To the People

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or TO THE PEOPLE.

Monday, August 07, 2006

The Road to Serfdom, Part II: Property Taxes

Kudos to the NY Times today for putting on its front page an article that outlines how the property tax increases of the past five years have dramatically outpaced the rise of personal income. We are in a growing economy, but the government is not only negating that income rise but actually bringing us significantly backwards in terms of disposable income, which harms the economy. This is creating a major, and little appreciated, destruction of the American dream of owning a house outright as the epitome financial security, and it also affects renters as those taxes are passed onto them in the form of higher rents.
Property taxes grew two to three times faster than personal income from 2000 to 2004 in the suburbs surrounding New York City....

In Somerset, Mr. Kulberda said that his taxes started to rise steeply in 2001, and that now they had reached $6,600 a year, a jump of 50 percent in five years. Mr. Kulberda, who was laid off in 2003, is having a hard time finding work now, but he can’t afford to retire. “I have to keep working in order to cover the property taxes,” he said.

“In 1997, my taxes were $2,600; now they’re $8,000,” said Dan Mackey, 42, a credit manager who lives in Somerset, N.J. “My salary certainly hasn’t tripled in the last nine years, and I don’t know anyone’s that has.”
Poor Dan Mackey, because if his property taxes keep increasing at 13.3.% per year by the time he retires at 65 his bill will be a cool $141,000, per year. We all better stay in good shape to pay the hand that bleeds us.