Cont: The Biden Presidency (3)

[Delphic Oracle]

Don't shoot the messenger, bro.

I'm sure he must have done something worse than write speeches for/support Rumsfeld and defend waterboarding, in order to earn the title of "loon". No matter, these Biden family dealings kind of reek, imo. Let's see what the GOP can do with it.

How do you not put defending torture in the "loon" category?

What upsets you and what you don't even bat an eye at reveals quite a bit.

President's son is successful in his professional life: reeks

Big chunk of President's family in administration: crickets

Being dubious of the opinions of those who excuse torture: feigned confusion

Knowing that there's no point trying to convince true believers to see reality: priceless

 

[Aridas]

Don't shoot the messenger, bro.

I'm sure he must have done something worse than write speeches for/support Rumsfeld and defend waterboarding, in order to earn the title of "loon". No matter, these Biden family dealings kind of reek, imo. Let's see what the GOP can do with it.

In other news -

JUST IN: The Supreme Court just ruled 5-4 siding with red states against the Clean Water Act. Roberts joined liberals in dissent, but the conservative majority did not even issue an opinion explaining why they ruled the way they did.

MORE: This 5-4 ruling brings back a Trump rule that undermines the Clean Water Act by limiting states’ ability to stop projects that could poison their water.

The conservative justices used the shadow docket to undo decades of precedent without even an opinion explaining why.

Thanks so much for cheering this wildly not conservative behavior on.

 

[Solitaire]

The Wrong Way To Tax The Rich by Brian Riedl


Between Build Back Better and the new budget, Biden is proposing a staggering
$3.5 trillion in new taxes over the decade—the vast majority of which would finance
huge new spending.

I wouldn't call that a huge jump. It's only 350 billion per year.

Long-term deficits are instead driven by federal spending projected to leap
from 21 to 32 percent of the economy over that period.

What's this? Surely you can't mean we're running four plus trillion dollar deficits.
You'd get a bust of inflation followed by a recession when capital gets depleted.

Biden would raise the corporate tax rate to 28 percent, which at 32.3 percent
when including state taxes would restore America’s status as the highest
corporate tax rate in the OECD.

Meh.

Yet Biden would also raise the capital gains rate as high as 43.4 percent
(including the surtax) for upper-income families. This is especially excessive
considering that capital gains taxes are assessed both on the inflationary
growth of an asset, and the “real” growth. An investment that grows from
$100 to $200 due to $50 in inflation and $50 in true appreciation would
still face a $43 tax, wiping out nearly all inflation-adjusted gains. Taxing
inflation is one reason the typical capital gains tax rate in Europe is 19.5 percent.

Well, adjust if for inflation. Having 360 billion more taxes over ten years for
the one percent will not hurt much. They can adjust the capital to labor ratio
from 70% to labor down to 65% and that'll cover the cost.

That said, Washington faces a baseline budget deficit of $112 trillion over
the next 30 years that even a 100 percent tax rate on corporations and
upper-income families could not close. Any new taxes should pay for our
current commitments before recklessly making expensive additional promises.

Well, simply tax those bellow one million dollars per year income.
160 million taxpayers at $25,000 per year, ought to cover it nicely.

 

[ZiprHead]

Well, adjust if for inflation. Having 360 billion more taxes over ten years for
the one percent will not hurt much. They can adjust the capital to labor ratio
from 70% to labor down to 65% and that'll cover the cost.

Property taxes on homes increases almost exclusively due to inflation.

 

[gnome]

That's kind of the point.

People are paying so little attention that they don't realize that the things they like and want done are often exactly what Biden has been trying to get done or even doing. Some think 'well if they were doing what I want, things would get fixed fast, therefore they must not even be attempting it', not understanding that the reasons some of that isn't done isn't Biden (I have some criticisms of him and some others I find reasonable even if I don't agree with them). More than that, they vastly over-estimate the effectiveness and speed of their ideas.

It doesn't help that the US is so self-absorbed they forget that other places and peoples have agency too, so it's all only the US President not working that is the problem.

