Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: GST who wrote (21162)	7/2/2009 4:46:43 PM
From: Skeeter Bug	3 Recommendations Read Replies (1) \| Respond to of 71454

>>You dodge the three most obvious problem faced by California<< i don't dodge anything. i try and tell it as the facts bare out. >>First, the existing system is inherently a roller coaster that cannot be tamed as it gyrates wildly from one period of time to the next<< by "existing system," do you mean prop 13 does this? it might have an impact, but i suggest it is miniscule compared to the bubble economy purveyed by our fearless federal reserve leaders. >>-- and yes this is directly due to prop 13;<< while prop 13 may have an impact, it is MINISCULE compared to the effects of the bubble economics practiced by our fearless fed. also, prop 13 doesn't explain arizona's bubble and collapse very well, now does it? >>and second, the taxes that California uses profoundly penalize income which is just plain stupid and relies heavily on the most regressive of all forms of taxation, the sales tax, and yes this is directly due to prop 13,<< my argument is that if the government wasn't reckless in its spending, the income and sales tax could be much lower. as an example, GM pays pensions to its workers of $19k (once SS kicks in) and their management is said to be irresponsible. in CA, we pay $100k+ pensions to retired school administrators. we allow the government class to pad their pensions by working mass over time, too. not even GM allows that. let's see, that 6x "irresponsible." the high income taxes and high sales taxes have to do with EXCESSIVE GOVERNMENT SPENDING. incomes are nominally flat over the last decade, yet government spending more than doubled. are you making twice as much now as in 1998? i'm making about 25% as much and i'm doing better than most! when incomes go up 25% and government spending goes up 100%, there will be problems. it doesn't matter if prop 13 is in place or not. GOVERNMENT SPENDING IS THE PROBLEM. >>and third, home prices in California have been tragically distorted in no small part due to prop 13.<< why were home prices distorted in arizona? washington? florida? new york? the 90-95% of the distortion would've occurred regardless of prop 13 or not. >>Nobody should argue that California is well governed -- but to deny the obscene consequences of prop 13 is just to live in denial.<< i wouldn't mind a change in prop 13 as long as it was offset by other tax decreases. nobody seems to mention tax decreases in these discussions, just prop 13 tax increases. my stance ought to be clear, i don't want to feed a government that spends more than population and inflation combined or that increases spending 100% when an income up 25% is doing better than most. prop 13 could definitely be improved. protecting primary residences from insane credit bubbles and irresponsible home purchase decisions is one of its good points. everything else could be put on the table as long as there are tax cuts that more than offset the prop 13 changes. prop 13 IS NOT the cause of CA's woes. a government that out spent the largest credit bubble in the history of mankind is the problem. fix that problem first and we can talk about prop 13 adjustments.