Last night both the President and the Governor spoke eloquently about rising income inequality and our “solemn duty” to leave no one behind.
Today, Progressive Massachusetts, is announcing our intention to take up that challenge here in the Commonwealth. We hope you will take the time to tell us what you think.
Massachusetts has the economic engine, creative and intellectual capital, environment, historic models, energy and inspiration to reinvest in, re-create and grow a true Common Wealth. We can build more opportunity and more equity, better prospects and greater justice. We can use the power and strength of our economy as our tool to shape a better society. We can and we must bring about true economic justice and shared prosperity.
First some HARD TRUTHS
Working families are under siege, finding it harder than ever to achieve a middle class standard of living, while income wealth inequality grows.
- We are 8th in the nation in income inequality;
- 15% of our children live in poverty;
- 66% of our students graduate from college with a debt that averages over $28,000, while state support for public post-secondary schools has declined by 31% since 2001;
- In the Greater Boston Area, more than 50% of renters pay at least a third of their income in rent, and 25% are paying at least half their income in rent, while the wait time for a rental voucher is over 10 years;
- Our real minimum wage has lost 25% of its value since 1968;
- The average family spends more than $13,000 a year on health insurance, even after reform, while 240,000 remain without any coverage at all;
- Our tax system is more regressive than most, collecting less revenue than 21 states and is below the national average,
At Progressive Mass, we believe that we can and we must do better. We believe that Massachusetts can lead the nation in protecting working families and expanding the middle class, while reducing poverty and inequality.
THE SHARED PROSPERITY AGENDA:
Quality, Free Publicly Funded Education From Pre-K Through Post-Secondary
- Within Five Years: Free, publicly funded education for all residents, from pre-K through community, vocational or four-year college
- A First Step: Universal, publicly funded pre-K available for all residents
Quality, Affordable Health Care Covering All Medically Necessary Treatment
- Within Five Years: A Single Payer Health system, similar to Medicare for All
- A First Step: A Public Option which enables any resident to pay into an enhanced MassHealth system
Affordable, Decent and Safe Housing In the Neighborhood Of Your Choice
- Within Five Years: Universal access to housing that costs no more than a third of your family income
- A First Step: Increased funding for rental assistance programs
A Job That Pays A Living Wage and Is Close To Safe and Affordable Transportation
- Within Five Years: Every job pays a living wage, of at least $15/hour, and everyone has access to safe, affordable public transportation
- A First Step: Enact RaiseUp MA – Increased minimum wage indexed to inflation and earned sick time
An Equitable Tax System That Raises Sufficient Revenue To Invest In Our Commonwealth
- Within Five Years: A constitutional amendment that implements a graduated income tax
- A First Step: Enact legislation that raises $1 billion in new revenue from the wealthiest residents and closes corporate tax loopholes
Tell us what you think?
Let’s focus on where we can actually produce results–here in the Massachusetts . . . If elected Democrats in the state aren’t on-board with these goals, they should explain why they’re not.
We have asked every Democratic candidate for statewide office – and many running in Special Elections – to tell us where they stand. Results will be posted before the caucuses.
…but also not holding my breath.
Who do you consider the wealthiest residents? Based on assets or just income? What tax or taxes are you proposing? And what tax loopholes are you looking to close?
IMO, there can be no progressive tax code in Massachusetts unless we decide to impose a tiny 2% fee on private universities on their assets over $1 billion dollars. This would generate over a billion doddars a year. Where do you stand on this proposal?
Sure let us impose taxes on tax exempt organizations like Universities so that the cost of education becomes even more out of reach of the average citizen, because government is only suppose to be for the wealth citizens and screw everyone else.
You know this was considered in 2008, right? Harvard, BU, BC, MIT, Brandeis, they all can pay a small fee of 2.5%. We can exempt the first billion, Mike. They won’t even notice it.
Ain’t if hilarious how Mike believes this tiny fee would would “the cost of education becomes even more out of reach of the average citizen”. Yet, Mike and others have no issues with the Obamacare tax on insurance companies, which using the same logic, would put health care premiums out of reach for the avg citizen. Mike has no problem increasing taxes on corporations like oil, which would make gas prices even more unaffordable for the working class.
It’s amazing how liberalism works sometimes. Thanks Mike! I don’t expect progressmass to answer me.
1) Exxon Mobil $41 Billion
2) Chevron $26 Billion
2011 Most Profitable Companies by Fortune 500.
Cry me a river.
They paid more than anyone else, Mike and you still complaining!! Chevron was second with $20 billion. ConocoPhillips was #6 in paid income taxes, almost $8 billion paid. What did Harvard pay? How much?
Some time ago, we had a long wrangle about GE and what they pay in taxes: the upshot was that they reported $X amount of taxes as paid prior to claiming the deductions which were -$X (+/- epsilon) making the totality of dollars transferred around zero.
That, also, is hard to calculate. There is PILOT (on the endowment) and ordinary taxes on commercial property and all the ordinary payroll taxes they have.
