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  • Raise Taxes — Lose Revenue

    The current taxes on a pack of cigarettes in Chicago include $2 from Cook County, 98 cents from Illinois and 68 cents from the city. If Quinn signs the latest increase, the taxes in Chicago will be $4.66 per pack, compared with 99 cents in East Chicago.

    On Monday, a pack of Marlboros at a 7-Eleven on North Wells Street in downtown Chicago ran $9.69, before the state tax increase. At a 7-Eleven on Hohman Avenue in Hammond, the same smokes went for $6.20.  …

    “The cigarette tax increase passed the Senate last week. Quinn has said the hike is necessary to generate about $350 million for the Medicaid program.  …

    In 2006, the Cook County tax doubled to $2 per pack.  …

    But even as taxes on cigarettes climbed, the revenue in Cook County dropped. In 2006, the county garnered more than $200 million in cigarette taxes. That number plummeted to $131 million in 2010, according to annual reports.

    Let’s stop here for a second and think about that.  In 2006 the Cook County Government DOUBLED the cigarette tax in order to RAISE REVENUE.  What was the result?  Revenue fell by a third!!

    Legislators and experts agree some drop-off can be expected as tax increases price people out of the market or alter smoker behavior. The percentage of U.S. adults who smoke declined from nearly 21 percent to 19.3 percent between 2005 and 2010, according to the Centers for Disease Control and Prevention.  …

    So during roughly the same period smokers (albeit nationally) kicked the habit to the tune of 8%.  But Cook County revenue off by 34.5%.

    Cook County Sheriff Tom Dart has said he thought most of the revenue dip was due to fraud.

    Dart and County Board President Toni Preckwinkle joined forces in September to add more staff to the county’s Revenue Department to investigate fraud claims. Within three weeks, investigators seized more than $353,000 in unstamped cigarettes and imposed more than $400,000 in fines, Dart said.  …

    Well Mr. Dart, if your own statement is true then you completely suck at your job.  Your missing $69 million and you find $400,000.  You’ve located 0.58% of the missing money.  Less that one percent.

    So what’s really happening here?  We know that the double the tax, yet revenues off by a third, only 8% quit, and Tom Dart can’t find the missing money.  So where’s the money?

    Larry DeBoer, professor of agricultural economics at Purdue University, noted that Indiana benefits as taxes spike in neighboring states.”There’s no doubt that commerce goes back and forth across the borders,” DeBoer said. “If Illinois increases its tax by $1, we’ll realize about $10 million more in cigarette tax revenue.”

    via Chicago Tribune.

    Aaaah.  There’s the money!

    In Illinois we’re governed by complete morons.  The Laffer Curve is a real thing.  People will change their behavior to engage in tax avoidance.  In this case is primarily involves not buying cigarettes in the City and County but in the collar counties and in Indiana.

    More to the point, wouldn’t you think that when you double the tax and see revenue falling and falling and falling that someone would have stood-up and said, “Maybe we should roll-back that tax before we lose any more money?”  But not in this county.

    Stupid Quinn and his ilk are going to keep raising taxes until there’s no one left to tax.

  • Protests

    Story:

    Protesters throw fence on police 5:43 p.m.

    Police Superintendent Garry McCarthy, dressed in his white uniform and wearing sunglasses, has appeared behind the thick line of police in riot gear.

    The police are facing off with protesters at the corner of Michigan Avenue and Cermak. A large crowd of protesters is gathered in the street on Cermak.

    Police and protesters are nose to nose, pushing at each other. Some protesters fall when police shove them with batons held horizontally in both hands. Periodically, police pull a protester out and take them away.

    At one point, protesters facing the police threw a section of metal street barricade on top of the line of police, who caught it with their hands and passed it back through the line of cops.

    via Chicago Tribune.

    And either a differing account or a wholly new event:

    Pizza proprietors fail to ride NATO summit wave 7:21 p.m.

    The four operators of Papa John’s Pizza, 80 E. Cermak Road, watched from their closed storefront window as the bloody skirmishes took place outside.

    “I had as good a front row view as anybody,” said Steve Feldberg, one of the operating partners.

    The pizza proprietors originally decided to stay open during the NATO summit weekend in hopes of picking up extra delivery business from customers who didn’t want to leave their homes.

    That turned out not to be the case, and sales lagged below expectations, he said. Just before noon Sunday morning, they made the decision to send staff home and close for the rest of the day, citing safety concerns.

    “We could just tell what was coming,” Feldberg said.

    He and his colleagues decided to stick around out of curiosity. At one point, the group watched as protestors wielded a barrier fence above their heads and started trying to throw it toward his store.

    “We were all watching it as it happened,” Feldberg said. “There was nothing we could do.”

    Police were able to take control of the fence and pass it safely to the rear of their flank.

    via Chicago Tribune.

    Whether this is one incident or two there can be no doubt as to a few facts:  The protesters tried to hurl a section of a metal fence at someone, & this is not the kind of non-violent action the protesters claim to be all about.

