Flagship state university expensive for you? Calling middle class caught in middle

Parents Forum
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<p><<<< People voted for Prop. 13 because they fell for the kind of slick argument you just made. >>>></p>

<p>People didn't "fall" for any "slick argument. People voted in order to be able to afford to keep their homes. My own parents (who had a modest income) saw their prop taxes rise from 300 a year to over 1300 a year in a very short time. while 1300 may not seem like much now, but at the time, 1300 represented more than 10% of my parents' income. People in my parents circumstances (and there were many) found themselves unable to afford to keep their own homes simply because the prop taxes rose to an unaffordable level. The passage of prop 13 brought my parents prop taxes back down. </p>

<p>At least people who are buying property NOW know what they will be paying in prop taxes. Before Prop 13, you didn't know how ridiculously high your prop taxes could go -- a very scary situation. AND, no one can force a factory or warehouse to remain in CA. If their prop taxes go up, they will just leave CA --- so instead of getting some money from them, you will get ZILCH.</p>

<p>But.... the argument today was about how prop 13 has hurt college ed. College Ed funding is not hurt because of prop 13. There is more prop tax money coming in than anyone could have imagined - simply because of the increases in home prices. The problem is that K-12 education takes too big of a chunk and a good percentage of that money is wasted on bloated administrations.</p>

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<p>dstark and jlauer: now you have made some of the legitimate arguments regarding Prop. 13. And Prop 13 is only tangentially the issue in any event. Total tax revenues - property tax (real and auto), income tax, sales tax - the total is what matters in the long run. What happened after Prop 13 is we shifted a big chunk of revenues from property tax to sales tax - which is the most regressive tax there is. Overall average tax revenues remain the same, but are much more volatile, and much more skewed to the benefit of the extremely wealthy (who pay a relatively small portion of their income in sales tax because consumption of goods can't keep up with the amount of wealth being amassed) and to the detriment of the poor and middle class, (who-- well, vice versa) I don't really have an issue with Prop. 13 - as long as we make up the lost tax revenue from a source which is not regressive. So far, we haven't. What we've done is replace it with an incredibly complex system of funds transfers which end up sticking it to the poor and middle class.</p>

<p>Dstark - college costs have gone up faster than inflation at both public and private Universities. This is probably due mostly to the odd set of "costs" we use to define the "cost of living" upon which our inflation calculations are based. And there is waste and inefficiency in any large-budget organization. You get a cure for that, let me know. In the meantime, that's the only really effective way we have of getting things like freeways and wars and schooling millions of kids done.
Jlauer - your assumptions are comforting and convenient, (it's always good to have a villain to blame) but not reality-based. California K-12 funding is middle-of-the-pack nationwide, notwithstanding our unusual challenges due to multiple languages, ethnicities, etc. and overall higher cost of pretty much everything you need to run a school - starting with electricity.</p>

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<p>Isn't the Cali income tax progressive and does it not bring in vast amounts for the state??</p>

<p>As a former local and state budget analyst I can with reasonable certainty assure you that they would not cut the tax rate back enough to come close to equalling the increase in assessed values. You take 20% give back a 5% cut and brag about "cutting taxes. WE see it in Washington a lot where values are going up rapidly.</p>

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<p><<<< California K-12 funding is middle-of-the-pack nationwide, >>></p>

<p>Yes, many states (and DC) spend more money per kid on k12 ed than CA does (and yet they don't have much (if anything) to show for that increased spending). </p>

<p>Just because there are other states that waste even more K-12 money than CA does, doesn't mean that CA doesn't waste a lot of money</p>

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<p>Barrons - yes, you're right. California has a very progressive income tax, topping out at 9.3%. But we had that before Prop. 13. What has changed is a dramatic increase in the sales tax.
Jlauer: The beautiful thing about your position is that you don't have to have any facts, data, expertise or knowledge to back it up. Just repetition. Repetition, without any real facts has in fact been the primary means of selling this point. When I see some actual hard data to back it up, I'll be all ears.</p>

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<p>Barrons' said, "As a former local and state budget analyst I can with reasonable certainty assure you that they would not cut the tax rate back enough to come close to equalling the increase in assessed values. You take 20% give back a 5% cut and brag about "cutting taxes."</p>

<p>That's what happened in California before Prop 13 and the public just got fed up.</p>

