July 16, 2017

A Thought about Liberals

"A liberal is someone who feels a great debt to his fellow man, which debt he proposes to pay off with your money."

~ G. Gordon Liddy

Source: page 83, "As Certain as Death: Quotations About Taxes," 2010, compiled by Jeffrey L. Yablon, TaxAnalysts.com (this is a new link for the collection, but publisher's identify shown on the first of the unnumbered pages; the link I had been using produced a 'page not found' message).

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George Gordon Libby (born 1930) "is a retired lawyer who is best known as the chief operative in the White House Plumbers unit that existed from July to September 1971, during Richard Nixon's presidency. He was convicted of conspiracy, burglary, and illegal wiretapping for his role in the Watergate scandal," reports Wikipedia.

July 15, 2017

Monthly Federal Spending Tops $400 Billion for 1st Time

CNS News editor-in-chief Terry Jeffrey wrote on Thursday, "Real monthly federal spending topped $400 billion for the first time in June, when the Treasury spent a record $428,894,000,000, according to the Monthly Treasury Statement released today."

He continued by writing:

"Prior to June, the record for federal spending in a single month was held by March 2017, when the Treasury spent approximately $392,816,000,000.

"In August 2012, the Treasury spent $392,408,410,000 in constant 2017 dollars.

"As the Treasury was spending a record $428,894,000,000 in June it was taking in approximately $338,660,000,000 in taxes—thus, running a deficit for the month of $90,233,000,000.

"So far in fiscal 2017 (which began on Oct. 1, 2016 and will end on Sept. 30, 2017), the Treasury has brought in $2,507,820,000,000 in taxes and spent $3,030,903,000,000—running a deficit of $523,082,000,000.

"Last year in June, the federal government spent $323,320,000,000—or $328,303,590,000 in constant 2017 dollars. The record $428,894,000,000 that the federal government spent this June is $100,590,410,000 more (in constant 2017 dollars) than last June’s spending.

"The dramatic increase in spending from last June to this June was driven by increases in spending by the Departments of Education, Housing and Urban Development and Health and Human Services. It was also helped by the fact that the first day of July fell on a Saturday rather than a business day."

Jeffrey concluded by reporting on how CBO's explanation of "the massive increases in Education and HUD spending during the month," writing:

“Outlays for the Departments of Education and Housing and Urban Development increased by $33 billion and $21 billion respectively, because of upward revisions to the estimated net subsidy costs of loans and loan guarantees issued in prior years,” said CBO.

CBO also noted the impact of July beginning on a Saturday.

“Because July 1 fell on a weekend this year, certain payments scheduled for that date were instead made in June,” said CBO. 'If not for that shift, the deficit in June 2017 would have been about $44 billion lower.'"

Based on spending and revenues of the first nine months of FY 2017, the federal government is headed towards annual revenues of $3.336 trillion and spending of $4.056 trillion in FY 2017, and a deficit of $720 billion.

Growls readers are encouraged to take a few minutes to write or call their Congressional representatives. Ask them to justify the fiscal insanity occurring in the federal government. Contact information is available at the Library of Congress' Congress.gov. Taxpayers living in Virginia's Arlington County can contact:

  • Senator Mark Warner (D) -- write to him or call (202) 224-2023
  • Senator Tim Kaine (D) -- write to him or call (202) 224-4024
  • Representative Don Beyer (D) -- write to him or call (202) 225-4376

And ask for a written response. And tell them ACTA sent you.

July 14, 2017

Social Security Trust Funds to be Depleted in 17 Years

Ali Meyers reports for the Washington Free Beacon today, "The Old-Age and Survivors Insurance and Disability Insurance Trust Funds will be depleted in the next 17 years, according to the Social Security Administration's trustees report." (with link to Social Security Administration (SSA) 7/13/17 press release) According to the article, the program will begin to exceed revenues in 2022.

She adds, "By 2034 the combined asset reserves of both funds are expected to be insolvent. Alone, the Disability Insurance Trust Fund will be insolvent by 2028."

She went on to explain:

"It is time for the public to engage in the important national conversation about how to keep Social Security strong," said Nancy A. Berryhill, acting commissioner of Social Security. "People understand the value of their earned Social Security benefits and the importance of keeping the program secure for the future."

"In 2016, the program took in $957 billion in income but still had expenditures as high as $922 billion.

