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Well, voters capped their ability to make money on property tax, so is that the state's fault? (Also it has a budget surplus?)

jelliclesfarm 5y ago
property tax is different from the rest of the budget. perhaps you should look into how the state of california manages its budget. there are paid professionals and researchers who will do the research the work for you.
- ericd 5y ago
  I think a lot of changes in the state finances resulted from prop 13. There’s a great podcast interview series with Jerry Brown where he talks about the passage, and the chaos that ensued, worth a listen.
  - jelliclesfarm 5y ago
    Prop 13 happened in 1978 after thousands of senior Californians became homeless after retirement. It was meant to protect tax paying Californians from being evicted from homes.
    - ericd 5y ago
      Sure, and it was terribly designed if the sole purpose was to save seniors on fixed incomes from losing their homes. And anyway, that’s beside the point of it messing up the state’s finances, isn’t it?
      - jelliclesfarm 5y ago
        It was fairly designed. The alternative is to kick people out right after they finish paying their mortgages and have retired. Is that what you’d call a good design? That’s precisely the point about the state’s finances. You have to go back to Gov.Gray Davis disastrous handling of the state pension funds that has led to staggering unfunded pension liabilities. [..] The California Pension system is way under water and in dire need of reform. The state's unfunded pension and retirement liabilities approach $1 trillion, or roughly $80,000 for each taxpayer in the state.[..] From 2016: https://www.latimes.com/projects/la-me-pension-unfunded/ https://www.latimes.com/projects/la-me-pension-unfunded/ : Understanding California's public pension debt 2018: https://amp.sacbee.com/opinion/editorials/article199693069.html https://amp.sacbee.com/opinion/editorials/article199693069.h... : The pension nightmare for California’s cities is getting scarier There was a whole investigative piece done in 2015-16. Search for Gov.Gray Davis + ‘unfunded pension liabilities’ + California It’s been downhill for a while and mostly because the wealth creators are not even eligible to vote in California. Ask the right questions to get the right answers..that’s my guiding principle. Otherwise, everything is just noise.
        ericd 5y ago
        Nope, that wasn’t the only alternative. If it was really meant for seniors, they should’ve made it age-based, and they should’ve set reasonable limits - the yearly tax exemption should’ve been set at a 1 bedroom condo level, with them paying whatever the excess is. This would’ve encouraged the behavior many seniors in other places engage in - downsizing when their kids leave home, to allow family-sized housing stock to open up for people with growing families. And they certainly shouldn’t have made the tax exemption inheritable. And it shouldn’t apply to corporations. As it’s designed, the whole “don’t let seniors lose their homes” argument is pretty obviously just political cover for a pretty egregious wealth transfer scheme. No argument about the pension liability problem, CA’s governance issues are a big reason we decided not to put down roots long term. Prop 13 is one of the bigger examples of that, in our minds.
        jelliclesfarm 5y ago
        I agree. Wealth transfer should be considered as income and should be taxed moderately. There is no legal reason for kicking out seniors out of their homes from which the unrealized gains haven’t been harvested. The truth is that most people don’t want to downsize. Why should anyone work 40-60 hours a week and pay a mortgage for most of their working adult life and taxes only to live in a condo when they have paid their dues and want to enjoy their retirement. Should we be dictating to seniors that they deserve no more than a one bedroom condo just because they got older? Is that what you are suggesting? That’s akin to discarding people and kicking them out of their homes. I don’t know any culture or country that would even suggest this except here in the United States. It’s actually truly appalling to me.
        ericd 5y ago
        I'm not suggesting kicking them out, I'm suggesting that they pay property taxes at market rates, minus the property taxes of a 1 bedroom condo, which would be society's freebie to them. They could live in a small place and not pay property taxes, regardless of what happens with the market, or they can continue paying property taxes on a huge house, if they can afford to do so. That's more generous a deal than they'd get anywhere else in the US.
      - dragonwriter 5y ago
        > Sure, and it was terribly designed if the sole purpose was to save seniors on fixed incomes from losing their homes. That was not the purpose. The purpose was to starve state and local government in California of revenue; while it long predates Grover Norquist’s famous statement about getting government “down to the size where we can drown it in the bathtub”, it was pushed by people with similar ideology. (It’s true that the specter of pushing people out of their homes with property taxes was used to sell it, but it was very much not focussed on that in its design or intent.)
        ericd 5y ago
        Yeah, that’s the same conclusion I’ve drawn.
    - xrikcus 5y ago
      The problem is that because of the tax burden shift, the cost of keeping those people in their homes is paid by people who are trying to buy homes. It's a form of redistribution to people who already have assets from people who have income and are trying to build assets. It keeps people in their homes, in some cases it traps people in their homes, but at significant cost to other people.
      - NoRagrets 5y ago
        That’s not true. Nobody is ‘keeping’ seniors afloat. They do pay taxes. Unless a sale is made, there is no profit. Property tax is an ad valorem tax. It’s just like unrealized gains. If you haven’t vested your stocks, should you be paying taxes on them? It’s like everyone asking Elon musk to pay ‘his fair share’ because Tesla is doing well and his money is just a number. Those who are trying to buy homes are not finding homes. I agree. It’s very easy to solve in a free market. Pay more. Seniors are not a burden to the infrastructure and utilities. Instead of wanting to sip champagne on a beer budget, perhaps those who want to buy need to evaluate their wallets and purchasing power. And if their quality of life is wanting, the people who need to be questioned are our public servants. Demand that they SERVE the public. Not developers and the only ones being supported here are the public servants with developers colluding with them. My grandmother bought a Diamond ring for 1000 bucks. If it’s worth a million now, it’s not her fault and she shouldn’t be penalized. It doesn’t cost anyone anything if she refuses to sell the Diamond. It costs people nothing to NOT covet what’s not theirs..

