From: usenet@transfer.stratus.com (Mr. Network News)
Newsgroups: ne.politics
Subject: Re: Lotus as a public charity
Date: 10 Sep 92 18:15:36 GMT
Reply-To: Dave_Wetzel@vos.stratus.com
Organization: Dave_Wetzel

In article <1992Sep9.124703.759@miki.pictel.com> boba@miki.pictel.com (Bob 
Alexander) writes:
> Let's say Lotus pays $1M in taxes and receives $0.5M in city services.  
That
> means that Lotus is subsidizing others.  If Lotus' taxes are cut to 
$0.75M,
> Lotus is not receiving a $0.25M subsidy.  In fact, it's still paying a
> $0.25M subsidy.  Regardless of what happens to everyone else's taxes, 
Lotus
> is not being subsidized.  (BTW, these are not the real numbers.)

Ah, but if the tax rate for businesses in Cambridge is 10% and Lotus is 
paying 9% because they've struck a special deal, then Lotus is getting a 
1% tax subsidy from Cambridge.  (Also not the real numbers)  

It doesn't matter what the taxes are used for.  The principle behind 
taxation is that the government takes something from those who can afford 
to lose it and use that to provide services to all (hopefully raising up 
those who don't have enough).  It's not a business deal.  No-one is 
gaurenteed to break even on services!  You're not purchasing services from 
the government.  You're doing your *DUTY* as a responsible member of 
society to provide for all.

I also find it hard to quantify the value of services.  Somethings are 
clear.  Others are sketchy.  What's the value to Lotus of having removed a 
mugger from the streets of cambridge?  Would mugger X have harrassed Lotus 
employees?  Even if not, would the incremental fear created cause a loss 
in standard of living in Lotus employees?  What's the value of terror?  
What's the value of providing parks?  Do Lotus employees use them?  And 
what's the dollar figure placed on giving the Lotus employees a place to 
go and get away from work for a while?

On the other side, would Cambridge be better off without Lotus?  Lotus 
undoubtedly adds prestige to Cambridge when the city tries to attract 
other buisnesses.  What's the value of that?  But I imagine most Lotus 
employees do not live in the city of Cambridge; would Cambridge be better 
off with many smaller buisnesses whose employees do live (and shop) in 
Cambridge?

It's not easy to quantify for either side.

> If the city chooses to raise everyone else's taxes rather than reduce
> spending to match revenue, then that's a separate decision.

Absolutely.  But seeing as the people whose salaries most need to be cut 
in government (or positions removed altogether) are the same bureaucrats 
that get to decide where the money gets cut, I think it's safe to say that 
someone out there will suffer for every $1 Lotus gains through this deal.  
Either services that are needed will be cut or taxes will be raised 
elsewhere.

> Since Lotus has no control over city spending, it is inappropriate to
> scapegoat them.

And Cambridge has no control over Lotus' financial condition either.  If 
Lotus is in such financial difficutly, why don't they cut executive 
compensation to make up the cost of their taxes?  The obvious answer is, 
of course, the same reason that the bureaucrats in government don't cut 
their own salaries when budget cutting time comes 'round: they get to 
decide so they decide someone else has to suffer.

In any case, Lotus can ask for whatever they want.  And the Cambridge city 
government can tell them to stuff it.

--------------
Dave_Wetzel@vos.stratus.com
Newsgroups: ne.politics