind a paywall, well don't worry, as you're actually not missing much.  Basically, the newspaper makes the point that Pennsylvania Governor Tom Wolf's proposal for the legalized recreational use of marijuana should be debated by the legislature.

What definitely can't you read on-line?  That would be my comment regarding the editorial because The Scranton Times would not publish it.  I'm not sure why; my best guess is that they are using some kind of AI to screen postings based on keywords, and I must have flipped the switch.  That facet of this story is more interesting from a process/technology perspective than anything else.  Part of me can almost envision the Asian technology services company selling the newspaper's leaders on this incredibly smart AI cloud-based comment screening software that would be "foolproof" and save them money.  Based on my comment, well, it may not be so foolproof after all.  In any event, that ball-o-thought is noted below.

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Two thoughts:

(1) Personally, I think using marijuana is pretty damn stupid unless you have glaucoma or your chemotherapy causes you to lose weight (and you actually need a case or three of the "munchies"). Again, just my opinion, but intentionally getting high is a sign of personal weakness and an inability to deal with the real world. I'll note though that I feel the same way about those who constantly get drunk, something for which NEPA has a well-earned reputation. Simply put, it seems to me that marijuana use probably isn't all that worse than drinking alcohol (and for the record, I don't do either).

(2) The editor(s) mention tax revenue when comparing to the legalization of marijuana to gambling, but they miss a central point: Gambling revenue was supposed to measurably reduce property taxes. Instead what actually happened was that gambling revenue more or less became a kind of slush fund that allowed politicians to sponsor local projects, etc. Granted that some of this work was needed, but gambling wasn't sold to the population as a way to fund parks...it was sold as a way to reduce taxes. I'm not going to touch the issue of property tax rebates, as while getting a rebate is great, in reality, it's just a cynical ploy for politicians to say that property taxes are being reduced when in fact they are not*.

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(*) Think of a property tax rebate as being a 10% off sale at Boscov's. That shirt still costs $25, but for now, you get it for $22.50. The price though is still $25, and at any time Boscov's can end the sale and charge you the full $25.

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I do worry about the recreational use of marijuana.  As noted above, I get that it's probably not worse than alcohol, but that's a thin argument to make for legalization.  There is also an admittedly selfish component to my thoughts about legalization:  Honestly, I find the smell of it repulsive.  I can see the day when just walking down the street my nose might be assaulted by the rancid stench.  

A bit more seriously, I had (emphasis on "had", as in past-tense) a brother who suffered greatly from substance abuse issues, which ultimately cost him his life.  Now I don't necessarily buy into the gateway drug argument against marijuana, as by that logic, smoking cigarettes could also fall under that category.  What I do wholeheartedly believe though is that substances designed to do nothing other than temporarily alter reality actually serve no useful purpose in life.  You see, that's the thing about altered realities:  They always lose to, as referenced in the play Rent, "actual reality".  For some, that notion of a temporary-but-altered reality is good enough.  The problem though is when the altered reality becomes so much more preferable than the real thing.  Having yet one more roadway into the temporary realm of unreality doesn't help society.

In the end, I suspect it is inevitable that marijuana use will become legal in Pennsylvania (and eventually the entire country).  Fast forward a few years after that and the campaigns against buzzed driving will start in earnest, along with additional resources to deal with the psychologically addicted.  It will be a movie we've already seen time and time again under the title of alcoholism.  This is basically a slow-moving train to nowhere, with the only real beneficiaries being those who find a way to legally monetize temporary excursions into the land of make-believe.

Scranton School District: When the Man Comes Around

The big news coming out of Scranton...well make that one of several pieces of big news coming out of Scranton (considering the fact that the FBI recently searched the home of the Mayor)...is the fact that the state Departmartment of Education (DoE) has appointed a recovery officer that will be assigned on a full-time basis to the Scranton School District (SSD).  This is one step shy of the Pennsylvania DoE actually assuming full control the SSD.  A related article can be found HERE. 

Yes, the man is coming around.

No one will be happy with what happens next:

• Teachers will be paid less.
• SSD employees will be laid off.
• Taxes will increase.
• Children will lose the benefit of a neighborhood school.
• Some programs will be eliminated.

Basically, less will be delivered and it will cost more.

Who is to blame?  That's surprisingly easy to answer:  Registered voters in Scranton.

