I normally don't come up with back to back posts - I'm not THAT brilliant. But an article on Matzav popped into my Google Reader this morning that looked interesting. After reading it, I'm pretty shocked - I mean he's essentially saying the same thing I am - even better because his readership is like 1,000x bigger than mine! Everyone should read this article; I really like the way this guy thinks.
I'm shocked that this actually made it through the censors though... Wow...
Friday, July 2, 2010
Of beverages, hedge funds, and... bullies?
There's been a lot of buzz about New York State's proposed beverage tax lately. The proposed tax, backed by both NYC Mayor Bloomberg and NYS Governor Paterson, would be levied at a penny/ounce rate on sugary beverages and the like - though I'm not sure how they'll define what would be taxed and what wouldn't. The tax would be expected to theoretically bring in around $465m, ostensibly to combat obesity and help offset the state's rising healthcare costs due to obesity.
I can agree in theory (GASP!) with the reasons behind the tax - legislators wants to reduce obesity and help stem the (allegedly) spiraling healthcare costs that rampant obesity can cause. Sounds noble. However, I totally disagree with the methods and don't believe for a minute that the many a**holes who run the state have any noble intentions whatsoever.
Let's analyze for a minute. Remember when I said that all NYS knows how to do is tax, tax, tax? This certainly bears this out. There is certainly a problem with obesity in the state - so what does NYS do about it? They instinctively reach for the tax button to wipe it out. Did they think of alternatives to taxing the hell out of NYS citizens? Of course not (well, maybe some Republicans did). Instead of adding to the burgeoning state tax burden on individuals, elected officials might have considered other methods to go about their business, like using tax as a reward instead of a weapon. They might have weighed the option of creating a state-wide "weigh-in" with tax incentives tied to positive, long-term results (don't laugh - this was tried with some success on a city-wide level in a city in Oklahoma, I believe). They might have allowed deductions or tax breaks on gym membership fees or gym equipment purchases to encourage people to sign up for gyms or purchase fitness equipment (of course the problem of whether the purchasers would actually use the membership or equipment would still exist and have to be addressed). They might have given tax breaks to businesses who purvey healthier foods or businesses that can prove they reduced sales of sugary foods and increased sales of healthier options. These are just a few ideas that floated to the top of my head. I'm sure that they have their flaws, but they reflect a general idea - using the tax code as a reward, not a punishment.
The truth is that I really don't believe one word the hot air comes out of any of these NYS officials' mouths. They say this tax is noble in nature and would be levied to help make everyone healthier and alleviate health care costs. Eventually, we will all live in happiness, harmony and in peace with our new, physically fit selves and we'll get on our knees and thank the great State of New York everyday for helping us cope with a problem we couldn't deal with on our own - thanks, NY!!
More likely, instead, are the reasons why this tax is truly nasty. It's not really about health - that's just a by-product. It's really just an obscure and obtuse way to help plug budget holes, plain and simple. All the state is really doing is balancing their horrendously bloated budget on the backs of people who can ill afford it. This is a regressive tax in the worst way. It's the lower strata on the economic scale who tend to buy more of these drinks and foods, because they're cheaper than the healthier alternatives. With the tax, they'll still be cheaper, but significantly less so, so these families will continue to purchase these foods and drinks despite the tax. They'll just have to squeeze more out of an already strapped budget. Richer families, on the other hand, will easily absorb the extra couple of bucks and their household budgets will barely crack a sweat with this tax.
