A fee is a fee is a tax is a tax

I hesitated to post this because some of the tax and spenders here in Franklin read my blog.

City Journal writes about the fiscal problems state and municipalities have had since the recession:

America’s states and municipalities should be awash in good budget news. Unemployment remains below 5 percent, inflation is tame, and the S&P 500 rose about 20 percent in 2017—the ninth year of a bull market. Household income is pacing upward strongly again, too. Yet despite the good news, many local governments faced intense struggles last year to balance their books. Nearly a dozen states failed to pass new financial plans on time, and many with budgets in hand had to scramble midyear to cut spending.

The difficulties were nothing new, though. Localities have confronted unrelenting fiscal pressure since 2008, a result in part of the Great Recession and then the weakest recovery since World War II, but also of ever-escalating costs—including massive public-employee retirement debts—and tax collections so weak that many governments have yet to see revenues return to pre-2008 levels. Many states and localities have had to rewrite budget books, altering how they spend money in ways that leave taxpayers paying more—and receiving less.

The situation may not change for the better anytime soon.

There’s more.

Meantime, in Wisconsin—a state that didn’t expand Medicaid—costs are still spiraling upward. Overall state spending on most items was basically flat in 2016, but Medicaid surged more than 7 percent, soaking up most of the state’s new revenues. Medicaid now consumes 18 percent of Wisconsin’s budget, up from 10 percent in 2011. “When municipalities and school districts grouse about not getting a bigger share of the state budget, truth is there aren’t a lot of discretionary dollars lying around the state treasury,” one Wisconsin newspaper editorialized.

If you were listening to Marketplace on public radio this morning you learned that, not surprisingly, cities are increasingly turning to fee increases to raise revenue.

And no, I don’t agree with reporter’s last sentence that they have to find the money somewhere, insinuating tax/fee increases are a must.

Here’s a novel approach: Do what families all across America have had to do. CUT SPENDING.

6 thoughts on “A fee is a fee is a tax is a tax

  1. This is exactly why all members of the County Board (*except* for Alexander, Sebring, and Weishan) voted to allow fee revenue in the budget from parking meters in the parks when they approved the 2018 budget. the reason the county is legally able to do it is because a tax is a tax, but a fee is only a fee.

    Liked by 1 person

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