The Globe reports on a proposal by state officials to spend an extra $10 billion over the next decade to keep our roads and public-transit systems from collapsing. Naturally, we're talking new taxes to pay for it all.
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Stevil, do me a favor
By Kaz
Tue, 01/15/2013 - 5:55pm
Show me in actual dollar amounts a graph of what a couple making $25,000 before taxes up to $600,000 before taxes (above that and there's probably more to do with capital gains, etc. than simply amazing salaries for both individuals) gets to take home.
Put their gross earned amounts on the X-axis and their net after taxes ($ amount, not percentage) as you think it exists on the Y-axis. If the curve doesn't maintain a positive slope the entire graph, then we'll talk.
Even better
By Stevil
Tue, 01/15/2013 - 8:23pm
Sure it's always a positive number - but there comes a point where the marginal satisfaction/utility of a fraction of a dollar earned working isn't worth the effort of working.
Here are two examples:
Your wife is an accomplished doctor. You have been raising the kids, but you want to go back to work. You can make about $50k, but thanks to your wife's salary, your marginal rate (federal, payroll and state) is 50% so you net $25k. Then you get out an envelope and on the back you calculate the following: commuting expenses $3000, childcare after school/school vacation etc. for 2 kids - $10k (low??), lunch and dry cleaning $2000, summer camp/daycare $6000, Retirement savings $4k.
Take home for a whole year of work - $0
Scene 2
You can make $110k per year. Using the same calculations above you get:
Gross $110k
Net $55k
Same work costs/expenses $25,000.
Take home = $30k
Given the requirements - personal, stress etc. of a $110k job if you only get to keep $30k and I have a feeling in both scenarios I am underestimating child care costs, you have to wonder if it's worth it.
Sure it's better than a sharp stick in the eye - but it's not a whole lot of financial motivation to work and this is someone smart and productive enough to generate $110k per year whom we have essentially incented to withdraw from the workplace.
If you get over that $110k rate it gets a little better as you don't have to pay additional SSI (for now), but realistically you probably have to get back into the upper 6 figures before it starts to make much financial sense to reenter the workforce.
This is not a tax problem
By Sock_Puppet
Wed, 01/16/2013 - 7:08am
Wow, Stevil. I never took you for a fan of Elizabeth Warren. You've done well conveying a bit of the argument of her excellent book.
The Two-Income Trap
A fellow I know very well gave up a six figure job to stay at home with the kids. It wasn't because TAXES WAAH LIBERALS. It was because, as you and Warren show, the marginal contribution of a second income to family financial security is less than one might think, whereas the contribution to children's emotional and intellectual development of having a stay-at-home parent is greater than commonly believed. And, yes, you did underestimate child care costs: a two-career family keeping a single child in day care can pay 30-40K a year just for that.
The failure of your argument, however, is that the problem cannot be solved by jiggery-pokery with marginal income tax rates. Sliding that one factor up or down by a few percent does not change the reality that, for upper middle class parents, one career is better than two.
Kaz also alludes to a more fundamental rebuttal of your argument: this is a very nice problem to have.
Well good PR can sell just
By Bearwalker
Tue, 01/15/2013 - 10:28am
Well good PR can sell just about anything, including higher taxes and fees on a public that is sick and tired. Has government even tried to control waste, or not bother because it wouldn't make a difference anyways?
It's not like government is the only producer of waste
By Cutriss
Tue, 01/15/2013 - 2:47pm
Why exactly does private industry have the high ground on government? Is it because of some illusion of choice in the matter?
Easy, private industry is
By anon
Tue, 01/15/2013 - 3:30pm
Easy, private industry is only spending the capital of willing investors. Government on the other hand spends confiscated taxpayer money with increasingly little consent.
Says the man
By anon
Tue, 01/15/2013 - 3:39pm
... who is using the internet.
The internet is hosted and
By anon
Tue, 01/15/2013 - 8:09pm
The internet is hosted and administered by private companies.
To list a few things: 19k
By anon
Tue, 01/15/2013 - 2:47pm
To list a few things:
19k people on the rolls which the state can't confirm even live here is a big start. Verifying residency and eligibility for state benefits and tax refunds is a big deal and not taken seriously enough.
Gutting all the assistants, secretaries, directors, etc. of non existent departments and positions throughout state government would also be a big step.
