Few of our economic policy makers know it either.
We have an interesting (and very poorly thought out) law in Kentucky. It was passed with the supposed goal of limiting future tax increases. In practice it has done just the opposite. And our local taxing authorities love it and use it to its fullest.
How it works:
Taxing authorities, county, city, library board are allowed to set tax rates to raise up to a maximum of 4% more total revenue than was taken in the previous year. This is key. There is NO limit on the actual RATE of taxation, just that no more than a 4% increase in total revenue can be done (without a public hearing; to go over 4% they have to hold public hearing and they hate doing that).
Now our local government(s) as well as our idiot local leftest rag can’t understand that rates and revenue are not the same thing. IMO it’s 6th grade math in my youth.
Here is a typical example of how they are raping us and smiling the whole time, and most of the people are too damn stupid to get it.
Our county library board (appointed, not elected) can unilaterally set rates on our property taxes. A few years ago as the economy slowed and revenue dried up because so many were out of work, this board set a tax rate that increased revenue by 4.1% from the previous year. BUT, in order to get that 4.1% more revenue they had to increase our property tax millage rate by 25%. Fewer cash cows (taxpayers) in the county.
The local rag trumpeted headlines praising the board for only “raising rates” by 4.1%. I had a long conversation with the woman who ran the board (typical “it’s for the children” lib) and she insisted over and over that it was a 4.1% *rate* hike, that I was just interpreting it wrong. Keep in mind that 4.1% required a public hearing. So I told her I would be at that meeting to explain the real rate hike and that I would hold her accountable to the math in a very public way.
I next wrote a letter to the local liberal rag, which surprisingly published it. I showed the math whereas a millage rate increase from 5.6 to 7.0 was a NET increase of 25% in the RATE and that we would be paying 25% more in taxes. I stated that anyone that couldn’t understand that needed to go back to the 6th grade.
Quietly and suddenly, the board had a private meeting and dropped the revenue increase to 3.9% which meant that they could cancel the public hearing. Consequently, our taxes only went up 22% that year!
Because the average numbnuts American can’t do math, we in KY keep getting these outrageous tax increases while being told that they are less than 4%. When I talked to the legislator (republican) that was instrumental in the passage of that law, he did not understand or care what the hell I was talking about.
Yep. Sold house now rent, there is little reason that I see to be a cash cow for a bunch of pols that need a little extra green to hire more fat, stupid nieces. In the small town in Ky where I live I noticed at one in the morning the Christmas lights were still on and so called the mayor’s office. Got a hold of his female assistant and asked why in early March the Christmas lights were still on? She said it drew business to the downtown. I said the businesses downtown are closed after 9 in the evening and why were timers not set up to shut them off at 9. She said I would have to ask the city engineer why, trying to get rid of me. I then said what is our cut of the extra business being generated for the downtown businesses because of the lights? She did not understand. I explained that the lights were paid for by our tax money and we should share in the extra profits they generated for the local businesses, at the very least to the extent of our cost. She got off of the phone hurriedly but by midmorning all the lights were off downtown except for two, which I hope the benefiting businesses were paying for. I explained to her that I was just an ignorant redneck from E.Ky and we may leave our lights hanging on our trailers year around but we were smart enough to cut em off after the New Year. For some reason they no longer take my calls to the mayor’s office, can’t imagine why.
One other story. I had a farm and raised cattle and decided that raising a couple acres of tomatoes, peppers, and higher end veggies looked like a pretty good idea.
Went to talk to the county agent that handled the Farmers Market and verified the organic nature of the produce.
I asked what kind of money might you expect to collect at the Farmer’s Market in a days time. She said she had seen local farmers pocket as much as a thousand bucks in a day. I said gross or net?
She looked a little surprised and asked me where I was from. I told her E. Ky. She told me no one looks at it that way whatever they put in their pocket they figured was all profit. I said without figuring in your expenses and time, wear and tear on equipment, loss of income from the former use of the same land, how could you know what your profit actually was? Then she asked how much education I had. I told her high school and a very little college but have been in business all my life. The best answer she had for me was no looked at it that way.
I did not attempt the business because the facts were not available to make a rational decision. But did attend one meeting of the growers ass. and it was run entirely by loudmouthed women and cowed men. I thought to hell with this.
As with all levels of government I have had the misfortune to deal with, the old saying ‘close enough for government work’ always comes to mind.