It was a majority of the 30% or so of registered Scranton voters who routinely voted for grotesquely incompetent candidates for the SSD board.   How "grotesquely" you may ask?  Well, ponder the fact that, over the past few years, two former SSD board presidents didn't even graduate from high school,  That's how grotesque.  The SSD board operated like a sailor on leave in Bangkok for decades, and now no one is "clapping".

Scranton taxpayers got the successive SSD boards that they wanted.  

This is also a board that twice...not just once, but twice...voted for a no-bid busing contract that just happens to be with a significant campaign contributor and influential local businessman.  For the record, I don't blame the businessman; if anything, he's guilty of out-smarting a bunch of amateur politicians (again noting that two recent SSD board presidents didn't even graduate from high school, so how difficult could that have been?).

District teachers don't escape blame here either.  The Scranton Federation of Teachers (SFT) routinely endorsed many of these grotesquely incompetent board members, time and time again.  Why?  Well, like the busing contractor, I suspect that they knew who they could out-smart.  They were successful, but like the kid that eats too much candy, the inevitable rotten teeth now must be pulled.  Look for the SFT to complain loudly about the actions that "the man" will recommend, while conveniently forgetting their active role in SSD mismanagement.  Their excuse/refrain will be that it was the "administration" that is to blame here, and they are right...but again forgetting that they helped elect many of the "administration".  

Detecting a pattern here yet?

My heart genuinely goes out to those teachers, maintenance workers and others who will lose their jobs.  I've lost a job through no fault of my own, so I know the difficult road they will travel.  Many of these people just want to work hard and earn a decent living.  But like the bystanders in a drive-by shooting (decades in the making), they had little choice in the matter.

I'd like to tell you that this will all work out in the end and that there will be momentary pain followed by a better tomorrow, but that's a lie.  There will be years of pain ahead.  Scranton voters will learn the hard way that you reap what you sow by either voting for the incompetent or not voting at all.  

Scranton's Fiscal Pickle: The Heart of the Matter & 8 Recommendations

The following story from The Scranton Times...

Reorganized City Council Ready to Tackle Challenge

...reminded me of something important relative to the fiscal plight of Scranton.  Specifically, saying that Scranton "needs revenue" in order to solve its fiscal problems is a bit like saying that a drunk "needs" just one more drink in order to feel better.  

In point of fact, Scranton already has significant and regressive revenue sources in place.

Wage Tax

3.4% of earned income, one of the highest in Pennsylvania.  2.4% of this tax goes to the city government, with the remaining 1% going to the Scranton School District.  By way of comparison, here are a few other city wage tax rates:

- Philadelphia...3.92% (for residents, 3.4915% for non-residents)

- Reading...3.60%

- Scranton...3.40%

- Pittsburgh...3.00%

- Wilkes-Barre...3.00%

- Altoona...1.45%

- Allentown...1.33%

- York...1.25%

- Erie...1.18%
- Lancaster...1.10%

- Bethlehem...1.00%

You can read more about local tax rates HERE.

Business Privilege Tax

"Any for-profit, Scranton-based business that provides a service or receives payment for an exchange of talent must pay a business privilege tax at a rate of 6.13 mils, which amounts to $6.13 for every $1,000 of gross receipts. This is based on the previous year’s gross sales."  Citation HERE.

Mercantile Tax

Retailers = $1.68 per $1,000 of gross receipts
Wholesalers = $1.43 per $1,000 of gross receipts

Citation HERE.

Note that these taxes (Business Privilege & Mercantile) are levied on gross receipts, not on profit, meaning that even if the business were to lose money it would still owe the tax.

I'm not going to add property taxes into the mix, mainly because it gets difficult to explain (since it is often times composed of taxes going to the city, county and school district).  Suffice to say, Scranton once had fairly low property taxes, but those days have long gone.  In fact, residents will likely be seeing a further increase in property taxes over the next year or so (see the article from The Scranton Times).

It comes down to this:  I don't think there is any amount of revenue that would solve Scranton's fiscal problems, simply because Scranton doesn't have a revenue problem.  Don't believe me?  Well why then do other cities of similar size manage to run their affairs with less in the way of tax revenue?    

Simply put, Scranton has an expense problem.  It simply spends far more than it can reasonable ever expect to collect in taxes and fees.  What's more, the city is eventually going to run out of big assets to sell and/or leverage.  City residents have already been through the "sell stuff and it will all be better" charade in the past, and the net result has been where the city is now.  