• Income tax expense: $31.05 billion
• Earnings before taxes: $78.73 billion
• Revenue: $428.38 billion
•1-year share price change: 6.56%
• Industry: Oil and gas
“Joe Biden said Thursday that paying more in taxes is the patriotic thing to do for wealthier Americans”.
Thus, nobody is more patriotic than Exxon/Mobil, they paid the most. So before we ask them to pay even more, can other wealthy institutions who pay nothing, make a contribution to show their patriotism?
You’re exhibiting the logical skills of a medium sized rock.
Biden said that paying more is the patriotic thing to do, within a context. But, two notes:
1. He didn’t say it was the only patriotic thing one can do, and only a medium sized rock or it’s logical-skills-exhibiting equivalent could make that mistake, and
2. I disagree with Mr. Biden. I don’t believe that paying taxes is an exhibition of patriotism.
I made the mistake over on my TPP post, I replied to his reply and then clicked the back button before pressing submit. It serves the function of venting out all that steam, which reduces stress and is the healthy thing to do, without getting another right wing spambot reply.
He has been repeating himself so much I sometimes wonder if he is a spambot.
An effete Brandeis student who overhead some tanked hard hat bitch at the bar at Sal’s back in the day and took on that persona to mock his own kind. The world may never know.
Maybe we should leave this at DFTT.
… benefactors of college endowments…
Or did you think the University of Texas had the fourth largest endowment in the US because… what… Massachusetts liberals?
What happened to ‘double taxation’? If you’re going to tax endowments, and tax exxon already… isn’t that a ‘double taxation’?
and you think Harvard doesn’t see any Exxon money? Boy are you in for a surprise…
We talked about this at length in 2008.
We had a good thing going before you showed up Dan…
You’ve been given, over and over again various and comprehensive arguments TO WHICH YOU HAVE REFUSED TO REPLY.
You keep repeating the question, louder and louder over the din of the answers you refuse to hear.
End of discussion? I must say, a bit surprised Farnkoff didn’t get more support back in 2008 when he first blogged about this idea.
When it comes to taxing these rich filthy corporations like Harvard Univ, with their tax-exempt hedge funds known as endowments, “The work goes on, the cause endures, the hope still lives and the dreams shall never die” .
… you lose.
If you’re just going to wave away the arguments and treat those who’ve proffered them as merely “say we shouldn’t’ then you’re done and only awaiting the fork to prove it.
1.” Harvard employs lots of people, so can’t tax them.” Well, businesses in general employ lots of people, and we tax them. Microsoft employs lots of folks in Seattle, should they be tax-exempt.
2. “Taxing Harvard will increase tuition”. Yet, we tax corporations, which increases the prices of their goods and services, so this okay in your eyes?
3. “Taxing the multi-billion endowment funds would impact the donations given by wealthy people”. Cry me a river, I don’t give two-bleeps about rich pricks who donate millions to these institutions, by which, they lower their federal tax obligations since they deduct it from their taxable income.
4. And the worse reason given why we can’t tax Harvard and other wealthy universities goes to Kbusch, who said we can’t tax them b/c “they need to thrive”. I still get a chuckle out of that one.
That’s not the argument, Dan. You’ve misread it. The argument is a counter-argument to your completely false notion that Harvard pays either no taxes or not enough. When dealing with commercial properties and employees Harvard is no different, in any way whatsoever, from any other corporation. It pays plenty of taxes. On top of the normal, every day, ordinary taxes, they also have a PILOT. So if Commercial property(C) + PILOT (P) + payroll (Py) = taxes… so math:
C + P + Py = X
The argument I make is that if you want to tax the endowment, rather than accept a PILOT, you’re not going to make much more money, in the short term, and have the effect of shrinking the endowment, meaning you’re going to have less overall in the long term.
If we replace the Pilot (P) with straight up taxes (T), so more math:
C + T + Py = Y.
Y is not guaranteed to be greater than X. Because P is not guaranteed to be smaller than T. In fact, if taxing the endowment has the deleterious effect of shrinking it, then Y is guaranteed to be smaller than X. Let me remind you that X is what we are collecting now. You want to collect less in the future for the dubious privilege of punishing the privileged.
As I already pointed out, Harvard is already taxed. Taxing Harvards endowment won’t answer because there are a multiplicity of legal entanglements involved in charitable donations and trusts that make up the endowment. That’s exactly why the universities agreed to the PILOT rather than the can of hairy worms lying in deep yogurt that would be the tax on an endowment.
And if you do end up taxing the endowment then the endowment will shrink and undoubtedly the tuition will go up.
So why not tax the rich directly? That’s how this whole discussion got started, innit? What to do to get more revenue without raising taxes? The answer you gave was to tax the pile of money that Harvard is sitting on: You want to punish Harvard for sitting on a pile of money… but that pile was GIVEN to Harvard. Endowment. Is. A. Gift. If you don’t like that, take it up with the givers.
