— from Bob Waunch —
Why is it that as soon as someone has an idea to help solve a problem the first thing that comes up is – let’s create a new tax!
Instead, how about we sit down and try to think creatively of other ways to solve the problem that does not include any government or newly created agency to ‘oversee’ use of our tax dollars.
I’m referring specifically to the proposed YES FOR HOMES on the November ballot. The initiative sounds good on the surface but in fact all it does is ‘increase’ the cost of housing by adding another tax burden on everyone, and that includes the people that would own the new ‘affordable’ properties.
Here’s a suggestion for your thinking caps: eliminate some government instead of adding more. Many cities and municipalities have done this by outsourcing some or all of their governmental functions to private contractors.
The first place we could start would be with Public Works. Everything they do could be done (and a lot of it is already) by private contractors. Public works has a lot of employees, a lot of expensive equipment and lots of property that all require tax dollars to support. Public Works could keep a couple of engineers to oversee public projects but all their employees and equipment could be absorbed by local excavation, etc. operators, and all projects would be bid on a competitive basis; plus the former employees would now be paying citizens instead of burdens on the tax payers.
But let’s get back to the housing problem. Now all that public works property (that is already owned by the citizens) could be made available at ‘very reasonable’ lease rates to private contractors to build affordable housing. Plus, the County Building Department could eliminate all duplication of the same task; e.g. if they approve one house in a project then they should rubber stamp all the remaining houses if they meet the same standards – for no additional cost.
Now instead of more new taxes we, the citizens, would be donating the land we already own, the land would provide income from the leases, we would see a decrease in the cost of public works projects because of competitive bidding and the Building Department would substantially reduce the cost for developers.
These types of solutions are called ‘Win-Win’ and we wouldn’t have the burden of another government agency.
I vote NO on the YES FOR HOMES new tax proposal but I vote YES for looking for creative solutions to the affordable housing problem.
Hmmm…
Good ideas, Bob.
Government should exist only to smooth the social intercourse among its citizens.
I forget who said that (maybe Rousseau), but it’s a useful quote to remember.
Jean is deeply involved in the “Yes For Homes” vote, and at present it’s the best solution available to us. So I’m going to have to vote YES on it.
So who pays those for-profit Private Contractors to build the roads & other infrastructure? You suggest that public projects be put out to bid rather than being done by Public Works, but I don’t understand who is taking the bids and paying the Private Contractors if not the state or the county or some other public body. Somebody still has to pay the costs of construction, plus the contractors’ profits. Who would that be if not taxpayers, just one step less directly ? There must be something in this suggestion that I am missing.
When I moved here 27 years ago, there was no Opal, home for islanders, etc. It would be good to know what is the % of housing that is currently available that is considered affordable housing ? I like the idea of private enterprise.
No new government agency is created. This is not a tax on everyone, and truly, it isn’t even a tax, as the money doesn’t go into general revenue but goes directly to creating affordable housing. Buyers will pay 99% of 1/2 of 1% of the amount of the transaction. On a half million dollar home, this amounts to about $12 per month rolled into the mortgage. Is it the only solution? No, but it is a reasonable proposal that will really help.
Bob- I think it helps to see these trends as part historical and part necessitated by recent developments. Your fears are more deeply rooted in the below struggle.
Historical –
Since the mid- 1930’s our country embraced a mixed-economic model–neither socialism nor laissez-faire capitalism but instead “humanized capitalism” (my phrase) wherein incentivized wings to excel aren’t clipped by a sterile state but safety nets are inserted to avoid rupturing the “social contract” (Rousseau, for Steve- see also “Discourse on Inequality”).
Recent Developments-
The “miracle” middle class is disappearing. It arose through deliberate intent; through specific government laws and tax policies (correct priorities) to counter what’s “natural” in economic and political modeling, that is, (1) an extreme concentration of wealth and (2) dictatorship, respectively. Recent trends have concentrated more wealth into fewer hands due to “incorrect priorities” (in Manhattan we refer to millionaires as the “new poor”); as the middle class becomes more extinct, the “social contract” buckles under the stress of inequality; automation exacerbates the trend; it’s an open question whether new tech related jobs can replace what WIL BE LOST.
That brings us to our proposed REET. It’s meek.
The larger questions are:
1. Will technology help, hinder or remain neutral in finding solutions to social instability and economic inequality?
2. Will we overshoot towards a subsidized model and de-incentivize individual drive?
3. Will this overshoot cause further partitions within society, some of which may be hardened and securitized?
No one is sure but some understand the trends better than others; the demographics are fairly clear.
The real mystery question is will a combination of “quality education and technological innovation” work to eliminate the degrees of separation between us such that we end with a highly educated, economically balanced, and still innovative society that satisfies the individual ego (an inalterable reality) that’s willing to sustain the “social” (a necessary invented abstraction–necessary if we’re to successfully co-exist).
It’s both a scary and exciting time. Let’s hope for the best.
p.s. Under the auspices of “connecting dots”–again, education is always the key! Real education teaches us how to see the limitations of socio/economic models. Without weighing in on policy, for “any” model to work, flows into a system (a country) need to be regulated. Otherwise, the system (the country) will necessarily break down. Hence, open borders or a failure to stop the flow on undocumented immigration means certain failure. Combined with the challenges of automation, i.e., the coming decline of human labor (even in low-wage agriculture), an open borders and unenforced immigration policies render any system or model helpless.
Citizens need to be adequately educated without political influence so as to implement helpful not destructive local, state and federal policy.
FACTS:
1. No new government agency. Affordable Housing Fund to be administered by County Dept of Health and Community Services.
2. Not a tax on “everyone”. It is a fee on real estate transactions, 99% of which is paid by buyer. 1/2 of 1% on a $500,000 home is about $12 per month when rolled into a 30-year mortgage, not an onerous burden.
