AURORA PROPERTY TAXES SUBSIDIZE LAVISH MUNICIPAL EMPLOYEE PENSIONS

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Aurora–Taxpayers United of America’s Director of Outreach Val W. Zimnicki, in Aurora last week, called for the city to engage seriously with pension reform.

“It is fascinating how much things can change over 10 years.” Said Zimnicki.

“In 2011, the amount that taxpayers in the City of Aurora contributed to IMRF (Illinois Municipal Retirement Fund) with their property taxes was $2,712,000. (The IMRF sucks up property taxes, while the other government pensions are supplemented with the state income tax.)

The amount contributed to the police pension fund was $10,155,400, and the firefighter pension fund was $8,339,700. Let’s look at how these numbers compare to 2021.”

“In 2021, City of Aurora taxpayers’ property taxes subsidized IMRF with $4,005,000. The amount contributed to the police pension fund was $19,039,600, and to the firefighter pension fund, $15,291,100.”

“In the span of 10 years, Aurora taxpayers are spending millions more on the lavish, gold-plated pensions of retired government employees. IMRF pension payments have gone up 47.67%, police pension payments have gone up 87.48%, and firefighter pension payments have gone up 83.35%. These payments are made yearly, and are expected to go even higher next year.”

“Aurora Taxpayers cannot afford this burden. In a study done by the Lincoln Institute of Land Policy, it was revealed that the tax rate of a median-valued home in the United States was 1.49 percent in 2017. Only a handful of cities have effective tax rates that are roughly 2.5 times higher than the average, which includes Aurora. The City of Aurora was shown to have an effective property tax rate of 3.76%!”

“The fact that so many taxpayer dollars are pulled from Aurora taxpayer’s pockets and funneled into the black hole that is the Illinois pension system is abominable. Taxpayers are always told that taxes are used to fund ‘basic necessities.’ Instead, they are used to fund the lavish retirements of government employees who retire in their 50s and early 60s.”

“Take for example William A. Wiet. Wiet was estimated in 2020 to receive $137,049 annually from his IMRF pension. He paid $158,009 into his own pension, and is estimated to receive $3,365,886 over the course of his lifetime.”

“Another example is Steven E. Booth. Booth was estimated in 2020 to receive $130,451 annually from his IMRF pension. He paid $100,020 into his own pension, and is estimated to receive $3,891,301 over the course of his lifetime. Booth retired at the age of 55.”

“Instead of benefiting a handful of elite government pensioners to sit around unproductively, the State of Illinois and Gov. Jay Robert ‘J. B.’ Pritzker should implement pension reform to reduce taxpayer burdens. Meaningful tax cuts can bring growth back to Illinois, and reverse the outflow of Illinois residents.”

“To that end, the City of Aurora should stop being a benefactor of government pensions and, instead, be a responsible steward of taxpayer’s money. It is time for those responsible for the City of Aurora’s finances to take a stand, and demand pension reform.”

ECONOMY WOULD LOSE GROUND WITH THE HOUSE BUILD BACK BETTER ACT

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The so-called Build Back Better Act proposed in the House of Representatives, with its “economically costly and inefficient tax increases,” will result in reduced economic output, wages, and jobs, according to a new report by the nonpartisan Washington-based Tax Foundation.

“We find that long-run GDP would drop by a little over $1 for every $1 in new tax revenue,” writes the foundation’s Garrett Watson.

The Foundation’s General Equilibrium Model estimates that the Ways and Means tax plan would reduce long-run GDP by about 0.4 percent, which in today’s dollars amounts to about $129 billion of lost output annually.

Furthermore, the foundation estimates that “The tax changes in the plan (including IRS enforcement and excluding other non-tax revenue raisers like drug pricing) would raise about $124 billion annually in new tax revenue in the long run, conventionally estimated in today’s dollars, meaning for every $1 in revenue raised, economic output would fall by about $1.04.”

Starting with a 0.05 percent drop in GDP in the first year (about $11 billion) and building to a 0.26 percent drop in GDP by 2031 (about $86 billion), the plan would result in a cumulative GDP loss of about $531 billion from 2022 through 2031.

The Organization for Economic Co-operation and Development (OECD) found that the corporate income tax is the most harmful tax for economic growth, and academic research suggests that workers, especially low-skilled, women, and the young, are negatively impacted through lower wages.

The report notes that “Even before accounting for a smaller economy, taxpayers earning less than $400,000 would see lower after-tax incomes due to higher corporate taxes and higher taxes levied on nicotine.”

Additionally, the economic harm caused by the tax increases would claw back some of the plan’s permanent full refundability of the child tax credit (CTC) aimed at low- and middle-income families. For taxpayers in the bottom 20 percent, it would reduce the average net benefit of the plan per filer from $54 to $7, nearly wiping out the average benefit per filer.

Source: https://taxfoundation.org/house-tax-plan-impact/

BIDEN’S INFLATION MONSTER WOULD REDUCE EVERYONE’S ASSETS

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The annual inflation rate in the U.S. edged up to a 13-year high of 5.4% in September of 2021 from 5.3% in August and above market expectations of 5.3%. What is hard for most consumers to grasp is that inflation is a hidden, insidious tax that affects everything. It affects low-income families who struggle to pay for food and services, and harms the vital middle-class needed for a stable society.

Not only does it eat away at the value of the dollar, it devalues other assets such as real estate. A 5% rate of inflation will lessen the value of a person’s home by 5% regardless of market value, without the owner’s being aware of it.

Biden’s proposed spending bill is in the trillions of dollars.  Whether it is partly funded by tax increases or not, it will cause massive inflation over and above the present rate and will bring back painful memories of the inflation that ravaged the country under the administration of peanut-farmer Jimmy Carter (D).

Washington politicians are very skillful at raising taxes through inflation. Politicians love inflation because creating money from nothing makes it easy to finance wars and pork. Whenever money is needed by the federal government for wars or pork, the Federal Reserve will buy securities from the U.S. Treasury by means of a check drawn on itself. The Treasury then uses this new money to finance increased federal spending. The Fed is the only entity that can legally create money from nothing. Created by anyone else, it is called counterfeiting.

Newly created money from nothing floods the economy and makes all assets, whether liquid or not, worth less. If Biden’s spending bill becomes law, even consumers in the middle-class will struggle to pay their bills and the entire economy of the U.S. will suffer.

Source: https://tradingeconomics.com/united-states/inflation-cpi