Re: Understanding the Dreaded Stimulus

The GOP spent more time railing against deficits/spending than it did claiming outrageous tax hikes.

Except, of course, when they were railing for the possibility of using deficit spending to continue the Bush tax cuts.

All of the above dutifully reported by the press.

From a really interesting study of PBS by FAIR. As I keep complaining about NPR – the major segment guests are still Republican, even with a Democratic administration. When Bush was President, we were told it was because the administration was R and therefore that’s where the news was. Now that Obama is President, they have to have more Rs to show that they are balanced. Real balance just doesn’t happen. I am likening this to your comments above and suggest that one reason so little was known was because so little was reported. If only they had called it a Life Tax Rebate in your paycheck.

– While Democratic guests outnumbered Republican guests nearly 2-to-1 in overall sources, Republicans dominated by more than 3-to-2 in the program’s longer format, live segments. (FAIR’s 2006 NewsHour study, which examined a period when Republicans controlled the White House and Congress, showed Republican guests outnumbering Democrats in both categories: 2-to-1 among all sources, 3-to-2 in the longer live interviews.)

http://www.fair.org/index.php?page=4178

It’s not a secret that Obama and the Dems did a bad job with the PR portion of selling their initiatives, particularly with the stimulus and health care reform. They let the GOP and the wingnut brigade control the message letting them disseminate false information and science fiction interpretations of the policies that made the war for public opinion twice as hard to fight. Despite the histrionics of the suddenly once-again fiscally conservative conservatives, Obama hasn’t done nearly the damage to the deficit as they would like people to believe. At least Obama can say they prevented an economic catastrophe and advanced US health care policy a decade or two for the money they’ve spent so far under his watch. Bush resurrected the national debt and didn’t have a thing to show for it when he left office.

C’mon, Ivy_B, you know that when the public is woefully misinformed about government, it must be a Democrat’s fault. I mean, it’s not like we have a public media to properly inform them. Not one worth spit anyway.

Look, shepherdwong, it’s not the media’s job to properly inform the public. It’s the media’s job to dutifully parrot Republican talking points, and then later loudly wonder why the Democrats can’t get their message through.

It’s not that hard to understand. Most working people didn’t get enough to have it meaingfully improve their standard of living, which is the only thing that matters.

Adam Sorensen:
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You mention it yourself, but only indirectly:
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“…increased state taxes resulting from underwater local governments…”
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Here’s a piece at SeattleBubble.com entitled “How can falling home values = rising property taxes?”

If you’re like many local home owners, the county’s assessment of your home has probably dropped around twenty percent over the last few years, but your property tax bill has continued to rise.
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So what gives? If the value of your home is falling, how can your property taxes still be going up?
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One factor that might cause your property tax bill to go up regardless of the value of your house is that Seattle area voters are prone to constantly passing new levees for things like schools, libraries, and low income housing. These are usually voter-approved measures that tack on an extra few cents per thousand dollars of assessed value, and adding a handful of these to your bill could easily offset whatever decrease may have seen in your assessment.
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However, even without additional property tax levees, it is likely that your taxes may still be increasing, despite having a home that is worth less every year.

In New York City, where I live, property taxes doubled last year, even while property values went down, because the assessment that’s based on 2007 bubble values was done on a schedule that doesn’t change simply because there’s a depression. If you didn’t flip for high profit and get out, like most developers did, and you just stuck around in your house, you’re stuck paying the tax bill run up by the people who made out like bandits while jacking up property taxes, even if you had nothing to do with the bubble, and paid a 6% fixed year mortgage lent in 2002, like plenty of normal people did. Lots of people who weren’t a part of the boom at all suddenly got priced out of their homes –not because their houses were under water, or they borrowed more than they could afford, but because tax assessments on their property are 2007 bubble-high and will stay that way for the next five years. Tell those folks they should be thankful for the stimulus’ little-people tax break, if you want to lose elections.
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As a matter of fact, many, many people don’t see the benefit of “lower taxes” when locals governments are selling their debt to big bank tax farmers eager to penalize & foreclose for profit:

The New Tax Man: Big Banks And Hedge Funds
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Nearly a dozen major banks and hedge funds, anticipating quick profits from homeowners who fall behind on property taxes, are quietly plowing hundreds of millions of dollars into businesses that collect the debts, tack on escalating fees and threaten to foreclose on the homes of those who fail to pay.
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The Wall Street investors, which include Bank of America and JPMorgan Chase & Co., have purchased from local governments the right to collect delinquent taxes on several hundred thousand properties, many in distressed housing markets, the Huffington Post Investigative Fund has found.
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In many cases, the banks and hedge funds created new companies to do their bidding. They gave the companies obscure, even whimsical names and used post office boxes as their addresses, masking Wall Street’s dominant new role as a surrogate tax collector.
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In exchange for paying overdue real estate taxes, the investors gain legal powers from local governments to collect the debt and levy fees. At first, property owners may owe little more than a few hundred dollars, only to find their bills soaring into the thousands. In some jurisdictions, the new Wall Street tax collectors also chase debtors over other small bills, such as for water, sewer and sidewalk repair.
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Some states allow the investors to tack on as much as 18 percent interest and a passel of legal fees and other charges. When property owners fail to make full payment, the investors can sue to foreclose – in some states within as little as six months.

What do Obama and Beltway Democrats have to do with local governments’ selling citizens’ tax and fee debts to TARP recipients, so that these banks pay the local tax bill up front in exchange for whatever they can wring out of average folks who –like nearly everyone– are behind on soaring bills?
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A) either (or both) FinReg and TARP implementation could have stopped this practice, not by somehow interfering with state and local governments, but by writing into law and Treasury policy prohibitions on these rapacious practices on the part of these giant banks
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B) passing a stimulus that could have kept municipalities and states from being that immediately and desperately broke in the first place, instead of the half-a-bridge Larry Summers predicted would get us back on track in no time
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C) pounding the message home to constituents that they actually give a damn about these obviously unfair and predatory practices, instead of concentrating on “reassuring markets”
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In this situation, the “we lowered your taxes, you just didn’t notice it” rhetoric is just as dismal and predictable a failure as the “the benefits of health care reform are great, you just haven’t heard them yet” rhetoric.
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It seems to more and more folks like the people supposedly representing them in Washington, and the people who go to conferences, and submit policy papers, and make recommendations, and the people assigned to report on these things don’t seem to have a clear understanding of what’s actually going on in the rest of the country for ordinary people.
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It’s hard to convince people that they got a break from something when, you know, they didn’t actually get a break from anything, while all of the people who got us into their mess –both in government and in big finance and industry– aren’t paying any price whatsoever for their terrible failures .
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We didn’t get a real break, and, if we did, it was obviously a drop in the ocean of breaks the people who did this to us received.
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The most stupid thing the New Democrats could possibly do — their Katrina– would be to tell people that they ought to be grateful to them right about now.
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You mention that the “central political question raised…is why people aren’t convinced they got a tax break,” but the central political question really is why the political-media class can’t understand why people aren’t convinced, isn’t it, Adam Sorensen?

Sorry, that should probably read “It seems to more and more folks as if the people supposedly representing them in Washington…“

“It’s hard to convince people that they got a break from something when, you know, they didn’t actually get a break from anything, while all of the people who got us into their mess –both in government and in big finance and industry– aren’t paying any price whatsoever for their terrible failures.”
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Come now, SZ, we all know Americans are too stoopid to grasp the dems’ symphonically wonderful narrative. It’s failure to resonate has nothing to do with, um, the message.

