Author Archives: larrylittlefield

About larrylittlefield

A blogger on state and local government and related issues in Brooklyn NY.

New Yorkers Are Going To Pay More and Be Forced To Expect Less, But Shouldn’t Let Them Say It’s Fair or Blame Circumstances or Scapegoats

I was in Target the other day and noticed their motto:  “Expect More, Pay Less.”   That sure is a hell of a lot different from New Yorkers under the age of 60, and in particular under the age of 40, will be paying into and getting from the federal, state and city governments over the next 20 to 40 years.  At the federal level because of four decades of future selling by Generation Greed that have left us with a massive national debt and underfunded old age benefits – underfunded despite later-born generations already being required to pay in more while being promised less.  At the state level because New York City shares a tax base with Upstate cities and rural areas with extensive needs and dwindling resources, and suburban areas with more power and greater entitlement. And at the city level because one politician after another has cut deal after deal to cash in the future, to further benefit already-advantaged unionized public employees and contractors, who are cashing in and moving out.

The theft has occurred, the money is gone, and “Expect Less, Pay More” is inevitable.  In fact a New York City in the 1970s-style institutional collapse is highly likely, and not just in New York City.  So what will our “leaders,” still beholden to the same interests and generations and still promising to hand them even more, say about this?  I want them to be forced to admit the truth.  And let me tell you what I don’t want to hear.

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In Global Politics, Technology and the Grim Reaper Are Our Best Hopes

In the wake of the U.S. getting sucked into yet another crisis in the Middle East SUV cheap gasoline supply area, it occurs to me that Iranians and Americans have the same problems.

Each are being ruled over by a generation that thinks of itself as the generation, the Americans who came of age in the 1960s and the first half of the 1970s, and the Iranians of the Iranian revolution of 1979 and 1980.

Each of those generations is obsessed by its particular culture war, in part sex-driven, tribalist issues, and those of at the top in politics seek legitimacy based almost exclusively based on those “people like us vs. people them” issues.  They don’t want to talk about anything else.

At the same time, however, these aging generations, in their own self-interest, have left the generations to follow worse off than they have been, by cashing in the future. And despite having done so, they still think they have the right to dictate the terms of that future to those following, and stifle their aspirations, rather than allowing disadvantaged later-born generations to find their own way through the mess they have inherited.

The dictating the future aspect is more obvious in Iran, where I would probably be in jail (at best).  But you see it in the United States too, every time those over the age of 60 show up to protest against a bike lane being added or a multifamily housing development being approved (and, of course, Obamacare).   “We don’t need it,” they say, “it will change things and benefit outsiders!”

U.S. Millennials get paid 25 percent less, on average, than Baby Boomers had at the same point in their lives, despite higher educational attainment on average and, frankly, less socially destructive behavior.  And yet those Boomers want to force the Millennials to live the same way.  To buy their houses at inflated prices, in places where it takes one car per adult just to live.

The Boomers, while running up public debts and grandfathering themselves into richer benefits and lower taxes, claim that later born generations can deal with higher taxes and diminished old age benefits, because they have “time to adjust.” But that doesn’t mean the Boomers feel compelled to allow those adjustments.  They seek to foreclose alternatives and shut down discussion, just like the Ayatollahs in Iran.

In olden days, the passing of the wise elders was a loss those following had to overcome. But as I look around the world, and see the tribalist geriatrics in charge, sometimes I think the Grim Reaper is the best hope for everyone on the planet.

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The Executive/Financial Class, The Political/Union Class, Generation Greed and the Serfs: Wherever You Look It’s Getting Worse

I think people who read this blog would agree that I follow U.S. public finance issues pretty closely, including those related to taxation.  But I recently found out something I had never heard of before, that was never publicly debated in any news source I follow, that no “progressive” politician has objected to as far as I know, and frankly I’m shocked.

https://www.marketwatch.com/story/heres-the-formula-for-paying-no-federal-income-taxes-on-100000-a-year-2019-11-22

In a country with a median household income of less than $62,000, you can get more than $100,000 a year while not working and pay no federal tax at all, because $80,000 in investment income (dividends and capital gains) is tax exempt!  Even as work income for the less well off is taxed twice, by the payroll tax, and the income tax.   It turns out that for married couples, while other income might be taxable if it is higher, that $80,000 in investment income is fully exempt from taxes even if total income is as high as $184,250 — with other deals up to $200,000.

How could this possibly be thought of as fair?   After all, a working couple with half that income from work would pay $7,500 in payroll taxes (or $15,000 if they were “gig” workers) and federal income taxes – at a higher rate – on top of that.  Why hasn’t a single pundit or politician raised a loud objection?

