Analysis of the Landlord Relief Act of 1997
(Called 'Taxpayer Relief' by Others)
According to its authors, the new tax law signed by our president in August is designed to encourage investors, help families and correct errors in previous tax laws which were either unfair or inefficient. This would be very funny, except that it's su ch a slap in the face to most people, especially the poorest and hardest working people. Nearly every major change made by this law is simply a gift to landlords (banks and the real estate business), a method for taking more out of the pockets of those wh o rent and putting it into the pockets of those who own; an inverted Robin Hood-wink.
The biggest change is that real estate held for more than a year will be taxed over 25% less than previously. Why not tax weekly paychecks 25% less, so more people can afford to feed their families and companies can afford to hire more workers? I don't mean to say that taxing wages less would necessarily help working class people, since, of course, the rent of land would simply rise to meet, and thus devour any benefit of a wage tax decrease, but if the desired change was taxpayer relief, why give a higher incentive to real estate investment? Isn't rent high enough yet? Don't land speculators get enough windfall profit yet? And the biggest question, how do the media get away with overlooking such feudal tendencies in this, "the land of the free" ?
There are, of course, a few seemingly benevolent gestures in the new legislation, but analysis of their ultimate effects reveals the actual beneficiaries to be, again, real estate speculators. There will be a $500 tax credit for every child in your hou se, which, on the surface, will be a break for families, but the end result will be, mainly, a higher population, which just raises the amount landlords can charge. That $500 a year will be collected by landlords. The same goes for the incentives to educa tion in the new tax package. The smarter you are, the more wealth you can produce and thus, the more rent you can pay. When will people be smart enough to deserve a decent standard of living? Apparently, never -- until they're smart enough to demand t he collection of public revenues with land value taxation.
The incentives for investing in IRAs (Individual Retirement Accounts) are obviously beneficial primarily to banks, which will, of course, just use the increased investments for even more real estate speculation. Invest in the feudal system and get a ta x break. Boy, that's real social magnanimity. Bigger incentives for giving to charity and hiring former welfare recipients will ultimately just raise the amount of rent landlords can charge, too. The entire bill is just a way to further squeeze the poor a nd swell the pockets of landlords.
Considering the three month decline in housing starts just previous to the signing of this legislation, perhaps we should simply think of it as a preemptory bank bailout.
The most amazing thing about it all is how the media go along with this sham. There's no outrage, no biting criticism, just piled-on details and jokes about how complicated economics is. Fewer and fewer people are laughing.
Seriously, though, why not give the country some real taxpayer relief? Why not raise the taxes on land speculation and lower the taxes on people who actually work? That would make rents go down while raising wages and increasing the number of jo bs, which would also lower the crime rate. There's no technical reason government can't tax land speculation more and everything else less, which would raise the standard of living for America's poorest and hardest working citizens. Taxpayer relief is, in deed, possible, but the quality of life will not be improved by the so-called "Taxpayer Relief Act of 1997". It will, instead, reward land speculators even more than they already are while the standard of living for most Americans continues to go down. In stead of decentralizing land ownership, which would alleviate the increasing disparity between rich and poor, our government has enacted a law which will further that disparity.
This is for William "Jefferson" Clinton: Your middle-name-sake would not have approved of this effort.