What to do?  The solutions are not easy, but they exist.  Here are mine.

A. First and foremost, the city needs to make it clear to all of its constituencies, including unionized city employees, that it is prepared to declare bankruptcy if it is unable to reduce expenses through structural changes to city operations.  And it has to be prepared to actually act on that intention, if needed.  Now the state politicians in Harrisburg may not allow Scranton to declare bankruptcy, but even if they don't they will impose fairly harsh measures in place of declaration.  Yes, bankruptcy will effectively destroy the city's ability to borrow, but that is already happening through a slow decline without the opportunities that bankruptcy would provide (such as opening up contracts).

B. Second, all employee compensation and benefit packages need to be open for discussion and potential adjustment.  The city should baseline salary and benefits against an average of similar sized municipalities in Pennsylvania.  The city must also become much more aggressive in evaluating disability claims made by city employees.  This process should be undertaken with the city leadership, union leadership and a neutral third party.

C. Third, mandatory manning clauses need to be open for discussion and potential adjustment.  City police and fire department staffing levels need to be evaluated on a comparative, per capita basis against similar Pennsylvania municipalities.  This process should be undertaken with the city leadership, union leadership and a neutral third party.

D. Fourth, the city needs to evaluate its overall organizational structure, including ratios of staff to managers.  With very rare exception, no manager should be supervising any fewer than five employees.  Departments with similar functions should be consolidated.  Common resources, such as supplies, should be centralized.  The city should look to consolidate some services, possibly such as Human Resources, procurement and information technology, with the Scranton School District.

E. Fifth, the city should engage in a partnership with the University of Scranton or other institution/group ("strategic partners") to undertake a "soup to nuts" evaluation of every service offered and provided by the city.  The evaluation would involve three steps:

1) Is this something that the city alone must provide in the first place?

2) If the answer to #1 is "no", then the city should seek out private business(es) to undertake the service for residents.  One that might be on the "no" list, for example, is refuse collection, as there are many private businesses that can collect refuse.  Scranton's current refuse collection system actually harms senior citizens and others that generate small amounts of garbage by charging them the same amount for refuse collection that large families pay (yes, your elderly grandmother and a family of 10 pay the same amount); words like "grossly inefficient" and "unfair" come to mind.

3) If the answer to #1 is "yes", then ascertain how efficient the service delivery is being performed and implement best practices to improve efficiency.  The strategic partners would help with the process.  

F. Sixth, every expense needs to be justified, authorized and approved...including overtime.  All contracts need to undergo a competitive bidding process.  

G. Seventh, a cost-benefit analysis should be completed for every open city position; unless the position serves to reduce expenses (such as a single new position that replaces two old positions), make city operations more efficient or directly and positively impacts public safety (within the framework of revised manning guidelines, see "Third") it should not be filled.  All approved vacancies should be publicly advertised.  The city should have strict anti-nepotism and ethics policies that preclude the hiring of relatives and all contributors to political campaigns of city council members and the mayor.

H. Finally, every budget every year for every department needs to be constructed from a baseline of zero (see zero-based budgeting).  This will force city leaders to focus on expenses on an on-going basis.  The budgeting process needs to include required city payments into pension and other long-term obligations (see "Second").  The city should financially reward employees who develop more efficient processes or find other ways to save money.  For example, provide a bonus equal to 10% of the first year realized savings to the employee.

Of course items B-H are null and void if the city actually has to declare bankruptcy.

When all is said and done, Scranton has been floundering for decades under a distressed city designation that will not go away until radical changes are made.  What I've seen and read over the years from city leaders have been far from radical.

(Scranton's leaders need to memorize this quote.)

Independence Day, 2014 (a non feel-good posting)

Now the thing to do today would be to post a picture of a flag and maybe a patriotic quote or two.  But I am not going to do that; instead I am going to take a moment to honestly assess what it means to be an American in 2014.  Here goes nothing -

Your Neighbor, The Anti-Christ - We have degraded so much as a society that it's now encouraged to demonize those you disagree with on just about any issue.  If you are pro-choice you are a baby-killer; if you are anti-abortion you are against women's health.  It's the politics of winning, running amok. Note to file:  when everyone insists on claiming the moral high ground, there ends up being no moral high ground for anyone.  It's this mentality that has given rise the the ridiculous "Occupy Movement" on one hand and the equally ridiculous (and dangerous) Tea Party on the other.

