economics

Socialists Clueless About Economics

I keep seeing things like this, and it really bugs me:

Since 2013, I have been warning those pushing for an increase in minimum wage that it will simply cause higher prices. I, along with others, have been shouted down and told how stupid and wrong I am.

Seattle and California have a $20 per hour minimum wage. The answer is “real communism hasn’t been tried.” People in the Seattle area now have to contend with $26 coffees and $32 sandwiches, with taxes and delivery fees comprising nearly 30 percent of the total bill. Instead of listening, the left is now demanding $33 an hour as a new minimum wage.

If $20 is good, and $33 is better, why stop there? Why not make the minimum wage $250 an hour? Then we can all be rich!

Next month, Florida’s minimum wage will increase to $14 per hour, a 61% increase from the $8.56 minimum wage in the state back in 2020. Not coincidentally, the median home price in Florida went from $306,000 in 2020 to $436,600 in 2025, which represents a 43% increase in house prices.

Rents saw similar increases. Rentals were costing a median of $1187 in 2020, and now are running about $1752 in 2025, a 67% increase.

Increase the minimum wage, and prices will increase to match. Economics, it’s a thing. The socialist blames a free market, but it’s market manipulation that is causing a huge chunk of this.

It isn’t just housing. As long time readers are aware, my Denny’s Grand Slam scale is a great example of this. That breakfast has 2 strips of bacon, two link sausages, two eggs, and two pancakes. A good cross section of food products. I have been using the price of this breakfast in the same Denny’s location since 1997 as an indication of costs.

  • Here we are in 2025, and the cost of that breakfast is now $14.19.
  • In 1997, that breakfast cost $1.99
  • In 2009, it cost $4.99
  • In 2021, it cost $9.29
  • Just a year later in 2022, it was $11.59
  • In 2023, the rate slowed a bit. The breakfast was $11.99 in April
  • By November of 2023, the price was up again, to $12.99

So the breakfast in 2021 was $9.29, and it is now $14.19, a 65% increase. It’s almost like prices across the board are increasing to match wages. It’s a simple rule- more money (demand) chasing the same goods (supply) equals higher prices. Now there is a bit of a mismatch, because population (which is also part of demand) has increased a bit, but it still illustrates the point.

Before any of my readers respond with “well, technically…” please understand that my relatively short posts are not an exhaustive treatise on the issue. Books have been written about this, and I am not writing a book here. I had one reader respond to a recent post that mentioned income taxes with a comment that stretched into more than 600 words, explaining that I had calculated the taxes incorrectly. This post went into details about exemptions, credits, and other factors that made my numbers incorrect. My posts aren’t meant to withstand an IRS audit. I use public sources and usually post links to them, but they are still meant to be quick examples to illustrate the point. Responding with an over 600 word comment to explain one insignificant sentence in a 450 word post is just silly.

By Divemedic, ago

Florida Taxes Rising 10x Faster than Population

Property taxes in Florida are skyrocketing.

The population of the state of Florida has increased the most of any US state, but the increase in population was still only 8.2% since 2020. Where is all of the money going?

Taxpayers are being fleeced. Ripped off to pay for DEI, illegal immigrants, and for government employees to groom your children to turn them into twinks and trannies. Enough is enough.

By Divemedic, ago

It Must Be Deliberate

This article has hit my feed several times recently, and the author is either deliberately being deceptive, or she is just a moron. The headline reads: “I Asked ChatGPT What Would Happen If Elon Musk Paid Taxes at the Same Rate as the Middle Class” The claim is made in the article that Musk only pays a tax rate of about 3 percent, because his net worth increased so much.

The article claims that Musk can dodge taxes by using the value of his assets as collateral to take out a loan, which isn’t taxed. They are demanding that we tax people on the unrealized gains of their assets, because rich people something something.

The author is comparing apples to Volkswagens. The middle class, for the most part, pays taxes on income. It’s right there in the name: Income Tax. In the article, you are talking about taxing the rich on their wealth. It’s two entirely different concepts. If the two were equal, the middle class would be paying taxes on the value of their house, not on what they make.

