Newsgroups: ca.politics
From: mfriedma@uucp (Michael Friedman)
Subject: Re: Prop. 13 and California's fiscal crisis
Organization: Oracle Corporation
Distribution: ca
Date: Thu, 13 Aug 1992 03:07:55 GMT
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In article <1992Aug12.053528.3263@Cadence.COM> phz@cadence.com (Pete Zakel) writes:
>In article <1992Aug11.152411.11985@nas.nasa.gov> dbailey@wk49.nas.nasa.gov (David H. Bailey) writes:
>>The point is, why should anyone, aged or not, be excused from paying
>>their fair share of property tax, when they are not "poor" by any
>>stretch of the imagination, but instead have hundreds of thousands of
>>dollars in home equity?

>Yeah, so I've got equity -- what gives you the right to "tap" it?

Same thing that gives us the right to enact any tax.
				   
>Tying property taxes to the paper "value" of the home is downright stupid,
>and completely unfair.  If I buy my home for $50,000 and 10 years from now
>someone says it is worth $500,000 you are saying I should pay taxes on that
>$500,000 value?  Bullshit!

That's what we are saying.  Why souldn't you?

>You say I'll get it back when I sell it, but what if I decide to sell 20 years
>after I buy and the economy has dropped and now it's worth $60,000.  Property
>taxes should be used to pay for services.  Base it on the purchase price, or
>base it on the size, but if you can arbitrarilly change the tax at any time
>because of perceived "value" it is completely unfair.

Doesn't seem unfair to me.  Is it fair for two people living in two
identical houses next door to each other to pay wildly different
property taxes becasue one bought low and one bought high?  You ask
what if you sell 20 years later when prices drop.  So what?  Property
taxes are wealth taxes.  When you own an expensive house you own
wealth.  If you don;t like it, cash in and move somewhere cheaper.

>>Home equity is not the most liquid form of
>>wealth, but it can be tapped, either by simply taking out a home
>>equity line of credit or else by moving to a less expensive home (say
>>in a beautiful location such as the Sierra foothills), banking the
>>difference and living very well on the interest.  These are options
>>that struggling young homeowners and "newcomers" do hot have.

>Before prop. 13 a LOT of the people being hit WERE the struggling young
>homeowners and "newcomers".  Someone would buy a house to be close to a
>new job, and in three years the house would almost double in value, but
>the salary hadn't changed nearly as much.  Suddenly the family is having
>to sell the furniture to make the tax bill.

Well, if they're that stupid it's their problem.  If their house just
doubled in value why the heck don't they sell it and take the windfall
profit?  It would have to be some job to make it worth their while not to.

>So you want them to move to where there are no jobs and cheap houses?  And
>what are they supposed to live on after they've spent the equity (don't
>forget the capital gains hit they have to take!)?

How long does that take?  You are talking about doubling the value of
their house.  Most people buy houses worth several times a year's
salary.  They'll have plenty to live on for a while even if they have
to take a pay cut to move.

>If you want a FAIR tax, tax eveyone based on INCOME -- and make it progressive.

Why is progressive fair?
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