And your answer to that is to say ‘so what’?
Ok then.
if you answer is to say ‘so what’ then we have our solution to the question of what to do instead of raising taxes…. say ‘so what’ and raise taxes. There. I fixed it. Derp.
Chuckle all you want. You realize that your vaunted Exxon wouldn’t be even possible if it weren’t for MIT? Fred Koch, father of the Koch Brothers, was an MIT trained chemical engineer who developed a cheaper method of turning crude into petrol. In a very real way the world we inhabit wouldn’t be conceivable without cheap petrol.
You think every chemistry program in Texas and Louisiana isn’t funded, in large part, by endowments fueled by companies like ExxonMobil and BP and all the others? New England schools are biotech, basic science and business…. so they don’t get much OilCo money. But… so what?
Google came outta Stanford. Akamai came outta MIT. The very internet itself was a gift from the government that started in three places: MIT, Rice University and Berkeley. The web started at CERN, in Switzerland. The guy who invented the web, Tim Berners-Lee is now at MIT. None of the Internet itself would be possible without money from the government and brains from the university… a university system that thrives under the current regime of endowments.
So yeah. They need to thrive. If that gives you a chuckle… so what?
A simple 2.5% tax and its a wrecking ball for Harvard and MIT.
By the way, they should pay some taxes to the cities, they do use the fire and rescue services, no? Their employees and students do use the MBTA, no?
… you’re being obtuse. Is it deliberate?
MIT paid a full 12.2% of all the taxes paid in Cambridge in 2012. Harvard paid more. So at least ONE FULL QUARTER OF ALL TAXES PAID TO THE CITY OF CAMBRIDGE IN 2012 CAME FROM EITHER MIT OR HARVARD They paid the corporate rate on all commercial property and they paid payroll taxes and all incidentals. In addition to all this they paid a PILOT on all tax-exempt properties.
One full quarter of all the taxes paid in one year in one of the wealthiest cities in the state is a pretty darn big chunk of change.
You keep acting like I’m saying they have never paid one dime and further that I’m saying they never should. I. Am. Not. Saying. That. At. All.
Harvard and MIT pay a lot in taxes. Right now. Yesterday , today and tomorrow… They pay more than you’re willing to admit to and about as much (in the short term) as they would pay if you taxed the endowment and certainly MORE than they would if the endowment were taxed directly (in the long run).
THE DO PAY TAXES TO THE CITY!!! They have and they will.
What about all this is hard to grasp?
Harvard and MIT pay a fraction of propery taxes, something like 10% of the true value of the real estate. But if 10% tithe is good enuff for God, it’s good enuff for Cambridge.
But you imply since they make their voluntary donations in city taxes, this would be reduced if the state puts a tax on their endowment? How can you and me pay property taxes (about to walk my check down to Waltham City Hall today) and still pay income taxes and sales taxes and capital gains if I’m lucky to hold stocks. How can we manage, but these mega universities won’t be able to. It is not an either or scenario. Besides, I am more concerned about state revenue to cities like Lawrence and Springfiled and New Bedford, not Cambridge. If Cambridge takes a hair cut in the PILOT program, send the bill to Liz Warren and the Weld family who live in the lap of luxury.
My other suggestion of taxing intangible assets, if the person sells their stocks on Dec 30 to avoid the 2% tax, then they pay the higher capital gains tax, so I’m fine with that. But I don’t think that will happen, and neither do you.
This statement is SIMPLY NOT TRUE. The statement above IS ONLY TRUE for all buildings that are being used for tax exempt purposes and IS NOT AT ALL TRUE for all commercial properties… of which MIT and Harvard own more.
You are lumping all the property they own into one big bucket and comparing that to all the taxes they pay. That’s a wrong, and simpleminded, way of looking at it… and it ignores everything I, and others, have been trying to tell you…. You simply gloss over what we’ve said.
Both MIT and Harvard own a lot of commercial properties for which they pay commercial taxes. They paid fair market value for the commercial property and they paid sales tax on the commercial property when they purchased it and they pay property tax on the commercial property no different from any other corporation. Furthermore… where is it, do you think, from which the PILOT funds arrive? They, actually, cannot legally dip into the endowment to pay it. So where does that extra PILOT money come from? From the commercial property. So the effective rate on the commercial property is actually GREATER, because of the PILOT, than other corporations pay. And, as part of the PILOT agreement, both universities (and I think all the others) have agreed to limit the conversion from commercial property to tax-exempt…
You keep running roughshod over this idea… saying things like you said above which are demonstrably untrue… because your entire argument collapses if you admit that I’m right. Rather, you’d instead pretend that I either said something I didn’t or didn’t say anything at all.
