Repeal Obamacare But Do NOT Replace It

Republicans in Congress are painting Americans into a corner they will never be able to get out of with Obamacare.  The paint will never be dry, and we will always be stuck with a horrific piece of legislation.

Why are Republicans playing this game with our future?  Do they truly believe that they can, via government, provide a better social program than the Democrats?  What happened to Free Market principles.

First, repeal Obamacare completely. Continue reading

Picking Winners and Losers: How Our State Government Functions (Georgia Musical Investment Act)

Georgia’s State government is pretty much like every other government.  They love the idea of picking winners and losers.    Whether or not your business or sector is a winner or a loser is going to depend on a lot of things, but it will not depend on being equal under the law.


 

HB 155
Georgia Musical Investment Act

A BILL to be entitled an Act to amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to the imposition, rate, and computation of and exemptions from state income taxes, so as to create an income tax credit for certain expenditures by a production company related to certain state certified musical or theatrical productions or recorded musical performances; to provide for rules and regulations and an application process related to such income tax credit; to provide for certain conditions and limitations; to provide for definitions; to provide a short title; to provide for related matters; to repeal conflicting laws; and for other purposes.

We apparently need to offer tax credits to production companies to the tune of 15% for Production Companies to come to the State of Georgia.  And if they locate into one of the 100 poorest counties, they could get an additional 10% credit.

And while the tax credit is limited to $5 million the first year, it will expand to $15 million by year three.

If Georgia politicians want a better business environment, then why do they not lower taxes for ALL Georgia businesses?  What game are we playing here?

Is the music industry in crisis?  Is there a reason that they need additional support from the State of Georgia?  Frankly, it doesn’t matter.

When government picks winners, they also pick losers.  Government should not be in that job.

Supply and demand should pic winners and losers.  And under the law, it should not matter if you have started a Music business or a Automotive Repair Shop.  Each should be treated equally.

It’s no wonder the American Public looks at government with disdain.  So much time and energy is spent attempting to engineer outcomes when they should only be administering the framework, and not determining outcomes.

By the way, it passed 157-11 in the Georgia House.  Now it goes before the Senate.  Let’s hope they have a little more common sense.

 

It’s a Privilege to Do Business in Georgia(and So You Must Pay)

Yes, indeed, it is a privilege to do business in Georgia.  I am not speaking from the eyes of the business owner who is grateful of where he has chosen to open his business.  Instead I am speaking of how government views you and your business enterprise.

And as it is such a privilege, the State of Georgia taxes you for that privilege.

Senate Bill 133 brought that to my attention as they are attempting to remove this tax for businesses of a certain size.  It will still be a privilege to have a business, for that language will not be removed, but some businesses will be exempt.

http://www.legis.ga.gov/Legislation/en-US/display/20172018/SB/133?utm_source=Copy+of+Eyes+and+Ears+-+GaPundit+for+Feb+27%2C+2017&utm_campaign=GaPundit+Todd+Rehm+Georgia+Politics+04202015&utm_medium=email

Continue reading

The Naked Truth About (Subsidized) Wages

If you have read my work over the years, then you know that I am not a proponent of Minimum Wage.  An adult should be able to work for anyone at an agreed price.

However, a new issue has come into my view I did not realize existed until recently.

Apparently there are groups out there (think Chamber of Commerce) that works with your local governments to hold wages down by:

A)  Making sure that there is Affordable Housing in your area so their workers can live nearby

B) Making sure there is mass transit options so that low cost workers can get to the businesses that want to hirer low cost employees(A Chamber Objective for sure) Continue reading

The Trump Card: VETO

As Trump moves forward to become President of the United States(POTUS), you’d think that things were chaotic in DC.  Nothing could be further fro the truth.  Yes there are some that are getting their feathers ruffled(and that is a good thing).

If you want to see if Trump is actually draining the swamp in DC, watch just how many times he uses his Veto Power.  Because if Congress is not getting vetoed legislation sent back to them, then you will know that the Swamp is not being drained.

Yes, the Veto can be overridden.  But that takes compromise among those under the Capital Dome.  And we have not seen that sort of cooperation for decades.  Instead we have had the majority run over the minority not based on solid ideas and concepts, but on sheer force.

Trump can change that quickly and effectively.  Trump, hopefully, will not have favorite stooges under the Capital Dome.  Hopefully, he will spread out who he goes to to push forward valuable legislation.

Most importantly, Trump can Veto the thousands of Executive Orders put forth by Obama and Company, and do so quickly.  Trump, who feels precedent has no value whatsoever, will do more the first week by reversing the bad choices of Obama, than any other POTUS in modern history.

And that is a good thing.

The Federal Reserve Bank: Pumping Fuel onto the Bonfire of Inflation

We are in very uncertain times.  And they are becoming more uncertain.  The Federal Reserve Bank(FRB) just raised interest rates .25% and has stated it is their objective to raise rates perhaps 3 times in 2017, in an effort to effectively curb inflation.

And while that may seem to make sense based on the way both the FRB has worked in the past, and what we have been told about inflation and how it works, these actions, perversely, are going to have the opposite effect this time around.  Should I be correct, then the raising rates will actually fuel inflation, which will force more rate hikes, and then even more inflation. Continue reading

Johns Creek: It’s In Your Best Interest to Stop TSPLOST

The vote Johns Creek residents will take on the TSPLOST 0.75% tax is critical to understand.