Drop the ridiculous travel allowances and state owned cars for representatives.
All state and local employees could be sharing the same pension and healthcare benefit pool to reduce overhead.
Why isn't MassPort part of MassDOT?
We have many redundant state agencies which could be consolidated much like MassDOT and DCR has been.
The state is giving out money to interests out of state and paying for out of state trips and offices for public officials. This is beyond what state level government should be doing and we shouldn't be paying for it.
I'm sure everyone can think of at least one thing state government is paying for which it shouldn't be. Add that together and there would be plenty of money for the stuff that everyone can agree on.
Use FACTS
By TaxGuy
Tue, 01/15/2013 - 3:34pm
Eligibility for state tax refunds? That's not an actual issue.
Name 1.
Drop the per diem for state reps? I agree. That'll save less than $500k. No such thing as a state car for a Rep.
500k is nothing to sneeze at,
By Bearwalker
Tue, 01/15/2013 - 5:05pm
500k is nothing to sneeze at, especially in the position we find ourselves. Nothing should be off the table before asking the taxpayers to pay up. If we had more faith in our government, I don't think asking us all to pitch in would be such a stretch. The problem is, I don't think the general public has much faith in the way the state spends our money.
indeed
By anon²
Tue, 01/15/2013 - 11:24pm
but that type of spending is usually used to argue for not paying taxes.
It also fails to explain that the MA budget is around 1.4 billion, and we have a annual GDP of around 350 billion.
Math matters.
Look at Florida who implemented a drug screening program for welfare recipients that cost the state more money than it made in finding drug users to kick off the rolls.
But hey, someone got to feel all righteous.
Why was so much $ spent on transportation projects
By anon
Tue, 01/15/2013 - 8:03am
including the T, that didn't add any real capacity? 50 billion to put that elevated stretch of the artery downtown underground...yes, it was a beautification project that's resulted in a strip of parkland that almost nobody uses because it's stuck between two heavily trafficked streets, and one extra traffic lane in the underground highway. 50 billion dollars.
The MBTA:
Why was the blue line built and then just ended at Bowdoin and Wonderland? Why was the greenline stopped at Lechmere instead of extended as a transit line into East Cambridge and Somerville? If you get on a greenline train today most the trains end at Government Center! Never mind the fact many people go on to North Station and Lechmere [I go on to N. Station so often must wait to go a few more stops], and they can't even manage to get that right. I guess they assume 95% of the tourist are getting off at Government Center so F it. Why hasn't the orange line made it's logically extension to Hyde Park/Readville, West Roxbury, etc., with room to run express trains? It's the reason why F.Hills and Washington St. is such a clusterF and 'kids' hang out causing trouble. I understand why this wasn't done in the past, but the past is long gone. It's silly that a major transit line just ends at F. Hills and was never extended as population and neighborhoods grew. People in H.P., Roslindale, W. Roxbury might also be able to stop paying $176. a month or more for commuter rail zone 1 and 2 passes and settle on a simple 70 buck combo pass like everyone else in the city limits. The streets are also too crowded for all the buses. Why hasn't the Fairmont Line been turned into a regular transit line to service the heart of the city? Boston's transit lines look like they simply stopped logically expanding 75-50 years ago, and every transit project since then has been about making things look prettier, more 'green' or complaint with the federal disabilities act.
And there's a simple disconnect and lack of logical coordination between the independent municipalities within Greater Boston, even within the inner urban area like Boston, Brookline, Cambridge, Somerville, Malden, Revere, Everett, Chelsea, Quincy, etc., If this were almost anywhere else, they would have been combined into one big city [like Toronto and Montreal did a decade or so ago up in Canada, like Houston down in Texas has done a million times]. Do people realize how geographically small the City of Boston is compared to comparable cities? Baltimore is over 60 sq miles in land area, Washington DC almost 60, Atlanta [which has a much smaller population vs Boston, 430,000 vs 625,000] is 130 sq miles in land area, Louisville,KY, Memphis,TN both well over 100 sq miles in land area, the list is endless...and Boston stopped at 48 sq miles in land area, Hyde Park being the last surrounding town incorporated into the city. Seattle is like 90 sq miles in land area, roughly twice the size geographically of Boston. Imagine All of Boston, Brighon/Allston, H.P., Roslindale, West Roxbury, J.P., Dorchester,Roxbury,S. Boston, south end, North end, Back Bay, Charlestown, etc., being twice the size geographically as it is now, with the same population...you just imagined Seattle. Only S.F. is comparable to Boston or vice-versa as far as big cities go in America, in fact San Francisco is slightly smaller geographically than Boston.