What are we talking about here? The state doesn’t collect property taxes, the city does. The state might tax the endowment, but as I and others have been at great pains to point out, that’s an entirely different kettle of worms…
Actually, yes it is. They are only “mega” universities at the bequest of others: rich people gave them money. And they are not “mega” universities with unfettered funds: the rich people gave with a lot of strings attached. If the rich stopped, or even slowed, in their giving, then they would become formerly “mega” universities. The universities took the rich peoples money turned it into students who then turned themselves into rich, or in some cases, richer people. Lather, rinse, repeat. The reasons for giving money are varied: some give out of gratitude; others give out of the goodness of their heart; others just want a tax deduction; some do it for a combination of these motives. Aside from the legal implication of taxing a charitable donation with strings attached, taxing the endowment removes the impetus for a tax deduction: people who endow will either have to endow more to get the same return or not at all…. Taxing the endowment excises a large motivation for the giving and the endowment, undoubtedly shrinks… over and above the shrinkage from the taxation.
Once again, you’ve run roughshod over what I said. I said “selling short” which can be a form of price manipulation to get the price down for a day, lowering their tax on the 31st and then back up again afterwards. I’m not talking about getting out of paying tax. I’m talking about manipulating the price to lower the value for one day. If you want to collect a tax on the price of stocks on Dec 31 don’t be surprised if that price takes a nosedive before then… Like I said, simple is as simple does.
“Harvard and MIT pay a lot in taxes. Right now. Yesterday , today and tomorrow… They pay more than you’re willing to admit to and about as much (in the short term) as they would pay if you taxed the endowment and certainly MORE than they would if the endowment were taxed directly (in the long run).”
Did you write that or not?
You expect the avg citizen to feel bad if some rich dude withdraws his $1 million dollar donation b/c 2% of it may be taxed by the state to help teachers educate some underprivileged kids in Lawrence or New Bedford?
I expect Harvard and MIT to become lesser institutions and the whole economy of the entire commonwealth to suffer as a result because you back-doored the rich guy rather than taxing his wealth directly.
And the average citizen wants Harvard to be Harvard and MIT to be MIT, ‘casue that’s the place they hope to send their kids.
I assume (perhaps incorrectly) that progressivemass understands the difference between wealth and income. Do you?
In selecting by wealth, *income is irrelevant*.
“Enact legislation that raises $1 billion in new revenue from the wealthiest residents”. That say just from taxing income?
Is is hard for you tell the difference between w-e-a-l-t-h and i-n-c-o-m-e?
Let me ask you a question. Suzie has three and half million dollars in their checking account. Lucy is overdrawn by a buck and half. Neither Suzie nor Lucy got ANY money at all this month.
Can you see a difference between Suzie and Lucy? How much revenue will you gain from taxing Suzie’s “income” this month?
I have simply asked for more specifics to these proposals, which progressmass has failed to respond. Anyone can support abstract concepts Tom, but I prefer specific policy proposals, and you should as well.
I should have followed her advice and ignored DFW. Dan, you’re blowing smoke again. Perhaps DFW *is* a sock-puppet, in which today’s worker needs to re-read the earlier comments from “DFW” on this very thread.
I have written about my preferences in numerous comments here, such as this one from last week:
Dan, YOU posed a specific question about a specific bullet: “I want to ask progressmass about raising $1 Billion from the “wealthiest residents” and close corp tax loopholes”. That bullet contains NO reference to an income tax, graduated or otherwise.
YOU asked another question, in that comment:
“Who do you consider the wealthiest residents? Based on assets or just income? ”
I responded to each of YOUR questions with the observation — that I stand by — that wealth is NOT income. Your own words in the second of your questions that I quote betray your confusion about this fundamental question.
Wealth is not income.
What if Tom progressmass wants families earning $75K to pay more income taxes, would you support that? It’s stated in the diary supporting a graduated income tax, but how much and when does it kick in?
Why go after capital gains and not the asset themselves. 3% tax on assets (stocks and bonds) over $100K. So if you have a $500K portfolio, tax to the state is $12K. And I would require endowment funds to pay the same tax as I discussed up above. I would exempt,the first $1 million in IRA portfolios, but not liquid assets.
If we attempt to tax the wealth itself (“Why go after capital gains and not the asset themselves”), we create an ENORMOUS number of difficult or impossible to answer concrete and political questions.
The concrete questions have to do with “value”. One appeal of a capital gains tax is that it only happens *when an asset is sold*. That sale involved a concrete number, and no “judgement” is required to establish that number (even there, I oversimplify).
When Suzie gifts an option to purchase a gazillion shares of currently-worthless (and unregistered) ABC corporation to her god-daughter, how do we decide the value of the resulting portfolio, and who does the valuation?
The other and more important area is political. When we are discussing the amounts we’re talking about, several important factors are at play:
– EVERYBODY dies eventually.
– Any tax is paid by the ESTATE of a dead person. It’s much harder for Suzie to squawk from the grave about a 70% tax on her estate than about a 15% tax on her current portfolio.