  • Half of Florida H.S. Students Fail Reading Test

    Nearly half of Florida high school students failed the reading portion of the state’s new toughened standardized test, education officials said on Friday.

    Results this year from the Florida Comprehensive Assessment Test showed 52 percent of freshman students and 50 percent of sophomores scored at their grade levels.

    Students in the 10th grade must pass the exam in order to eventually graduate but can retake it if they fail.

    The results came days after the Florida State Board of Education voted to lower the standards needed to pass the writing part of the test, known as FCAT. The test is administered in public elementary, middle and high schools.

    via Yahoo! News Canada.

    #1.  This is just plan embarassing.

    #2.  Why is this being reported by Yahoo! News Canada and not here in the U.S.A.?

    #3.  When are we going to have a national discussion about how our educations system is fundamentally, philosophically, and systematically broken?

    #4.  Note the “proposed solution” is NOT to actually teach the students how to read.  The solution is to reduce the testing standards so that more dummies can pass.

    We are failing as a society.

  • Illinois 3rd in Foreclosures Nationally

    This is embarrassing:

    Foreclosures starts in Illinois are on par with those in other areas but the state’s court-supervised foreclosure system continues to bog down properties in the process.

    Almost 7.5 percent of all one-to-four-unit mortgage loans in Illinois were in foreclosure in the first quarter, compared with a national average of 4.39 percent, according to data released Wednesday by the Mortgage Bankers Association.

    “Illinois and New Jersey trail only Florida as being the worst in the country, and they’re getting worse,” said Jay Brinkmann, the association’s chief economist “The rate in Illinois more than twice that of California. In the judicial states the problem continues to get worse in terms of the backlog of loans in the foreclosure process.”

    via Chicago Tribune.

    Perhaps if we had a government that was at least minimally friendly to business more people would be working.  That would certainly help.  But you cannot crush every businesses’ ability to efficiently function in the city and then wonder why more people don’t have good jobs.

    Jobs will come when businesses come.  When people are working again mortgages will get paid.

  • Gov. Red Tape Kills Another Biz, Jobs

    Last month when Mayor Rahm Emanuel announced his streamlining of city business licensing procedures, he chose Logan Square Kitchen as the location to herald this new day in better relations between the city and small businesses.

    And so it’s more than a little ironic that today LSK owner Zina Murray annouced on her website that her shared kitchen is closing at the end of June due to continued red tape from the city. The city’s Department of Business Affairs and Consumer Protection did not respond immediately to requests for comment.

    Here’s an excerpt from and link to her full post:

    It’s a sad time when our government kills the very things that can heal our City. Logan Square Kitchen was designed to heal the local economy, environment and food system all at once. It was an innovative, bold idea that never had its chance. The Dept of Business Affairs and Consumer Protection (BACP) began hammering nails in its coffin before we even opened our doors in 2009 and hasn’t stopped. Unfortunately, we see no end to regulatory burdens, which will continue to block our ability to grow a healthy business.

    Murray says that the 20 businesses operating in her shared kitchen–which rents hourly cooking space to artisanal food entrepreneurs–will have to find new kithens by June 28.

    via Chicago Tribune.

    Very sad.

    A government overrun with power.  Harassing the very people who create jobs and pay the bills.  This is why Illinois is doing poorly and other states (Wisconsin, Indiana) are recovering.

  • Stripping Chicago Spending, Bare Down

    “What do a Chicago strip club
    and the President’s campaign fund have in common?    ”

    ANSWER:  BOTH were paid- with public funds- as “VENDORS” to the City of Chicago.
    _______________________________________

    Yesterday, OpenTheBooks.com upgraded it’s transparency portal to include the City of Chicago checkbook from 2002-2011.

    It contains $74 billion in vendor payments. Last year 69,800 entities received checks.

    Here’s what I found while scanning the data…

    The City of Chicago approved checks to both The Admiral Theatre Inc, a Chicago strip club, and Obama For America, the president’s campaign organization. According to data received, both share the same “vendor code.”  Yet, neither organization exists in Chicago’s current transparency portal: click here and here.

     

    The Admiral Theatre strip club received $5,197.78 in City of Chicago checks. Sixteen checks range from $1.20 to $1,900. A buck twenty?

    See a database of City payments to The Admiral here.

     

    The check to Obama for America raises more questions. The campaign received a $1,000 check on August 28th, 2007. For some reason, theydidn’t disclose this to the Federal Election Commission: click here, and Open Secrets- here.

    Click here for my Freedom of Information Act Request seeking more information. See the detailed accounting data surrounding the check: vendor code, transaction id, PO#, fund, department, amount, check number, and date.

     

    Surely, the City will have some sort of explanation. Because, public funds used for campaign purposes violates federal and state law. And, we know that no Illinois or city worker would ever violate those laws, right?

     

    The City has five days to respond to our request for additional information. I can barely wait for the naked truth.

