The federal tax overhaul exposes the problem by punishing New Yorkers with double taxation

by Dan Smith

This week Wall Street fund AllianceBernstein announced that it was the latest in a line of finance businesses fleeing New York in order to lower, among other things, its property taxes.

This is the latest story of Wall Street banks relocating far away from Wall Street—i.e., outside of New York.  One Bloomberg radio commentator opined, “this is a seminal shift, if AllianceBernstein is capable of moving and is going to make the move, others shall follow.”

Businesses aren’t the only ones leaving—New York’s population is on the decline, in no small part due to taxation.

That’s because the silver lining regarding property taxes used to be that they are deductible from federal taxable income. But that’s done. The federal tax overhaul which was signed for 2018 disallows property tax deductibility (caps it, along with all other state and local taxes, effectively eliminating it for many, given New York’s nation’s highest tax burden). That means that individuals will now be double taxed—paying federal income taxes on money that was already paid in local (and state) taxes. New Yorkers who rent will likely find their rents creeping up as their landlords pass the higher taxes on to them.

Such double taxation will surely drive down New Yorkers’ property values and force more to leave our state for places such as Florida, which has lower property taxes and no state income tax (because they spend less than half what New York does, despite Florida’s larger population). Governor Andrew Cuomo has proposed cumbersome gimmicks in an attempt to help New Yorkers avoid the double taxation, but most say the IRS will see through these schemes and disallow them. And none of them apply to property taxes.

Some say that the Republicans were attempting to punish “blue states,” whose state and property tax rates are typically much higher than “red states.” But no matter the reason, a lot of pain is coming for New Yorkers.

And while the federal taxation rule change is the catalyst for the sudden pain, let’s be clear: the problem is quite simply the high taxes in New York.

Property Taxes – What are they and Why are New York’s so high?

Property taxes are an easy way for municipalities to raise funds. It’s a fixed target. You either pay your taxes, or you lose your property. To many, it’s like paying rent on land you already own—seemingly a violation of property rights. In their best light, they are like HOA fees you “agree” to pay when you buy your property, subject to changes by local government. But their ease of collection from typically the wealthiest people—landowners, makes them a staple for trying to raise funds for: public schools, first responders, sewage treatment, local road maintenance, parks, general administration, as well as hundreds of other uses.

And New York localities spend a lot of money—among the most in the nation.

Bloomberg news reports that three of the five most expensive counties in the nation for property taxes are in New York, while other reports say that New York has nine of the top 10 highest property tax counties in the nation. Overall, New York state’s property taxes are twice the national average, third highest overall.

The New York state legislature has put a soft cap on local government spending (the “tax levy”) which limits increases in annual spending to the lesser of two percent or the inflation rate, unless local government gets 60 percent approval of going over the cap, after public hearings are held.

While a cap is a great thing for those of us who are payers of property taxes, it leaves localities struggling to meet fiscal challenges—many of which come from the state. That’s because there is no limitation on Albany’s or federal requirements of local government with new and expanded rules they write, for which no state or federal budget monies are provided to comply. These are the dreaded unfunded mandates.

With both a property tax cap and increased requirements from Albany and Washington, local governments find they are getting squeezed. Many turn to other forms of taxation: fines and fees—everything from increases in mobile phone taxes (New York’s are 50 percent higher than the national average) to diverting police from preventing violence and turning them into tax collectors: plaguing non-violent people with more traffic stops to raise funds via traffic/parking summons or civil asset forfeiture.

What Can be Done?

Solutions to the problems localities face are not simple, but Albany can help:

• As we’ve proposed here, new unfunded mandates from Albany need to stop and old ones need to be eliminated. New York localities need to be protected from federal mandates, whenever possible.
• Albany can cut back on dozens of rules and regulations which stifle local businesses, among these are New York’s ever-growing minimum wage and jobs-killing occupational licensure laws.
• Public schools need to be free to run without Albany interference so that they can meet their fiscal and unique educational challenges in creative and cost-effective ways.
• State government spending in Albany can be cut dramatically, thereby relieving pressure on New York taxpayers and therefore local governments.
• Public employees’ pensions need to be transitioned from defined benefit plans to defined contribution plans or otherwise restructured to meet their near- and long-term fiscal challenges without massive tax increases which will surely come, otherwise.

No matter what, New Yorkers are looking at tougher times with the federal deductibility of state and local taxes being capped/eliminated. Albany can do a lot to ease the burden on localities so that property taxes can be controlled.

The post New York’s Property Tax Spiral appeared first on Larry Sharpe, Libertarian.

New York state’s centralized education policies are expensive, mandatory, . . . and not working.

by Dan Smith

Every year, Albany grabs more power over New York’s pre K-12 schools. Every year, costs go up. Every year, student performance remains stagnate or declines.

Why must it be this way?

New York State’s Education Department (NYS ED) gets many things backwards. Instead of empowering teachers, they box them in with more rules and more testing. Instead of decreasing the state education budget to match New York’s declining population, they increase their spending every year.

The facts are clear. According to the US Census Bureau, New York state spends more per pupil than any other state on K-12 public education—more than $21,200 per pupil.  We have 12.7 students per teacher (which is eighth best in the country); and we’re paying our teachers most, at an average salary of $79,200. Yet, despite these high costs and small class sizes, New Yorkers are getting a poor value. US News & World Report/McKinsey consultants say New York’s K-12 education ranked 33rd in both math and reading, 31st overall.