– The amounts are large enough, and the flow of them constant enough (see the first item), that we can afford to be patient. The estate tax on Suzie’s three billion dollar portfolio will be large whether we collect it today or a lifetime from today.
Because assets have no tangible value until you cash in on them and realize capital gains. A portfoliio with some stuff in it is only worth $500K if you sell everything and get $500K for it. At any given time of the day the ‘value’ of the assets can fluctuate between very loose constraints. Is it volatile and high-risk? Then the value of the portfolio could be between $0 and $40x… You can’t tax that.
I would exempt,the first $1 million in IRA portfolios, but not liquid assets.
Liquidity is called liquidity because there are constant ripples, waves, swells and dips involved: you can tax cash but you can’t tax what can be converted into cash until you actually… well… convert it into cash. A liquid asset might be ‘worth; $4 today and $400 tomorrow and $20 the day after…. how do you tax that?
This is not a new idea, taxing intangible assets was done years ago, and I don’t know why you want to protect the wealthiest Americans who have most of the intangible assets.
It’s real simple, just take the value of the portfolio as of Dec 31 of that tax year. Don’t people get a statement with a dollar value? Surprised you and Tom want to over-complicate this idea.
…and is not liquid. A bond is about the furthest thing from liquid you can get. That’s why it’s called a ‘bond’. You can trade a bond for cash but then you’ve got the same problem: you tax the cash you get from the trade, not the bond.
You’re trying to shift the ground from under your own feet.
And everybody sells short on Dec 30 to bring that Dec 31 price down. Simple is as simple does…
I’m not sure you’re being serious. Assets have value, hence the definition of the term; and assets are taxed all the time, think excise taxes, think real estate taxes. The value of the asset can be assessed by the government, it can be the original price less depreciation, or plus capital investments, but it has a value which could be taxed.
You are correct that income in the form of capital gains is created when assets are sold for more than their basis, and losses are born in the opposite case, but certainly assets can be taxed.
Sometimes I think people argue with Dan for the sake of arguing, but that’s irrelevant to my point and I express no opinion regarding the taxing endowments.
Nested incorrectly.
My mistake.
… no general disagreement here on property. Excise tax is defined by the IRS as a tax on purchases or uses (The excise tax on your car isn’t on the car itself but on the cars use of the roads.)
In the context of DFW asking “Why go after capital gains and not the asset themselves” he was speaking of (and I was referencing) assets that are volatile. So property tax is assessed yearly (often) and sometimes over longer time frames, because the value isn’t likely to be drastically different over those time frames. Capital gains are realized when the value of the asset is concretized by its sale. For property the curve is smoother over shorter time frames.
The curve for volatile assets is different, full of spikes and not predictably so… I suppose the raw argument could be ‘so what’ just go a head and tax. So I guess the argument reduces to optimizing the tax (or minimizing it, if you on the side that doesn’t want to pay it). And that’s why the government doesn’t do it… The price of many volatile assets could be X today and 400X tomorrow and X/2 the day after that… If the government declined to tax tomorrow, when the price is 400X, and instead waits until the day after when the price is X/2… that’s a huge differential in taxable amounts. Not only are they ‘missing out’ by way of bad timing, how could they plan revenue collection and future spending under those conditions?
So Petr, let’s play hypothetical. A guy has a $1 million in a stock portfolio and let’s say $500,000 in US Treasury notes. Under my plan, he would owe $28,000 to Uncle Sam since the first $100K is exempt.
What are you saying, he and his portfolio manager will sell everything, tank the stock prices on Dec 31, and pay little or no tax? Then on Jan 2, it goes right back up?
I don’t buy it Petr and most Americans are not worried about short sales, they are worried about when they are getting paid do they can pay last months heating bills.
Seriously, do you believe we are all just desperately closeted Republicans who only believe in progressive issues because of pier pressure and that we are desperately seeking a reason to show our true selves?
We do understand and would love to engage in the most effective and just ways to raise revenue – estate tax on wealth, income tax on regular wages, capital gains tax on investments. All with pros and cons.
It is time for big goals, and bolder candidates.
Your view, I’m sure, sounds great to the upper middle class suburban liberal, but the goals aren’t really that big nor are they that progressive. Let me explain, point-by-point.
So basically, you’re offering to extend a program already available to low-income residents (pre-K) to the middle class, and you’re offering to extend something available [but unused for various reasons] to the middle class (free college education). That’s hardly progressive. How about funding poor urban school districts to the point where they become attractive for a middle-class parent to consider sending their kids to school there? How about something to break down the educational segregation that is in this state, so that spending through your nose to get into the “right” zipcode wouldn’t be necessary anymore? That would be a true litmus test.
I’m on board with universal healhcare, though this is, again, another middle-class benefit (since the poor get Medicaid and ACA allows the near-poor to get subsidies). I do think that decoupling health care from employment would make our job market more flexible, and this might allow for more people to open small businesses.