Our road system is a clusterF, and should have been logically modernized and extended where necessary to add capacity, not just to beautify things and comply with this or that federal 'green' legislation [then of course the federal funding would have evaporated, I understand].
Our transit system is a clusterF primarily, IMO, because it stopped logically expanding [minus commuter rail] and add more capacity to deal with increased demand as the population of metro Boston grew and grows. All transit projects seem to be about solely complying with the federal disabilities act [literally millions of $ so maybe a few dozen people can use a transit station more comfortably] or essentially beautification projects. No money to actually expand and add capacity to the system, especially the core. Now compare the MBTA to the D.C. Metro...that's a system that's designed for a modern late 20th-21st century city. We're stuck with a early to mid 20th century designed system.
And our roads aren't much better. And the $ cost of really improving and God forbid expanding is prohibitive primarily because of all the red tape and regulations at both federal and state level. I understand engineers, accountants, lawyers and unions make big $ off the status quo. I understand 'advocates' for this or that get their brownie points and pad their resume every time a 'green' project or 'disabilities' project gets built. I understand the typical politician is owned by these various special interest groups. But the average citizen gets screwed, per usual.
Quick reaction to transport issue- a step in the right direction
By issacg
Tue, 01/15/2013 - 10:23am
I haven't had time to look through the proposal yet, and we will know more after the Governor talks tomorrow, but my quick reaction based on what I heard this a.m. on 'BUR:
I think the "everyone is going to pay more" approach is the right one both morally and politically. Transporation infrastructure is a core governmental function (private entities cannot build it - they might be able to operate it, but there is no way that they could acquire the necessary rights of way, etc.) and as such, I am happy to spend a significant amount of tax revenue on it (but less happy to do so on things that are not core gov't functions).
The blended approach for enhanced revenue is the right one - there is no reason to soak a particular group disproportionally (e.g., triple the gas tax, triple T fares, etc.).
The earmarking for particular projects is the wrong approach and Stephanie Pollock of the Dukakis Center was right when she talked about better planning. That said, not diverting the money from transportation, again, a core governmental function, is a good idea.
The Commonwealth-wide approach is also the right one both morally and politically (we need buy-in from everyone, and that means outside of greater Boston, too).
Projects to make quick meaningful improvements must be put to the front fo the queue so that people can see results quickly and start to be assured that this is not just another tax/fee hike to pay for salaries and pensions.
The details are going to be a bear, but let's see what the Gov has to say tomorrow night.
Can we at least wait till
By anon
Tue, 01/15/2013 - 12:15pm
Can we at least wait till Congress sorts out the debt ceiling? Please.
"New MBTA Red and Orange Line
By anon
Tue, 01/15/2013 - 2:14pm
"New MBTA Red and Orange Line Cars ($1.5 billion)...Green Line Cars ($732 million) – The cars will be made in Massachusetts, supporting the local economy."
Uh oh. Didn't the T learn their lesson from the Hyundai-Rotem commuter rail coach debacle? When companies have to reinvent the wheel and tool a factory from scratch, it's no surprise when it leads to huge delays and cost overruns.
Yet instead of buying off-the-shelf rail cars from trusted manufacturing plants, the T is going to insist that someone build a brand new railcar factory in Massachusetts?
"the T is going to insist
By anon
Tue, 01/15/2013 - 8:16pm
"the T is going to insist that someone build a brand new rail-car factory in Massachusetts?"
Some politician's family knows a guy that is a friend of some other connected lady that once met another guy that owns a factory which once considered building rail-cars. So in other words, a fully vetted and competent factory has been found after an exhaustive nation wide search and will only be 10 years and 500% over budget in delivering the orders. Within a year the vehicles will explode and suck some toddler down a black hole leading to an invasion by demonic turkeys which will enslave Brookline and only be thwarted from state wide domination by an army of cranberry farmers with highly illegal 'high powered military grade' muskets.
AdamG will of course have the scoop on all of this well before any of the lazy media does.
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