It also doesn't help that political argument is so based around personalities that people give a reflexive answer when asked about a person, rather than about a policy without a name on it.

 

[Bob001]

Property taxes on homes increases almost exclusively due to inflation.

Not really. Inflation is a standard economic term based on a market basket of goods. U.S. inflation in 2021 was 7 percent; in 2020 it was 1.4 percent.

A lot of factors, often hyperlocal, cause property values to increase, often at a rate higher than inflation.
https://www.usinflationcalculator.com/inflation/current-inflation-rates/

But so what? Property taxes are based on property values. Do you think they shouldn't be? Then you end with with Prop. 13, where your taxes are largely determined by how long you've owned the property.

 

[Stacyhs]

Not really. Inflation is a standard economic term based on a market basket of goods. U.S. inflation in 2021 was 7 percent; in 2020 it was 1.4 percent.

A lot of factors, often hyperlocal, cause property values to increase, often at a rate higher than inflation.
https://www.usinflationcalculator.com/inflation/current-inflation-rates/

But so what? Property taxes are based on property values. Do you think they shouldn't be? Then you end with with Prop. 13, where your taxes are largely determined by how long you've owned the property.

I'm all for Prop. 13 style laws. A senior citizen shouldn't lose their home because the house they could afford and bought to retire in suddenly sky-rockets in value along with the sky-rocketing property taxes.

 

[Delphic Oracle]

I'm all for Prop. 13 style laws. A senior citizen shouldn't lose their home because the house they could afford and bought to retire in suddenly sky-rockets in value along with the sky-rocketing property taxes.

In doing some canvassing for a tenants' organizing non-profit, I found the most effective way to get a contact to take interest in what I was saying was to research the neighborhood and look at the last few high-dollar sales paid with cash and with the appraisal/inspection waved nearby and point out what that means. Get ready to be overrun with out-of-state absentee owners slapping a coat of slab-gray, off-white, or beige paint over aging housing stock, putting up those awful backsplashes with the little narrow horizontal tiles including the little transparent strips that have all the luster of frozen spit finished off with a caulking job that reminds you of a 5 year old frosting a grandparent's birthday cake. Now charge $1200/mo. for a "charming" craftsman bungalo with a yard the size of a postage stamp with a deteriorating foundation in a sleepy midwest cow-town with median household income of ~$56k.

Sorry, I kinda got going there...

 

[Bob001]

I'm all for Prop. 13 style laws. A senior citizen shouldn't lose their home because the house they could afford and bought to retire in suddenly sky-rockets in value along with the sky-rocketing property taxes.

I see it as more complicated than that. For one thing, why should people in basically identical houses with the same value pay wildly different tax rates based on how long they've lived there? Would you vary income taxes based on the age of the taxpayer? Prop. 13 law distorts the real estate market and reduces turnover. Maybe those people who bought a house 30 years ago would like to move, but they don't want to give up the tax break. You also have people, probably the majority, who borrow against the increased value of the house and benefit from their investment returns. No other state has anything like prop. 13, and they seem to function just fine.

One possible solution to the specific problem you describe would be to assess taxes at market value, but defer collection until the property is sold. The homeowner could choose not to pay while he lived there, but when he sold it or it was passed to his estate, the unpaid taxes would be collected off the top, with interest.

 

[Bob001]

In doing some canvassing for a tenants' organizing non-profit, I found the most effective way to get a contact to take interest in what I was saying was to research the neighborhood and look at the last few high-dollar sales paid with cash and with the appraisal/inspection waved nearby and point out what that means. Get ready to be overrun with out-of-state absentee owners slapping a coat of slab-gray, off-white, or beige paint over aging housing stock, putting up those awful backsplashes with the little narrow horizontal tiles including the little transparent strips that have all the luster of frozen spit finished off with a caulking job that reminds you of a 5 year old frosting a grandparent's birthday cake. Now charge $1200/mo. for a "charming" craftsman bungalo with a yard the size of a postage stamp with a deteriorating foundation in a sleepy midwest cow-town with median household income of ~$56k.

Sorry, I kinda got going there...