Money Wasted, Children and Taxpayers Suffer

The problems stem from Albany’s ever-growing centralized control, which requires too much testing and enforces too many silly, one-size-fits-all rules through unfunded mandates which give Albany unchecked power and an unlimited checkbook. That’s because all of the costs and obligations get pushed onto local school districts.

Costs go up and innovation is destroyed.

Our teachers are highly educated (including degrees in education and Master’s degrees) and trained. We’re paying our great teachers the most in the nation. So why not set these talented professionals free to address their classrooms’ unique needs?

The waste is seen most clearly in the amount of testing Albany requires, despite the lack of evidence that such testing improves students’ learning, much less prepares them for work and life.

The NYS ED requires seemingly endless testing of children in grades 3 – 8 and requires the Regents exams for high school students. This contradicts studies cited by education experts and President Obama himself that students are vastly over-tested and studies and experts which conclude that such testing doesn’t measure educational quality.

The NYS ED require the controversial Common Core education standards, despite New York parents leading the national charge to opt-out of its rigorous testing program. NYS ED tweaked its program slightly, but largely ignored the pleas of several hundred thousand New York parents, and kept the tests and Common Core program rolling along.

New York’s huge volume of testing yet low performance should clearly demonstrate that there’s a real problem. But nothing ever changes.

Perhaps the worst feature of centralized school control in Albany is unfunded mandates—expensive rules which Albany requires of local schools, but for which no funding is provided from the state budget. Unfunded mandates’ power creates all kinds of perverse incentives—Albany pays no price for the rules they require local schools to fulfill.

One school district compiled a list of the many dozens of unfunded requirements—the list is astounding.

With loads of rules and unfunded mandates, the amount of administrative spending at schools has grown dramatically. This answers a mystery which has confounded people for decades: if school spending has risen so sharply, why have class sizes not come way down and/or teacher pay risen sharply? It’s because the money doesn’t make it to the classroom–centralized rulemaking increases the need for overhead in the form of administrators who push around paper.

Worse, the spending always goes up, despite our population going down. The budget for the NYS ED is $35.7 billion in 2018—its sixth straight year of increases, despite seven years in a row of New York state losing about 100,000 people per year.

Time to Send Albany Home from School

We’ve all heard countless proposals to fix the existing education system. But you can’t fix the system when having the system IS the problem.

The best way to stop the madness is by eliminating the centralized rulemaking.

We need much more (if not all) control at the local level. Local school boards can address local needs—something Albany cannot possibly do. Local school boards can look try new things and pass the best ideas on to other districts, while quickly abandoning bad ideas—something which Albany has proven it cannot do, either. Better yet, each teacher can adapt their plans to fit the children in his or her classroom. After all, who knows the children better than a teacher working with that child and his or her parents?

Decentralization allows parents to have a greater voice in their children’s education and allows taxpayers to better hold local officials accountable. Local school boards will no longer be able to hide behind the excuse of a draconian Albany rules. If local schools are performing poorly, parents will vote with their feet, as well, sending a signal to local government that they need to change or get voted out.

When you pin down teachers and administrators, they express extreme frustration with the divergence between what they know they should be doing and what Albany requires them to do. They’re frustrated, which has led to teacher shortages. Several high school guidance counselors recently admitted to me that they were certain that New York’s Regents exams were an utter waste of time and money. When I asked why they still exist, they shrugged and said it’s always been this way—that you can’t change Albany.

But we can change Albany:

• We can elect state officials who put more control back to the local level.
• We can eliminate unfunded mandates—and require Albany to fund all of its rules and requirements themselves, thereby incentivizing fewer rules.
• We can foster innovation in teaching and encourage sharing of ideas of what works and what doesn’t—and allow those changes to be implemented.

The best way to make Albany more effective is to reduce the number of things it’s doing poorly. Mismanaging education has got to be near the top of that list.

The post Albany Should Be Suspended From Schools appeared first on Larry Sharpe, Libertarian.

by Dan Smith

April 15th is commonly known as National Tax Day (well, this year it’s April 17th). That’s the deadline for average Americans to file their annual federal and state income tax returns.

But assigning one day with that title is misleading, because EVERY day is Tax Day—especially for New Yorkers.

On top of all the taxes we pay from our incomes throughout the year, we all face a myriad of other taxes and fees. They’re everywhere and in nearly everything. New York has been clever about hiding them. They include: sales tax (8%), property tax (1.8%), taxes within cable and mobile phone bills (25%), taxes on electric and gas bills (50% higher than the national average), hotel taxes (5.9%), airport fees and taxes ($30 fee at JFK), alcohol ($0.14/gallon for beer, $6.44/gallon for liquor) and cigarette tax ($4.35/pack), gas tax ($0.62/gallon), car registration fees ($75 and up to $25/year), tolls on roads and bridges (between $5 and $15), dozens of taxes on health insurance and healthcare expenditures, and many, many more.

While most people in our country face these taxes and fees, New Yorkers get hit harder than anyone else.

Yes, we’re Number 1.

Several independent studies have recently shown that New Yorkers have the highest tax burden in the nation. And it isn’t even all that close.