That isn’t bold because neither affordable nor rental housing exists in the neighborhoods that people want to choose. A bold vision would be to truly break down segregation-by-zoning. Allow multi-family properties to be built in places like Dover or Weston. Another approach would be to do the right thing when it comes to Local Aid and help poor urban communities make their cities better – not possible now because those communities rely on local aid, and local aid has been decimated. We now have at least two communities (Springfield and Holyoke) at the Proposition 2.5 Levy Ceiling, and this is not because those communities offer luxurious services, it is because of low property values – which, oddly enough, is considered a good thing because such property is “affordable”. Seems like there could be a win-win solution here somewhere.
I’m on board with this, but a truly progressive vision would include living-wage jobs made available to anyone who will work them, doing work in communities where work needs to be done (you can’t believe the condition of the potholes in Springfield, or how bad the streets are after a snowstorm due to lack of funds for snow plowing).
This sounds too much like raising taxes just for raising taxes sake. You need to tie this to the other goals more closely, or you’re going to be vilified for it.
And just to follow up on this point:
You can buy a house in Springfield for as little as $50,000. Median house listed price is $120k. I don’t see people flocking to buy these houses, even though a $100k mortgage would run them about $500/month, or about $6,000 per year. Why aren’t people taking these deals – if you use the 1/3 yardstick this means it should be attractive to anyone earning more than $18,000 per year. This should be a home-run for someone earning $75k, right?
Answer: no, because the property taxes a city can collect on a $120k house are, at best, $3,000, and such a low level of funding makes the community unattractive.
For all you fiscal types out there, what would you do if you could only collect $3,000 per property in your community? Would that make for a good budget, one with basic services funded? I seriously doubt it.
If people want to pay lip service to “affordable housing”, then the state needs to at least make up the difference in the funding of services, taking into account the increased demand for services coming from people who can only afford a $120k house.
The rate things are going there will hardly be one in a few years and they are feeling squeezed. Universal pre-K already available – since when? It’s not in the town in which I grew up and teach, regardless of income. Free college? Didn’t get that memo either.
You’ve made the economic segregation point often, but short of dictatorship the solutions aren’t practical. You make it sound inherently evil that some people would like some breathing room in their zoning. You should not try to force people to live like sardines.
Universality is both politically palatible and the right thing to do. More services SHOULD be available to everyone without having to prove you are poor.
but a lot of grousing.
I agree 100% that the case needs to be made that taxes need to be raised because the current level is inadequate to fund basic services at a good level, not just for the sake of it. I’m confident that Progressive Mass. and anyone else actually making the case for higher tax revenue will be sure to connect it to concrete things.
I take the point about living wage jobs for anyone willing to do them to mean it’s not enough to require that $15 wage for the jobs that happen to exist, we should fund the work that needs to be done, like fixing the potholes in Springfield. Again, this goes back to having sufficient revenue for public services.
Fixing the local aid situation goes hand in hand with overall state revenue levels. And you’re absolutely right that cities like Springfield – with “affordable” housing that can only be taxed at $3,000 – are hamstrung by the Prop 2.5 formulas. Those need to be fixed but that’s a more complex issue and a hard sell right out of the gate.
Housing may be affordable in Springfield but there are a lot of reasons why people don’t buy it. Some of it is the poor services in Springfield due to lack of revenue and other problems. A lot of it is that 80% of the state’s population lives in eastern MA, and they’re constrained to because of their jobs.
Agree 100% that the state needs to make up the difference in available funding for cities like Springfield and Holyoke and Lawrence, but you seem to be going after Progressive Mass – which is trying to move things in that direction after 3 decades of Reaganomics.
Your points about healthcare, etc., strike me as off. The MassHealth cutoff for a family of 4 with children is under $3,000 a month in income. Are you really saying providing a family of 4 making $40K with health insurance is no big deal because families making $30K already have it? There are a lot of people with little cash to spare who’d benefit from the proposal. And single-payer’s a better deal than the private plans under the ACA.
40B is supposed to provide for multi-family housing in Dover and Weston. If it needs tweaking so be it.
And where did I miss the free college education?
Yes, there was a lot of grousing, but only because I’m disappointed that an article that throws out “big goals” was so tepid.
Free college was clearly in the plan:
I’ll accept your points on the health care, since I’m not well-versed on the subject and do support Universal Healthcare. I was under the impression, though, that the ACA provides significant subsidies for people who earn up to 4x the poverty level – so Universal Healthcare would primarily be a benefit for those earning 4x the poverty level and up, meaning the middle class.
Regarding your theory that housing prices in Springfield are lower due to 80% of the population living in the East, that would be true for regional divergence in prices, but not for localized divergence in prices. The difference in localized prices is solely due to the localized difference of Springfield versus surrounding communities. The median house price difference between Springfield and its adjacent neighbor is $180,000 for houses currently listed on MLS. That’s a pretty significant difference.