Actually, you're touching on a serious problem. Major investment groups are buying thousands of modestly prices homes across the country and renting them, making it harder for consumers to both buy and rent homes.
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html
https://www.washingtonpost.com/business/interactive/2022/housing-market-investors/

 

[Delphic Oracle]

Actually, you're touching on a serious problem. Major investment groups are buying thousands of modestly prices homes across the country and renting them, making it harder for consumers to both buy and rent homes.

https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html

https://www.washingtonpost.com/business/interactive/2022/housing-market-investors/

I know this all too well. "Afforable" stock in my area went down to an average of 2.1 days on market. You can't possibly get inspected and appraised in that time. Not taking those steps is way risky. And without cash, nobody is going to underwrite a home sight unseen anyways.

 

[Stacyhs]

I see it as more complicated than that. For one thing, why should people in basically identical houses with the same value pay wildly different tax rates based on how long they've lived there? Would you vary income taxes based on the age of the taxpayer? Prop. 13 law distorts the real estate market and reduces turnover. Maybe those people who bought a house 30 years ago would like to move, but they don't want to give up the tax break. You also have people, probably the majority, who borrow against the increased value of the house and benefit from their investment returns. No other state has anything like prop. 13, and they seem to function just fine.

One possible solution to the specific problem you describe would be to assess taxes at market value, but defer collection until the property is sold. The homeowner could choose not to pay while he lived there, but when he sold it or it was passed to his estate, the unpaid taxes would be collected off the top, with interest.

I agree that it's more complicated but I think my point is still valid. No senior should lose their home because they can no longer afford the huge increase in property taxes when their income is fixed. Your idea of delayed tax collection is certainly feasible. I would suggest a plan that they keep paying the tax at the rate it was when they either bought the house or at the time of retirement and then be able to defer the difference to when the property is sold.

 

[Fast Eddie B]

Major investment groups are buying thousands of modestly prices homes across the country and renting them, making it harder for consumers to both buy and rent homes.

Wouldn’t that make it easier to rent? Seems like supply of rentals going up would drive rental prices down overall.

 

[Random]

Wouldn’t that make it easier to rent? Seems like supply of rentals going up would drive rental prices down overall.

It doesn't affect just the Supply though, it also affects demand. Every house that is not available to buy means that potential homeowners are force to stay in the rental market a bit longer.

 

[Bob001]

Wouldn’t that make it easier to rent? Seems like supply of rentals going up would drive rental prices down overall.

As one of the investors explains:

And in case you were assuming that converting houses to rentals would flood the market and bring down rents, don’t get your hopes up: As Invitation Homes tells its investors, “We operate in markets with strong demand drivers, high barriers to entry, and high rent growth potential.”

https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html

As fewer people are able to buy, more need to rent, increasing the demand for rentals. And investors are likely to buy the more desirable properties and increase the rents as much as they can, pushing up the average price across the market.

 

[Bob001]

It doesn't affect just the Supply though, it also affects demand. Every house that is not available to buy means that potential homeowners are force to stay in the rental market a bit longer.

Or a lot longer. Or forever. Not everybody can ever afford to buy a house.

 

[Bob001]

I agree that it's more complicated but I think my point is still valid. No senior should lose their home because they can no longer afford the huge increase in property taxes when their income is fixed. Your idea of delayed tax collection is certainly feasible. I would suggest a plan that they keep paying the tax at the rate it was when they either bought the house or at the time of retirement and then be able to defer the difference to when the property is sold.

But why should someone be able to sit on a valuable asset just because he's retired? If you give a tax break to one group arbitrarily, everybody else -- including a lot of people who will never be able to afford to buy a house -- has to pay more one way or another. Prop. 13 has skewed the California economy in multiple ways, none of them good. No other state has anything like Prop. 13.