To demonstrate this in another way, the Tax Foundation has calculated each state’s “Tax Freedom Day”—the day when the average taxpayer has earned enough to pay his or her share of taxes for the year, including federal, state and local taxes and fees. After that date, you get to keep all your own money. So, earlier is better. The national average Tax Freedom Day is April 19th. The best state is Alaska, whose relatively low taxes allow them to celebrate theirs on April 4th.

New York is, by far, the worst. Our Tax Freedom Day is May 14th. That’s 11 days later than any other state.

11 days!

The reasons for this are pretty simple:  our state’s spending has been rising quickly, while people are leaving the state. More cost spread over fewer people. And it’s getting worse. Sadly, we’ve ranked in the top three in the statistic of most moved-out-of-states for the seventh year in a row.

As history has shown, people flee wars and bad government. For example: refugees fleeing war-torn Syria, Cubans floating to Florida, North Koreans running through the DMZ and away from Kim Jong-un.

And now people are fleeing New York state.

Having the highest taxes and so many people leaving our state is no coincidence. They are cause-and-effect. People are leaving New York because of the high tax burden, the ever-growing set of rules and regulations and because those taxes are squandered by our corrupt and incompetent politicians in Albany.

None is worse than Governor Andrew Cuomo—who’s presided over New York for those seven years.

The source of the problem is spending, of course. Spending on incompetence, waste and corruption. And since New York can’t print its own money or borrow endlessly, the money has to come from taxpayers in New York.

But most New Yorkers have had enough. Many are leaving. Those who stay need to demand change—deep spending cuts to permit deep tax cuts. These changes, along with a slashing of rules and regulations, will attract people and businesses to our state—further diminishing the tax burden.

It’s time to demand change!

The post Tax Day is Coming appeared first on Larry Sharpe, Libertarian.

New Yorkers deserve all the facts about how many years late and how much over budget the Cuomo Bridge will be.

by Dan Smith

“It is on time and it is on budget! . . .” loudly proclaimed Governor Andrew Cuomo last August, as he stood atop the Mario Cuomo Bridge—the Hudson River crossing which is to replace the Tappan Zee Bridge.

However, it turns out that neither of the Governor’s statements were true, even at the time.

It is quite late and quite over budget. And the situation is growing worse by the day.

While some of Cuomo’s media friends were happy to grant Cuomo his undue victory, some basic fact checking shows that it’s no victory at all—not for Governor Cuomo and certainly not for New Yorkers.

It was just a bunch of lies. Records show that the Cuomo bridge was originally slated to be completed by February 2017 at a cost of $3.9 billion dollars. While a portion of the bridge has indeed opened, even today the bridge is far from complete. The August announcement demonstrated the missed February deadline for completion. And Poltico has reported that contractors are submitting claims for overtime and other cost overruns which will put the project at least hundreds of millions of dollars over budget.

But no one is certain how long the project completion will be delayed, nor by how much the budget has been blown. That’s because the Cuomo administration has been opaque about costs and has even refused Freedom of Information requests for details about his people’s activities to date.

Realistically, few public projects are completed on time or on budget. That’s the way our system works. Politicians and bureaucrats almost never pay a price for making unattainable budgets and timelines. So, without a penalty for lying, politicians say whatever they wish in order to get projects approved.

But Cuomo’s claim goes well beyond a faulty projection. His statement was demonstrably false the moment he said it.

That’s incredibly brazen.

Cuomo probably thought he could risk the bold-faced lie. A portion of the bridge was opening. And at the time of that declaration, he was on the heels of a political victory, having convinced the state legislature to rename the bridge after his late father, former governor Mario Cuomo. That decision has since been met with public backlash and a bill to have the name revert to the prior name—the Tappan Zee Bridge.

So perhaps New Yorkers are wising up to Cuomo’s game. Perhaps voters will hold a lying politician accountable after he squandered taxpayer money and trust.

Given the delay which will likely end up being close to two years, and given the cost overruns which some estimates put in the billions of dollars, perhaps Andrew Cuomo will tackle the issue honestly as he seeks reelection this autumn.

It won’t happen unless New Yorkers and the media demand honesty and transparency from their governor. Time and again, he has done neither without incredible amounts of public pressure.

The post Cuomo’s Bridge: Late and Over Budget appeared first on Larry Sharpe, Libertarian.

The Second Amendment protects the First Amendment. It’s always a good time to point that out.

By Dan Smith

I personally don’t like guns. I’ve had a few run-ins with angry people who’ve used a gun to make a point and criminals who’ve used one to coerce others to their will. No one got hurt, but it was scary each time.

I wish no one had a gun. But wishing doesn’t make it so. That’s not operating in the real world.

Guns exist, and we have to rationally deal with that fact. Notably, the government has guns—lots and lots of them.

In the wake of shooting tragedies, pundits and politicians often tell us that it’s not the time to discuss rights. People are told it’s a time to grieve . . . for thoughts and prayers.  That seems reasonable.

However, lately, many have rejected the thoughts and prayers. They are calling on people instead to pressure our representatives to address the violence. On those occasions when they get specific about how that’s to be done, it typically involves making it harder to get a firearm and taking guns away from people who’ve done nothing wrong.

