Elections matter.
When a political party is able to gain voter support to elect a President and the majority of the members of the United States Senate, that President should be able to confidently nominate judges to the federal judiciary including the Supreme Court.
That happened in 1993 when President Bill Clinton nominated Ruth Bader Ginsberg to the Supreme Court when his Democratic Party also held a slim majority of the seats in the United States Senate.
The minority Republican Party did not actively fight her appointment, or threaten filibusters, despite her public record of advocating that prostitution was constitutionally protected and that the age of consent should be lowered to 12. She also had criticized the Boy and Girl Scouts for perpetuating gender stereotypes.
There was even little controversy in the fact that she had been the General Council of the ultraliberal American Civil Liberties Union. Amazingly, nearly all of the Republican Senators joined in the 97-3 vote to confirm her to be an Associate Justice of the Supreme Court.
So what has changed? Why is President Bush having such a hard time with his nominees?
Millions of voters around the country worked tirelessly to get out the vote in 2000 and 2004 to elect George W. Bush to the Presidency. In 2004, those voters also gave the President a comfortable majority in the United States Senate which should have ensured him an easy time putting conservative judges on the federal courts.
So why do the minority Democratic Senators believe it is OK for them to pull out all of the stops to deny President Bush, and his voters, many of his choices for federal judges?
More thought provoking is why does President Bush feel he has to nominate individuals to the Supreme Court with limited paper trails for his opponents to use against them?
To me, the situation is simple. President Bush should not be shy or hesitant to nominate judges who will apply the laws as written by our founding fathers and by our Congressional and state lawmakers. He should proudly select a proven jurist who has a proven reputation for applying the law and not changing it to meet his or her personal or religious views.
The new Chief Justice of the Supreme Court, John Roberts, said it best when he stated that if the Constitution is on the side of the little guy, then he will be on the side of the little guy and if the Constitution is on the side of the big corporations, then he will be on the side of the big corporations. He said the law would determine his rulings – not his opinions.
President Bush’s recent nomination of Harriet E. Miers to replace Associate Supreme Court Justice Sandra Day O’Connor is a big question mark. Does she have the background or intellectual skills to vote on the important constitutional issues debated by the Supreme Court? She has no judicial track record and no appellate or constitutional experience of which I am aware to base her analysis and votes.
Perhaps her biggest selling point for a lifetime seat on the Supreme Court is that most of the Democrat Senators seem to like her and plan to have an open mind when it comes to voting for her. What do they know about her past legal efforts and battles that the President does not know? I doubt Bush’s tens of millions of voters worked hard so he would select a nominee who the Democrats like and defend.
With so many judges who Bush himself has appointed to the federal courts, why didn’t he choose one of them to move up to the Supreme Court? They have paper trails and we can probably predict their future analysis on their past rulings.
Harriet Miers, if she is confirmed by the Senate, may turn out to be a superb Associate Justice of the Supreme Court. For the sake and benefit of our country, we should all hope that she exceeds our limited expectations of her.
Perhaps President Bush has nominated the perfect stealth candidate to the Supreme Court. Perhaps his twenty years of friendship with, and counsel from, Ms. Miers has given him insight into knowing that she will strictly apply the Constitution and federal laws. Or perhaps not. Only time will tell.
Tuesday, November 01, 2005
Saturday, October 01, 2005
Hurricane Katrina - October 2005
Partisan blamemanship.
Frankly, I found the recent wave of finger pointing by partisan politicians about the response to Hurricane Katrina to be sad and depressing when peoples’ lives were still at stake and a unified rescue mission should have been the priority of the day.
Certainly there were hundreds of dedicated public servants and volunteers who worked tirelessly without the necessary support after the storm and I applaud their efforts and hope you share that belief. I’ll even give Sean Penn credit for putting his life at risk to help others.
Frankly, I feel guilty writing this rebuke of our government agencies while sitting in the cool and dry confines of my home office as others are still rolling up their sleeves in the Gulf Coast heat and are becoming part of the solution rather than being part of the chorus of partisan hacks playing the blame game.
Writing checks to the American Red Cross, Humane Society of the United States, the BushClinton Relief Fund, and other entities makes me feel a little less guilty. I hope you have given generously also.
Nevertheless, I want to go on the record to opine about how the local, state, and federal governments each failed to perform up to even minimal standards before and after Hurricane Katrina destroyed hundreds of miles of Louisiana, Mississippi, and Alabama.
In the event of a natural disaster on the scale of Hurricane Katrina, our federal government should have been ready on a moment’s notice to deploy machinery, equipment, and personnel to participate in rescue missions. I was deeply disappointed, disheartened, and disgusted to see any citizen begging for the basics of food, water, and other necessities at their time of need regardless if they had made poor decisions to stay in town.
The fact that FEMA and other federal government agencies delayed or prevented donations of water filtration equipment, communication systems, and personnel from countries around the world is embarrassing at best and criminal at worst.
I understand that our division of government requires that the state or local governments first request assistance from the federal government before help can legally commence. In most cases, this protocol makes sense. But when it is obvious that the local and state politicos and governments are incapable of caring for their own, our federal government should do first and ask later.
When it is obvious that a local Mayor in New Orleans cannot command or control his fleet of 1,000 school and city buses to evacuate his at-risk citizens and those without cars, and cannot find one third of his police force once the storm hits, the federal government must act without waiting for permission. Seeing all those buses under water was pitiful.