Still, it’s hard for California to claim any sort of lasting victory on taxes or homeownership. Today, Californians remain among the most highly taxed people in the nation; low property taxes have been more than offset by increased income, sales and gas taxes. That might not be so bad if Proposition 13 was thereby rendered a wash. But it’s not. Its effects are deeply regressive taxation and distorted local economies and housing markets.

https://www.latimes.com/opinion/op-ed/la-oe-friedersdorf-prop-13-20180604-story.html

That amounts to a giant, rent-control-size subsidy to Californians who bought their homes a long time ago. (It’s particularly sweet for Californians with big, expensive houses. Tax relief from Prop 13 aligns almost perfectly with household income.) It’s one reason why the proportion of the state’s properties that change hands each year fell from 16 percent in 1977 to less than 6 in 2014. It’s a seller’s market.

More anecdotally, longtime homeowners are among the most stringent opponents of new housing. They’re the ones lining up behind L.A.’s Neighborhood Integrity Initiative.

Obviously, Prop 13 changed the way cities raise money. Property tax went from 90 percent of local revenue in the ‘70s to less than two-thirds today. What took its place? Hotel taxes, utility taxes, and new fees. Mostly, the highly regressive sales tax.

https://slate.com/business/2016/09/...and-here-are-some-graphs-to-show-you-why.html

Retirees are not necessarily poor. In fact, on average, they are doing pretty well. And for someone who owns valuable property with limited income, a reverse mortgage is always a possibility. Protecting the owner from market forces just allows him to pass the property along to his heirs, which also has big tax advantages. Why should everyone else have to pay for that?

 

[TurkeysGhost]

But why should someone be able to sit on a valuable asset just because he's retired? If you give a tax break to one group arbitrarily, everybody else -- including a lot of people who will never be able to afford to buy a house -- has to pay more one way or another. Prop. 13 has skewed the California economy in multiple ways, none of them good. No other state has anything like Prop. 13.


https://www.latimes.com/opinion/op-ed/la-oe-friedersdorf-prop-13-20180604-story.html


https://slate.com/business/2016/09/...and-here-are-some-graphs-to-show-you-why.html

Retirees are not necessarily poor. In fact, on average, they are doing pretty well. And for someone who owns valuable property with limited income, a reverse mortgage is always a possibility. Protecting the owner from market forces just allows him to pass the property along to his heirs, which also has big tax advantages. Why should everyone else have to pay for that?

Not to mention that tax sheltering property like this rewards the exact kind of NIMBYism that is partly responsible for the shortage of housing stock and the spiking costs. High property taxes are the only negative effect that people face for enacting policies that make it impossible to build. It's bad enough that people treat buying a home as buying a license to print money, we should not be rewarding this system by letting people not pay taxes on their gains.

Building more housing stock, and denser housing stock in existing neighborhoods, is a great way to keep prices and taxes under control.

 

[bruto]

Wouldn’t that make it easier to rent? Seems like supply of rentals going up would drive rental prices down overall.

Not if housing stock is limited. It allows the same people (and corporations etc.) who have made purchase unaffordable to raise their rents to nearly unaffordable, because there's no other place to live. Rental prices won't go down unless or until they have raised them so high that people move away, at which point it's probably too late and one is left with abandoned residences with huge artificial leverage that makes it more economical for an owner to take the inflated loss than to rent them cheaply.

 

[Stacyhs]

But why should someone be able to sit on a valuable asset just because he's retired? If you give a tax break to one group arbitrarily, everybody else -- including a lot of people who will never be able to afford to buy a house -- has to pay more one way or another. Prop. 13 has skewed the California economy in multiple ways, none of them good. No other state has anything like Prop. 13.


https://www.latimes.com/opinion/op-ed/la-oe-friedersdorf-prop-13-20180604-story.html


https://slate.com/business/2016/09/...and-here-are-some-graphs-to-show-you-why.html

Retirees are not necessarily poor. In fact, on average, they are doing pretty well. And for someone who owns valuable property with limited income, a reverse mortgage is always a possibility. Protecting the owner from market forces just allows him to pass the property along to his heirs, which also has big tax advantages. Why should everyone else have to pay for that?

Like I said, if they continue to pay the tax at the rate I mentioned but can delay paying the increase until they house is sold (or even inherited), the state still gets its money.

I really don't want to get into a big discussion about this. It's just not that important to me.