ARE YOU WILLING TO FIGHT A TAX INCREASE?

moneytreeMuch of politics revolves around budget wars. How much money? Provided by who? Spent on what? By whom?

So it is that tomorrow (May 6, 2016) the Prince William County Board of Supervisors will have a meeting (at the Prince William County McCoart Administration Building, Board Chambers, 1 County Complex Court, Woodbridge, VA), and the budget is on the agenda.

Here is Supervisor Pete Candland (R-Gainesville) take on it.

Friday night, May 6, the [Prince William] Board of County Supervisors will set the tax rate for the FY17 budget, and the choices are very clear.

The county executive has proposed a 3.88 percent tax increase that will increase county spending and expand county government by $90 million in the next year alone.

That tax hike was based on a five-year plan that assumed a robust economy that would skyrocket out of the effects of the Great Recession. Unfortunately, our economy continues to be sluggish, hitting mid to low income earners the hardest. (continued here)

Of course, there is considerable controversy. The Prince William County School Board Chairman Ryan Sawyers, a Democrat, is uttering the usual class warfare rhetoric. Why?

To explain his point, Sawyers noted that homeowners in Gainesville, where properties are worth an average of $495,000, will save more from the flat-tax rate than homeowners in Woodbridge, where the average home value is about $295,000. (from here)

So if you live in the east end of the county, you should advocate a tax increase so you can screw the west end? If you live in a small house or apartment, you should advocate a tax increase so you can screw the folks who live in big houses. Why?

Of course, since he is the chair, Sawyers has a ready made propaganda machine => Click for the facts. The Financial Services services department of PWCS is, of course, a wholly unbiased source.

Anyway, read up on the matter.

Note that those who support Candland’s call for flat tax rate will be gathering at the Prince William County McCoart Administration Building at 6 PM on May 6, 2016 to speak to the board of supervisors and to stand with those board members who stand in opposition to a tax increase. The people who live off the government can always be counted upon to have representation at these meetings. Perhaps it is about time the people who pay the bill showed up too.

Can’t show up? Then please contact your supervisor and let them know how you feel about paying more taxes. Do you really want to pay more taxes just because some elected official wants to spend more of your money? No? Then complain.

WHEN ECONOMISTS BECOME THE COURT MAGICIANS — PART 1

The Pharaoh watches as the rods of Aaron and his magicians become snakes. (from here)
The Pharaoh watches as the rods of Aaron and his magicians become snakes. (from here)

Long ago Moses visited Pharaoh and told him God’s command: Let my people go! The Pharaoh disobeyed. So through Moses God brought ten plagues upon Egypt. Even though Pharaoh’s magicians, Jannes and Jambres, could not undo what God had done, they “duplicated” the first plagues God brought upon Egypt, and for some strange reason, Pharaoh took comfort in that.

What is magic, that thing magicians do? More often than not “magic” is just sleight of hand. The magician just fools us into believing he is doing something he is not actually doing. Sometimes, however, even the magician does not know what he doing.

That thing we call the economy is one of the most mysterious things in the world. That is, even though we depend upon it for our food, clothing, and shelter, none of us know exactly how it works. Therefore, when what is going on in the economy concerns us, we consult “experts,” economic magicians, to find out what we should do.

Economic magicians? Does that seem excessively derisive? Then consider these two stories.

Will negative interest rates come to the United States? Probably. Sadly, what economists recommend these days often does not make much sense. Our economy is becoming too contrived, like a house of cards. The problem? Well, let’s begin that discussion by considering a magic trick we call fiat money.

What is ‘Fiat Money’
Fiat money is currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat money is derived from the relationship between supply and demand rather than the value of the material that the money is made of. Historically, most currencies were based on physical commodities such as gold or silver, but fiat money is based solely on faith. Fiat is the Latin word for “it shall be”. (from here (www.investopedia.com))

Because it is not backed by anything, fiat money has no intrinsic or innate value. That is not to say financial analysts do not have formulas to calculate the intrinsic value of fiat money. Nevertheless, fiat money has no utility of its own.

The value that we get from goods and services is innately apparent from the simple, most basic acts of living. We need food to survive, so food has value. The value for tradeable goods and services is predicated on utility and relative scarcity.

For financial assets, and money is the world’s first financial derivative, there is no direct utility. It does not satisfy any basic demand of survival or continued existence. Therefore, any value attached to financial products does not come from utility. It comes from faith. (from here)

What does Jeffrey Snider, the author of the above, mean by “faith.”

Value itself is nothing more than the outward expression of individual faith. The traditional value of money is really just an outgrowth of its historical reputation, earned through so many actions and consequences. Money may seem to add a level of objectivity into the discussion of value, but that is only because of a more universal “faith” in the transactional price discovery process it allows. (from here)

So why do we believe our money has value? There is actually a little more to it than merely believing fiat money is “real” money. Remember that our government uses its power to define fiat money as legal tender, that is, the government says we can legally use fiat money to pay off our creditors.  That includes the government itself. Don’t we pay our biggest bill, our taxes, with fiat money?