<p>To not know what your property taxes are going to be in the future and leave it up to the politicians to decide is insane.</p>

<p>The public got the property tax issue right. </p>

<p>All you have to do is look at the late 90's. California's revenues exploded and what did the state do? They spent all the money plus more. All those increasing revenues and it wasn't enough money.</p>

<p>It's never enough money.</p>

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<p>"Dstark - college costs have gone up faster than inflation at both public and private Universities. This is probably due mostly to the odd set of "costs" we use to define the "cost of living" upon which our inflation calculations are based. And there is waste and inefficiency in any large-budget organization. You get a cure for that, let me know. In the meantime, that's the only really effective way we have of getting things like freeways and wars and schooling millions of kids done."</p>

<p>I agree that the "official" cost of living numbers are bogus.</p>

<p>I have a cure for the problems but they aren't going to be enacted. I would cut staff, cut salaries, and cut pensions.
If it makes you feel better, I would start right at the top. :)</p>

<p>I would cut the smog program for cars where we have to have our cars checked every two years. How many cars do they catch that really pollute? (I had to mention this. I hate this program. What a stupid way to find cars that pollute.)</p>

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<p>"Its a complex subject, but ignoring the correlation between the decline in financial contribution to the common good by the extremely wealthy and the increase in costs to everyone else is naive - and college costs is a prime example of the multiple processes which continue to shift more and more of the nation's wealth from the poor and middle class to the extremely wealthy."</p>

<p>Quote: Kluge</p>

<p>Thank God. Somebody finally says the emperor has no clothes.</p>

<p>It is silly to complain about the costs of Flagship U and vote for conservatives.</p>

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<p>dstark: why not just throw in "eliminate inefficiency, do more with less, and provide everyone wih a free lunch" while you're at it? Heck, why bother to limit yourself to simply "cutting" staff and compensation? Why not eliminate government employees altogether? If you can assume that you can do more with less, why not just assume that you can do more with nothing at all? :)</p>

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<p>Kluge, didn't expect you to like my ideas. :) I would cut programs. In the late nineties the government had a party. Increased pensions and salaries. Then the party broke up and the taxpayers are now stuck with the tab. </p>

<p>I was reading in the local paper about a guy who is 50 and just stopped working for the government after 20 years. He was making $200,000 and now collects a pension of...$200,000. Plus, now we have to hire somebody else for that job. That pension looks a little rich to me. Where's my axe? :)</p>

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<p>dstark - if he were working for a major corporation he would have had a 8 figure golden handshake - after getting a 7 figure pay package his last few years.
Here in California in the late 90's we cut taxes because of the influx of income tax receipts (which we knew was temporary.) The main cut was the expressly temporary suspension of the vehicle tax (a property tax on the value of motor vehicles which had been in place since the 1930's, and which brought in about $5 billion a year.) The suspension was supposed to give some tax dollars back to the public while the government coffers were flush, then be restored when the boom was over.<br>
Yeah - that's the "hated car tax' which the Governator eliminated when the boom was over and we were $15 B in the hole. That put us $20 B in the hole - which the Chamber of Commerce now blames on Schwartzenegger's predecessor. If we had kept the tax structure the same as it was in the 90's California would have a balanced budget today. As it is, we're still in the red.
I'm sorry, but rote assertions like "I would cut programs, bloated salaries, excessive pensions, blah, blah, blah" are just an excuse to ignore the root problem while making pleasant but meaningless sounds.<br>
"I read in the paper..." This is your idea of meaningful data?</p>

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<p>The University of Michigan was able to absorb a cut of about 20% in nominal dollars and is still doing well. Same more or less for at UVa, and several other top state schools. Most states did not come back and raise taxes from 2001-2004--they sucked it up and made tough choices. Now they are enjoying better times and solvent rather than going Billions in debt--another thing not allowed in most states for operating expenses.</p>

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<p>Is financial aid usually based on need or on merit? or is it a little bit of both?</p>

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<p>Financial Aid (FA) is strictly NEED based</p>

<p>Scholarships are usually merit based (aka merit scholarships) but sometimes can have a "need" requirement or an ethnic requirement, too.</p>

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<p>ohhhh That CA car registration tax -- what a rip off that was....</p>

<p>when I moved to AL it only cost about $30 bucks to register our cars -- any car -- no matter what it was. AND..... When you buy a car in AL, you only pay 2% sales tax on the car, not the typical sales tax -- what a savings that is!!! We needed to buy a new car in CA but we waited til we got here -- what a smart move that was!!</p>