Gosh Adam – if only there was some sort of dedicated group of full time researchers and analysts who could as it were, ‘report’ on the actual substance of the policy and the veracity of the messages being pushed by the main parties. You could even assemble all of these people and have them publish a weekly or monthly ‘journal’ filled with said information in easily accessible prose, so that citizens and voters are kept informed about the political process. Y’know, I think if America just had a few more of these ‘reporters’ and ‘journalists’ it might be able to turn things around.

Unfortunately what it has is a large pool of paid stenographers who spend their time issuing competing press releases without actually passing any comment as to their content. Oh well.

My property taxes have not gone up, but my services have gone down. The likely next governor insists that he will not raise taxes (state is income tax) no matter what. There is precious little left to cut in the state or local budgets and the impact of decreased federal aid is rarely reported.
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I think the tax picture is more complex than can be determined by taking one piece at a time.

“In New York City, where I live, property taxes doubled last year”
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That’s insane. I’ve been looking around for the tables or a story about that, do you have a link?
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A 100% increase in one year is beyond the pale.

(you’ll appreciate the historical perspective of this, JC)
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For those of you as yet unfamiliar with the terms “tax farmer” or “tax farming” –presumably because you live in a modern democratic republic– this Wikipedia entry may be enlightening:

http://en.wikipedia.org/wiki/Tax_farm
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Tax Farming
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Tax farming was originally a Roman practice whereby the burden of tax collection was reassigned by the Roman State to private individuals or groups. In essence, these individuals or groups paid the taxes for a certain area and for a certain period of time and then attempted to cover their outlay by collecting money or saleable goods from the people within that area.[1] The system was set up by Gaius Gracchus in 123 BC primarily to increase the efficiency of tax collection within Rome itself but the system quickly spread to the Provinces.[2]
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Within the Roman Empire, these private individuals and groups that collected taxes in lieu of the bid they had paid to the state were known as publicani, of whom the best known is probably St. Matthew, a publicanus in the village of Capernaum in the province of Galilee. The system was widely abused, and reforms were enacted by Augustus and Diocletian.[3] Tax farming practices are believed to have contributed to the fall of the Roman empire.[4]
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Tax farming is not identical with privatized tax collection, where private individuals or groups collect taxes and give them to the state in return for a fee. Tax farming is speculative, meaning that the private individuals or group must invest their own money initially to pay off the tax debt, against the hope of collecting a larger sum subsequently (hence “farming”).

That’s right…the whole idea is that these “investors” pay the strapped Roman Empire’s insane war and occupation costs immediately, in exchange for the prospect of collecting more than the tax payers actually owe.
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Sounds like a perfect place for investment banks (recently bailed out by those tax payers) to park their money, doesn’t it?
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If they can collect, then they’ll be able to get more than the ordinary citizen owed in the first place, which could mean more foreclosed properties!
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Perfect! Being so much more profitable, they can then “pay back” Treasury in the form of the even more valuable stock they sell to the government to “repay” TARP.
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I’ll bet Geithner is wild about the idea. It’s better than HAMP…for the people who matter, of course.
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What does that Wikipedia piece say about the risks, though?

The key flaw in the tax farming system is the tension between the state, which wants a long-term source of taxation revenue, and the tax farmers, interested in making a profit on their investment in as short a time as possible.
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As a result tax-farmers often abuse the taxpayers in various ways, such as deliberately undervaluing goods paid to them in lieu of taxes, which allows the tax-farmers to re-sell those goods at maximum profit. However, such abuses stifle economic growth, limiting the quantity of taxes generated over the long-term. In this instance economic growth is assumed part of government edict and unlimited.

No…abuse tax payers? …Short term profit at expense of long-term growth and individual suffering?
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Doesn’t sound like our investment banking system at all!
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That sounds like some wild, Third World, hacienda-economy, where the poor, illiterate citizens barely scrape by on the crappy products offered to them for consumption by their perpetual elite overlords. That sounds like somewhere completely different than the exceptional, democratic United States, somewhere like…Bangladesh?