Thus, using its power, the government prints money and creates a demand for it. So it is that even though fiat money has no actual value of its own, the value of fiat money still follows the law of supply and demand.

  • Supply equates to scarcity. How much labor or how many goods and services are required to obtain a certain amount of money?
  • The demand for fiat money depends upon the bills we must pay. What is the amount of money we need to pay off our creditors?

Therefore, to make its fiat money serve as an appropriate means of exchange, our government must regulate both the supply of and the demand for its fiat money. That’s what we will talk about in the next post.

Note: that I don’t claim to have a huge amount of economic expertise.  I am sharing my observations in the hope of promoting a discussion. Hence corrections and comments are welcome. If you want your comments to include what you think of the economic proposals of the presidential candidates, that is okay with me.

ARE YOU A PHILOSOPHICAL CONSERVATIVE?

preamble to the constitutionLabels are imprecise things.  Therefore, when we call ourselves Conservative, we don’t tell people much.  Hence, we try to clarify with adjectives.

Consider this list.

Types of Conservatism (from here)

  • Cultural Conservatism.
  • Social Conservatism.
  • Religious Conservatism.
  • Fiscal Conservatism.
  • Paleo-Conservatism.
  • Neo-Conservatism.
  • Bio-Conservatism.

What you won’t often see in any list is the expression “Philosophical Conservatism.” Why? Well, many of the people who educate us are opposed to the concept of Conservatism. They don’t like Conservatism, they don’t understand Conservatism, and they don’t want anyone to be Conservative. The last thing they want is any discussion of a coherent Conservative philosophy.

Consider some quotes.

Some are just shallow and silly.

Philosophical conservatism is defined as the belief that people are evil or selfish by nature, while philosophical liberalism is described as the belief that people are good or have great moral potential. (from here)
Some are so “deep” they drown in their own nonsense.
Fourth, there is what I would call philosophical (or also anthropological) conservatism, that in turn is rooted in a particular philosophical anthropology or perhaps social ontology. This stance implies a commitment to realizing a set of substantive values, irrespective of whether these values are already instantiated in the present. In other words, for philosophical conservatives, the primary question is not about what the past suggests, or how, or by which proven method, these values should be implemented. The question is of course what sets of values we are talking about in this context. I claim that philosophical conservatives are primarily invested in the importance of hierarchical relationships, or some more or less naturalized conception of inequality. They do not simply emphasize the particular and the potential importance of its preservation; they attribute differential value to particular sets of human beings, and they emphasize that certain social arrangements distributing power unequally are unalterable. (from here)

Some are just hateful.

The philosophical conservative is someone willing to pay the price of other people’s suffering for his principles. (from here)

This last quote is actually fairly popular, and it is the way too many see Conservatism. Such is the headache with letting politicians educate our children. Should we be surprised that our SOCIALIST school system does not encourage us to ponder what it means to be a Conservative?

Consider this observation.

Conservatives typically possess a pessimistic vision of human nature, drawing on the modern tradition, on Hobbes’s belief, that were it not for strong institutions, men would be at each others’ throats and would constantly view one another with deep suspicion. (Their emphasis is thus not on the ensuing hypothetical pacifying social contract but on the prevalence of fear in human society). Conservatives are highly skeptical of power and man’s desire to use it, for they believe that in time it corrupts even the most freedom loving wielders: hence, the potential accession to any position of supreme power over others, whether in the guise of a national or international chamber, is to be rejected as being just as dangerous a state as Hobbes’s vision of the anarchic state of nature. Conservatives thus applaud those institutions that check the propensity for the stronger or the megalomaniacal to command power: conservatives magnify the suspicion one may hold of one’s neighbor. (from here)

Do Conservatives possess a pessimistic vision of human nature? Yes. We realize that we are all imperfect and quite corruptible. The Christian Conservative takes it for granted that but for the grace of God we would all be going to hell. And yet because God loves us we all have infinite worth. With the help of the Holy Spirit, we each can do good works.

Are you a Social Conservative or a Fiscal Conservative? Why? What is the logic that drives you to be a Social or Fiscal Conservative? Have you ever asked yourself questions such as these questions?

  • What is the purpose of government?
  • What powers should the government have?
  • Can the government provide justice? What sort of justice? How should the government provide justice?
  • When is it moral to force our neighbors to pay taxes? What functions of government justify punishing people when they refuse to pay their taxes?
  • When is it proper for government officials to transfer public funds to private charities? Is a private charity that is funded entirely by the government still a “private” charity?
  • Is it moral for government officials to take money from some citizens and provide charity to other citizens? Can we trust the same government officials to redistribute the wealth and protect our property rights?
  • What is a constitution? What purpose does a constitution serve? How should a constitution be interpreted?
  • What is the role of the Declaration of Independence in our nation’s heritage?
  • Are men corrupted by power? How do we prevent our leaders from becoming too powerful?
  • What obligations does each citizen have to exercise control over the government?
  • When do citizens have an obligation to rebel against the government?