As an example, let’s say that an average guy and his wife are making the US median income of $80k. They have two kids, take the standard deduction, and are thus paying $9400 in income tax, plus Social Security, Medicare and other payroll taxes totaling $11,752. That makes this family’s effective tax rate 14.69%. However, his house is worth $40,000 more than it was last year. That $40k is an unrealized gain, and this lowers his effective tax rate to 9.7%.

Now look at Elon’s taxes. They are screaming that his wealth increased by $86 billion in 2021, but he “only” paid $8.6 billion in taxes. They don’t say what he actually made, just what he is worth. It just isn’t a proper comparison.

My opinion here is that the powers that be desperately want the ability to tax wealth. Currently, this isn’t permitted because the 16th Amendment only permits the taxing of income, not wealth. Once they get the power to tax what you own, and not just what you make, there is no limit to what all of us can be taxed on.

  • Your retirement account? 2% annual tax
  • Your house? 4% annual tax
  • You have a collectable car? taxed at 5% of its gain

The beauty of this, is that even if your unrealized gains are adjusted for inflation, the official rate of inflation is lower than the actual rate. So if they let you deduct 2% of your unrealized gains as being inflation, but the actual rate of inflation is 5%, you will pay taxes on that extra 3%.

This will make all of us poor in no time.

By Divemedic, ago

Economic Illiteracy

Read this to begin the post:

A maximum wage? So what happens when your doctor, lawyer, or accountant hits that amount in September, and decides to take the rest of the year off? You will pass a law saying that they have to work all year? OK, so those high wage people, being smart, do some math and switch to a three day, 24 hour workweek. Good luck getting a doctor on Thursday. That means doctor appointments will be even more difficult to get.

The funniest part of all this, is that it won’t affect the truly wealthy. They don’t earn wages. They make their money from investments. Cap those, and people stop investing, which will grind the entire economy to a halt.

Democrats really are economically illiterate.

By Divemedic, ago

Property Taxes Again

Governor DeSantis is pushing to have a ballot initiative on Florida’s 2026 ballot. The initiative would be to eliminate property taxes.

Those who oppose this claim that counties, school boards, and other government entities rely on this to provide essential services. That’s a load of crap. On average, counties only rely upon property taxes for 18% of their expenditures. Of course, if you ask the counties, they play a bit of a shell game with the facts:

“If you want to get it from sales tax, well, it’s really going to disproportionately hurt lower income,” Kroll said.

Each year Kroll’s offices collect more than $700 million from property taxes, he said.

“The majority of it goes to the school board that that’s about $248 million,” Kroll said.

The remaining revenue goes to the Seminole County Board of Commissioners and Kroll said they use most of that money to fund the budgets for the Seminole County Sheriff’s Office and Fire Rescue.

  • It isn’t going to disproportionately affect lower income. See, lower income will buy less stuff, so they will pay less in taxes. If a person spends ten times as much, they will pay 10 times more in taxes. That’s how proportionality works. What they really mean is that the poor are now paying nothing, while those who aren’t poor are paying for bullshit that isn’t necessary. There are so many carve outs and exemptions, that nearly half of the people in my small town pay NOTHING in property taxes. More on that in a minute.
  • Don’t look now, but $248 million isn’t most of $700 million
  • The Seminole county school board has an annual budget of just over $1 billion. Only 1 in 3 households in Florida has a school aged child, yet we are each paying thousands to send those kids to school, even though education is a giant failure. It’s a huge drain of resources.

Seminole County’s proposed 2025 budget is $1.2 billion, which includes a potential property tax increase for 2025. That amount also doesn’t include the money that goes to the school board, because that is a different budget. In fact, they are increasing the milage rates for property taxes by 10% over 2024 levels, as well as increasing the county gas tax from 6 cents to 11 cents per gallon, and increasing taxes on electric, cable, and telephone.

With property values climbing, there is no need to raise taxes, but they do like them some tax and spend. Government officials always like to blame the services that are popular for tax increases, even though there is plenty of room to cut other, unneeded services. People don’t want to see the fire department cut, so they fund things like free needles for drug addicted transgender unwed mothers, then cry poor when there is no money left for the fire department.

