A New Post: The Socialistic State of Sullivan County by Ben Math

Writer’s Workshop of Sullivan County

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The Socialist State of Sullivan County:

More socialism is not the answer to reducing poverty and rebuilding property values

 

by Ben Math

Has Karl Marx Played The Catskills Too Long Already?

 

In the recent article published by the Writer’s Workshop of Sullivan County entitled “Questionable Priorities of SC Legislators” by Ruby Pixman, he claimed that more and better government intervention was needed to address the terrible poverty in Sullivan County.

 

Here’s my answer to Pixman: More government is not the answer.  

 

Yes, socialism is a wonderful political method in theory, but doomed to failure in practice, as demonstrated over and over in recent history.

 

Locally, socialist policies in Sullivan County over the last 50 years have had a profoundly negative impact of the standard of living in Sullivan County.

 

With all the county programs, we still have one of the highest property tax rates in the Country and the average income is close to if not below the national poverty level.

 

Is there any correlation between these two facts?

 

More importantly how can the local people afford this? Are we approaching the breaking point?

 

When houses sell at auction for $50 or less, as they recently have, that is a significant marker.

 

There are those who cling to the rhetoric that it is a distressed sale. The fact is, many Sullivan County houses are about to bottom, not because the real estate recession is over, but because they cannot go negative in value.

 

Owners would rather walk away than pay someone to “buy” their house. That’s not distressed, but making a sound business decision and giving up on zero economic worth.

 

And that creates a very interesting situation.

 

If we assume property values track the rental value with cyclic variations due to the economy, then we can easily figure out what a house is worth.

 

Take for example a 3 bedroom 1200 Square Foot house in reasonable condition. If we could rent it out for $800 per month, how much would we pay for it?

 

Well let’s do the math. If taxes are $600 per month we only have $200 left for insurance, maintenance and the cost of our money. Let’s next assume we will need $100 per month for fire and liability Insurance. Let’s next assume we can cover all of the maintenance needs with just $100 per month.  That leaves $0 per month for the principal and interest for our mortgage.

 

So will the number of people, homeowners and landlords alike, walking away from their homes increase, especially if they have a mortgage, all because of the current high tax rates?

 

And as property values approach zero, the tax revenues will follow them down, and the municipality could financially implode.

 

But wait, there is a solution, though socialist again in nature, which Ruby would approve of.

 

Since no one will buy the homes, the towns and villages can take them over and rent them out to cover their taxes needs. Some of the people who rent the homes can work for the municipality to maintain the homes, and others can work as property managers.

 

Marx would be proud.

 

So there is then only one question remaining.

 

What happens when the municipality mismanages its funds (as government agencies have a proven track record of doing) and has to raise rent above what the market is willing to or can afford to pay?

 

Of course, our government will have to raise property taxes higher and there will be more vacant run down rentals.

 

Obviously higher taxes and more government handouts has not been a solution in reducing poverty or building the economy in Sullivan County.

 

Here’s the real solution: Perhaps if we lowered taxes, reduced the size of government and put more disposable income back in the hands of the taxpayer, we could see an economic revival.

 

Really want to help the poor?

 

How about volunteering to help charities and increasing public awareness of the needs of the poor and the benefits of making tax deductable donations to help them.

 

I already have my favorite charities for which I freely donate both my time and money.

 

But please Mr. Pixman, don’t feel entitled to “volunteer” my time and my money-and raise my high taxes to support your passions.

 

##

 

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