Here's Some Democracy Down Your Throat - We now insist...no we demand...that other people set up democracies even though we arguably don't have one ourselves anyway (mainly because we are too lazy to vote).  It's a pretty simply proposition actually:  Democracy only works when people actually want it, and it's nothing more than arrogance on our part to think otherwise.

It's Off-Budget - We have politicians on one hand that insist on offsetting every bit of domestic spending with cuts but don't seem to mind spending trillions to fund foreign wars on the other.  See above:  we have to stop insisting that the rest of world wants to be like us (which I think is at least some of the reason why some really don't like us or our way of life).  If it were up to me, there wouldn't be blank checks written out for anything...domestic or otherwise.

Bread And Circuses - More adults probably watch professional sports than vote.  Forget about demonizing the Koch Brothers (Right) or George Soros (Left):  we have met the enemy and it is ourselves.  Want to really "fight the power"?  Then vote, and bring someone with you next time.

Praise [insert the name of your favorite deity]! - What to know what's NOT in the Declaration of Independence or the United States Constitution?  Give up?  Okay, here you go:  the word "Christian".  The word "Christian" is not mentioned in either founding document.  There is only a reference to "God".  Now why is that?  According to some, our founding fathers were all born-again, conservative Christians, but these folks are simply wrong.  Our founding fathers were not born-again Christians; if anything, they were mostly Deists who were suspicious of organized religion.  They didn't want the United States to be a "Christian" nation (again, if they did, they would have said so...a very conservative point, I might add); rather they wanted the United States to be a nation where any and all could worship or not worship as they see fit.  Many seem to forget this basic fact, simply because it plays into their own personal narratives built around demonizing people who are not like them in the first place; see the Tea Party for an example in action.

Road Apples, #123

My Annual Republican Moment...occurs every year when I have to write out a check to pay the balance due on my federal taxes.  This years moment was particularly painful for a variety of reasons.  I know, I suppose I could be more creative here, but I have two over-riding principles that I like to apply regarding my taxes:

• I don't want a refund! Loaning the federal government money for a year is insane.  They don't need the cash and I can use the pay.
• I do believe in paying my fair share...but you know what...I really want everyone else to as well.

All of this comes with success I guess...not that I claim to be successful by the way.  I do, however, pay an awful lot in taxes (I pay now more now in taxes than my total gross pay during my first few years out of college).  Speaking of insane, the complexity of the tax code boggles the imagination.  If Mittens would stop talking about women needing their nether-regions probed before abortions and start talking more about simplifying the tax code then I might even vote for him.  Note the word "might".  Oh, and someone as a vice-president running mate with slightly more in the way of qualifications than Sarah Palin would be desirable as well.

Travel...I picked my youngest daughter up from school in West Chester yesterday, I am bringing her back on Sunday.  I am driving to Hartford Monday afternoon and from Hartford to Boston Monday evening.  On Tuesday I am driving back from Boston to Scranton.  I need frequent driver miles.  I also need an audio book or two.

Living Will...One of  the personal items I have been working on since the beginning of the year is a Living Will and Durable Health Care Power of Attorney.  This is not easy stuff to think about, but I suppose as I grow older these kinds of thoughts just naturally creep into the cranium.  I also have one over-riding reason for doing this:  I don't want my children to be put in a position of being forced to decide whether or not to unplug me something terrible should happen.  This is important stuff, and if you don't have arrangements such as this, I strongly recommend that you take action.

Next up in new Will.

Working Late?...This is an interesting read (link HERE).

Tim Holden...is realizing that he is not in Kansas (or is that Pottsville?) anymore.  Evidence HERE.  I'm thinking that Matt Cartwright stands a very good chance of removing Mr Holden from office, which would probably be fine with me.  Mr Holden is a Republican, period.  That's fine with me and I've voted for Republicans, but it does irk me that he claims to be a Democrat...it seems so, well, dishonest.  Put another way, there is much about Congressman Paul Ryan that I both agree and disagree with, but I do really admire the fact that he puts his ideas out there in a way that is very unmistakable.  Love him or hate him, but you know where Paul Ryan stands.  Tim Holden...well...he has this sort of "wolf in sheep's clothing" thing about him that is just so dishonest.

