Comment by adventured | Hacker News Reader

Comment by adventured | Hacker News Reader

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So you're saying that local governments have less funds to spend today than they did 15 years ago? I don't think so. I wasn't aware America still had a free market, much less one that sprung up in the last 10 / 15 / 30 years to deprive local governments of their massive spending binge over that time.

The data I've seen indicates total government expenditures have doubled over 15 years, and it's even faster at the local level. The local + state spending haul is close to $2.6 trillion annually now. It's practically another federal government system in size.

What has actually happened is local and state governments ballooned in size massively since the late 1970s. Having over expanded without any means to actually pay for it, all based on insanely optimistic (fraudulent?) economic projections, now those governments are having to shrink due to their own poor management.

California is perhaps the greatest - and most well documented - example of this, both at the state and local level.

So you're saying that local governments have less funds to spend today than they did 15 years ago? I don't think so.

Relative to costs, yes. Their funding has gone up, in general, by less than inflation[1]. Then account for the fact that their costs involve a lot of healthcare benefits that suffer 15% inflation, and relatively few things like electronics that get cheaper over time.

When you talk about things like 'ballooned in size', you're really missing the picture. Money that goes straight out of our coffers to the health fund isn't bigger government. It's more money, same amount of government.

[1] In my case in Massachusetts, it was strictly 2.5% revenue growth a year, a figure that's less than inflation in most years, certainly in the early 2000s which is the time period I'm talking. Commenters below illustrate a similar picture for California, your favored example.

>California is perhaps the greatest - and most well documented - example of this, both at the state and local level.

California's problem is mostly because of their ballot propositions, especially the effects of prop 13, which limits property taxes to 1% of the original sale price.

There are many additional propositions which have passed that increase spending(especially for schools and other services), which make it pretty much impossible for the budget to be balanced, because the state and municipalities have almost no way of increasing taxes, nor can they realistically cut spending.

> California's problem is mostly because of their ballot propositions, especially the effects of prop 13, which limits property taxes to 1% of the original sale price.

The limit is to 1% of the current assessed "full cash value", not the original sale price. However, there is also a limit that the assessed "full cash value", despite the name, can increase no more than 2% per year excluding new construction (and quite a lot of classes of improvements are expressly excluded from counting as "new construction") and changes of ownership (and certain changes of ownership don't count, as well.)

The net effect of which is that the property tax base can fall rapidly with real estate market collapses, but expands only slowly with real estate market booms (and, particularly, that property that doesn't change hands frequently tends to be taxed at a low nominal rate applied to a value that is vastly below its actual market value.)

I think what he saying is that large cable corporations are significantly wealthier than most local governments, and the stats would agree.

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