When it is clear that a Governor and her Homeland Security staff make ridiculous decisions to bar the American Red Cross and Salvation Army from providing aid to those waiting in the New Orleans Superdome and along roofs and dry portions of I-10 because the order of the day was to evacuate them out of town rather than feed them, the federal government needs to act.
When it is apparent that local city and parish emergency preparedness officials are ignoring the recommendations of the head of the National Hurricane Center to evacuate well in advance of a deadly Category 5 storm and only make that decision with hours to spare, the federal government should be ready to deploy.
When the entire Louisiana Congressional delegation would rather each seek separate federal pork barrel funding projects for roads and buildings rather than unite behind a singular request for repairing a levee system known to be in need of enhancement, the federal government should have the foresight to plan for the inevitable rescue of a flooded community.
Perhaps the most important lesson to be learned from this deadly and incredibly expensive natural disaster is that we citizens should first prepare and take care of ourselves and not expect any government agency to efficiently and effectively look out for our best interests.
This disaster also shines more focus on the need for local community organizations, churches, and neighborhood associations to look out for their own. In the Town of Davie, Hurricane Katrina not only cut power and phones for thousands, it also destroyed dozens of manufactured homes and trailers.
Fortunately, several of Davie’s elected officials and community activists quickly put together a relief fund called www.DavieHurricaneRelief.org to serve as a mechanism to quickly raise funds to help our community neighbors get back on their feet. I urge you to visit this website and find out how you can help.
Hopefully our area will be spared from catastrophic damage from hurricanes which are bound to hit our area in the years to come. That said, I hope that our local, state, and federal officials learn from the pitiful mistakes made in Louisiana during Hurricane Katrina.
Finally, I hope that the US Military – including the National Guard – is given a more prominent role in directing future responses. Their performance during the storm relief was commendable. And I believe that FEMA should become a cabinet level agency so that it gets its own budget to prepare for natural disasters while Homeland Security focuses on defense of the homeland and responses to possible terrorist strikes.
Frankly, I found the recent wave of finger pointing by partisan politicians about the response to Hurricane Katrina to be sad and depressing when peoples’ lives were still at stake and a unified rescue mission should have been the priority of the day.
Certainly there were hundreds of dedicated public servants and volunteers who worked tirelessly without the necessary support after the storm and I applaud their efforts and hope you share that belief. I’ll even give Sean Penn credit for putting his life at risk to help others.
Frankly, I feel guilty writing this rebuke of our government agencies while sitting in the cool and dry confines of my home office as others are still rolling up their sleeves in the Gulf Coast heat and are becoming part of the solution rather than being part of the chorus of partisan hacks playing the blame game.
Writing checks to the American Red Cross, Humane Society of the United States, the BushClinton Relief Fund, and other entities makes me feel a little less guilty. I hope you have given generously also.
Nevertheless, I want to go on the record to opine about how the local, state, and federal governments each failed to perform up to even minimal standards before and after Hurricane Katrina destroyed hundreds of miles of Louisiana, Mississippi, and Alabama.
In the event of a natural disaster on the scale of Hurricane Katrina, our federal government should have been ready on a moment’s notice to deploy machinery, equipment, and personnel to participate in rescue missions. I was deeply disappointed, disheartened, and disgusted to see any citizen begging for the basics of food, water, and other necessities at their time of need regardless if they had made poor decisions to stay in town.
The fact that FEMA and other federal government agencies delayed or prevented donations of water filtration equipment, communication systems, and personnel from countries around the world is embarrassing at best and criminal at worst.
I understand that our division of government requires that the state or local governments first request assistance from the federal government before help can legally commence. In most cases, this protocol makes sense. But when it is obvious that the local and state politicos and governments are incapable of caring for their own, our federal government should do first and ask later.
When it is obvious that a local Mayor in New Orleans cannot command or control his fleet of 1,000 school and city buses to evacuate his at-risk citizens and those without cars, and cannot find one third of his police force once the storm hits, the federal government must act without waiting for permission. Seeing all those buses under water was pitiful.
When it is clear that a Governor and her Homeland Security staff make ridiculous decisions to bar the American Red Cross and Salvation Army from providing aid to those waiting in the New Orleans Superdome and along roofs and dry portions of I-10 because the order of the day was to evacuate them out of town rather than feed them, the federal government needs to act.
When it is apparent that local city and parish emergency preparedness officials are ignoring the recommendations of the head of the National Hurricane Center to evacuate well in advance of a deadly Category 5 storm and only make that decision with hours to spare, the federal government should be ready to deploy.
When the entire Louisiana Congressional delegation would rather each seek separate federal pork barrel funding projects for roads and buildings rather than unite behind a singular request for repairing a levee system known to be in need of enhancement, the federal government should have the foresight to plan for the inevitable rescue of a flooded community.
Perhaps the most important lesson to be learned from this deadly and incredibly expensive natural disaster is that we citizens should first prepare and take care of ourselves and not expect any government agency to efficiently and effectively look out for our best interests.
This disaster also shines more focus on the need for local community organizations, churches, and neighborhood associations to look out for their own. In the Town of Davie, Hurricane Katrina not only cut power and phones for thousands, it also destroyed dozens of manufactured homes and trailers.
Fortunately, several of Davie’s elected officials and community activists quickly put together a relief fund called www.DavieHurricaneRelief.org to serve as a mechanism to quickly raise funds to help our community neighbors get back on their feet. I urge you to visit this website and find out how you can help.