And the speed with which pundits and legislators move to promote laws which would necessarily infringe on your right bear arms is astounding. Florida was voting on legislation within days of the Parkland shooting.  

The legislation to take guns is already written, awaiting the right moment to be introduced. And that moment is when emotions ride high from a tragedy—praying on people’s understandable shock, anger and grief.

But Due Process demands a legislative body rationally deliberate the merits of legislation—including its legality. And almost all gun legislation fails that test in several ways.  The Second Amendment exists and it’s quite clear—the right of the people to keep and bear arms shall not be infringed.  The Fourth Amendment protects your right to privacy which mandatory background checks violate. The Fifth Amendment protects against self-incrimination and many gun registry laws violate this right.  And like all other parts of The Constitution, these protections apply to all levels of government—including state and local. These are laws which our representatives have sworn an oath to defend.

The founders of our country had seen that freedom was the exception in history. Kings, priests or other autocrats ruled absolutely over their subjects. Whenever a ruler’s power was challenged, they would invariably take away more of their subjects’ rights. The founders saw that the ultimate check on such power was a free people who could defend themselves to preserve those unalienable rights.

Even after most of the World moved away from the rule of monarchs and priests, some 320 million people were killed by their governments during the 20th century—many more subjugated, jailed and starved by governments which stopped recognizing individuals’ rights to life, liberty and pursuing happiness.

Many of those new governments used the tools of fear and jealousy to get their people to surrender their rights of free speech, privacy, Due Process and right to firearms with which to protect themselves.

If you don’t think that Americans could be forced to give up such rights, I suggest you look at our history:  how the Native American population was treated, how people were jailed for speaking against the President following the Sedition Acts of 1798 & 1918, how Japanese Americans were interned in concentration camps during WWII and how African Americans were treated under the Jim Crow Laws, among many other examples.

A primary reason the United States has the greatest right to free speech is because of the population’s ability to defend itself. Just like the different branches of government are checks on one another, the People are the ultimate check on all levels of government—via the ballot box and, if needed, personal defense against government injustice.  Although we’ve allowed our freedoms to slowly erode, we are the oldest republic with the greatest freedom of speech, religion, press and right to assemble because of our right and our ability to defend ourselves.

In other words, the Second Amendment protects the First Amendment. And it’s always the right time to point that out.

The post It’s Always Time to Defend Our Rights appeared first on Larry Sharpe, Libertarian.

Governor Cuomo has declared a state of emergency for New York’s subways. But he’s also the cause. Killing passengers, service declines, crumbling stations, corruption, waste and illegally discriminating against the disabled are just a few of its problems.

By Dan Smith

I doubt I’m going to shock anyone by pointing out that the New York City subway system is a mess.

When I first started riding the subways every day, almost 30 years ago, the system had just undergone a massive revitalization—new, clean subway cars and refurbished stations. But things are much different today. Crumbling stations and dilapidated cars are frequently the case.

Worse, service had declined dramatically. Ten years ago, trains ran on time 90 percent of the time. Since, that figure has fallen to 70 percent.

And more people are getting hurt, as there have been many notable derailments and track fires. As a result of these issues, and many more, in June 2017 Governor Cuomo declared a state of emergency. Cuomo was quoted as saying, the “state of decline is wholly unacceptable,” which sounds like he is just a casual observer of the situation rather than the person responsible.

For you see, while the NYC subway system is owned by New York City, it is run by New York State’s Metropolitan Transit Authority (MTA), with both its chairman and its CEO being appointed by Governor Cuomo (as well as several of its other board members).

So, when the New York Times chronicles in some detail, that the system is plagued with a “byzantine bureaucracy which has allowed transit leaders to avoid responsibility for problems,” they are referring to Governor Cuomo’s appointees and cronies—if not Cuomo, himself.

The New York Times lays blame on current and former administrations—both Republican and Democratic, both in Albany and in New York City for the long history of how we got here, but Cuomo has had more than seven years to deal with the problems and they’ve only gotten worse.

While riders pay fares to ride the subway, New York City contributes hundreds of millions of dollars to the MTA. But that begs the question: why is the city diverting taxpayer dollars to a fee-based transit system? Why don’t rider fees, shop rentals and things like advertising fund the entire system? The answer to that is complicated, meaning that it’s political. And when government tries to run a consumer service, it gets complicated and this is the result—high costs, bad service, lost rights, waste, fraud and abuse. Everyone suffers—except those who benefit from the system: politicians and unions.

The MTA Breaks a Law Which NYC Strictly Enforces on Everyone Else.

As I’m writing this, I’ve just read that it’s been announced the U.S. attorney has filed a lawsuit against the MTA to comply with the Americans with Disabilities Act (ADA). The ADA is a 1990 law whereby those with disabilities must have access to all buildings and businesses which serve the public. This includes apartments, shops, restaurants and everyone else—including the subway. However, the MTA has ignored the law . . . because they can.

The MTA has had 28 years to comply with this law and it has done almost nothing. Only 20% of subway stations have elevator access. If that’s not bad enough, many of those elevators are 20 years old and many are regularly out-of-service. That’s an unwelcome but frequent surprise to those who depend it.