Unhappiness...I saw this a few weeks ago and just had to share.

More true words have never been spoken.

Breaking News...I know many have been waiting on the edge of their seats for this, so I am very glad to report that "the Situation" has in fact left rehab.  Yes, you heard me, "the Situation" is now clean and sober.  Reference HERE.  Note that "clean" doesn't mean, for example, chlamydia free.  You can thank me for this news nugget later.

The Shining...Mr Rivers and I were watching The Shining last night, and I am ashamed to admit that I didn't know it was directed by Stanley Kubrick. Bad Steve! After seeing the opening credits you can then begin to see how very "Kubrick" this movie really is; case in point:  the chapter titles that begin each part of the movie.  The rolling camera that was used while the boy ride his big-wheel and in the maze were also classic kind of Kubrick stuff.  Great movie.  

NEPArtisan Posting: Why the U.S. Tax Code Sucks

My latest NEPArtisan posting that you can link to HERE.

NEPArtisan Posting: Political Math 10-2=11

My latest addition to NEPArtisan, inspired by local political candidate Kevin Haggerty.  You can view it HERE.

Franchise Fee (a.k.a. Kickback)

Okay, here is a scenario for you:  I run a business and I want a monopoly in a particular geographic area for my specific service.  How do I do it?  Well I figure out a way so that I can charge my customers an extra fee and then funnel that money back to the governing entities that gave me monopoly rights.

The politicians win, as they get a new form of tax revenue just for giving me the monopoly.

I win because I get my secure monopoly.

The customers lose, because not only do they have to pay more for my service (with that "more" being the kickback), but they can't buy my specific services from a competitor.  Do they get the best possible service from me?  Honestly, it does't matter:  what matters is that I kick-back money to the city.  If another service provider offered a better, cheaper product it wouldn't matter, as the fee I charge and kick-back I provide is really what drives the decision to exclusively offer my services to the city.  Screw such esoteric concepts as "service" and "value".

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Yes, here you have the City of Scranton's insane agreement with Comcast/Xfinity cable.  I like cable television...while I don't watch much of it, I have to confess a soft-spot for such educational programs as "Hoarders" and "Falling Skies".  Rumor has it I also have something called "On-Demand" that allows me to watch old shows.

What I don't know though is whether or not Comcast offers the best possible value to the residents of the City of Scranton.  Nor will I ever know, because as long as Comcast has this franchise fee arrangement with the city, they are virtually guaranteed to continue the monopoly they have always enjoyed.

Now could I move to, say, satellite dish service? Sure I could, but that misses the point of this rant.  What point?  Simply that a franchise fee is just another back-door tax, all be it with a pretty dress on and sweet smelling perfume designed to mask the stench of things like inefficiency, greed, corporate welfare and ineffective/self-serving politicians.

Now I understand that the City of Scranton's contract with Comcast lasts something like a billion years (kind of like the contract Scientologist sign with the C of $), but when it eventually comes up, maybe some genius on North Washington avenue can actually consider the concept of eliminating monopoly cable service in Scranton.  Maybe.

Ryan Budget Proposal

Paul Ryan...Congressman from Wisconsin, released the de facto GOP budget blueprint yesterday.  You can read about it HERE.  This budget isn't as much about fiscal policy as it is about ideology.  For example, it clearly makes the case that the well off should be taxed less (dropping the highest personal and corporate tax rates).  It also basically begins a massive shift on health care costs.

The biggest flaws in the ideology here, in my opinion, are two fold:

Health Care...somehow consumers can keep medical inflation in check through the magical power "of the free market"; that's a sad, laughable joke.  Having a heart attack?  Gonna "shop" for the best quality @ lowest cost doctor?  Gonna haggle on the price of that insulin at your local CVS?  Simply put, the free market doesn't work when a consumer is captive, which is why "free market" reforms for health care don't work.  Health care costs go up at double digit rates annually simply because service and product providers want profits that go up at double digit rates annually.  Insulin, for example, isn't a commodity that lends it self to being "shopped" for; if you are diabetic, you buy insulin regardless of the price.

In addition, the Ryan plan will only increase government funding for the Medicare replacement at a rate indexed to GDP; note that health care costs have typically increased at a 10%+ rate over the past 20 or so years.  GDP may, in a very good year, increase by 3%.   So who will be paying for that cost gap?  Hint:  You and me, unless of course the "free market fairy" comes along and magically makes it better.

