John C Dvorak shows Intelligence is no indication of Smarts. Property Tax Epic Fail

In the morning everyone.  So, did you see this tripe and dribble on John C Dvorak‘s twitter feed ( https://twitter.com/THErealDVORAK ) this weekend regarding taxation, wealth taxes, and property taxes?

Forget the arguments of a “wealth tax” in general for the moment, let’s focus on PROPERTY TAX as a wealth tax and being “implemented just fine.”

Property taxes are the WORST and MOST REGRESSIVE tax of any kind because THERE IS NO CORRELATION BETWEEN THE TAX AND THE ABILITY TO PAY!

With an income tax, the more one earns (i.e. more income) the more income tax is levied and paid which theoretically one could afford to pay.  With a sales or consumption tax, the more one buys or consumes the more the tax. If you can’t or don’t want to pay the tax, don’t buy the item (side note: we’ll discuss sales tax on food and its regressive nature on the poor in another post).

But with property taxes THERE IS NO CORRELATION BETWEEN THE TAX AND THE ABILITY TO PAY!

Just because some government hack declares that my property has increased in VALUE, it is therefore subject to more tax. This has no relationship on whether I can pay said tax.

For instance, a young newlywed couple buys a fixer upper in an up and coming neighborhood. Put lots of sweat equity into making a lovely remodeled home thereby increasing said home’s value. Maybe others see the same in the neighborhood and do likewise. Now said Revenuer says these homes have all doubled in value and therefore their property taxes have doubled. Can this newlywed couple pay double the amount of taxes? Did their income double?  DID THEY EVEN REALIZE ANY OF THE INCREASE OF VALUE OF THEIR HOME?  Hell No!  Just because their home increased in value they WILL NOT REALIZE ANY OF THE GAIN UNTIL THEY SELL! Of course at which time they will be taxed AGAIN on that increase, the same increase they have been taxed on every year through property taxes for the mere pleasure of owning a home.  But does the Revenuer even care? Hell No. Can’t pay the property taxes because said value has increased, “Well then just sell your house!” says the Government.

Not only are property taxes REGRESSIVE they are merely rent paid to the Government for the privilege of owning something.

Let’s take another example to see how destructive and regressive property taxes are.  Look at the “greatest generation”, they come back from the war, settle down and start a family. Maybe get a nice blue collar union job and put in their 30.  Along the way they buy a nice house in San Francisco¹ and scrimp and save to do so.  In the meantime they age, they have paid off the mortgage on the house, and now look forward to retirement.  But wait says the Revenuer, San Francisco is now valuable property, why look at all these techies flush from the Federal Reserve pumping cash into the stock market.  The Techies want to live in SF now and are driving up the prices and the boomer’s house is now taxed at double or triple the previous tax.  Again, does the Government care that the retirees on a fixed income can’t pay double or triple the tax?  Does the Government care that said retirees haven’t seen or pocketed one cent of the increase of VALUE? Hell no¹.

And that ladies and gentlemen is the sheer and utter fallacy of property taxes as a wealth tax  and being “implemented just fine.”

p.s. if Dvorak keeps this crap up, Curry will no longer be considered the Crackpot!

¹ Thank God for CA Prop13 which limited annual increases of assessed value  to an inflation factor, not to exceed 2% per year, but that doesn’t help the rest of the country so substitute the up and coming popular are in your state.

p.p.s And NO, Prop13 did not cause the current financial mess. The legislature willfully spent more than they took in to create that mess.

 

6 thoughts on “John C Dvorak shows Intelligence is no indication of Smarts. Property Tax Epic Fail”

  1. So these idiots want to implement a higher property tax to combat income inequality…when it will make it harder for people of lesser financial stature to own land?

    “We need to make sure we close the wealth gap by making sure only rich people can own land.”

    Brilliant.

  2. Only an idiot would think property taxes are even acceptable! What? Am I renting my property from the gov’t?

  3. Property taxes are the antithesis to property ownership. They negate the ownership entirely. You own nothing, you only lease the land the State allows.

    I would love to see property taxes abolished.

  4. Let’s not forget every single taxing authority that has the ability to raise your taxes at least once a year. School boards, community college districts, “health care” districts (those are 3 property taxing entities in AZ that can, once a year, vote to raise your property tax rates, and the community has no true “say” in the matter.) Not to mention your neighbors increasing your property taxes whenever someone yells, “Override! It’s for the children!”

    Thank you for this post. I have never thought about it as a regressive tax before, or that it’s not directly linked to ability to pay. I have never liked them just based on the idea of it being “rent” to the government on property you should own free and clear.

  5. at the very, very least – NO FOOD OR PROPERTY TAXES! property taxes imply that you can never own “your” land and will always be leasing it as slaves from the land masters…

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