I have friends who are disabled and daily life getting around New York City is a nightmare. They tell me that, despite New York City’s strict access laws enforced against private businesses, the MTA aren’t even in the Top 10 cities in the nation in helping the disabled get around. As a substitute, the City provides a service called, Access-A-Ride which are shuttle buses for the disabled. But my friends complain that Access-A-Ride is terrible: slow and unreliable. Further, a recent audit by the Comptroller shows that complaints about the service’s safety and bad service are high and that the MTA is unresponsive to the issues.

In response to the federal lawsuit alleging that the MTA is violating the ADA, an MTA spokesperson said, “the MTA and NYC Transit are committed to adding and maintaining accessibility for the century-old subway system, and working hard to do so by investing more than a billion dollars over the current five-year capital plan alone.”

That statement is both an excuse and clearly a false promise . . . if not an outright lie. The MTA is blaming the age of the system, but they’ve had 28 years to comply. And they’re implying that a billion dollars will fix the problem in 400 stations, when it has cost $3.5 billion to lay one mile of track. The idea that $1 billion will make even a small dent in making the MTA compliant with federal law is laughable. Moreover, that billion dollars is likely the same billion dollars promised last June to correct the “state of emergencies” issues which led to the derailments and track fires.

It’s just another shell game by Governor Cuomo’s cronies. Neither they nor Cuomo are up to the monumental task of even beginning to address the issues which Cuomo is largely responsible for creating.

The Root Causes

Let’s look at the realities. The MTA is inherently flawed. It answers to politicians and unions, not riders. It is a monopoly and acts like one—it has no interest in controlling costs, obeying laws, nor pleasing its customers. It’s terrible because it can be. It takes in money from its ever-increasing ridership, from advertising, from shop owners, from New York City taxpayers, from New York State taxpayers and from bondholders. Yet it largely answers to bureaucrats, politicians and unions.

And New York City punishes competitors with high bridge and tunnel tolls, insane parking taxes and a highly regulated taxi system—all to compel people to use the subway.

Yet, the system is the most expensive at building new track and one of the most expensive to operate—all while getting ever-worsening results.

Another problem is the system’s debt. The MTA spends 17 percent of its budget paying interest on its ever-growing debt—three times what it did 20 years ago. Its debt is $35 billion, which is greater than 30 World nations. Despite all of its sources of revenue, it operates at a perpetual loss–$6 billion per year. The average MTA employee makes $90,000 per year and has the most generous benefits imaginable, while a typical worker anywhere else sees a fraction of that—and usually produces much, much better results.

These problems are symptoms of the immense, multi-layered bureaucracy to which the New York Times referred, as well as the control the unions have over the system and the corruption which both bring. In addition to the high profile pay-to-play corruption conviction recently, reports by the Times and others highlight overstaffing, hundreds of employees with no apparent job, highly slack bidding processes, and costly and useless consulting firms.

What Can Be Done?

Let’s address the incentives problem. The MTA has no interest in providing a good service, so they have to go. New York City should fire them—fire Cuomo and his cronies. I’m sure it’s illegal to do so, if not prohibited by contract. But the MTA has flouted the laws for decades. Shouldn’t a lawbreaker and lax provider of service be fired? New York City must find a way to do so.

This creates a few other issues. Two of them are: i) who will run the subways? and ii) who will repay the huge MTA debt?

These two problems can solve each other New York City should put the operation and perhaps even the ownership of the subway system out to bid to private entities. Just as New York has done to revitalize Bryrant Park, they could do with the subway—turn the operations over to those who know how to please customers and are incentivized by profit to do so.

It’s not a crazy idea. With a firm like SpaceX showing they can do things which NASA cannot and doing them much cheaper, one should question government monopolies over such things. Although some will say that only a city can run a transit system, airports around the World have privatized with a great deal of success—more efficiency, better service and benefits to taxpayers instead of costs. A private firm will find what customers value and drop nonsense. The city can set any rules it wants. And the money from a sale or leasing could address the $35 billion in debt.

And the city could require that the operator bring the system up to compliance with the ADA—something which the MTA has no interest in doing.

No matter what, a big change is essential. Expecting it from Governor Cuomo and his cronies at the MTA has proven a failure—as usual.

The post The Subways Have Gone to Hell appeared first on Larry Sharpe, Libertarian.

Your property can be taken by the police for no reason—and it’s guilty until you prove it innocent.

By: Dan Smith

Civil asset forfeiture is an area of law which permits local, state or federal law enforcement to seize your money or other property (car, home, etc.) if they suspect you might be involved with a crime.

The practice is nicknamed, “Policing for Profit,” by critics who see that law enforcement officials have highly questionable incentives in this arrangement. If police come across money (or other assets) in nearly any situation, they may take it and there’s almost nothing the owner can do about it. Your money or property is presumed guilty whether or not you are charged or convicted of a crime. Some estimates say that’s the case more than 80 percent of the time.

Even more egregious is that the police get to keep the funds if you don’t initiate the complicated and expense legal process to prove your property innocence within 270 days (per New York’s law).

So, the police are clearly incentivized to profit from such situations. They find the money and then they are the judge, jury, executioner and beneficiary of the taken property.

It’s wrong on a great many levels.

Many law enforcement officials feel that civil forfeiture is an important tool for them, particularly in the War on Drugs—where they feel they can cripple narcotics distribution operations by taking perpetrators’ cash.