Unless we consider such questions, and we have ready answers, how can we say we have a coherent Conservative philosophy? To be any kind of Conservative, we must first construct a coherent Conservative philosophy. Once we have done so, I think many Conservatives will realize that for our Conservatism to have any meaning, we must be Philosophical Conservatives, that is, we must be able to logically explain why we believe what we believe.

Delegate Bob Marshall’s “I-66 Toll Update!”

Here is an I-66 Toll Update that Delegate Bob Marshall sent out in email yesterday.

THE MARSHALL MESSAGEI-66 Toll Update!

Opponents of I-66 tolls upset about location of Va. transportation board meeting to approve plan

Dear Friends,

On Monday I sent a letter to Secretary of Transportation, Aubrey Layne and the Commonwealth Transportation Board (CTB) asking them to delay their vote yesterday to give preliminary approval to the I-66 Outside the Beltway tolls until they could meet in Northern Virginia and hear from concerned citizens.  (Check out the Fox5 story above.)  Unfortunately, they ignored my request.  The final CTB vote to go ahead with the tolls in the I-66 project will be on December 9th in Northern Virginia. If you live in Northern Virginia I encourage you to contact VDOT at transform66@vdot.virginia.gov with your concerns and plan to attend the meeting if at all possible.  If you don’t live in Northern Virginia this should still be an issue of concern to you since it will set a precedent that the Governor and unelected Board members can take a road that is already paid for and slap tolls on it in spite of massive citizen opposition.  

I have reviewed the Transform 66 website (www.transform66.org) and sent another letter today to Secretary Layne and Governor Terry McAuliffe encouraging them read VDOT’s own website because it conflicts with some of the statements they have made with regard to the Transform I-66 projects.

VDOT’s own 2012 and 2013 studies said:

  • tolls would be from 15-20 cents per mile;1
  • the conversion of existing I-66 lanes to toll lanes “do not assume that existing lanes would be tolled,” and  “were not analyzed;”2
  • that public support for tolls would have to be generated, and that questions remained about tolling existing lanes.3

Secretary Layne and Governor McAuliffe are undermining public trust for this project by failing to properly inform the public.  No I-66 Message Boards were used to alert drivers to potential tolls and they have provided no analysis nor justification for such tolls.

The 2014 VDOT I-66 survey of I-66 users mention tolls four times, but not the price of such tolls.  How can the Commonwealth Transportation Board vote to give authorization to this project without even know the costs of the potential tolls?

I fully support the Northern Virginia Transportation Authority prioritizing using the annual $315 million in funds they receive from the Northern Virginia taxes collected to widen I-66 inside the Beltway, expedite extending VRE to Gainesville/Haymarket, add additional parking at VRE and Metro parking lots and create 4,000-6,000 park and ride spaces in areas that do NOT take family farms.

Sincerely,

Delegate Bob Marshall

1  “The toll for the peak periods in the peak direction for Package 1 was set at 15 to 20 cents per mile (in 2007 dollars), depending on the demand in each segment. In the reverse-peak direction for the peak periods the toll was about 20 percent lower than the peak.”[page 3-25 I-66 Multimodal Study Final Report, June 8, 2012 http://www.virginiadot.org/projects/resources/NorthernVirginia/I-66_Multimodal_-_Final_Report.pdf
2  “ … Options that simply converted existing lanes to tolled lanes were not analyzed; rather it was assumed that any tolling option would require adding additional capacity.”
“… the tolling scenarios assessed for this high-level Tier 1 tolling analysis do not assume that existing lanes would be tolled, but rather that tolls would be applied to new roadway lanes, with the most likely scenario resulting from tolls applied as part of a HOT lanes system that allow 3+ occupant vehicles to avoid paying the toll. [Page 9-8,   Transportation Technical Report, I-66, http://www.vdot.virginia.gov/projects/resources/NorthernVirginia/I66_TransportationTechnicalReport_2013-02-25-ForWeb.pdf ]
3  “Policy issues with tolling existing capacity on an Interstate wold need to be addressed; Potential policy issues with tolling Dulles Airport users;  Public support for tolling existing capacity would need to be addressed.”   [page 1-4, I-66 Multimodal Study, Supplemental Report, August, 2013, http://www.virginiadot.org/VDOT/Projects/Northern_Virginia/asset_upload_file118_54324.pdf
I-66 Improvements Study, Finalized Survey, Southeastern Institute of Research.