Hopefully our area will be spared from catastrophic damage from hurricanes which are bound to hit our area in the years to come. That said, I hope that our local, state, and federal officials learn from the pitiful mistakes made in Louisiana during Hurricane Katrina.
Finally, I hope that the US Military – including the National Guard – is given a more prominent role in directing future responses. Their performance during the storm relief was commendable. And I believe that FEMA should become a cabinet level agency so that it gets its own budget to prepare for natural disasters while Homeland Security focuses on defense of the homeland and responses to possible terrorist strikes.
Thursday, September 01, 2005
A Ruling Majority? - September 2005
When the 108th Congress took office in January 2003, the Republicans had finally reached majority control of the White House, Senate, and House of Representatives after more than 50 years in hiatus.
They had not held such power since the mid-1950’s when President Eisenhower was in office unless you count the 4 months in 2001 when the voters gave the Republicans a ruling majority until Jumpin Jim Jeffords changed his party registration and gave Senate control back to the Democrats for the subsequent two years.
For those of us who are fiscal conservatives, we were looking forward to complete majority rule in Washington, D.C. in 2003. After all, we had frequently pointed to the social experiments and bloated government spending of the Democratic majorities in the 1940’s, early 1960’s and mid-1970’s and confidently said that would never happen under our control.
Until 2003, the best we could do was keeping the Democratic Congress in check with Republican presidents during the 1980’s and early 1990’s. Things reversed in the late 1990’s when we counted on a Republican House to counteract a Democratic President.
So where are we today? Has a Republican majority in Congress and control of the White House met our hopes and expectations? Is having single party majority rule good for the country?
Under the leadership of President Bush and a Republican Congress, our country has benefited from notable tax cuts giving our citizens the incentive to work harder and invest in our future. That leadership has given us a stronger military to battle the continuing and growing threat of terrorism. That leadership has also given us some key regulatory relief. And that majority rule has also resulted in the selection of strict judges who will rule by the law rather than create it which is the role of our lawmakers in Congress.
And it has been fun to watch some of the political payback which comes with a change of ruling party such as the mass rearrangement of office space on Capital Hill during which the Republicans took over the prime office space while the Democrats moved into the closet-size spaces formerly forced upon the Republicans when the Democrats wrote the rules. Politics can be a blood sport although I find this disorganized movement of metal and wood to unbecoming of adult men and women.
That is the good news. Now for the bad news. Many of the Republicans in Congress have exceeded the worst performance of the big spending Democrats on pork barrel projects. Alaskan Senator Ted Stevens brazenly made sure his state received $ 220 million for a 200 foot bridge for a city of 8,000 citizens who did not want it and an “initial” $ 229 million for site preparation work for an estimated $ 2 billion 2-mile bridge from Anchorage to a sparsely inhabited section of marshes.
Even our Republican Congressmen from South Florida proudly brought home some extra pork to our area. That is the way the system worked when Democrats were in control and, apparently, now is how it works when the Republicans have their turn at majority rule. Without giving President Bush the line item veto – which we fiscal conservatives yearn for – I am disappointed to say that Republican pork is now the status quo.
And speaking of vetoes, President Bush appears hesitant to strike down any legislation now that his party is writing it. Vetoes historically are more prevalent when the President and Congress are from opposing parties. Bad legislation is bad legislation regardless of which party writes it.
So is our country actually better off to have divided government which occurs when the Democrats or Republicans control the White House and the other party controls the Congress? Unless the current crew of Republican leaders sees the light, I believe the American voters will answer that question for us in 2008 by possibly giving control of one – if not both – houses of Congress back to the Democrats. I can only hope that the Republican leadership puts its ship back on course in time to avoid that happening.
They had not held such power since the mid-1950’s when President Eisenhower was in office unless you count the 4 months in 2001 when the voters gave the Republicans a ruling majority until Jumpin Jim Jeffords changed his party registration and gave Senate control back to the Democrats for the subsequent two years.
For those of us who are fiscal conservatives, we were looking forward to complete majority rule in Washington, D.C. in 2003. After all, we had frequently pointed to the social experiments and bloated government spending of the Democratic majorities in the 1940’s, early 1960’s and mid-1970’s and confidently said that would never happen under our control.
Until 2003, the best we could do was keeping the Democratic Congress in check with Republican presidents during the 1980’s and early 1990’s. Things reversed in the late 1990’s when we counted on a Republican House to counteract a Democratic President.
So where are we today? Has a Republican majority in Congress and control of the White House met our hopes and expectations? Is having single party majority rule good for the country?
Under the leadership of President Bush and a Republican Congress, our country has benefited from notable tax cuts giving our citizens the incentive to work harder and invest in our future. That leadership has given us a stronger military to battle the continuing and growing threat of terrorism. That leadership has also given us some key regulatory relief. And that majority rule has also resulted in the selection of strict judges who will rule by the law rather than create it which is the role of our lawmakers in Congress.
And it has been fun to watch some of the political payback which comes with a change of ruling party such as the mass rearrangement of office space on Capital Hill during which the Republicans took over the prime office space while the Democrats moved into the closet-size spaces formerly forced upon the Republicans when the Democrats wrote the rules. Politics can be a blood sport although I find this disorganized movement of metal and wood to unbecoming of adult men and women.
