Thursday, September 28, 2017

On Taxes - An Ongoing Series

I see that the national political debate has moved from healthcare to taxes. Oh boy!

Tax policy is a rather complex topic, as pushing on taxes in one area creates results in an often-unrelated area. For example, if we do away with the mortgage interest deduction, that makes buying a house less tax preferred and probably hurts (a) the mortgage origination market; (b) the realtor industry's bottom line; and (c) the value of your home. If you don't get to deduct the interest you pay on your mortgage, perhaps you're less likely to take out a huge mortgage just because you can.

Anyway, I don't want to get too bogged down in that at the moment. Today, I'd like to talk about why I give a damn about whether other people's taxes go up or down.

Someday, I'm going to try to send my children to college.

This will likely (hopefully) be a state school, such as IU or (God help me) Purdue.

These schools get their funding from the State of Indiana.

The State of Indiana gets its budget backfilled by the federal government.

With less money coming from the feds, the State has less money to support public colleges. These public colleges have to fill their budget somehow, and that generally involves tuition increases. I attended IU in the late 1990s for $1,500/semester; I got a 50% tuition break because my mother was a nurse for IU Health, so most people paid roughly $3,000/year.

Today, tuition and fees total $10,534/year. That is roughly 350% of what it cost when I went there, and this does not include the ever-rising cost of living in Bloomington.


So, to review, college has gotten 3.5X more expensive since I graduated, and the wages of the person expected to pay for the next generation's college education have, at best, remained stagnant. Do I want public aid to colleges cut? Hell no!

This is but one reason why I do NOT support the current plans on offer regarding tax "reform."

I assure you, dear reader, that there are plenty more reasons to come.

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