Such an explanation runs into the highly questionable War on Drugs.

Further, the victims of civil forfeiture tend to be the poor and minorities—as they are more likely to be carrying cash when they encounter police. Individuals from these groups are less likely to initiate negative publicity against the police and have the least ability to defend themselves.  

How Is This Even a Thing?

Besides being unjust from the common-sense viewpoint of ‘innocent until proven guilty,’ one can legitimately ask: ‘How is this practice constitutional?’.

The Due Process Clause of the United States Constitution under the Fifth Amendment states:

“No person shall . . . be deprived of life, liberty, or property, without due process of law.”

So, it certainly sounds unconstitutional.  Unfortunately, this practice has not faced a serious constitutional challenge at the Supreme Court in over 40 years (and that case is quite likely no longer applicable). Prosecutors typically yield before the question can reach federal appeals court and since this is a civil proceeding, your property does not have the right to an attorney, making challenging the law quite costly.  

One might ask:  why is the process of seizing funds a civil procedure, when the crimes themselves with which they’re associated almost always criminal or traffic violations? The answers one gets to that question are highly dissatisfying (e.g., a “thing” cannot commit a crime). But cutting through the legal bull, it seems to be related to the fact that it’s easier for the police to keep your property under this lower standard of proof and our legal system is often about making policing easier on the police.

What’s also ironic is that when people do fight and get their property back, the police often don’t give back or repay what was taken, much less face any punishment. The money for restitution often comes out of general taxpayer funds—so the police really face no penalty for being wrong. Taxpayers’ lose, as usual.

These clear police abuses have been written about more and more in recent years. And some states have rewritten laws to curb some abuses. But much of it is window dressing. President Obama’s DOJ used this tool widely—much more than any past administration, to the point that more money was taken by police in a given year than was taken by burglars committing crimes.  Under some pressure for civil rights groups, Obama announced the practice would be curbed, but then sadly reversed many of those rule changes when he came under pressure from powerful law enforcement groups who profit from the seizing of people’s property.

President Trump has fully backed the practice and his Attorney General, Jeff Sessions,is aggressively using it, and will likely beat Obama’s records. As I write this in March 2018, the DEA is about to hold an auction to sell off $25 million worth of Bitcoin, primarily seized via cases of civil asset forfeiture where no charges were filed.

The bottom line is that the police like it. And in this country, the police get the benefit of the doubt. The police are highly organized and make a lot of money from this practice.  And no public official wants to appear ‘soft on crime.’ So, while the practice is heinous and corrupt and while there have been attempts to reduce the practice, it largely continues.

New York Is An Average Offender of Rights

The Institute for Justice, who regularly defends victims of forfeiture abuse (having won dozens of such cases), rates New York State as an average offender of people’s civil rights in this area, giving us a “C” grade.  Among other factors influencing that grade: New York law enforcement gets to keep 60 percent of the property they seize (the remainder is sent to other agencies), New York’s standard of proof for keeping the funds (“clear and convincing evidence”) in trial is higher than standard civil proceedings, but lower than “beyond a reasonable doubt”—as in criminal proceedings.

However, New York has been particularly opaque about its forfeiture activities. In 2013, a rare disclosure from the NYPD, via being forced to by Freedom of Information filings, showed that they’d seized many tens of millions of dollars from New Yorkers, all with no Due Process. In reality, no one knows how much money has been taken—the NYPD complained to a judge that if they tried to figure out how much, their computer systems would crash.

Statewide information is even harder to come by.

New York has made some strides to investigate and potentially reduce abuses. In 2017, the New York City Council passed a law to demand civil forfeiture data from the NYPD. This led to the NYPD agreeing to new rules limiting seizures in February 2018.  

New York Can Do Much More to Improve

New York State Police and local police, including the NYPD, can do more to track their seizures, to give the public better information about how much the police are seizing and what is happening with the funds.

Ending the failed War on Drugs would eliminate much of the practice.

New York should remove the clearly corrupting incentive of allowing police to keep the property. Police and officials at all levels should turn the property over to the state treasury—the Department of Taxation and Finance, or some other entity unconnected with the seizures or their adjudication. Law enforcement should not be compensated in any way, other than via taxes from their jurisdiction.

Most importantly, New York should require a conviction of criminal activities related to the asset seizure. If a prosecutor can’t make a case or convict the person, why should his or her property be forfeited? It should be returned, with interest.

These changes might be a challenge for the police and the justice system. But “innocent until proven guilty” is a burden which the state must bear. A free society demands it.

The post Civil Asset Forfeiture appeared first on Larry Sharpe, Libertarian.

Using propaganda with half-baked ideas, politicians tempt us with promises of financial or physical security. They can never deliver those. Worse, the price they ask is your freedom.

By Dan Smith

“Power tends to corrupt”, Lord Acton tells us.  When you give away the power to run your own life as you see fit, politicians tend to use that power to look after their own needs, first and foremost.

The lesson is that you should be suspicious of any slogan or philosophy which asks you to hand over that power. A great many popular political philosophies ask you to do just that. Be wary of such potentially bad philosophy. It’s everywhere and politicians are trying to get you to vote for it, and then use it against you.