That is the good news. Now for the bad news. Many of the Republicans in Congress have exceeded the worst performance of the big spending Democrats on pork barrel projects. Alaskan Senator Ted Stevens brazenly made sure his state received $ 220 million for a 200 foot bridge for a city of 8,000 citizens who did not want it and an “initial” $ 229 million for site preparation work for an estimated $ 2 billion 2-mile bridge from Anchorage to a sparsely inhabited section of marshes.
Even our Republican Congressmen from South Florida proudly brought home some extra pork to our area. That is the way the system worked when Democrats were in control and, apparently, now is how it works when the Republicans have their turn at majority rule. Without giving President Bush the line item veto – which we fiscal conservatives yearn for – I am disappointed to say that Republican pork is now the status quo.
And speaking of vetoes, President Bush appears hesitant to strike down any legislation now that his party is writing it. Vetoes historically are more prevalent when the President and Congress are from opposing parties. Bad legislation is bad legislation regardless of which party writes it.
So is our country actually better off to have divided government which occurs when the Democrats or Republicans control the White House and the other party controls the Congress? Unless the current crew of Republican leaders sees the light, I believe the American voters will answer that question for us in 2008 by possibly giving control of one – if not both – houses of Congress back to the Democrats. I can only hope that the Republican leadership puts its ship back on course in time to avoid that happening.
Monday, August 01, 2005
The Bush Economy - August 2005
Let me count the ways. Inflation is down. Job numbers are up. The deficit projections are down. And the stock market continues to rally.
Why is it that those on the left just cannot accept good news when they read it?
It was not long ago that candidate Kerry was saying that President Bush would have the worst jobs record in modern times. And the media wrote article after article about how the deficit would keep getting worse for decades to come.
I believe that President Bush’s tax cuts are a major reason for the continued strong economy. Just as Presidents Kennedy and Reagan proved before him, tax cuts provide people with the incentives to want to earn that extra dollar which they can spend in our economy.
Now is the time for Congress to make those tax cuts permanent so that individuals and businesses can properly plan their respective investments in goods and services to keep the positive momentum going.
Before I am accused of just being a partisan shill for the Bush administration, I will repeat what I have said in past columns. Federal spending is out of control. President Bush’s failure to veto any spending bills has been a great disappointment to me.
In fact, spending growth under President Bush has been almost four times as high as it was during a similar timeframe under Bill Clinton. And it is not just necessary homeland defense spending that has bloated the budget or the growth of entitlements like Social Security and Medicare. Rather, there are many Republicans in the Congress who do not know how to “just say no” to road and building projects or crop subsidies.
I hope that someone in the administration will bring back the push for a budgetary line item veto so President Bush can wipe out pork barrel spending as his brother, Jeb, can do here in Florida.
As good as our economy is doing, there are still many citizens under tremendous personal financial pressure. Will this mountain of credit card and home equity debt finally bring a halt to personal spending which has played a major part in driving our economy?
And while employment numbers are near what economists call “full employment”, there are still many of our fellow Americans who are underemployed and lacking the training and skills to move on from work that has been replaced by less expensive sources.
Fortunately in today’s America, people can still easily improve their lives by starting their own businesses, taking affordable night school courses to learn a new trade, and confidently investing in the world’s most important stock market. Opportunities continue to abound for those that seek them.
I am optimistic for our country’s future. Our economy continues to be the envy of the world. So much so that we continue to attract immigrants – some legal and some not – who come to our shores for their piece of the American pie.
Our economy is the fuel behind that bright shining city on the hill that President Ronald Reagan immortalized more than twenty years ago. Let’s hope that Congress, the Federal Reserve, and the Bush administration continue to provide it with the appropriate fiscal tools so it can continue to shine.
Why is it that those on the left just cannot accept good news when they read it?
It was not long ago that candidate Kerry was saying that President Bush would have the worst jobs record in modern times. And the media wrote article after article about how the deficit would keep getting worse for decades to come.
I believe that President Bush’s tax cuts are a major reason for the continued strong economy. Just as Presidents Kennedy and Reagan proved before him, tax cuts provide people with the incentives to want to earn that extra dollar which they can spend in our economy.
Now is the time for Congress to make those tax cuts permanent so that individuals and businesses can properly plan their respective investments in goods and services to keep the positive momentum going.
Before I am accused of just being a partisan shill for the Bush administration, I will repeat what I have said in past columns. Federal spending is out of control. President Bush’s failure to veto any spending bills has been a great disappointment to me.
In fact, spending growth under President Bush has been almost four times as high as it was during a similar timeframe under Bill Clinton. And it is not just necessary homeland defense spending that has bloated the budget or the growth of entitlements like Social Security and Medicare. Rather, there are many Republicans in the Congress who do not know how to “just say no” to road and building projects or crop subsidies.
I hope that someone in the administration will bring back the push for a budgetary line item veto so President Bush can wipe out pork barrel spending as his brother, Jeb, can do here in Florida.
As good as our economy is doing, there are still many citizens under tremendous personal financial pressure. Will this mountain of credit card and home equity debt finally bring a halt to personal spending which has played a major part in driving our economy?
And while employment numbers are near what economists call “full employment”, there are still many of our fellow Americans who are underemployed and lacking the training and skills to move on from work that has been replaced by less expensive sources.
Fortunately in today’s America, people can still easily improve their lives by starting their own businesses, taking affordable night school courses to learn a new trade, and confidently investing in the world’s most important stock market. Opportunities continue to abound for those that seek them.