Tax farming in modern days
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In practice tax farming is not outdated as yet. In many countries, including Bangladesh and India, collection of toll on bridges or other public properties like lakes and forests, is often entrusted to private persons or firms to avoid the problems related to the collection of revenue.
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In 1999, the National Board of Revenue in Bangladesh (NBR) negotiated with the cigarette producing firms the minimum amount of Value Added Tax (VAT) that should be paid per month, although VAT was an ad valorem tax. NBR took this step because under the self-clearance system, monitoring of production and sales of cigarettes proved to be difficult. It was negotiated that if the cigarette producing firms paid the minimum revenue fixed by NBR, physical monitoring would be withdrawn. NBR resorted to this technique of tax farming to avoid the unbearable costs of monitoring, while gaining more in revenue with certainty.[7]

Well, I’m certainly glad that we’re about to follow in the wise footsteps of Bangladeshis and their domestic cigarette manufacturers!
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What a country!
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So, that’s what “tax farming” means.
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…And that’s the benefit our current government’s policy and philosophy of collaboration with finance and industry has produced. Bank of America and JP Morgan Chase, bankrupt if not for tax payer dollars because of their failed and fraudulent investment schemes, are now investing in the tax debts of ordinary citizens, and empowered with the legal right to collect whatever they can from the same tax payers whose money is being sunk into that new investment.
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People just need to hear the message that the Stimulus gave them a tax break, though, and everything will be fine.

PNNTO:
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My @lovely_bride is the treasurer of my coop, I’ll see if I can get her to pull the numbers out again.

SZ-For goodness sake nothing specific, of course.

OT
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Giants over Phils in a tidy 2:39.
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See Yankees, a game CAN be played in under 3 hours.

As Digby said of the tax “debate” writ large last month: “if progressive taxation is now a dead issue like gun control and the death penalty then there’s nothing more to argue about. It’s over.”
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Not that it’s stopped her but…
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Or, hell, what IOZ said (link)

“My property taxes have not gone up, but my services have gone down.”
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Next time you see a teacher give them a hug!

Now, if only Burnett gets shelled, my morning will be complete. Sadly, I have to leave an hour into the game.
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OTOH, game 7 in TX, with Lee on the mound…

Ha, as (disappointingly predictable!) the first round was for the Twins I have been loving the LCSs.
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jc, no way to listen at work? The MLB radio feed is cheap and plentiful.
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Or are you expected to actually work?

Well, as much as I’ve implored my students to consider learning English via MLB broadcasts, they’ve not taken me up on it as yet.
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As for the ALCS/playoffs overall, hate sustains me. If the Yanks lose, my attn. will waver considerably.

“Next time you see a teacher give them a hug!”
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Next time you see one, consider asking for their assistance.

stuartzehcman, your comment is extremely cogent, thorough, balanced, and persuasive (not that I needed any persuasion, mind you).

I would add one point to your comment that I believe is a very large one we should keep in mind when assessing the success, failure, or mixture of the two of not only the stimulus package, including the gone-unnoticed tax cuts, *and* of the rather wretched handling of the PR aspect by the Administration. That is, some in opposition to the entire package flat misrepresented information — to call it what it is, they flat-out lied. How many times did we here people claiming that not only was there NO tax cut but in fact a tax INCREASE??? That tax cut is the ONLY one that benefited me personally, if only in a very minor way, in many a year. I didn’t see any benefit from the Gush tax cuts, but that was due to oddities and unusual changes in my own financial situation, not because I got shafted.

Of course, what PolitiFacts calls “Pants-on-Fire!” lies are hardly the province of any one party or interest group, as they come from all quarters quite regularly and frequently, as do lesser misrepresentations. To see that, all we have to do is to recall Alan Granyson’s accusation that the Republicans’ health plan amounted to “hurry up and die!” or Sarah Palin’s infamous claims regarding “death panels.”