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Bureau of Economic Analysis Local Area Personal Income Data: Somebody Screwed Up the State and Local Government Earnings Data for NYC

A couple of years ago, I wrote a post based in part on Local Area Personal Income data from the Bureau of Economic Analysis, showing how the mean earnings per worker (adjusted for inflation) had changed for state and local government workers, financial sector workers, and other private sector workers from 1969 to 2016 – for Downstate New York, Upstate New York, New Jersey and the U.S. as a whole.  I later added data for Connecticut.

https://larrylittlefield.wordpress.com/2017/11/26/the-executive-financial-class-the-political-union-class-and-the-serfs-redux/

I recently downloaded the same data from the same source to see if there was anything different.

https://www.bea.gov/data/income-saving/personal-income-county-metro-and-other-areas

The data shows that the total earnings of state and local government workers in New York City increased 22.7% from 2017 to 2018.   While Manhattan was flat, the increase was 52.1% in the Bronx, 43.8% in Brooklyn, 39.3% in Queens and 47.8% in Staten Island.  Clearly that did not actually happen.

In the past I would have dismissed this as an error, to be pointed out to the BEA and fixed next year. But more and more data and other factual information has been altered in more and more ways over the past three years, or disappeared completely, specifically for state and local government finances in New York.  So I have begun to fear something worse.  I looked into it.  Here is what I found.

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The Upstate NY Rural Population Boom?

Last August I downloaded population and earnings data from the U.S. Bureau of Economic Analysis, from its Local Area Personal Income series, to use in my compilation of state and local government employment per 100,000 people.  The data was for 1997, 2007, and 2017.  As always I divided the state into four regions.  New York City, whose population I got by adding up the five boroughs. The Downstate Suburbs, which I got by adding up Nassau, Putman, Rockland, Suffolk and Westchester Counties.  The Upstate Urban Counties, the sum of Albany, Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, Orange, Rensselaer, Saratoga and Schenectady Counties.  And the rural and small Rest of New York State, which I got by subtracting the other three areas from the state total. The data showed a big population drop for this part of the state from 2007 to 2017 – and a thus huge increase in local government employment per 100,000 people.

Local Area Personal Income data has been updated to 2018 recently.

https://www.bea.gov/data/income-saving/personal-income-county-metro-and-other-areas

And I started downloading it for possible use in another analysis.  New York State’s 2017 population was exactly the same as the estimate released a year earlier.  But New York City’s 2017 population was slashed by 184,427 (2.1%), with smaller decreases for the Downstate Suburbs and Upstate Urban Counties.    Which means that since the Rest of New York State was obtained by subtraction, its population 2017 had soared by 247,319, a full 10.3% increase!  Despite the fact that the 2017 population estimate for virtually every individual county in the Rest of New York State has gone down!  It isn’t a surprise that the numbers are different.  Numbers are revised all the time based on new information.  But changes of this magnitude, despite NO change in the state total?

The best case scenario is a screw up.  Which is pretty much what I believe about next year’s 2020 Census of Population.

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The Sold Out Future By State Analysis Reprised

About a year ago I published an analysis based on U.S. Census Bureau government finances data, for all states and all available years from 1972 to 2016, that showed the extent to which each state’s future (with New York City and the rest of NY State analyzed separately, and the District of Columbia also included) has been sold out. Sold out by past decisions, non-decisions, deals and favors with regard to state and local government debt, past infrastructure investment, and under funded and/or retroactively increased public employee pensions.  The analysis was well received, and best of all many people downloaded the spreadsheet with all the data for all 50 states, all the tables, and almost all of the charts.  I always put up a post encouraging people to download the spreadsheets, look at the data themselves, and make up their own minds before reading my subsequent posts and getting my take on it. Generally people had downloaded charts, but not spreadsheets.  Last year that changed.

What I had forgotten last year, however, but have since remembered, is the multi-step process needed to put readable tables, in JPEG format, into the posts on WordPress.   So this year I added the tables to the posts I just completed on state and local government employment and payroll data from the 2017 Census of Governments, and I found that many people had downloaded them.  I don’t know why some people might prefer pictures of numbers to actual numbers, but apparently some people do.  So I plan to rectify last year’s omission of tables – except for people who downloaded the spreadsheet — from the Sold Out Futures posts with a brief reprise.   The data shows that while the blame for our sold out future is widely shared, New York City’s past taxpayers are the most the most blameless in the entire United States.  And New York City’s public employee unions and contractors have been the most unfair to other city residents.  And nowhere else is even close.

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Bureaucracy: 2017 Census of Governments Employment & Payroll Data

This post will complete my series on different government functions based on employment and payroll data from the Census of Governments, for March 2017 and previous years. It includes data for the kind of general government and legal workers one might generally expect to find hanging around in city and town halls, and county seats and courthouses, reviewing applications, keeping records, handling cases and doing inspections, rather than providing services.  At the local government level the functions included are, as delineated by the U.S. Census Bureau, Health, Financial Administration, Other Local Government Administration, Judicial and Legal, and Other and Unallocable. At the state level there are two additional functions:  Social Insurance Administration, basically state Departments of Labor, and “Other Education,” which includes oversight agencies such as the New York State Department of Education and Board of Regents.

For decades I’ve been making the case that for public employment and expenditures alike there is not much to see here. New York State is about average when you add everything up, and no part of the state is really out of line. Today, however, things have changed enough in one part of the state that this time around I don’t feel that to be true anymore.

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