I am optimistic for our country’s future. Our economy continues to be the envy of the world. So much so that we continue to attract immigrants – some legal and some not – who come to our shores for their piece of the American pie.
Our economy is the fuel behind that bright shining city on the hill that President Ronald Reagan immortalized more than twenty years ago. Let’s hope that Congress, the Federal Reserve, and the Bush administration continue to provide it with the appropriate fiscal tools so it can continue to shine.
Friday, July 01, 2005
Broward County Florida Property Taxes - July 2005
“In terms of total value, the Broward County tax roll increased by over $14.1 billion (in 2004) -- the largest dollar increase ever in Broward history.”
So said Broward County Property Appraiser Lori Parrish on June 1st.
She also stated that “With this rate of growth, the various taxing authorities have an opportunity to cut millage rates while still generating more than enough money to provide for services."
What are the odds that the Broward County Commission and most of our other local agencies will heed her advice to notably cut tax rates instead of using that growth to fund ever increasing government expenditures? Don’t count on it.
Fortunately for those of you living in the Town of Davie, your Town Council is comprised of a number of fiscal conservatives who share my belief in limiting government growth to fund necessities and not luxuries.
Property taxes have become a major topic around the country and in our local neighborhoods. Have property taxes gotten out of hand? Your answer will depend on whether you are one of the “haves” or “have nots”.
If you “have” owned your home since the 1990’s, you are benefiting from the 1992 Save Our Homes Amendment which limits the increase in your home value to about 3% per year.
If, however, you purchased your home in the past few years when housing prices started to explode here in South Florida, then you are a “have not” and are paying far more in property taxes than many of your neighbors. See for yourself by checking out the Broward County Property Appraiser’s website.
Perhaps if the Save Our Homes amendment had not been passed, all property owners would be paying similar taxes and those “have nots” would not be paying a disproportionate share of property taxes for the same government services.
More importantly, are potential “have nots” being scared away from buying a new or resale home by high property taxes? And are the “haves” afraid to give up their low taxes by moving?
Before you get ready to tar and feather me for suggesting that the Save Our Home Amendment be revised to more fairly value all homes in our county and state, I don’t propose doing so. People should not be taxed on the potential resale value of their home since that would hurt our neighbors on fixed incomes or those already financially stretched by other costs of living in our society today.
Perhaps the solution is to start the taxable value of all new or home resales at the average existing assessed value of similar homes in that particular neighborhood. Of course doing so would notably decrease property tax collections which fund our local governments. Would that be so bad?
Before you start laughing all the way to the bank, let’s agree that local governments have to replace those diminished tax receipts. The most likely solution would be to capture some of those lost taxes when the home is sold.
In essence, instead of the “have nots” paying ridiculously high property taxes throughout their period of home ownership, they should pay something similar to a capital gains tax on the difference between the market value of their home when sold against my recommended neighborhood average assessed value when they bought it.
What about the “haves”? Since they too have benefited from property taxes based on assessments well below current market values, they too should pay the gains tax.
What rate should that capital gains tax be? I’ll let the economists and actuarials calculate and propose that number for voter approval. But it must be ultimately revenue neutral and not provide revenue that would allow government to grow beyond its current needs. And I would want such tax legislation to require voter approval for that agreed upon rate to ever be increased.
Does proposing such a capital gains tax end my rein as a fiscal conservative? Or does my suggestion make me a hero by actually increasing home resales, and maximizing the affordability of buying a home, by eliminating the sticker shock of high property taxes in exchange for a small fractional profit tax similar to that paid for other investments? I welcome your thoughts in care of this magazine.
So said Broward County Property Appraiser Lori Parrish on June 1st.
She also stated that “With this rate of growth, the various taxing authorities have an opportunity to cut millage rates while still generating more than enough money to provide for services."
What are the odds that the Broward County Commission and most of our other local agencies will heed her advice to notably cut tax rates instead of using that growth to fund ever increasing government expenditures? Don’t count on it.
Fortunately for those of you living in the Town of Davie, your Town Council is comprised of a number of fiscal conservatives who share my belief in limiting government growth to fund necessities and not luxuries.
Property taxes have become a major topic around the country and in our local neighborhoods. Have property taxes gotten out of hand? Your answer will depend on whether you are one of the “haves” or “have nots”.
If you “have” owned your home since the 1990’s, you are benefiting from the 1992 Save Our Homes Amendment which limits the increase in your home value to about 3% per year.
If, however, you purchased your home in the past few years when housing prices started to explode here in South Florida, then you are a “have not” and are paying far more in property taxes than many of your neighbors. See for yourself by checking out the Broward County Property Appraiser’s website.
Perhaps if the Save Our Homes amendment had not been passed, all property owners would be paying similar taxes and those “have nots” would not be paying a disproportionate share of property taxes for the same government services.
More importantly, are potential “have nots” being scared away from buying a new or resale home by high property taxes? And are the “haves” afraid to give up their low taxes by moving?
Before you get ready to tar and feather me for suggesting that the Save Our Home Amendment be revised to more fairly value all homes in our county and state, I don’t propose doing so. People should not be taxed on the potential resale value of their home since that would hurt our neighbors on fixed incomes or those already financially stretched by other costs of living in our society today.
Perhaps the solution is to start the taxable value of all new or home resales at the average existing assessed value of similar homes in that particular neighborhood. Of course doing so would notably decrease property tax collections which fund our local governments. Would that be so bad?