But in the context of the Democrat-designed, -led, and -implemented stimulus and tax cuts, my earlier point is the relevant one.

Ron Washington is pure old school baseball.
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I can affirmatively root for the Rangers in direct relation to my detest for the Yankees.
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And GET CONTROL of that classroom!

“I would add one point to your comment that I believe is a very large one we should keep in mind when assessing the success, failure, or mixture of the two of not only the stimulus package, including the gone-unnoticed tax cuts, *and* of the rather wretched handling of the PR aspect by the Administration.”
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Not to mention that the post was about public ignorance about the stimulus, not liberal anger about TARP. Go figure.

Obama is all over the media. He’s on the tube every freakin’ day. What’s his message? Lately, it’s you are stupid.
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I tend to agree.
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And the message of Obama and Biden was great during “The Summer of Recovery.”
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The fact is that nobody is buying the hot steaming horse manure. But, you can have all you want from these guys; it’s cheap.

as much as I’ve implored my students to consider learning English via MLB broadcasts, they’ve not taken me up on it as yet.
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To quote the movie Better Off Dead: “Two brothers… One speaks no English, the other learned English from watching ‘The Wide World of Sports.’ So you tell me… Which is better, speaking no English at all, or speaking Howard Cosell?”

I honestly liked Howard.
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When I said that to a friend in high school he said “Of course you do Paul, you like whoever everyone else hates”

“See Yankees, a game CAN be played in under 3 hours.”
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To my astonishment, they couldn’t keep a 9 inning game under 4. Finally got a chance to check the “final” score and found that the 9th was still in progress.
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Kevin, by quoting BOD, you just moved way up my fav commenters’ list (not to mention hinting your age). One of the best lines: “He keeps putting his testicles all over me.”
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P, Howard is only llikeable in nostalgia-induced fancy. BTW, I just bought Sam Smith’s IPA–my happy hour beer 4 hours hence. Have never had, but I’m taking your word for it.

If you are working, you are working, if you are laid off, you are not. That is it in a nut shell. All the rest is BS, political fodder. What is happening is that those who are working but hate Obama are blaming Obama but really could care less about the unemployed. The unemployed or those worried about being out of work want change then.
Of course the Dem party has their own distractors..

Long game, but there is something about watching the Yankees lose in front of empty seats that warms my heart.
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If only the Sam Smith’s came in bigger bottles it would be perfect. Hope you did/are enjoy/ing it/them.
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Lastly, people recall the cartoon version of Cosell. I liked him because he was actually interesting.

Paul, saw you commented not long ago and hope you’ll check back. I’m off for an overnight trip with my daughter in a few minutes, but note that there is a new poll out this morning that also shows Sestak ahead by one. Markos tweet below.
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Muhlenberg tracker just released: Sestak 44, Toomey 41. Two weeks ago, it was Toomey 47, Sestak 39. http://is.gd/g9elM

Ooops. 5.1 was supposed to be here. too early in the morning for me.

Thanks Ivy. I read that the previously undecided are breaking to Sestak.
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Any and all updates you have are welcome.

6.6 I honestly liked Howard.
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When I said that to a friend in high school he said “Of course you do Paul, you like whoever everyone else hates”
Paul-no not th…
October 19, 2010
at 10:42 pm

If it makes you feel better, let me relate something I read many years ago in a newspaper story about fans in the stands were attending an NFL football game.
There was a close play on the field that the officials were discussing in a group, trying to decide how to call.
The reporter asked some fans, who were clustered around a guy who had a transistor radio, what they thought abut the play.
The man with the radio said, “I don’t know, I’m waiting to hear how Cosell calls it!”

Guilty secret: When I watched baseball or football games on TV I would often turn off the TV sound and listen to the radio play-by-play descriptions of what was happening on the field. The radio announcers were more likely to tell me what was happening at that moment than the TV announcers, who were liable to drift off to stories about what happened to a batter 5 years ago – while the TV picture showed the batter striking out.