    You can search for yourself at www.openthebooks.com

    Sincerely,

    ADAM ANDRZEJEWSKI
    Chairman | For The Good of Illinois PAC

     

  • Wealthy Flee France (Shhh, don’t tell the U.S. Media)

    For those that don’t know, France recently had an election and voted for the most socialist guy on the ballot.  The guy who’s promising to raise taxes on the rich and increase the transfer payments to the poor.  The result?  The rich are leaving…  in droves.

    France’s high earners feel increasingly unwelcome in a country now led by a man who has admitted: “I don’t like the rich.” So where are they looking? London. It comes as no surprise – while Hollande prepares to raise taxes, over here David Cameron is cutting the 50pc tax rate for income above £150,000 to 45pc. “I have already worked in London and lived in South Kensington,” said one French banker who expects to return to the UK over the next three months. “The question is how much of Hollande’s rhetoric will materialise into policy.”

    Few are keen to find out. Private equity firms and American banks in Paris have already begun making arrangements for their top executives to set up office in London, amid widespread concern about changes to the French income tax regime.

    via Telegraph.

    This story is told over and over again in the European press, particularly earlier this week (I realize I’m late to the story.)  But the U.S. press is just getting to the story; mostly in the business press.  Neither the Chicago Tribune nor the sun-Times has not written a single word about it.

    While it can be shown that the rich are generally willing to pay their fair share, i.e. remain in places with high taxes, it is only when they feel that the quality of life issues make paying the high taxes worthwhile.  There can be no doubt that ever higher and higher taxes will drive the wealthy away; the Laffer Curve is real.

    The net result of this is that higher taxes impose a disproportionate burden on the middle class and the poor.  States like Illinois need to move to a more progressive tax structure; however they must do so very carefully in order to assure that the rich are not incentivized to relocate to Indiana.

  • 21 Unanswered Questions

    #3 Why does the Department of Homeland Security need Predator-B drones to patrol the border between the United States and Canada?

    #4 Why is a militarized “Red Zone” being set up in Chicago three weeks prior to the upcoming NATO summit on May 20th and 21st?

    #5 Why is the Milwaukee Red Cross being told to prepare for an evacuation of Chicago?

    via YOLO (you only live once).

    Some of these are quite serious (#’s 7, 12, 19.)  Some are easily explained.  Visit the link and decide for yourself.

    Keep in mind as you as you review this list that:

    They who can give up essential liberty to obtain a little temporary safety,
    deserve neither liberty nor safety.
    — Benjamin Franklin

    and

    A government big enough to give you everything you want
    is a government big enough to take from you everything you have.
    – Gerald Ford, Joint Statement to Congress, August 12, 1974.

  • Layoffs on Wall Street?

    After adding thousands bankers in the past two years, financial firms again appear to be on the verge of cutting that many positions and then some. Consultants and Wall Street recruiters say banks could eliminate nearly 21,000 jobs from their securities divisions in New York alone. Worldwide cuts could be even larger. Recruiters say big banks are in the process of finalizing their downsizing plans, and that layoffs could start soon.

    The latest round of job cuts could rival those that happened during the financial crisis. Back then, which was less than four years ago, Wall Street eliminated 28,000 positions. But that round of downsizing included the collapse of Bear Stearns and Lehman Brothers, and the biggest crisis in the financial markets since the Great Depression. By comparison, the stock market is up this year, and just last week banks reported better than expected earnings for the first quarter. What’s more, at the same time large firms are firing, many smaller investment banks have been staffing up. As a result, overall employment on Wall Street might not drop as much as it did after the financial crisis.

    via Fortune Mag.

    Two thoughts:

    First, just so everyone knows, the crisis in not over; we’re not out of the woods yet.  It’s sad whenever anybody loses their job and there may be a lot more of this coming.  Bankers, especially investment bankers, are especially susceptible.  A story this week about how JP Morgan Chase lost $2 billion in their “synthetic credit portfolio” shows with what relative ease the wheels can fall off the bankers bus.  Everyone who works in that industry is on the edge everyday.

    Second, this is a fine example of the private sector doing something the public sector cannot — getting rid of unnecessary people.  We know from the 2010 U.S. Census that Illinois while Illinois is growing its 3% rate over a decade is enemic compared to other states; we lost a U.S. House seat.  Yet Illinois government continues to grow and grow and grow.  We need to right-size Illinois government.  Some agencies are actually understaffed; leaving taxpayers waiting for basis services.  Others are bloated with staff getting paid to attend baseball games.

  • Cars Sit Unused for 5 Years in Maimi

    Have you ever bought a brand new cars only to forget where you put it? How about 300 of them? Probably not – unless you’re Miami-Dade County, which was recently reunited with 298 vehicles it bought brand new between 2006 and 2007.

    The county “discovered” this fleet of no-mileage vehicles after reading about them in a Spanish-language newspaper there (see the source for more images). Most of the misplaced motorcade is made up of Toyota Prius hybrids whose warranties either expired with very few miles on the odo or will very soon.

    via AutoBlog.

    Does this surprise anyone?  Governments everywhere just waste and waste and waste.

    This is why governments MUST become more transparent so everyone can see where the money is being spent.