Let’s take a look at the Seminole County Sheriff’s budget: There is plenty of waste here. The SWAT team has 20 members, and spends $4.5 million a year on it. That is a lot of money. Perhaps there is some room for cuts there. The sheriff’s office is paid $4.4 million per year to provide school resource officers to Seminole county schools, but actually providing those officers costs the Sheriff’s office $9.9 million per year. The cheaper way to go is to have the schools participate in the Guardian program, allowing teachers who volunteer to go through the training to be armed at school. Most counties in Florida who are part of the Guardian program accept the grant money, but then pay cops to fill the roles while not allowing teachers to participate. It’s a HUGE waste of money to have cops there when so many teachers would do it for free. Then they are spending all of that cash, only to find out that school resource officers aren’t required to do a damned thing if, God forbid, there actually IS a shooting at their school.

I pay over $6,000 a year in property taxes. 28 percent of that goes to the county, another 33 percent to the town, 31 percent to the school board, and the remainder to police, fire, EMS, hospital, and the water authority.

Overall, the loss of property tax revenue would mean that government agencies would need to get rid of some luxury items and perhaps learn to stop wasting money. If I could vote more than once to get rid of property taxes, I would.

By Divemedic, ago

More Fat

In yet another example of tax funds that can be cut from the budget, people who want to upgrade their homes at taxpayer expense are angry that the state isn’t taking your money and giving it to them.

That’s $280 million per year that is stolen from one set of homeowners and given to another. A married couple with two kids who make more than $27 per hour, can’t receive your money.

That budget money is $30 taken from each household in Florida. Just one program. How many more can be cut?

By Divemedic, ago

Property Taxes

As I have posted before, property taxes in Florida are easy to understand, mostly.

Ad Valorem

In Florida, the county property appraiser is an elected position that estimates what your house is worth each year, called your “market value.” If your house is your primary residence, you can take a deduction called the “homestead exemption” of $25,000 from that market value if your home has a market value of more than $50,000. If your home has a market value of over $100,000, you can take another $25,000 exemption. This second exemption doesn’t apply to school taxes. The result is called your “assessed value.” Because of the second homestead exemption, this means that your home gets two assessed values: one for property taxes, and the second assessed value for school board taxes.

Each July, the property appraiser mails out the proposed value of each property to the property owner. If you don’t think that the value is fair, you have 30 days to appeal that valuation. Most people want it to be as low as possible, because that is the value that your taxes are based on.

It seems complicated, but it really isn’t. For example, let’s say that your house has been deemed by the property appraiser’s office to have a fair market value of $125,000, and your county charges a property tax rate of ten mills, plus the school board charges of 6 mils. You would take the $125,000 market value and subtract your homestead exemption to arrive at an assessed value of $75,000 for property taxes, and $100,000 for school board taxes. The tax of ten mills would make your property taxes $750 and $600 for the school board taxes, making your total property tax bill $1350. Clear so far? Good, because it gets a bit more complicated.

Save Our Homes

Back in 1995, the voters of Florida passed an Amendment to the state Constitution that limits the annual increase in the assessed value of your homestead to the lesser of 3% or the consumer price index. Since real estate increases more than that in value each year, the longer you own your home, the less you pay in taxes. The gap between the market value and the assessed value is called your “Save Our Homes” credit.

In most cases, you want the property appraiser to set your assessed value as low as possible. The only reason you don’t, is if you are about to move to a more expensive home. The reason is called portability. If you are moving from an old house to a new one, you can take your Save Our Homes credit with you. That can mean a significant tax savings.

Other Exemptions

There are other tax exemptions.

  • Any widow/widower who owns property and is a permanent Florida resident may file for a $5,000 exemption.
  • Homeowners who are totally & permanently disabled get a $5,000 exemption.
  • The un-remarried, surviving spouse of a law enforcement officer, a correctional officer, a firefighter, an emergency medical technician, or a paramedic killed in the performance of duty gets a 100% exemption on property taxes. There is an exception to this that I will explain later.
  • Homeowners over 65 years of age who have an income less than $37,500 a year get an additional $50,000 exemption.
  • In fact, there are a dozen more exemptions that also are available, but I don’t feel like listing them all here. The point is that the tax system has become cumbersome, confusing, and unfair.