"The Committee for a Responsible Federal Budget suggests policymakers phase in gradual changes that would allow for more time to plan but also promote long-term economic growth.

"The Social Security Trustees continue to underscore the need to address Social Security’s financing shortfall soon," the committee said. "Failure to act would result in all beneficiaries receiving a 23 percent across-the-board benefit cut when the combined trust fund exhausts in just 17 years, when today's 50-year-olds reach the normal retirement age. The SSDI program faces an even more immediate deadline and will deplete its trust fund in 2028."

"Policymakers can still address Social Security's financial problem without making drastic tax or benefit changes, but the window for responsible action is closing," the committee said. "If policymakers are willing to act soon, they can create a plan that strengthens the program’s finances while phasing in changes gradually to give workers time to plan, improving retirement security for vulnerable beneficiaries and promoting long-term economic growth."

She concluded by writing of whether increased taxes are needed to save the Social Security Trust Funds, writing:

"While some argue that taxes should be raised to save Social Security, David Barnes, director of policy engagement for Generation Opportunity, argues that it needs to be reformed instead.

"Some claim that the solution to preserving Social Security is to raise more taxes, but history shows that doesn't work," said Barnes. "In fact, since Social Security was created, payroll taxes have been raised more than 20 times. Twenty times! Yet, the program is still headed towards insolvency."

"Fixing Social Security isn't about throwing more money at the problem—it's about structurally reforming the program so it works better for current retirees and is still around for my generation when we reach retirement age," he said. "Otherwise, without serious change, young people must be given the choice to opt-out."

The SSA press release highlighted three bullets in the 2017 Annual Report to Congress:

  • The asset reserves of the combined OASDI Trust Funds increased by $35 billion in 2016 to a total of $2.85 trillion.
  • The combined trust fund reserves are still growing and will continue to do so through 2021. Beginning in 2022, the total annual cost of the program is projected to exceed income.
  • The year when the combined trust fund reserves are projected to become depleted, if Congress does not act before then, is 2034 – the same as projected last year. At that time, there will be sufficient income coming in to pay 77 percent of scheduled benefits.

In addition, the press release highlighted the following additional information from the Trustees Report:

  • Total income, including interest, to the combined OASDI Trust Funds amounted to $957 billion in 2016. ($836 billion in net contributions, $33 billion from taxation of benefits, and $88 billion in interest)
  • Total expenditures from the combined OASDI Trust Funds amounted to $922 billion in 2016.
  • Social Security paid benefits of $911 billion in calendar year 2016. There were about 61 million beneficiaries at the end of the calendar year.
  • Non-interest income fell below program costs in 2010 for the first time since 1983. Program costs are projected to exceed non-interest income throughout the remainder of the 75-year period.
  • The projected actuarial deficit over the 75-year long-range period is 2.83 percent of taxable payroll – 0.17 percentage point larger than in last year’s report.
  • During 2016, an estimated 171 million people had earnings covered by Social Security and paid payroll taxes.
    The cost of $6.2 billion to administer the Social Security program in 2016 was a very low 0.7 percent of total expenditures.
  • The combined Trust Fund asset reserves earned interest at an effective annual rate of 3.2 percent in 2016.

The complete Trustees Report is available here. The report includes literally an endless list of tables and figures.

A detailed, 8-page analysis of the 2017 Social Security Trustees Report by the Committee for a Responsible Federal Budget (CRFB) is here. The Committee's first point will likely get your attention since it says "Social Security is heading towards insolvency" with the second point being that "Social Security's Deficits are large and growing." If that doesn't cause sleepless nights, nothing will.

For the record, the CRFB is a bipartisan a policy organization as one can hope to find in Washington, D.C. For more information about CRFB, click here.

The Concord Coalition is probably somewhat of a left-of-center fiscal policy organization, but even they begin their response -- 7/13/17 press release -- to the 2017 Social Security Trustees Report by saying:

This year’s reports from the trustees of Social Security and Medicare highlight the need for substantial reforms to both programs that can put them on sustainable paths while protecting other government priorities in the coming years, according to The Concord Coalition.

“Once again, the trustees have made clear that without any changes, Social Security and Medicare will continue to claim ever-larger parts of the federal budget as other important federal programs are squeezed down to historic lows,” said Concord Coalition Executive Director Robert L. Bixby."