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<p>Kluge, give me a break. the guy was a middle manager. There is nothing I can say to change your mind. I have a different opinion than you on this issue, but don't give me this crap about the strength of my arguments. I'm not here to go into precise detail. You just want to look at the revenue side (taxes), but you don't want to look at the expenditure side. I've been involved in the financial markets for 25 years so I know a little something about numbers. :)</p>

<p>You know I buy the argument about who benefits in our society with the economic system we have in place (The well-off). . That doesn't mean I'm not going to look at how much the government takes in and how much it spends. When you are taking in an exorbitant amount of revenue from capital gains, you don't put in long-term spending plans based on these revenues. That's what California did. </p>

<p>When you base your long term spending on short term revenues you have a major management problem. And now we have a huge fiscal mess.</p>

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<p>The thing is this, dstark - and I know your positions on most things - we've been hearing all about how new politicians are going to eliminate waste, fraud, corruption, inefficiency, etc, and allow us to get more government services while paying less taxes forever. So you're different? You've got an idea that nobody ever thought of before? The argument for cutting taxes is always that we can do just as much with less revenue simply by eliminating the fraud, waste, inefficiency, etc. I'm 55 - so I've been hearing those promises for decades. We've got 50 state governments, one federal, and lord knows how many local jurisdictions. Virtually all of them are actually trying to do their best with the resources they have and the tasks they've been assigned. The promised reforms come one after another, like waves at the beach. And yet - it still takes pretty much the same amount of money to get things done. </p>

<p>While no organization is perfectly efficient, there is a range of realistic efficiency for every organization of a given size and assignment. Rather than insist on magic wand solutions, I accept that the realistic range does not include perfection, and assume that most governmental agencies are usually operating within the normal range of efficiency for their size and role. This is not an excuse for not trying to improve, simply a recognition that getting stuff done tends to cost a certain amount of money, whether you'd rather pay less or not. </p>

<p>When you (reluctantly) abandon the magic wand solution mentality, it all comes down to this: if you cut taxes, your government services will suffer. Not immediately, and not in most obvious ways, but they will suffer. Maintenance will be deferred, saving money now, but costing more in the long run. More talented people will elect not to enter government employment. Hours of service will be cut back, an hour here, a half hour there. Tangential services like first aid and lifeguards will be eliminated. You will start seeking revenue from easy targets - hike your park fees, raise college tuition. That is what happens in the real world.</p>

<p>You will alwys be able to come up with anecdotal evidence of poor financial decisions - because there always will be some. The realistic range of financial management does not include perfection - not for government, not for business, not in your or my household. Getting tunnel vision over those shortcomings and ignoring their actual lack of overall significance blinds you to the root problem: we have, as a society, decided to use less of our common wealth for the common good, and have acquiesced in transferring the savings from shorting those common-good institutions it to the very wealthy. </p>

<p>I repeat: Deciding that the problem can simply be solved by "eliminating waste, fraud and inefficiency" is a copout, and great cover for the ongoing process of societal income redictribution.</p>

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<p>What you call income redistribution I might call income repatriation.</p>

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<p>Kluge, The state of California made two very poor major decisions in the last several years. We let the Enrons of the world decide our energy policy, and we didn't handle the massive inflows of money into the state coffers well. </p>

<p>I know I would have handled the second situation better. </p>

<p>I'm not running the show and I'm just pretending that if I did I would cut what I wanted. In the real world, that's hard to do since various interests are at stake.</p>

<p>Kluge sometimes it isn't that the government doesn't get enough money. Sometimes it does and spends it foolishly. Like in the 90's.</p>

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<p>I'd argue that the main error we made at the end of the 90's when the dot-com boom money flooded into Sacramento was in cutting the 50 year old car tax instead of banking the surplus. All we had to do was not cut the existing taxes and our budget would be balanced today. Seriously. No change in California taxes after 1994 and we have a balanced budget. Instead, now we don't have a boom but we still have a lower tax structure - and the difference between a balanced budget and our current, ongoing deficit is - the amount of the car tax that Schwartzenegger eliminated in his triumphant entry into Sacramento in 2003.</p>

<p>That is a basic, simple fact. Yet you won't see it anywhere but here. Go figure.</p>