The state is being a cold, calculating, son of a b**ch with this tax. They know their demographics quite well; in fact I'd go so far as to say that, despite what these two-faced lying bastards say they want, they actually want these families to continue buying these drinks because the revenue that will accrue to the state from the tax will accrue NOW, whereas the health problems and increased costs (if this is even true) will accrue to the state MUCH LATER. The state will not "save this revenue for a rainy day". They will take the money as it comes in and throw it down the sh***er that is the state's bloated, current budget. This is their dirty little (well, not so little) secret. "Who cares about the next generation's problems" - that's one of the state's creeds with which the incomepetents in the legislature and executive branches live by. They are balancing their ruinous budget on the backs of households that can ill afford it because a) they can get away with it - those households don't have the powerful lobby or under-the-table representation that the higher socio-economic demographic does (fact o' life, people) and b) those households are far more in number and buy far more of this stuff - this tax works for the state's benefit in volume of items purchased, it's not like income tax. The truth is that the state purports to be primarily interested in the public health. That's utter bulls**t. No one ever became healthier from higher taxes. In fact, a serious argument can be made that higher taxes for those that can ill afford them carries it's own health hazard - rising stress levels, which can lead to the same place obesity can - cardiac problems. So all the state may be doing is leading people down the garden path to hell, just via a different route. Bravo, NY!!
Let's talk about hedge funds. The state has been mulling over taxing hedge fund managers who reside out of state that commute into NYS for work. While this has been dropped (for now), this is a further example of how the state operates and thinks - just reach for that tax handle, guys!! The fact that the governor didn't even seem to think about some of the repercussions when proposing this tax - these funds would simply relocate, DUH - shows how myopic these 'leaders' can be. Notice how Connecticut Gov Jodi Rell responded by trying to poach hedge fund firms who would try to escape the tax by relocating. Did ANY of this occur to Gov Paterson...???!!!
This is the direction that NYS has been inexorably moving in for years. Use the state's taxing power as a weapon and blunt instrument to fix problems that are only in front of your nose with total disregard to repercussions, both now and in the future. Bludgeon the vast majority of your residents with idiotic regressive taxation policy while refusing to cut the most wasteful spending. Nothing seems to change; it just gets worse with the passing years.
So much for beverages and hedge funds. Let's talk about bullies. Lets go down, south of the border.
Ah, New Jersey, a state that has historically shared NYS's distinction of being synonymous with corruption and incompetency. A state where cars still have "Dump Florio" bumper stickers, a state that will never forget the sordid McGreevey episode, etc. But, unlike "same ol'" New York, there's a whiff of change.
New Jerseyans woke up one fine day late last year and decided they've had enough. Enough of the same problems that plague New Yorkers to this very day. They threw out the ineffective Democrat Jon Corzine and elected a Republican, conservative governor in Doug Christie, and seemed ready for the beginning of a sea change in policy. They may be getting that.
See this article and video interview by CBS News. I like Christie's tone and demeanor; it speaks volumes as to where he wants to pull the state. This guy has balls. He is tough. I like how he says "I'm not a bully... just direct" - in truth, I'd love a bully in my (the taxpayer's) corner, bullying those pesky interest groups and unions that tend to hold NYS and NJ budgets hostage. I like how he is determined to reform the state's biggest issue - property tax, and wants to get it done NOW. We've heard this tired proclamation many times from NJ governors through the years, but this time, the governor seems to truly mean it and has the balls and fortitude to actually follow through. Something's changing in Jersey - that landfill stink is slowly ebbing away. Best of all, he really seems to mean it when he says he's not interested in any higher office than where he is right now. If he really does mean it, that just bolsters the impression that what he wants to do in his turn at playing guv'na is truly reform NJ to make it a streamlined, efficient, tax-friendly state.
So, to echo Dickens, it's a tale of two governors and two states. Both have creaking, antiquated fiscal policy structures. One state refuses to acknowledge its failings and continues to contribute to its demise. The other seems hell-bent on reform and improvement. One governor seems fiercely determined to right the ship and do what's best for the state's residents. The other probably wants to do something, anything, but is too spineless and weak to take on the entrenched, Tammany Hall-like "boss" system that seems to run New York these days.
If NYS keeps on its current route to hell, it'll find businesses and households turning their taxpaying, revenue-generating backs on the joke they call NYS, raising both middle fingers in a time-honored "F*** YOU!" salute and never looking back. New York can very easily be an economically poisonous environment in which to live and do business. It sucks money from your pocket and promises the world to you but gives appallingly little back in return.