Voters are being presented with the opportunity to raise the taxes on themselves, which will effectively increase the spending and size of the Johns Creek City government by 29.7%.  That is not insignificant. Continue reading

Are Our High Quality Schools Sustainable With High Density Housing?

There is another problem with High Density housing that you will not hear any politicians speak about in public.  I am not a politicians, and so I will.

The health of your schools is threatened with higher density housing.  Why?  Because a townhouse that sells for $300,000 will pay 1/2 the school taxes that a house that sells for $600,000 will.  If  both homes have two kids in school, the impact is significant. Throw an apartment complex into the equations and the fiscal impact on schools becomes even  more significant.

It costs $13,433 per student per year to educate children in Fulton County.  No small amount.  Property taxes are essential to school funding(especially those property taxes coming from people with no children in school).

Assuming 12 years of education per student, that totals  $161,196, quite a large sum.

For our example, we will consider an apartment, a townhome, and a single family home.

Based on my calculations from the number of units at some of our most valuable apartment complexes here in Johns Creek, an apartment unit is valued round 110,000 for tax purposes.

Apartment Townhome House
Value $110,000.00 $325,000.00 $500,000.00
School Taxes $1,284.05 $2,918.30 $4,961.11
Cost per Student 13433 13433 13433
% Covered 9.56% 21.72% 36.93%

(The above taxes are from the 2016 tax rates, and assume homestead exemptions have been applied for on the Townhome and house.)

As you can see, apartment dwellers and Townhome dwellers pay far less towards the education of a student than does a homeowner who lives in a more expensive property.

The math makes it clear.  If you continue to add more and more students who are in households contributing less to the cost of education, either property taxes will need to rise significantly or the cost of the education will need to drop sharply, reducing the quality of that education.

And none of this would even be possible today at these tax rates were it not for households with no children contributing to the system even though they have no children in school

Which leads us to this question:  How smart is it for communities to continue adding high density housing, which puts the same strain on school financing economics when you know that they are going to contribute substantially less to those very same schools?

 

What’s Undermining Residential Real Estate Values in the City of Johns Creek?

Johns Creek receives many accolades throughout the year, and 2016 has not been an exception to that trend.

For many residents, concern over ever higher densities of residential real estate developments such as apartments and town homes has been a major concern.  But the City of Johns Creek pushes ahead with ever more high density development with seemingly arbitrary lines drawn as to where the higher densities are permissible and where they are not.

Residents did not directly vote on these issues.  They only have cast votes for those that decide on these issues.  And as history has shown, there are not a plethora of voters that even bother to make their voices heard.  That, however is changing.

There is a cost to current residents as more and more of these high density developments are approved and put into place.

Let’s ask the residents of Johns Creek who were here in 2007.  Taking the data from the 2015 CAFR report (you can find it here:  http://www.johnscreekga.gov/JCGA/Media/PDF-Finance/2015-cafr.pdf ) on page 61 shows Johns Creek had a population of 70,050 and a residential tax digest (page 79) of $3,215,735,140.

A simple calculation reveals that in 2007 we had $48,727 of residential real estate per resident.

How have the residents of 2007 fared over the course of the last 8 years?  Well, not so well.  Using the population counts and the residential tax digest from the same pages mentioned above, we can see that residents of Johns Creek  have seen that number drop to $40,117 per resident, a decline of 17.67%.

Residential Property Value Per Capita
Year Residential Property Population
2007 $3,215,735,140.00 65994 $48,727.69
2015 $3,333,836,970.00 83102 $40,117.41
-17.67%
Source: Johns Creek CAFR 2015

Why are residents from years past seeing such a drop in values for their community at large over time? The drop in housing prices from the recession is behind most communities in our area and should certainly be behind us in Johns Creek.

I’ll blame that in large part to the additional higher density housing which has been added over the years and continues to be added even as we speak.

Those that move into higher density developments are those that are not buying the current real estate stock we have in Johns Creek.  Fewer buyers for that real estate naturally lowers the selling prices of the real estate.  Yes indeed, the supply and demand curve you had to learn about in high school and college is actually meaningful.

Additionally, all of this “new” higher density living is coming in at average price points below what the average homes in Johns Creek are worth.

So we have less demand lowering selling points and lower prices units pulling down the averages as well.

Also interestingly enough the amount of commercial real estate per resident is rising.

Commercial Property Value Per Capita
Year Commercial Property Value Population
2007 $691,897,960.00 65994 $10,484.26
2015 $879,818,130.00 83102 $10,587.21
0.98%
Source: Johns Creek CAFR 2015

So as residential property values fall per resident, commercial property values are rising per resident.

I doubt that has been the objective of many of the residents within our community.  Those that reside on Findley Road at City Hall are undoubtedly happy about this outcome, however.

After all, they are the ones who continue to vote and push us along this path of more commercial development and higher density housing.

 

 

 

 

 

Did You Really Think It Was Going To Be Easy?

Misplaced outrage is all around us.  I don’t even have to give you the examples, but it’s likely even you have been guilty of having misplaced outrage.

“Did you hear what So and So said? What are we going to do?”

Establishment politicians have a major advantage over un-elected challengers.  They are reelected at rates that boggle the mind when you consider how unhappy we are with their performances.  In November, the majority of you will vote to keep your Representatives and your Senators despite the fact that they have been in office as the debt of this nation has gone from $7 trillion to $20 trillion, wars around the planet we participate in are multiplying and the US economy dies a slow and steady death. Continue reading