Tax Rates...I agree that tax rates should, in general, be lower and the tax code should be vastly simplified.  It's a crime that most American's can't even complete their own tax forms.  However, simply lowering the top and corporate tax rates...without vastly reducing tax evasion loopholes...does nothing other than give those that have even more.  Make no mistake about it:  Congress is no more interested in having corporations pay their fare share than Courtney Love is interested in personal hygiene.

Now there is this Limbaugh-esque inspired fantasy out there that somehow the United States has the enormously high corporate tax rate, which on the surface is true; however if you turn over the rock you'll see that effectively there are so many tax dodges in this country that it's probably impossible to even determine the effective, actual corporate tax rate.  There is a great article on this topic HERE.


Bottom Line:  I'm all for things like personal responsibility, but at some point you have to wonder why those that have so much need even more.  This applies to corporations, wealthy individuals and those in the health care service delivery chain.

The Blogger Tax That Isn't

Drudge had been running a story about "the Philadelphia blogger tax" for a few days that caught my eye. You can read a similar story HERE.

What's interesting here is how the real underlying issue has been presented by the Internet media. In point of fact Philadelphia does not have a "blogger tax". Philadelphia has what is basically a fee that every business owner has to pay for the privileged of doing business in the city. Does that fee apply specifically to bloggers? No, and in fact many cities have business privilege taxes or fees (Scranton does as well), so the concept is nothing new.

What's the "new" part? I think it's the idea that running a blog...and getting paid for it...is a business. Note the use of the word 'and', as it's critical to the discussion. Basically what the government folks are saying is "Hey, if you run a blog and you get advertising revenue, that's basically a business. Like any other business, you have to pay this business privilege tax/fee.". Honestly, I think they are right, at least as far as consistency is concerned. Why should, for example, someone who runs a newspaper (which has content and sells advertising) have to pay a tax/fee but a blogger with ads (which has content and sells advertising) not have to pay the same tax/fee? I realize there is a de minimis argument that can be made, namely that many bloggers only earn very small amounts of revenue from their on-line endeavors. That's a fair point, but I'd argue that many businesses don't make a lot of money. Why should an on-line endeavor be treated differently?

For the record, I am not endorsing these kinds of taxes and fees. My point is one of consistency. If you are going to have this kind of tax/fee, then fairness dictates that there should be no sacred cows in the field. To hear some on the Internet, you would think that blogger is the most sacred of cows. It's not. Any dope can do this, although I'm not saying that any dope can do this well. To the extent that bloggers are upset that they need to pay the tax/fee based on, for example, the $11.20 in ad revenue they receive annually, then they should fight for a minimum revenue clause in the tax/fee legislation that would apply to all businesses.

Bottom Line: The moment a blogger begins to receive advertising revenue from their corner of cyberspace is the same moment that the blogger begins running a business. As a business person, they should be treated no better...or no worse...than anyone else running a business. If a blogger doesn't like the local business privilege tax/fee, then he/she should fight to end it (or at least add a revenue floor) for all businesses. Arguing that blogging should somehow be exempt from these types of business taxes is ridiculously arrogant.

Recommended Reading...Scranton Times

The Scranton Times article today (the second in a series) about non-profits & taxation was excellent. You can find it HERE.

I detest politicians who take complex issues and "sound byte" them. That's what the whole non-profit debate in Scranton may be degrading into; rest assured that while the non-profits should be doing more, this isn't a simple issue of they need to pay up or else.

A letter to the editor in a recent edition of the Time caught my eye as well as it relates to this issue. Specifically, the writer commented on the fact that at least some of the properties taken over by the University of Scranton were probably not current on their taxes. That may or may not be true, but it again points to the fact that the issue of taxation isn't as simple as it may appear.

Speaking of simple, I've been reading a certain local message board and the posters...99% anonymous...are regularly bashing the Mayor Chris Doherty and the University of Scranton over this issue while lauding Council President Janet Evans as being some kind of hero. Do these folks realize that it's the Internal Revenue Code...not Chris Doherty...that set forth the rules that regulate the taxation of not-for-profit entities? There is nothing...zero...zip...nada...that can compel an organization designated as a 501(c)(3) to pay taxes on the property that is central to their mission. Not even Council President Evans, with her mighty powers (and ability to type thousand word letters in ALL CAPS) has that ability.