I'm sure many people will accuse me of just being whiny. Do those people think I'm the only one who thinks and writes this way? Yeah, me and 10 million other taxpaying citizens. Let's not forget - Gov Christie was probably a whiny bastard, harping on the same things over and over. And look where he is now and what he's doing... Just sayin'...
I can agree in theory (GASP!) with the reasons behind the tax - legislators wants to reduce obesity and help stem the (allegedly) spiraling healthcare costs that rampant obesity can cause. Sounds noble. However, I totally disagree with the methods and don't believe for a minute that the many a**holes who run the state have any noble intentions whatsoever.
Let's analyze for a minute. Remember when I said that all NYS knows how to do is tax, tax, tax? This certainly bears this out. There is certainly a problem with obesity in the state - so what does NYS do about it? They instinctively reach for the tax button to wipe it out. Did they think of alternatives to taxing the hell out of NYS citizens? Of course not (well, maybe some Republicans did). Instead of adding to the burgeoning state tax burden on individuals, elected officials might have considered other methods to go about their business, like using tax as a reward instead of a weapon. They might have weighed the option of creating a state-wide "weigh-in" with tax incentives tied to positive, long-term results (don't laugh - this was tried with some success on a city-wide level in a city in Oklahoma, I believe). They might have allowed deductions or tax breaks on gym membership fees or gym equipment purchases to encourage people to sign up for gyms or purchase fitness equipment (of course the problem of whether the purchasers would actually use the membership or equipment would still exist and have to be addressed). They might have given tax breaks to businesses who purvey healthier foods or businesses that can prove they reduced sales of sugary foods and increased sales of healthier options. These are just a few ideas that floated to the top of my head. I'm sure that they have their flaws, but they reflect a general idea - using the tax code as a reward, not a punishment.
The truth is that I really don't believe one word the hot air comes out of any of these NYS officials' mouths. They say this tax is noble in nature and would be levied to help make everyone healthier and alleviate health care costs. Eventually, we will all live in happiness, harmony and in peace with our new, physically fit selves and we'll get on our knees and thank the great State of New York everyday for helping us cope with a problem we couldn't deal with on our own - thanks, NY!!
More likely, instead, are the reasons why this tax is truly nasty. It's not really about health - that's just a by-product. It's really just an obscure and obtuse way to help plug budget holes, plain and simple. All the state is really doing is balancing their horrendously bloated budget on the backs of people who can ill afford it. This is a regressive tax in the worst way. It's the lower strata on the economic scale who tend to buy more of these drinks and foods, because they're cheaper than the healthier alternatives. With the tax, they'll still be cheaper, but significantly less so, so these families will continue to purchase these foods and drinks despite the tax. They'll just have to squeeze more out of an already strapped budget. Richer families, on the other hand, will easily absorb the extra couple of bucks and their household budgets will barely crack a sweat with this tax.
The state is being a cold, calculating, son of a b**ch with this tax. They know their demographics quite well; in fact I'd go so far as to say that, despite what these two-faced lying bastards say they want, they actually want these families to continue buying these drinks because the revenue that will accrue to the state from the tax will accrue NOW, whereas the health problems and increased costs (if this is even true) will accrue to the state MUCH LATER. The state will not "save this revenue for a rainy day". They will take the money as it comes in and throw it down the sh***er that is the state's bloated, current budget. This is their dirty little (well, not so little) secret. "Who cares about the next generation's problems" - that's one of the state's creeds with which the incomepetents in the legislature and executive branches live by. They are balancing their ruinous budget on the backs of households that can ill afford it because a) they can get away with it - those households don't have the powerful lobby or under-the-table representation that the higher socio-economic demographic does (fact o' life, people) and b) those households are far more in number and buy far more of this stuff - this tax works for the state's benefit in volume of items purchased, it's not like income tax. The truth is that the state purports to be primarily interested in the public health. That's utter bulls**t. No one ever became healthier from higher taxes. In fact, a serious argument can be made that higher taxes for those that can ill afford them carries it's own health hazard - rising stress levels, which can lead to the same place obesity can - cardiac problems. So all the state may be doing is leading people down the garden path to hell, just via a different route. Bravo, NY!!