And at the Peter G. Peterson Foundation,  their analysis of the 2017 Trustees Report begins:

"Today, the Social Security Trustees warned that the program faces major financial challenges, which threaten its sustainability and ability to provide essential benefits to millions of Americans.

"According to the Trustees’ annual report, Social Security’s finances are facing growing pressure due to the aging of the population. As the large baby boom generation enters retirement and Americans continue to enjoy longer lifespans, more and more individuals will collect benefits from the system and for longer periods, while relatively fewer workers will contribute taxes to support it.

"Social Security’s financial imbalance is the result of simple math. Since 2010, the Social Security program has been spending more than it has been taking in, and the Trustam’s trust funds will be exhausted in just 17 years, which will put millions of beneficiaries at risk of large benefit cuts."

The Peterson report includes a chart showing that over the years, fewer and fewer workers are paying taxes to support Social Security beneficiaries:

  • 1970 - 3.7 workers supporting 1 Social Security beneficiary
  • 1990 - 3.4 workers supporting 1 Social Security beneficiary
  • 2010 - 2.9 workers supporting 1 Social Security beneficiary
  • 2030 - 2.3 workers supporting 1 Social Security beneficiary

That one chart pretty-well explains why Social Security is becoming insolvent, not to mention things like the "$550 million worth of bogus applications for Social Security disability," which the government says were filed by Eric Conn. According to the Washington Times' Stephen Dinan today, "Conn paid off a team of doctors to write fake medical evaluations, and paid a Social Security administrative law judge to rubber stamp the bogus applications."

Although I can't say that I've read or watched every news report about the Republicans bills to replace ObamaCare, it seems strange that the nation is embarking on a very large medical welfare/entitlement program, i.e., the repeal/replacement of ObamaCare, with no one talking about the looming insolvency of Social Security while at the same time another large social welfare program is "heading toward insolvency." As the hosts on RedEyeRadio.com like to say, "We're doomed."

Growls readers are encouraged to take a few minutes to write or call their Congressional representatives to complain that Social Security is heading into insolvency, and why Congress and the President are creating yet another welfare entitlement program. Contact information is available at the Library of Congress' Congress.gov. Taxpayers living in Virginia's Arlington County can contact:

  • Senator Mark Warner (D) -- write to him or call (202) 224-2023
  • Senator Tim Kaine (D) -- write to him or call (202) 224-4024
  • Representative Don Beyer (D) -- write to him or call (202) 225-4376

And ask for a written response. And tell them ACTA sent you.

July 13, 2017

Moral Hazard Explained

"Moral hazard exists when a policy produces incentives for perverse behavior , , , [For example] the policy of removing tens of millions of voters from the income tax roles, thereby making government largess a free good for them."

~ George Will

Source: page 131, "As Certain as Death: Quotations About Taxes," 2010, compiled by Jeffrey L. Yablon, TaxAnalysts.com (this is a new link for the collection, but publisher's identify shown on the first of the unnumbered pages; the link I had been using produced a 'page not found' message).

July 12, 2017

Arlington County-- Then and Now

A news item yesterday in the online Arlington Sun Gazette said the Arlington County Board is "set to approve school expansion.

According to the Arlington Sun Gazette article:

"On Saturday, County Board members are slated to take action that will allow the School Board to expand the capacity of a high school and two middle schools (including Gunston, which reopened in the 1990s), while also providing for additional classroom-trailers at a slew of elementary schools.

"The action comes as school officials continue to grapple with rising enrollment, which has seen the student population rise from less than 20,000 a decade ago to almost 27,000 today.

"In a series of what are likely to be pro-forma actions, County Board members are slated to approve modifications that will increase interior capacity of Wakefield High School from 1,903 to 2,203 seats; increase capacity at Kenmore Middle from 986 to 1,060; and increase Gunston’s interior capacity from 932 to 1,004.

"All are in line with requests from the school system.

"In addition, County Board members are slated to act on requests to add temporary classrooms adjacent to Long Branch, Claremont, Oakridge and Patrick Henry elementary schools and Arlington Traditional School."

The items are on the County Board's so-called consent agenda as Arlington Public Schools Use Permits (Agenda Items 8.A through 8.I.) The summary, background, and discussion on each of the nine reports to the County Board provide an interesting history of the Arlington Public Schools over recent years. Arlington citizens wishing to speak at County Board meetings can find additional information about meeting times here.