The solution here is actually pretty simple: sit down with these entities and have rational, fact-based discussions that don't involve posturing for "followers". Speaking of rational (or lack thereof), I'll continue to call Council President Evans out on her absurdly surreal behavior on this issue, but I'd be remiss if I didn't point out that the Mayor has had several years to work on this but really hasn't done squat. Time to get off your butt Mayor Doherty and make a sincere effort. This issue needs to rise above the politics of "gotcha" that you play with Mrs Evans.

Road Apples, #67

It's Hot...Damn its hot outside. I'm talking "jungles of 'Nam" hot out there. Just when I relish in the warm weather and wonder why I ever want winter to come, days like this arrive and I long for something colder. This my life, in a microcosm.

Scranton School Performance - The Scranton Times has something of a final report card on the performance of area school districts in its Sunday edition today. NEPArtisan has some reaction to it that is no doubt very well thought out, and I'm not going to add much, save for this: I think the single most important element in the education of children isn't schools, teachers, sports or buildings; no the single most important element is parental involvement. Now I can't claim an awful lot of temporal success in life, but one thing I have done well so far is to help my daughters value learning. As a result, they are all very good students. When that happens in a household...when parents do things like read to children, when children see their parents read, when children have help with homework, when children see their parents use math to solve problems, when parents talk to children about current events...then I think children can be successful even in just about the worst of schools. Am I saying that schools and teachers are unimportant? Hell no. Growing up I had teachers that were nothing short of inspirational, but I don't think that a great teacher alone can't undo a toxic home environment.

School Funding - In the "if I were a School Board Director" department, when faced with the tough economic times that abound, I would be looking at all of the non-instructional costs associated with public schools. The top two things on my list:

1. Administrators and administrative costs
2. Sports

How bloated are school district administrations? Well judge for yourself here. I know that there are rules a-plenty to follow in operating a public school, but there are rules to follow everywhere. My employer's business is regulated by no less than the IRS, SEC, DOL, FINRA, and the state insurance regulators from all 50 states. The difference is that we don't have the luxury of simply raising taxes when our expenses get too high. Bottom line: I think most school district administrations need a top-to-bottom review to eliminate redundancies and inefficiencies so that more money goes to teaching kids and less money goes to bureaucrats.

As for sports, well I think they are a "nice to have" in education. Yes, students can learn about discipline and they can grow as individuals by participating in sports, but that kind of participation doesn't have to come at the taxpayers expense. What's more, sports really only benefit a small, small fraction of the students in a district. I don't know that most sports programs need to be eliminated, but I do think that the costs of running these programs should be levied against the students that benefit from them. Start baking those cupcakes.

Eating - In the "now for something completely different" department, I had been doing pretty good eating-wise over the past two weeks, but I may...no make that "have" fallen back a bit over the past two days. As I've said before, weight loss is much more in your head than it is in your stomach, so I need to get my head screwed back on the right way so that I can get back on track.

Common Sense Tax Reform (or at least a start…)

I read an interesting article the other day from The Hill (Capital Hill Publishing) that outlined a proposal from Senator Judd Gregg (R-NH) and Senator Ron Wyden (D-OR). There are several articles out there on the proposal, including this one from the DailyCaller.com.

There are positives and negatives to the proposal, but at its core it has one attribute that I really like: it begins the process of simplifying the U.S. Tax Code. Note the word “begins”, as I’d hope this would only be the beginning of such an exercise. As I’ve noted before, the current tax code is an overly complicated mess of social engineering…constructed by both political parties…that is build on a foundation of good intentions gone awry.

Now those on the political left have a tendency to be wary of any reform, as they believe any thing that lowers taxes inevitably makes the system less progressive. I believe that’s a false assumption, as the current system’s encouragement of consumption (via tax-subsidized debt) and punishment of saving (via taxing it) is actually extremely regressive for the working classes. Furthermore, perpetuating a system that is so complicated that most folks don’t actually understand it is as far from a progressive ideal.

Think about it: the wealthy can pay to have accountants take care of their finances, but what about the working class? Honestly, do you think that the lady who sits in the Jackson Hewitt cube at the mall is a tax expert? How many of the working poor can complete an IRS 1040 Long Form (which is what would be required for a working family to take advantage of all possible tax breaks)?