Let's talk about hedge funds. The state has been mulling over taxing hedge fund managers who reside out of state that commute into NYS for work. While this has been dropped (for now), this is a further example of how the state operates and thinks - just reach for that tax handle, guys!! The fact that the governor didn't even seem to think about some of the repercussions when proposing this tax - these funds would simply relocate, DUH - shows how myopic these 'leaders' can be. Notice how Connecticut Gov Jodi Rell responded by trying to poach hedge fund firms who would try to escape the tax by relocating. Did ANY of this occur to Gov Paterson...???!!!
This is the direction that NYS has been inexorably moving in for years. Use the state's taxing power as a weapon and blunt instrument to fix problems that are only in front of your nose with total disregard to repercussions, both now and in the future. Bludgeon the vast majority of your residents with idiotic regressive taxation policy while refusing to cut the most wasteful spending. Nothing seems to change; it just gets worse with the passing years.
So much for beverages and hedge funds. Let's talk about bullies. Lets go down, south of the border.
Ah, New Jersey, a state that has historically shared NYS's distinction of being synonymous with corruption and incompetency. A state where cars still have "Dump Florio" bumper stickers, a state that will never forget the sordid McGreevey episode, etc. But, unlike "same ol'" New York, there's a whiff of change.
New Jerseyans woke up one fine day late last year and decided they've had enough. Enough of the same problems that plague New Yorkers to this very day. They threw out the ineffective Democrat Jon Corzine and elected a Republican, conservative governor in Doug Christie, and seemed ready for the beginning of a sea change in policy. They may be getting that.
See this article and video interview by CBS News. I like Christie's tone and demeanor; it speaks volumes as to where he wants to pull the state. This guy has balls. He is tough. I like how he says "I'm not a bully... just direct" - in truth, I'd love a bully in my (the taxpayer's) corner, bullying those pesky interest groups and unions that tend to hold NYS and NJ budgets hostage. I like how he is determined to reform the state's biggest issue - property tax, and wants to get it done NOW. We've heard this tired proclamation many times from NJ governors through the years, but this time, the governor seems to truly mean it and has the balls and fortitude to actually follow through. Something's changing in Jersey - that landfill stink is slowly ebbing away. Best of all, he really seems to mean it when he says he's not interested in any higher office than where he is right now. If he really does mean it, that just bolsters the impression that what he wants to do in his turn at playing guv'na is truly reform NJ to make it a streamlined, efficient, tax-friendly state.
So, to echo Dickens, it's a tale of two governors and two states. Both have creaking, antiquated fiscal policy structures. One state refuses to acknowledge its failings and continues to contribute to its demise. The other seems hell-bent on reform and improvement. One governor seems fiercely determined to right the ship and do what's best for the state's residents. The other probably wants to do something, anything, but is too spineless and weak to take on the entrenched, Tammany Hall-like "boss" system that seems to run New York these days.
If NYS keeps on its current route to hell, it'll find businesses and households turning their taxpaying, revenue-generating backs on the joke they call NYS, raising both middle fingers in a time-honored "F*** YOU!" salute and never looking back. New York can very easily be an economically poisonous environment in which to live and do business. It sucks money from your pocket and promises the world to you but gives appallingly little back in return.
I'm sure many people will accuse me of just being whiny. Do those people think I'm the only one who thinks and writes this way? Yeah, me and 10 million other taxpaying citizens. Let's not forget - Gov Christie was probably a whiny bastard, harping on the same things over and over. And look where he is now and what he's doing... Just sayin'...
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