As the Sun Gazette pointed out, "Thirty-nine years ago, Arlington school officials shuttered Gunston Middle School due to declining enrollment across the school district." Scroll forward from 1978. How times have changed.

If Friends of Growls who are Arlington County taxpayers have additional questions about the capacity at APS schools, take a few minutes and write to the Arlington County Board. Just click-on the link below:

  • Call the County Board office at (703) 228-3130

And tell them ACTA sent you!

July 11, 2017

County to Affirm Acquisition of VHC Carlin Springs Site

The Arlington Sun Gazette's Scott McCaffrey reported yesterday, "Arlington County Board members this week are expected to formally affirm the government’s desire to acquire Virginia Hospital Center’s South Carlin Springs campus as part of a land-swap agreement that would see a county-government-owned parcel delivered to the hospital."

McCaffrey provided the following details in his reporting:

"Under terms of an agreement inked earlier, board members have until mid-August to formally notify hospital officials of the county’s desire to take the 11.6-acre Carlin Springs parcel, currently home to an urgent-care center and the Arlington Pediatric Center.

"County Board members have slated action for their July 15 meeting. (The board generally does not meet in August.)

"The land swap would only go through if Virginia Hospital Center officials opt to acquire a county-owned parcel in the 1800 block of North Edison Street immediately north of the hospital’s North George Mason Drive campus. But that is all but a certainty, as the hospital’s leadership long has sought a way to expand its land-locked holdings.

"The Edison Street site most recently was valued at $12.6 million; in compensation for delivering it to the hospital, the county government can opt to receive land, cash or a combination, all to be worked out after hospital officials formally notify the county government of their desire for the Edison Street property. The hospital in June received approval from state regulators to expand onto the Edison site, another procedural hurdle needed before the swap could be consummated."

He also wrote that both the county and the Arlington Public Schools have had their eye on his "rare large parcel of land."

The 6-page staff report, dated July 7, 2017, of the "Notice of County Board election to require conveyance of the property" supports Item #54 on the Arlington County Board's Recessed July 18, 2017 Agenda.

The county has a fully-informed webpage for the Virginia Hospital Center (VHC) Proposed Expansion, which includes updates, options, land parcels involved, and the related documents.

We growled about the proposed land swap with Virginia Hospital Center on August 5, 2015 and September 11, 2015.

If you are a Growls reader concerned about Arlington County's governance and finances, and have questions of whether your tax dollars are being used economically and effectively regarding this land swap, take a few minutes and write to the Arlington County Board. Just click-on the link below:

  • Call the County Board office at (703) 228-3130

And tell them ACTA sent you!

July 10, 2017

County, Landowner Agree to Extend Time for Bus Facility

A staff report in the Arlington Sun Gazette last Wednesday said, "Arlington officials and a Fairfax County landowner are giving themselves a little more time to work out the details for the county’s purchase of land in Springfield to use for maintenance of Arlington Transit (ART) buses."

The staff report went on to say:

"County Board members in late June approved amendments to the purchase agreement, which extends the time limit for the Arlington government to complete its due diligence in evaluating the site, and also extends the time frame to garner Fairfax County government approval for land-use changes that will be required before the parcel can be used for its intended purpose.

"Arlington officials late last year announced plans to buy the 2.2-acre site on Electronic Drive for $4.65 million. County officials already have tendered a check for $100,000, which will become non-refundable once the due-diligence period is over.

"Under amendments agreed to by both the county government and property owner, the due-diligence deadline was shifted from June 19 to Sept. 29, while the deadline for the county government to file applications for land-use amendments with the Fairfax County government was extended from Sept. 19 to Dec. 30.

"Under the agreement, Arlington officials hope to have Fairfax County zoning approval in hand by next July."

The Arlington County Board "approved a contract to purchase a $4.65 million site, zoned for industrial use, at 6701-6705 Electronic Drive in Springfield to be used for construction and operation of a heavy maintenance facility for the County’s growing Arlington Transit (ART) bus fleet" on December 14, 2016, according to a county press release. In addition to the price to be paid, the press release highlighted the "new facility would accommodate ART bus fleet growth" and "will bring certainty to ART operations."

According to this county webpage, the county is also constructing an ART bus facility in "Crystal City at South Eads Street and 32nd Street South." The county says, "Construction started in September 2015 -- anticipated completion is summer 2017," and will "provide crucial operational space for its growing bus fleet." The webpage also comments on additional space leased for ART buses, saying:

"Until this ART bus facility is completed, the majority of buses will move to the newly leased 2631 Shirlington Road site, while the balance will be temporarily housed at the Water Pollution Control Plant.