Many politicians and pundits will claim they are not linked to any philosophy or ideology. They will claim they just do “what works.” Such supposed pragmatism is often just what sounds good in the moment, as long as you don’t ask too many questions or look at where similar ideas have been tried before. But they’re rooted in philosophy, nevertheless.

Politicians and “thought leaders” will propose all manner of slogans, policies and ideas to see what gets accepted by the public. They drop the ones which don’t catch on and pursue those which the media or their constituents find appealing. While this might sound like representing the will of the people, it really is just groping around trying to find a way to sell bad ideas. Many of the ideas are old failures, repackaged to appear as though they’re new and worthy of trial.

Further, the ideas seem to benefit politicians and their friends a lot more than you or me.

These slogans tend to have one thing in common. They want to cut a deal: you give away more of your personal freedom and the money you’ve earned and, in return, the politicians and elites promise they’ll punish some group you don’t like or make sure you’re safe and taken care of.

That’s been tried, many times and in many forms. It doesn’t work. It’s a raw deal—every time.

Here are a few of those sentiments and philosophies which have been popular over the years [along with commentary about some underlying issues].

• “It takes a village” – originally an African proverb about raising children, Hillary Clinton popularized the idea that modern society should be run like a small village, where everyone shares the burdens of everyone else and village elders (politicians and elites) make decisions for the villagers [forgetting that the elites and elders whom you’ve never met have no idea what’s best for you and your family; oh, and we’re not living in a small village!]
• “Promoting family values” – strong families tend to produce productive and kind people, so our laws should subsidize and enforce such a morality, while punishing deviant behaviors [such as defining marriage to that written in scripture, promoting the subprime mortgage crisis and unleashing the brutality of the failed War on Drugs]
• “You didn’t build that” – Barack Obama’s idea that no one is successful on their own—the public roads deliver products and the public schools trained you and your workers, so the successful should “give back”—offer to forfeit more of their income to the collective who support them [forgetting the fact that taxes and fees were already paid for those things; and you weren’t given your success—you risked, sacrificed, created value and exchanged that value freely . . . so there’s no obligation to ‘give back’]
• “Protecting our vital national interests” – as Secretary of State Rex Tillerson has said many times, the United States should intervene in World affairs if our national interests are at risk [our “interests” are usually a nebulous concept, but seem to involve oil or allies who purchase our weapons systems]
• “The paradox of choice” – life today has too many options and choices, you become confused and make bad choices [and you should surrender many of your options—to politicians and intellectual elites who somehow know best]
• “The wealthy become indifferent to human suffering” –social experiments show that the wealthy lose touch with other human’s problems, they are bad people and politicians and elites should help them be better people [as if politicians and elites corner the market on goodness; and despite the vast amounts of charity that the wealthy contribute]
• “We must be policeman of the World in order to spread American values”—the United States is the indispensable, exceptional nation which must force its values on other nations [often through occupations, hand-picking dictators, election tampering, bombings, invasions and buying foreign officials]
• “Inequality of outcomes is wrong and dangerous”– pointing to the French Revolution, warriors for economic justice claim that inequality of outcomes is unjust and will tear our society apart; they wish to redistribute wealth to correct for such injustice [despite the curious lack of historical examples of free societies facing these dire outcomes; forgets the incredible standard of living our “unjust” system has created; forgets that redistribution locks people into dependency and stunts investment; and doesn’t consider that a large, active state may be the cause of much of the inequality]

There are other examples which don’t lend themselves directly to policy, but which lay a foundation for permitting the government to take away more of your money and freedoms. There’s today’s popular postmodern philosophy claims that there may be no reality, so one can justify any policy or action which feels appropriate.  There’s also the view that science is showing that there is no free will—our decisions are predetermined, so you might as well submit to your fate [which is apparently defined as what politicians and elites have prescribed for you].

Note that these are simplifications of ideas summarized by someone who finds them largely repugnant. So, you should research and consider them yourself. But be sure to look at the examples where they’re put into practice—because reality is the best yardstick of a philosophy’s worth.

But looking at these slogans and philosophies, one notices a pattern:  you should not live your life as you see fit. Rather, elites and politicians should be making critical decisions for you and everyone else.

The propaganda is designed to sell you on that idea—to get you outraged . . . to say, “something ought to be done!”. Proponents of these ideas want you to surrender your rights and give elites the power to take some portion of what you’ve earned and run ever-larger portions of your life for you.

They use guilt, fear, pride, envy or anger—primitive emotions to keep you from using your logic and reason which might have you question the half-baked, self-nullifying behavior of giving such people more power over you.

They all presume you are a tool of the collective and can be directed by elites to the presumed benefit of the collective. In such a World, your needs and desires are secondary, at best. Many of the same people who claim to fight for diversity also fight to make outcomes and our lives uniform. You are being asked to forsake logic and reason. Your individuality is lost as you become a pawn of the collective.

What could go wrong?

People want “justice”. That’s a good and proper thing. But there’s a huge difference between:  justice in the form of being left alone to pursue your dreams, versus the justice of pursuing equality of outcomes. The former promotes individuality and leads to prosperity. The latter is a dead end. It gives power to people who will invariably use it to benefit themselves. Yielding freedom doesn’t even achieve its primary goal—as elites always end up with better outcomes.

Freedom is the one thing that works, again and again.  People free to make their own social and financial choices, and free to make and learn from their own mistakes, tends to generate the best outcomes.