Part may be due to services – but Springfield isn’t offering lower services because it is fiscally conservative. In fact, those other communities are largely populated by fiscal conservatives who vote Republican more often than not and who hate government services. Springfield is offering lower services because it doesn’t have the money to do any more. We are broke, and we have no way of becoming less broke except to cut services further. A state law is capping our revenue, a law that doesn’t affect 80% of the state precisely because property values are so high elsewhere.
40B is a joke, it does not even begin to address affordable housing in Weston or Dover. It counts a “senior” affordable unit the same as a “family” affordable unit, so most communities who appear to have “affordable” housing really have just created cheaper housing for the seniors who spent their lives there. A truly progressive policy would require communities to zone a certain percentage of their land as Residence B or higher, and would disallow condos (or in-law apartments) to count as “affordable” because people who need affordable housing tend to rent, not buy. What’s that you say? Rental housing causes problems in a community? Then provide funding to cope with those problems – problems that are occurring in communities dominated by rental units.
Nothing in this “big goal” plan would change much of any of this – hence my criticism that this is a plan that primarily satisfies wealthy suburban liberals. Yes, it’s a starting point, but it’s hardly progressive.
I know it was in the plan, but you seemed to be suggesting that it’s already available, which confused me.
The ACA’s subsidies disappear at 4x the poverty level, but I’d not call them “significant” at an income level approaching that. A family of 4 making $85,000 near Boston would qualify for a smallish subsidy. Their pre-tax income is about $7,000 a month, a lot less after taxes. Running these numbers for my ZIP code, a plan would cost about $10,000 a year, and over $8,000 of that would be payable by the family. The private insurance will run nearly $700 a month, or 15% of the household budget. And that’s for a silver plan, where you’ll be paying 30% of your medical costs yourself anyway and might have to pay up over $12,000 a year out of pocket if you get sick. A lot of out-of-pocket spending.
I would not call that $85K family “upper middle class,” since that income’s well below the median family income in most eastern Mass. towns. Particularly not if they don’t get employer-provided insurance and have to go the ACA route. Sure, there are people getting by on a lot less, but when you have two people working full-time and you have to pay for housing in an expensive area, transportation, feed and clothe a family of four, etc., on $4k a month you’re not getting ahead. This was my biggest disappointment with the ACA.
You’re totally right about this. I was just saying that a statewide plan for affordable housing requires taking eastern Mass. into account. The other issues you’ve raised have a lot to do with why people choose to live in a neighboring town rather than Springfield. These are hard problems, though, and just giving Springfield more money doesn’t solve them. Which doesn’t mean we shouldn’t give Springfield more money.
Agree 100% on this too, and I think I said so. I’d love to see Prop 2.5 changed so Springfield’s not in that position or, better, see the state make up the funding shortfall. A city that probably needs more funding is having to make do with less, and it’s not right.
I’m all for giving 40B teeth and the senior housing issue would be a great place to start. Providing more rental units too.
I think we agree more than we disagree. One area where I have a different take is that I think it’s important to make programs available that benefit the “middle class,” or what’s left of it. A lot of people feel insecure these days, with good reason, and they hate being caught in the middle. Too poor to feel comfortable for a second, too much income to qualify for any programs.
I think that needs to change, not least to counter the major problem of our politics for the last 35 years: how easy it’s been for Republicans to demonize public spending as for “The Other,” not for them. In that context opposing extension of programs to the “middle class” is counterproductive. Which doesn’t mean we (continue to) ignore the pressing problems of the poor and poorer cities. And Progressive Mass. has been working hard on things like fighting Shaunna O’Connell’s EBT “reforms.”
I’m confident people at Progressive Mass. will keep an eye on this thread, but you should contact them with your concerns and thoughts about what cities like Springfield need. We should all work together.
Meant to be an update for a thoughtful and lovely post.
Yes, I agree, it is important to make programs available to the middle class, however, this so-called bold progressive plan is almost 100% weighted toward middle class people and communities.
I think that the “Affordable, Decent and Safe Housing In the Neighborhood Of Your Choice” plank is the best start for poor communities, but the path proposed doesn’t get us anywhere near there.
This completely ignores the root cause of high housing prices, namely:
1) Proposition 2.5, which has spurred communities to only allow expensive housing to make sure that tax income matches expenses.
2) Restrictive zoning which is in place partly due to Proposition 2.5, to keep housing prices high for revenue purposes, but also to divert poor residents away from communities.
3) Bidding up of housing in non-urban communities based on the perceived quality of schools, but also because of exclusionary reasons, (some based on race), and some based on the dysfunctional funding mechanisms for local communities which leave Gateway Cities starving for revenue and in a perpetual state of decline.
4) Crowding in Eastern MA/suburban Boston. The differential in housing prices between Eastern MA and Western MA is preposterous and is going to ruin our state because the cost of living is being driven sky-high by housing prices in a vicious cycle (if a house can cost $50k in Springfield, the same house costing $500k in the Boston area is patently ridiculous). This has to be seen as a problem within the state. We have plenty of areas in the state below capacity – Gateway Cities. Instead of creating policy to address the symptoms of the disease (high housing prices), why not treat the disease itself (lack of supply of housing, and an economy concentrated in one small, crowded area of the state)?