Before you start laughing all the way to the bank, let’s agree that local governments have to replace those diminished tax receipts. The most likely solution would be to capture some of those lost taxes when the home is sold.
In essence, instead of the “have nots” paying ridiculously high property taxes throughout their period of home ownership, they should pay something similar to a capital gains tax on the difference between the market value of their home when sold against my recommended neighborhood average assessed value when they bought it.
What about the “haves”? Since they too have benefited from property taxes based on assessments well below current market values, they too should pay the gains tax.
What rate should that capital gains tax be? I’ll let the economists and actuarials calculate and propose that number for voter approval. But it must be ultimately revenue neutral and not provide revenue that would allow government to grow beyond its current needs. And I would want such tax legislation to require voter approval for that agreed upon rate to ever be increased.
Does proposing such a capital gains tax end my rein as a fiscal conservative? Or does my suggestion make me a hero by actually increasing home resales, and maximizing the affordability of buying a home, by eliminating the sticker shock of high property taxes in exchange for a small fractional profit tax similar to that paid for other investments? I welcome your thoughts in care of this magazine.
Sunday, May 01, 2005
Inflation - May 2005
Higher oil prices. A declining dollar. Rising interest rates. The real estate bubble. Spiraling healthcare costs. And the Bush budget deficit.
Many pundits believe these market factors will lead our country into a round of inflation unseen since President Carter was in office. Most interesting is the growing belief in the Ivory Towers of the academic world and in liberal – now known as “progressive” - publications that President’s Bush’s tax cuts and deficit spending are leading the way to inflation. I do not agree.
Certainly rising oil prices caused by the current world economic boom – especially in China and the United States – will have a latent effect in causing rising prices as businesses seek to recoup their added energy costs. Those higher oil prices will, however, provide the usual cyclical incentives for domestic oil producers and alternative fuel suppliers to ramp up their explorations and efforts until market equilibrium is reached and bearish oil market speculation again drives down the price of oil to a sustainable level. And if Congress finally has the foresight to pass President Bush’s energy plan, I believe those energy costs will stabilize at a faster pace.
Recent minute increases in interest rates have been made by the Federal Reserve to begin slowing down our economy to address its fast growth and the resulting higher demand for products and services which historically and theoretically do cause rising prices and inflation. However, I have confidence that Alan Greenspan - who has been involved in economic policy making since the early days of President Nixon’s efforts to control the inflation present in the early ‘70s - and the rest of the Bush economic team will not allow inflation to have a negative impact on our economy and way of life.
As for the Bush tax cuts and the current budget deficit, I frankly blame Congress more for their out of control spending then I do President Bush for his lack of courage and leadership in reining in their pork barrel spending. My respect for him would grow immensely if he would spend his widely publicized “political capital” on getting “line item veto” legislation passed in Congress. And certainly nobody can understate the impact on the federal budget deficit from the increased costs of homeland security as we fight the war on terrorism in the United States and around the world.
Do I like the current budget deficits? Absolutely not. Would I be in favor of taking more of the people’s money to close that budget gap? Absolutely not. I believe our nation’s strong economy which has been stimulated, in part, by President Bush’s commendable tax cuts, will eventually generate the tax receipts in the years to come to balance the budget and possibly create a surplus similar to what is happening here in Florida thanks to Governor Bush’s economic plan which has included tax cuts for all and wise use of our state’s tax revenues.
Frankly, I believe that liberals would really rather run a budget deficit and fund their many social and welfare projects then allow a budget surplus to grow enough to eventually be given back to the tax payers with additional tax cuts. Just look at the choices made in California over the past ten years from the added tax revenues which resulted from the stock market bubble. Instead of returning those surplus dollars to their taxpayers, that state increased their social program spending and now cannot follow the lead of their Governor in trimming those expenditures to bring fiscal sanity back to their state. Let’s hope that President Bush makes sure that Congress does not make the same mistake on the federal level in continuing to grow its expenditures while the deficit exists.
Many pundits believe these market factors will lead our country into a round of inflation unseen since President Carter was in office. Most interesting is the growing belief in the Ivory Towers of the academic world and in liberal – now known as “progressive” - publications that President’s Bush’s tax cuts and deficit spending are leading the way to inflation. I do not agree.
Certainly rising oil prices caused by the current world economic boom – especially in China and the United States – will have a latent effect in causing rising prices as businesses seek to recoup their added energy costs. Those higher oil prices will, however, provide the usual cyclical incentives for domestic oil producers and alternative fuel suppliers to ramp up their explorations and efforts until market equilibrium is reached and bearish oil market speculation again drives down the price of oil to a sustainable level. And if Congress finally has the foresight to pass President Bush’s energy plan, I believe those energy costs will stabilize at a faster pace.
Recent minute increases in interest rates have been made by the Federal Reserve to begin slowing down our economy to address its fast growth and the resulting higher demand for products and services which historically and theoretically do cause rising prices and inflation. However, I have confidence that Alan Greenspan - who has been involved in economic policy making since the early days of President Nixon’s efforts to control the inflation present in the early ‘70s - and the rest of the Bush economic team will not allow inflation to have a negative impact on our economy and way of life.
As for the Bush tax cuts and the current budget deficit, I frankly blame Congress more for their out of control spending then I do President Bush for his lack of courage and leadership in reining in their pork barrel spending. My respect for him would grow immensely if he would spend his widely publicized “political capital” on getting “line item veto” legislation passed in Congress. And certainly nobody can understate the impact on the federal budget deficit from the increased costs of homeland security as we fight the war on terrorism in the United States and around the world.