Milage Rates

The tax collector (also an elected position) charges a “millage rate” as an “ad valorem” property tax. Each “mill” is 0.1% of your home’s assessed value.

The county charges me 5 mils, the school board charges a bit over 6 mils, water control district charges half a mil; police, fire, hospital taxes, and EMS collectively charge 1.4 mils, the town charges 7.5 mils, and some other charges total up to almost 21 mils, or about 2.1%.

Fees

Some towns and counties charge fees that are part of your property taxes, but are not based on your property value. These are usually flat fees, for example each address may be taxed $150 a year for fire fees regardless of value. This is usually done so that the local taxing officials can raise taxes for social programs while blaming the increase on something palatable like the fire department. They simply take the money they were spending on fire and redirect it to whatever pet project they want to fund, then use the fire fee money to continue (or even cut) the fire department’s funding. Then they blame the fire department for the “tax increase.”

Total Taxes

After homestead exemptions, other exemptions, and Save Our Homes are all subtracted, the result is the “Taxable Value.” The milage rate is applied to that number. If you own a $300,000 house, you would be paying $5500 a year in property taxes. I pay even more than that.

Taxes aren’t just a money grab, they are a means of social engineering when you grant carve out exemptions to favored groups like the AARP, illegal immigrants, and others. They are also a grift, in that much of this money gets directed into the pockets of politicians and their friends.

and you have to pay them, or see your property confiscated and your ass in jail.

One note about the exemption for public safety that are injured in the line of duty. If you are off duty and see an auto accident, medical emergency, or fire, the pressure to do something is large. I used to stop for those sorts of things. Until the case of Shane Kelly, that is.

Firefighter Kelly stopped to assist victims of an auto accident on the Florida Turnpike in 2002. Shane was off duty. He was killed in full view of his wife when a tractor trailer slammed into the accident vehicles.  There were 2 occupants of the truck that killed Firefighter Kelly, and there was enough confusion as to which of them was driving that neither of them was ever charged.

The Federal Government ruled that Sean Kelly was acting in his capacity as a private citizen when he was killed, and since his death was not a line of duty death, his widow was not entitled to any of the benefits of the LOD status. Imagine how you would feel as an EMT, Firefighter, or other responder if you knew that helping an injured person carries the same risk of injury or death whether you are on duty or off duty, except that if you are injured, not only are you NOT paid for your time and skill, but you are not insured for that potentially career ending injury. Who will feed your family? Care for your kids?

In a meeting with my employer’s attorney, where Firefighters were attempting to get a written policy on what would be considered Line of Duty injury for off the clock employees, we were told that such decisions for off duty personnel would be made on a case by case basis by Administration AFTER the fact. I made a comment along the lines of, “So you get to decide AFTER I am injured whether or not you will pay for it. Will that decision take factors like the cost of treatment and PR benefit to you into account?” That REALLY pissed off the attorney. (I call ’em like I see ’em.)

After I learned of that case, I stopped helping out while off the clock. That policy marked the end of my stopping to help in emergencies. In fact, that policy change was a huge factor in my decision to retire.

How do I feel about fire department taxes? That is a topic for later in this week. I know what you probably THINK my feelings are, but you are probably wrong…

By Divemedic, ago

Voting

You get the government that you vote for, and Oregon residents can’t understand how they keep seeing their taxes raised. They were only supposed to tax the rich, you see…

By Divemedic, ago

Property Taxes

Florida Governor Ron DeSantis says that property taxes are nonsense, in that you are essentially paying rent to the government in exchange for owning property.

“You should own your property free and clear,” DeSantis said at a recent roundtable in Jacksonville. “I think to say that someone that’s been in their house for 35 years just has to keep ponying up money — you don’t own your home, if that’s the case.”