"Once completed, the new ART facility and the Shirlington site will accommodate all of the ART bus fleet. However, the Shirlington site is not a long-term solution, since the County's lease expires in 2023. A long-term solution will be examined as part of the Joint Facilities Advisory Committee."

The same webpage provided links to three community meeting presentations of the public process -- June and December 2915 and June 2016. In addition, the country provided the following information about funding:

"The total budget for the ART bus facility and streetscape improvements is $17.6 million, which includes design, construction, construction management and related costs. Funding comes from a combination of state and regional funds and local commercial real estate tax revenues that may only be used for transportation."

A May 16, 2015 county press release provides the details on the Crystal City ART bus facility. It emphasized two points. First, the need to support a "growing ART bus operation," and, second, "even more space needed to maintain, park buses." The lede paragraph said:

"The Arlington County Board today approved a $12.4 million contract with W.M. Schlosser Company, Inc. to build a new Arlington Transit (ART) bus facility in Crystal City, at South Eads and 32nd Streets. The facility, long included in the County’s Capital Improvement Plan, will provide crucial operational space for the County’s growing ART fleet, which has nearly 60 buses today and plans to grow to 90 by 2022."

There is also a May 14, 2016 press release, which said, "The Arlington County Board today approved a lease in Nauck for property that will house County vehicles, including some Arlington Transit (ART) buses.The 7-year lease for property at 2631 Shirlington Road, next to the CubeSmart storage lot off Interstate-395, is with NOBE I, LLC and SHCH, LLC." The release also said:

"The County will pay $720,000 in rent the first year, and another $460,000 to prepare the site, for a total first-year cost of $1.1 million. Construction costs will be funded through a combination of state and regional transit grants and funds."

The press release's first bullets said "supports growing ART bus fleet."

In his Right Note column for ARLnow.com on Thursday, July 6, Mark Kelly tries to make senses of the continual need to find space for its ever-growing ART bus fleet, urging the county panjandrums to "Stop 'Saving' Us Money."

According to Kelly:

"After spending over $17 million for the yet-to-be-opened ART bus light maintenance facility in South Arlington, the county announced it is close to acquiring land for a third ART bus facility in Springfield.

"The land cost for the heavy maintenance facility in Springfield itself is reported to be $4.65 million before up to $32 million could be added in the design and build process.

"County officials admitted when the first facility was announced that it was too small to meet actual maintenance and storage needs, but that did not stop them from moving forward with it. The maintenance facilities are on top of the acquisition of land for ART bus parking in Shirlington.

"As noted at the time, the South Arlington facility would save tax taxpayers $57,000 a year that Arlington pays to use existing Metrobus maintenance facilities. At that rate, the facility will pay for itself in about 308 years. If Arlington taxpayers are lucky, the heavy maintenance facility will pay for itself in 100 years or less.

"Sure, Metro could stop allowing us to use their facilities, though it is hard to imagine they are looking to shed any extra revenue sources right now. Yes, it’s nice to have a facility that is our own. But spending millions on a “nice to have” project is the type of decision that can eventually get governments into financial hot water.

"To put this in business terms, the decision to move forward with these maintenance facilities represents a negative return on investment. Only in government would you justify them as saving taxpayers money."

We've growled at least three times about Arlington County's ART buses -- April 30, 2015, August 31, 2016, and December 14, 2016.

On April 26, 2017, the county issued a press release after receiving a national planning achievement award for smart growth from the American Planning Association. Based upon  the narrative above, it certainly doesn't appear those planning skills don't extend to Arlington County's ART bus program.

If you are a Growls reader concerned about Arlington County's ART bus program, and whether your tax dollars are being used efficiently, take a few minutes and write to the Arlington County Board. Just click-on the link below:

  • Call the County Board office at (703) 228-3130

And tell them ACTA sent you!

July 09, 2017

A Thought about Taxation

"If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them."

~ Alexander Hamilton, Federalist No. 21

Source: Founders Quote Database, The Patriot Post.

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Items in Growls are written by individual ACTA members and do not necessarily represent the views of the Arlington County Taxpayers Association, Inc. Please send comments about Growls to The Growl Meister