This is not the answer. Building more housing is the answer. If you want the density of jobs in the east, then the housing has to become similarly dense. Break apart the rules that allow communities to zone out multifamily housing. Stop counting senior housing against 40B. Stop shipping the homeless to Western MA. These practices are segregating the state economically both from one community to another and from one region to another.
The amount of real estate available for housing expands as the square of distance. If the effective radius of the area served by public transportation is increased by a factor of four, we get SIXTEEN TIMES as much area available for housing.
Historically, the reason why the incredible density of New York city was possible a century ago was that high-speed elevators allowed the rapid vertical transport of people (and made the skyscraper viable), while high-speed rail allowed the horizontal transport of those people to areas where affordable housing could be built.
I enthusiastically agree that we need to build more housing. The density of jobs in the East is driven by geography — no government program is going to create an oceanfront in Worcester (though our GOP climate change deniers in Congress seem determined to try).
Worcester is, according to Google, 43.5 miles from Boston. A high-speed train serving that segment should be able offer a 30 minute commute. A public transportation system that ran such a train, say, every 15 minutes with, say, 2-3 intermediate stops, and that also provided local feeder-bus service for those stops, would allow affordable single-family housing to be built using reasonable cluster-zoning.
Our nearly-exclusive dependence on automobiles and traffic-clogged highways is an ENORMOUS factor in the practices that segregate the state economically.
Just an addendum … I note that elevators have ALWAYS been free to the public (to my knowledge, at least).
The lowly *free* elevator was the crucial element enabling NYC to become what it is today. The tightly-constrained geography of the island it is built upon meant that the ONLY way to achieve the density of workers needed for its emerging role as business and financial center was to build UPWARDS. And the only way THAT worked was for convenient and *free* elevators to get those workers into and out of their offices — where they could walk to subways and trains that got them into and out of the city.
Now just IMAGINE what would happen if elevators were not free! Suppose those who could not afford them were forced to walk thirty or fifty or ninety flights of stairs.
Rail transportation is to today’s Massachusetts what elevators were to 19th-century NYC. Public rail transportation should be, like elevators, FREE (in my opinion).
Granted its Metro program, commission form of government, and regional planning history are leftover legacies of its strong ‘capital P’ Progressive movement. But it long ago ran out of room in the urban core and forced its suburbs and exurbs to evenly build out from transit hubs. The result is exurbs that are deliberately mixed use and connected to rail hubs that resemble streetcar suburbs even if they are 30-40 miles out of the urban core. Massachusetts should definitely adopt more programs like that, we do a better job than the Midwest but we lag behind the Northwest in this regard.
of what’s actually been possible on Beacon Hill in recent years, they’re positively revolutionary.
I think this is the do-able that makes all your other notions do-able: Free tuition, living wages, health care are all monies to be spent; but you have to overcome the unwillingness to spend it, in order to overcome the unwillingness to raise it.
It seems obvious to say that if you raise enough money you’ll have enough money… but we’re stuck in a debate where ‘job creators’ is a term neither defined nor measured, at all, but nevertheless is thrown around like holy writ. And we’re stuck in a situation where nobody wants to think of themselves as the Sheriff of Nottingham, but they don’t exactly want to be Robin Hood either… taking from the rich and giving to the poor is fast becoming as grievous a sin as being poor. And so unwillingness to spend is, rather perversely, the impetus for the unwillingness to raise. One would think it would be the otherway round: an unwillingness, or even inability, to raise limits the spending but it isn’t that way at all: show me a man who venerates “job creators” and I’ll show you a man who detests the poor. The flip side, say the Malthusians, is that there simply ain’t enough to collect all you want. Both these notions, the idea of creation and destruction, share a point of view that is linear, with a beginning and an end: start — finish.
But the notion of adding to the list of people enjoying a living wage is also the notion of adding to the tax rolls. And a better education for all means smarter and more productive people who’ll, likewise, pay more in taxes. And healthier people work harder and longer and, likewise, add to the public coffers rather than draw from them. And, so, it’s not linear but cyclical… around and around and not the finite one way street it was thought to be. Why aren’t the poor paying taxes? Because they’re poor. Make them ‘not poor’ and they’ll pay taxes. Educate them so that they, as Justice Sotomayor once said “Could be brought to the starting line of a race many were unaware was even being run” and soon, as in the case of the Sotomayor, they’ll outrun the rest. You might even be able to couch it in terms of a payoff with a straight face: handouts now for tax rolls later. Though, for my part, I find that detestable… if illustrative.
It starts with funding the government now. Not some time in the future when a sufficient number of wealthy people exist and are paying low taxes, but right now and by collecting sufficient taxes, whatever that number, from the wealth that exists…. in order to create more.