Do I like the current budget deficits? Absolutely not. Would I be in favor of taking more of the people’s money to close that budget gap? Absolutely not. I believe our nation’s strong economy which has been stimulated, in part, by President Bush’s commendable tax cuts, will eventually generate the tax receipts in the years to come to balance the budget and possibly create a surplus similar to what is happening here in Florida thanks to Governor Bush’s economic plan which has included tax cuts for all and wise use of our state’s tax revenues.
Frankly, I believe that liberals would really rather run a budget deficit and fund their many social and welfare projects then allow a budget surplus to grow enough to eventually be given back to the tax payers with additional tax cuts. Just look at the choices made in California over the past ten years from the added tax revenues which resulted from the stock market bubble. Instead of returning those surplus dollars to their taxpayers, that state increased their social program spending and now cannot follow the lead of their Governor in trimming those expenditures to bring fiscal sanity back to their state. Let’s hope that President Bush makes sure that Congress does not make the same mistake on the federal level in continuing to grow its expenditures while the deficit exists.
Friday, April 01, 2005
Florida Slots - April 2005
I would like to thank the 106,000 of my fellow Broward County residents who voted yes on the sucker’s bet to approve slot machines in the county’s existing horse and dog tracks and jai lai fronton. Perhaps I should be more concerned about the 874,000 registered voters who chose to stay home on March 8th and let our county again become the laughingstock of our state.
Why am I frustrated and embarrassed? It is because my fellow county residents failed to make a reasoned voting decision beyond “those Indian casinos and cruises-to-nowhere pay no taxes so we might as well get something”. It is because many of my neighbors felt that approving additional gambling options in our area was more important than the realization that our new racinos will be generating tens of millions of dollars of educational funding for other counties in our state with only a tiny share for our own children! And in exchange for this tiny sliver of revenue, our county and our local municipalities will have to incur the added expenses of the likely public safety requests which will be generated by these facilities. I also believe that our local restaurants and retailers will find that more of our area’s discretionary income will be deposited into those slot machines instead of into their cash registers.
If you don’t think the residents of every other county, including Miami-Dade and Palm Beach, are smiling at the prospects of increased educational funding in their jurisdictions at our expense, then you probably believed that our punch card machines in the year 2000 were the sole problem and not equally the failure of voters to take a few moments to ensure that their chads were cleanly punched. Our fellow county residents let the emotion of the “kids and jobs” issue blind them to the economic reality that there are much more bountiful and efficient ways to raise funds for our schools. In fact, the Broward County School Board is already planning to seek a 1 cent increase in the sales tax to generate far more money than even the most wildly optimistic racino tax projections. Of course my thoughts about allowing such a tax increase will be saved for a later column.
Despite warnings from key Broward County School Board members, leaders of the local Parent Teacher Associations, notable elected officials including our own Town of Davie Mayor, and many religious leaders, your fellow county voters believed that these new facilities will be the panacea for ending portable classrooms and properly valuing underpaid teachers. Let’s see how many classrooms will be built with the funds which the legislature in Tallahassee will allow to come back to Broward County. Don’t get your hopes up. Our Broward County legislative delegation is already marginalized in both the Florida House and Senate which are run by large majorities from the other political party. Our elected legislators will have little say how the money is distributed throughout the state and back to our county.
Please understand that my frustration is not against the concept of gambling or of slot machines although I personally do not have the urge to throw my hard earned money into one-arm bandits. In fact, my brother was an executive in the gaming industry for many years and almost has me convinced that gambling, if properly managed, is another form of entertainment. I would still rather use those dollars for an enjoyable meal, a good movie, or a probable lousy round of golf. Maybe I shouldn’t be so frustrated since I surmise it will now be easier for me to get a good table at my favorite restaurant or a start time for my round of golf since most of my fellow citizens will be keeping those slot machines busy every moment of the day if the racino lobbyists are still to be believed.
So what happens now? How much should the racinos be taxed to help educate our kids? The industry has stated that 30% would be a reasonable amount. Recent articles in the print media have pointed out that such a tax rate would be the lowest in the country for similar facilities. My suggestion is that the politicians in Tallahassee calculate what the tax rate needs to be to guarantee that the racinos contribute that $ 500 million dollars in educational dollars they promised our kids across the state. Maybe they should even be required to contribute the first $ 500 million in profits to the state before they can pocket any profits for themselves. Of course with only Broward County now being approved for those facilities, the annual education contribution will most likely be less so perhaps the tax rate should be set to generate half as much revenue with at least $ 250 million per year guaranteed for the kids.
Why am I frustrated and embarrassed? It is because my fellow county residents failed to make a reasoned voting decision beyond “those Indian casinos and cruises-to-nowhere pay no taxes so we might as well get something”. It is because many of my neighbors felt that approving additional gambling options in our area was more important than the realization that our new racinos will be generating tens of millions of dollars of educational funding for other counties in our state with only a tiny share for our own children! And in exchange for this tiny sliver of revenue, our county and our local municipalities will have to incur the added expenses of the likely public safety requests which will be generated by these facilities. I also believe that our local restaurants and retailers will find that more of our area’s discretionary income will be deposited into those slot machines instead of into their cash registers.