jelliclesfarm 5y ago

property tax is different from the rest of the budget. perhaps you should look into how the state of california manages its budget. there are paid professionals and researchers who will do the research the work for you.

ericd 5y ago
I think a lot of changes in the state finances resulted from prop 13. There’s a great podcast interview series with Jerry Brown where he talks about the passage, and the chaos that ensued, worth a listen.
- jelliclesfarm 5y ago
  Prop 13 happened in 1978 after thousands of senior Californians became homeless after retirement. It was meant to protect tax paying Californians from being evicted from homes.
  - ericd 5y ago
    Sure, and it was terribly designed if the sole purpose was to save seniors on fixed incomes from losing their homes. And anyway, that’s beside the point of it messing up the state’s finances, isn’t it?
    - jelliclesfarm 5y ago
      It was fairly designed. The alternative is to kick people out right after they finish paying their mortgages and have retired. Is that what you’d call a good design? That’s precisely the point about the state’s finances. You have to go back to Gov.Gray Davis disastrous handling of the state pension funds that has led to staggering unfunded pension liabilities. [..] The California Pension system is way under water and in dire need of reform. The state's unfunded pension and retirement liabilities approach $1 trillion, or roughly $80,000 for each taxpayer in the state.[..] From 2016: https://www.latimes.com/projects/la-me-pension-unfunded/ https://www.latimes.com/projects/la-me-pension-unfunded/ : Understanding California's public pension debt 2018: https://amp.sacbee.com/opinion/editorials/article199693069.html https://amp.sacbee.com/opinion/editorials/article199693069.h... : The pension nightmare for California’s cities is getting scarier There was a whole investigative piece done in 2015-16. Search for Gov.Gray Davis + ‘unfunded pension liabilities’ + California It’s been downhill for a while and mostly because the wealth creators are not even eligible to vote in California. Ask the right questions to get the right answers..that’s my guiding principle. Otherwise, everything is just noise.
      - ericd 5y ago
        Nope, that wasn’t the only alternative. If it was really meant for seniors, they should’ve made it age-based, and they should’ve set reasonable limits - the yearly tax exemption should’ve been set at a 1 bedroom condo level, with them paying whatever the excess is. This would’ve encouraged the behavior many seniors in other places engage in - downsizing when their kids leave home, to allow family-sized housing stock to open up for people with growing families. And they certainly shouldn’t have made the tax exemption inheritable. And it shouldn’t apply to corporations. As it’s designed, the whole “don’t let seniors lose their homes” argument is pretty obviously just political cover for a pretty egregious wealth transfer scheme. No argument about the pension liability problem, CA’s governance issues are a big reason we decided not to put down roots long term. Prop 13 is one of the bigger examples of that, in our minds.
        jelliclesfarm 5y ago
        I agree. Wealth transfer should be considered as income and should be taxed moderately. There is no legal reason for kicking out seniors out of their homes from which the unrealized gains haven’t been harvested. The truth is that most people don’t want to downsize. Why should anyone work 40-60 hours a week and pay a mortgage for most of their working adult life and taxes only to live in a condo when they have paid their dues and want to enjoy their retirement. Should we be dictating to seniors that they deserve no more than a one bedroom condo just because they got older? Is that what you are suggesting? That’s akin to discarding people and kicking them out of their homes. I don’t know any culture or country that would even suggest this except here in the United States. It’s actually truly appalling to me.
        ericd 5y ago
        I'm not suggesting kicking them out, I'm suggesting that they pay property taxes at market rates, minus the property taxes of a 1 bedroom condo, which would be society's freebie to them. They could live in a small place and not pay property taxes, regardless of what happens with the market, or they can continue paying property taxes on a huge house, if they can afford to do so. That's more generous a deal than they'd get anywhere else in the US.
    - dragonwriter 5y ago
      > Sure, and it was terribly designed if the sole purpose was to save seniors on fixed incomes from losing their homes. That was not the purpose. The purpose was to starve state and local government in California of revenue; while it long predates Grover Norquist’s famous statement about getting government “down to the size where we can drown it in the bathtub”, it was pushed by people with similar ideology. (It’s true that the specter of pushing people out of their homes with property taxes was used to sell it, but it was very much not focussed on that in its design or intent.)
      - ericd 5y ago
        Yeah, that’s the same conclusion I’ve drawn.
  - xrikcus 5y ago
    The problem is that because of the tax burden shift, the cost of keeping those people in their homes is paid by people who are trying to buy homes. It's a form of redistribution to people who already have assets from people who have income and are trying to build assets. It keeps people in their homes, in some cases it traps people in their homes, but at significant cost to other people.
    - NoRagrets 5y ago
      That’s not true. Nobody is ‘keeping’ seniors afloat. They do pay taxes. Unless a sale is made, there is no profit. Property tax is an ad valorem tax. It’s just like unrealized gains. If you haven’t vested your stocks, should you be paying taxes on them? It’s like everyone asking Elon musk to pay ‘his fair share’ because Tesla is doing well and his money is just a number. Those who are trying to buy homes are not finding homes. I agree. It’s very easy to solve in a free market. Pay more. Seniors are not a burden to the infrastructure and utilities. Instead of wanting to sip champagne on a beer budget, perhaps those who want to buy need to evaluate their wallets and purchasing power. And if their quality of life is wanting, the people who need to be questioned are our public servants. Demand that they SERVE the public. Not developers and the only ones being supported here are the public servants with developers colluding with them. My grandmother bought a Diamond ring for 1000 bucks. If it’s worth a million now, it’s not her fault and she shouldn’t be penalized. It doesn’t cost anyone anything if she refuses to sell the Diamond. It costs people nothing to NOT covet what’s not theirs..