Look, I work in an industry that is predicated on the current tax code, so I genuinely could be harmed by any large-scale tax code overhaul. Even given that I support this kind of effort, as the good outweighs the bad. I’d much rather see my industry move towards a model where people saving more so because they need to and less so because complicated tax rules encourage them to do the right thing.

America needs a flatter, simpler tax system. I personally think we should be taxing consumption, not savings or income, but that’s a bit too “way out” for most folks, so I’ll settle for supporting the Wyden-Gregg proposal...for now.

Response to Tom Borthwick's Comment

I wanted to respond to Tom's comment on 5 Conservatives that I admire, but it was getting so long that I figured that I needed the full text editor just to make sense of my own words. So here goes...



Tom...Yes I have read Paul Ryan's budget, as well as some of this other work. While I don't agree with all of it, I do agree with his overall premise that the current system is so broke that it can't be fixed.

Broken? The current system is so complicated that most people have no clue as to how it works. Don't believe me though, believe the expert in taxation, the IRS itself. This is a citation from the IRS website, dated January 4, 2010:

"...With more than 80 percent of American households using a tax preparer or tax software to help them prepare and file their taxes..."

(Reference HERE).

Ponder that for a moment Tom. 80% of taxpayers basically say through their actions (not just their words, but with their wallets) that the system is so complicated that they can't figure it out on their own, so they've given up. What does that tell you? Here's what it tells me: The system has been hijacked by financial special interests and good intentioned individuals who want to accomplish social goals using the tax code as their instrument of choice. Nice thoughts, but the net result is an extremely complicated system that has at its core punishment for saving and rewards for consumption. If anything, the opposite should be true, especially for the poor. Anyone believe that unchecked consumption is good? I have a recession that proves that it's not.

As for the middle class, I write this as someone who is solidly there. I finished my 2009 1040 last month and I don't qualify for the vast majority of the tax breaks afforded to those earning less nor do I have the resources to take advantage of the tax shelters & other assorted tools available to the rich. For example, I am now punished because I paid off my mortgage. The government though would reward me if I borrowed more in the form of home equity loan. It's almost surreal when you think about it. All things considered though I was lucky: this near I "only" owed $91.

In short, I think many on the left have been lulled into this sense that the current system is somehow good because it has been deemed as being "progressive". Nothing could be further from the truth & in fact the only progressive thing about it is that the federal government has made PROGRESS in making people think that all consumption is good and all saving is bad. In effect the current system buys off those at the lowest end of the scale as cover for actually benefiting those at the highest end of the scale. The current system is not progressive...it's perverse. We rail against companies for providing consumer disclosures that are so long as to be unreadable, but yet that's exactly what the government has done with the tax code. I dare say that the more personal experience you have with the system Tom, the more you will see I am right.

We need radical change, and I'll listen to anyone with an idea.

"If you take a walk I'll tax your feet"

I've been working quite a bit in Hartford CT over the past two months, and one of my favorite topics to ponder is the Connecticut "car tax". Yes, in Connecticut, a property tax is levied against the value of your car(s). Here is a brief description for the official website of the state of Connecticut:

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Town Property Tax Information

Motor Vehicles are subject to a local property tax under Connecticut state law. This applies whether or not the vehicle is registered. The local property tax is computed and issued by your local tax collector.

If you do not register a motor vehicle but retain ownership, you must annually file a declaration form with your assessor(s) between October 1 and November 1.

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Tax Jurisdiction

A tax jurisdiction is considered to be your town of residence.

*********************

Silly me, I thought that the only property that should be taxed was that which conceivably could increase in value. Taxing the value of something that actually loses value the minute you buy it seems strange at best to me, repressive at worst. I realize that the intention here is to generate revenue that goes towards maintaining the infrastructure that cars use, namely roads. However, governments being what they are I suspect that this tax simply generates revenue that keeps governments running.

What's next, tax the value of my washing machine?

Speaking of repressive, this is a tax that screams repression. Think about it: it's not enough to tax what you earn, this state also has to tax that which you use to get to your job so that you can earn enough to pay your taxes. This is on top of other taxes that are higher than many other states.

Look, I actually do like Connecticut...it's beautiful here, the people are very nice and Hartford isn't a bad town. But this is one form of taxation that seems utterly insane.