3. Provides a way for newcomers to our islands to help pay for having more affordable housing available for our service workers who otherwise may not be able to afford to stay to provide the services that we all need.
4. If you don’t buy or sell a home, you don’t pay. If you sell, you pay 1% of 1/2 of 1%, which amounts to $25 on a $500,000 home.
David’s right.
That’s why the REET (real estate excise tax) is meek, not a heavy burden and well worth it —especially if the results are “low impact” affordable homes (as suggested by Janet Alderton) for critical members of our community. As we consider future builds (benefits), we should consider environmental impact (burdens). Low impact affordable housing stands a better chance at ensuring this.
But, again, the trend isn’t our friend and one hopes we have ways to regulate long term growth on our finite island footprint.
Zoning is an important tool.
Several comments mentioned “it’s only.” Do you know of any tax that has ever been decreased or usually not expanded to more parties? I seriously doubt it. After awhile it will be “we need more” so let’s make everyone pay a minimal amount – and so on. That is absolutely the response of every tax that has eve been imposed. Take a look at what’s happened to your property taxes.
Competition – that is the benefit of private enterprise. The roads, etc. would still have to be maintained but their would be competing bids for the work. I’m sure all of you must be familiar with monopolies (the county) and what they cost.
All I’m suggesting is that we look at creative options to the same old “tax solution.” and looking at other municipalities that have outsourced all or a lot of their functions. Is it going to hurt to look before enacting another tax?
Bob, I appreciate your faith in competition and private enterprise, but it doesn’t always work out that way. Do you see the competition between the big military vendors reducing the cost of our military? Or in healthcare, the Government runs Medicare at about a 1% overhead while the lowest overhead of any private insurer is over 10%. As long as profit must be wrung out of the deal, there will always be less money available to go to the actual project or person. Competition does work for some things, the cost of most consumer electronics comes to mind, but it is not the cure-all proponents of a certain political school promote.
Bob- while private enterprise matches human nature and is undoubtedly the engine of innovation, there are two predicates for it to succeed (and not implode):
1. Society must maintain a sufficiently educated population giving the overwhelming majority an opportunity to compete and participate in its fruits;
2. Private enterprise must have the highest standards to self-police its industries in conjunction with targeted, completely independent government oversight via minimal regulation as a back up to policing of said private enterprises.
Fraying at the edges-
—this occurs when we chip away at either of the above and when we grow out of balance economically such that more and more do not benefit from the growing largesse produced by private enterprise.
—when the highest innovative standards are not employed causing a disconnect in the public’s mind regarding “best intentions” (like doubling down on coal and fossil fuels and not pursuing policies to replace same with alternative clean energies)
—when education falters preventing our ability to compete effectively.
The reality is much more ruthless, less democratic, more of a top down command economies will follow in our footsteps if we do not meet the above challenges instead of making private enterprise out to be the enemy. If we fail in the above as we are now on track to, we will be (amd are now being) replaced in short to medium term and we then will follow along the path of the EU and decline in innovation and worker productivity, etc. This means we become poor and ever more divided.
Note, the alter egos of Google, Facebook, WhatsApp, Apple, IBM, etc are in Asia, not the educated but less private enterprise-focused
and more socialist oriented EU.
So, the world will change (is changing) but not in a positive way for the US (or the West) where, if we’re not careful, we’ll descend into a “socialist” malaise, fall behind technologically, and become more partitioned and fragmented between those with capital and better education and those with less or none.
These trends are in clear view right now…as they are well under way.
The point:
there is no alternative to the above form of intelligent private enterprise and private innovation but failure and an overall declining standard of living.
Either we intelligently hold the leash or wear what’s attached to end of it.
Hello, Evolution.
You want to tell our kids they’re smart when they’re not, lower the bar or alter standarized tests to make others “feel” they’re more competent than they “actually” are, and belittle the greatest human advancements since being Amoebae coming from Europeans and American descendents of Europe —go ahead but suffer the consequences of denial and evolution. The above may not be politically correct but it’s objective reality and it’s playing out before is right now. Wake up, or snooze and lose.
Who pays? That is a good question.
The buyer pays the extra 0.5%. But does he really? Will this tax cause an increase in the value of your property by 0.5%? Not likely. The market would seem to be determining the value of your property. So the price of your property just might fall by 0.5% to keep the overall cost at the market value. You get less for your house and that would make it the seller who pays.
If this tax does cause the market value of your property to go up 0.5%, you will see your property tax bill go up (for things like the State and the PHD). So the buyer pays and we all get to pay more property tax.
This tax may be a part of the solution for affordable housing. But make no mistake, someone is going to pay for it.
Nothing happens in a vacuum.
This REET isn’t a subsidy unto itself. It’s a symptom. So, what do most here do? —talk about it as if it were an isolated phenomenon.
I point the conversation to causes. The conversations here instead argue for or against it in ways that are disconnected to the larger causes.
How can limited conversations over this REET be productive? You’ll be doing this the next time another “subsidy” comes along never acknowledging why they’re multiplying at every turn.
The causes are looking at us head on but most are uncomfortable naming them.
Why are are so many unable to compete, excel, perform and succeed?
(Comments edited by publisher)
Edit?
It was under 350 words? A more more precise description would be “non-inflammatory content censorship,” which happened to explain and support what was left un-censored.
Since the “edit” now misrepresents and thereby distorts the comment, its author would kindly ask that you exercise professionalism and remove it in its entirety.
Honestly, if you were editing one would think you’d at least erase the duplicate “are” in the last paragraph of your edit—lol.
Thank you—and no bad feelings.