He’s right, but at the same time, things like police, fire, and schools need to be funded. The thing that surprised me about this article was that the state’s tax on real property accounts for 18% of county revenue, 17% of municipal revenue and between 50% and 60% of school district funding.

So the elimination of property taxes would mean that counties would have to cut 18% of their expenditures. Using Orange County (where Orlando is located) as an example, they have an annual budget of $7.2 billion. (pdf alert) That would mean that the county needs to cut $1.3 billion from its annual budget. From their budget, they spend money on:

In this budget, we have purposefully allocated resources to address critical areas that are essential to ensuring the well-being of our residents by investing in affordable housing, preserving the environment, fueling economic development, strengthening public safety, improving transportation, expanding mental and behavioral health services, and enhancing children and family services programs. We will also develop a plan for expanding services to homeless people.

Orange county’s property tax proceeds total about $969 million of that budget. Can they make some cuts?

  • $16.1 million is for affordable housing programs
  • Neighborhood Centers for Families (NCF) $7.5 million for mental health, early childhood development, youth empowerment, family support, and youth recreation.
  • The Citizens Review Panel (CRP) recommends grant funding for small and large nonprofit organizations that provide vital services to Orange County children, youth, and their families. CRP funding is budgeted at $4.1 million for the fiscal year 2025.
  • resources to advance environmental initiatives $100 million per year
  • Tourist Development Tax revenue budget for fiscal year 2025 is $345 million. Let businesses fund their own development.

Without even trying, I have found $472.7 million in cuts. That’s halfway to eliminating property taxes. It can be done. Government shouldn’t be an endless source of pork that is being used to buy votes. Government should stay out of our pockets and provide only essential services through taxes. They should ask for donations for any extra services.

By Divemedic, ago

Lies

 Two years ago, the Republicans caved by giving President Biden a blank check to borrow whatever and how ever much money he wanted to spend. On that day, the US debt stood at $31.46 Trillion. Within a month, the US had borrowed another Trillion dollars. Here we are with $36.21 Trillion in debt. (By the way, our national debt is the same now as it was on inauguration day, FYI)

They are borrowing money at incredible rates. We now are borrowing $1.5 Trillion each and every year.

It took this nation over 200 years to borrow a trillion dollars. Trump did it in seven months, Obama did it in only 6 months. It took Biden 9 months to borrow his first Trillion dollars, but he soon got better at it. His second trillion took three months, borrowing $2 trillion in his first year. In fact, he has increased the national debt by 118% in just two and a half years.

Biden increased the National Debt by 30% in four years, a total of $4.5 trillion.

President Trump increased the National Debt by 141% in his first four years.

Obama increased the debt by 194% in eight years.

President George W Bush borrowed his first trillion dollars in two and a half years. He borrowed his second trillion a year and a half later. Another two years, another $1 trillion. All told, President Bush borrowed $5 trillion in 8 years, increasing the national debt by 187%.

It took President Clinton 3 and a half years to borrow his first trillion dollars. All told, he borrowed $1.2 trillion in his first term, and $600 billion in his second. He increased the national debt by 140% in eight years.

George HW Bush borrowed his first trillion in 3 years, and he increased the National debt by 170% in four years.

Reagan borrowed his first trillion in 6 years, and doubled the National debt during his eight years in the White House.

Carter increased the National debt by 150%, but “only” borrowed $300 billion in 4 years. I guess that was when $1 Billion was real money.

Ford increased the debt by 147% in 3 years., Nixon by 135% in 5 years, Johnson by 116% in 6 years, Kennedy by 106% in 2 years, Eisenhower by 108% in eight years.

Democrats, and Republicans, both in a contest to see who can spend the most in our society of “how much can you give me if I vote for you.”

Remember when the Biden spokeswoman told us that borrowing trillions didn’t cost anything because it was already accounted for? Note that we weren’t really allowed to increase the debt until we divorced from the gold standard during the Nixon administration. Ever since then, spend, spend, spend. This nation creates money as fast as computers can create the 1′ and 0’s at the Fed. This can’t continue. By definition, anything that can’t continue, won’t. There is no amount of voting that will fix this.

By Divemedic, ago