Question these slogans. Hold onto your options. Consider choosing freedom.

The post Bad Philosophy appeared first on Larry Sharpe, Libertarian.

Student Loans Indenture Our Children; Governor Cuomo Becomes a Feudal Lord Over New York’s Student Serfs

By Dan Smith

Stories about young people saddled with loads of school debts are everywhere today.  With almost $1.5 trillion of outstanding student loan debt, more than 44 million Americans have student loan debt. That means almost everyone knows someone who’s greatly burdened by such loans.

The burden is real. More than 11% of student loans are delinquent. As Pew Research has noted, “young college graduates with student loans are more likely than those without loans to have a second job and to report struggling financially.”

And student loans are demoralizing. Pew’s research also shows, “compared with young adults who don’t have student debt, student loan holders are less upbeat about the value of their degree.”

Must it be this way? Can government fix it? The answer to both questions is: NO!

Government can’t fix it. Government is the source of most of the problems, they need to STOP!

Debt is a Tool Which Needs to be Used Carefully

But let’s back up. Debt itself is not necessarily a bad thing. It can be a wonderful tool. A synonym for debt, ‘leverage,’ comes from physics and means a device which creates and focuses additional power in order to do work. And that’s what debt is—the ability to make an investment now and pay for it later when the benefits start to roll in.

But debt has obvious risks. The inability to repay debt and interest can cripple you financially. Historically, college almost always pays off: tuition costs were much lower and graduates mostly got good jobs to pay back their loans. But both ends of that deal have turned upside-down: good jobs are harder to come by and the tuition is so much higher today. And unlike most investments, you can’t get out of this one so easily—it’s almost impossible to get a student loan discharged in bankruptcy.

Borrowers are not happy with the choices they’ve made. Pew finds that, “only about half of student loan holders think the lifetime financial benefits of their bachelor’s degree outweigh the costs.” College used to be thought of as a tremendous investment. For many, that’s no longer the case. Our system has crushed that belief.

Perhaps worse, entrepreneurial activity has fallen. To a large extent, startups in the U.S. are driven by young people taking the chance to quit their jobs and pursue their ideas. Startups are the future of our economy. But debt-burdened young people are not in the financial position to take the chance of leaving their post-graduation jobs in order to put the ‘sweat equity’ into starting their own businesses. This is hurting their future. And it hurts the rest of us who might be missing out on the next Microsoft, Apple or Amazon.

And startup activity, while up recently, hit an all-time low in 2013. The number of startups always decline at the beginning of recessions, but they usually bounce back quickly (the out-of-work start their own companies). This time they didn’t, and many have cited student loan debt as a cause: NBC News, TED, CNBC, business.com, and many others.

Government ‘Solutions’ Are the Problem

Many progressive leaders are calling for loan forgiveness, where the federal or state governments forgive public loans or rework deals.  This sounds nice and would certainly help those with outstanding loans, but there would be a crippling cost. The money must either come from taxpayers or financial institutions, or both. Or, in some cases it comes from the students through their time—the forgiveness comes only with the promise to work for government for ten years.

New York has created a law which they say will eliminate future student loans, the Excelsior Scholarship. It allows certain students to go to college for “free.” But that means that taxpayers must foot the bill. And there’s a catch: the students must agree to stay in New York post-graduation for the number of years they’re in school . . . or pay their tuition upon leaving the state.

That’s just New York’s new form of indentured servitude. It indentures students to the land, like serfs to the feudal lord, Governor Andrew Cuomo.

People should want to stay in New York because it’s fantastic, not because of some deal they made with the Devil when they were 18.

America already has a $20 trillion national debt and moreover we have $150+ trillion in obligations for which there is no known way for them to be repaid. Loading taxpayers up with trillions more by forgiving student loans will only exacerbate that problem. Forcing banks to write off loans would destroy many businesses today, and all the jobs they support. It would also make it much harder or even impossible for anyone to get a loan in the future—students most of all.

Solutions Only Come When Focused on the Root Cause

No, solutions don’t come by waving government’s magic wand. That’s black magic. Solutions arise by looking at and address the root causes. Key symptoms include:

• Rising tuitions – students must borrow more and more
• Diluted worth of a college education – ability to pay loans back gets diminished
• Easy access to loans and financial aid – drives up demand, drives up cost

These three things are highly interrelated and they point directly at the true root cause: government.  Government’s programs to make loans more accessible and college more affordable sound wonderful, but have had horrible unintended consequences: they’ve made college much, much more expensive and diluted the value of a bachelor’s degree to the point where employers don’t value them nearly so much. So, students are borrowing more and having a tougher time paying it back. Study after study shows government’s role is direct and proportional.

The good news is that, despite the dropping value, college degrees are still worth it for many areas of study. The not-so-obvious solution to the problem is to get government out of the business of giving away or lending taxpayer money. And we shouldn’t be asking young people to make a four-to-ten year commitment post-college, when many can’t even choose and stick to a major.

In New York, that means ending Andrew Cuomo’s feudalistic Excelsior program. That program drives up tuition for other students, saddles taxpayers with yet more debt and taxes and make serfs out of our young people.

Making things “free” has never turned out to be so expensive. We must reverse that public policy choice if we hope to turn things around.

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