If you don’t think the residents of every other county, including Miami-Dade and Palm Beach, are smiling at the prospects of increased educational funding in their jurisdictions at our expense, then you probably believed that our punch card machines in the year 2000 were the sole problem and not equally the failure of voters to take a few moments to ensure that their chads were cleanly punched. Our fellow county residents let the emotion of the “kids and jobs” issue blind them to the economic reality that there are much more bountiful and efficient ways to raise funds for our schools. In fact, the Broward County School Board is already planning to seek a 1 cent increase in the sales tax to generate far more money than even the most wildly optimistic racino tax projections. Of course my thoughts about allowing such a tax increase will be saved for a later column.
Despite warnings from key Broward County School Board members, leaders of the local Parent Teacher Associations, notable elected officials including our own Town of Davie Mayor, and many religious leaders, your fellow county voters believed that these new facilities will be the panacea for ending portable classrooms and properly valuing underpaid teachers. Let’s see how many classrooms will be built with the funds which the legislature in Tallahassee will allow to come back to Broward County. Don’t get your hopes up. Our Broward County legislative delegation is already marginalized in both the Florida House and Senate which are run by large majorities from the other political party. Our elected legislators will have little say how the money is distributed throughout the state and back to our county.
Please understand that my frustration is not against the concept of gambling or of slot machines although I personally do not have the urge to throw my hard earned money into one-arm bandits. In fact, my brother was an executive in the gaming industry for many years and almost has me convinced that gambling, if properly managed, is another form of entertainment. I would still rather use those dollars for an enjoyable meal, a good movie, or a probable lousy round of golf. Maybe I shouldn’t be so frustrated since I surmise it will now be easier for me to get a good table at my favorite restaurant or a start time for my round of golf since most of my fellow citizens will be keeping those slot machines busy every moment of the day if the racino lobbyists are still to be believed.
So what happens now? How much should the racinos be taxed to help educate our kids? The industry has stated that 30% would be a reasonable amount. Recent articles in the print media have pointed out that such a tax rate would be the lowest in the country for similar facilities. My suggestion is that the politicians in Tallahassee calculate what the tax rate needs to be to guarantee that the racinos contribute that $ 500 million dollars in educational dollars they promised our kids across the state. Maybe they should even be required to contribute the first $ 500 million in profits to the state before they can pocket any profits for themselves. Of course with only Broward County now being approved for those facilities, the annual education contribution will most likely be less so perhaps the tax rate should be set to generate half as much revenue with at least $ 250 million per year guaranteed for the kids.
Tuesday, March 01, 2005
Social Security Reform - March 2005
Our society’s current discussion about the future of Social Security is, I believe, really an underlying debate about more than Social Security itself. We are again evaluating the proper roles of the federal government and self reliance in our lives. When President Franklin Roosevelt introduced the Social Security Act in 1935 as part of his New Deal, he put forth his vision of the need for cradle-to-grave involvement of the federal government throughout our lives. Seven decades later, that role continues to be a wedge issue in most elections.
I believe self reliance should be the most important source of our personal welfare with family support as its primary backup. In my opinion, government assistance should only be available as a true safety net and not as an entitlement that we plan our lives around. That said, I believe the Social Security System is in its current financial state only because politicians expanded it beyond its original role as a needed safety net for the poor retiree. In 1937, they began positioning it as a major part of most citizens’ retirement plans by enacting the Federal Insurance Contribution Act and its 2% payroll tax. Today that tax is nearly 13%. When the FICA tax was introduced, there were nearly 40 workers paying that tax to support 1 retiree. With far more workers than retirees, the Social Security Administration was able to put aside a portion of the tax into a so-called trust fund for future needs.
Today approximately 14 workers pay the FICA tax to support each retiree. In a few decades, projections are that only 2 workers will be paying FICA taxes to support each retiree. In 1997, President Clinton appointed a Social Security Advisory Panel which concluded that the FICA tax would have to be raised by 50% at that time in order to provide actuarially sound funding for projected future benefit levels. Otherwise, they felt the trust fund would be exhausted by 2029. In the seven years since their recommendation, nothing has been done to address the issue while our economy went through a painful recession which reduced FICA tax contributions and further endangered the trust fund, and the number of retirees continued to explode.
What can be done now to give Social Security the financial security it needs to continue as a worthy government program for the future? I believe Social Security needs to be properly repositioned as the safety net program it should have been. Thus I believe that, rather than fully paying social security benefits to all retirees, those benefits should only be fully paid to those who financially need it. Do the likes of Bill Gates, Warren Buffett, or the tens of thousands of affluent retirees really need the full safety net of Social Security? Immediately imposing a sliding scale benefit would not be fair to those current and near retirees who, although not necessarily needing Social Security, paid their FICA taxes over the years expecting to receive benefits when they retired.
I will leave it up to actuarial experts, Social Security Trustees, and Congress to determine which retirement age group should be the first to have their benefits means-tested although I would suggest that those age 49 or younger still have plenty of time to adjust their retirement planning to a lowered social security benefit based on their expected financial well being at retirement. As a 46 year old, I am prepared to refocus my retirement plans accordingly. Frankly, I have never counted on Social Security benefits when I plan my retirement. Rather, my wife and I have always made sure that putting money into our retirement accounts was more important than buying new cars, eating out regularly at fine restaurants, or taking expensive vacations. We look forward to those pleasures of life when we retire in the years to come.
By enacting a means test for Social Security benefits, I believe that there will be no need to increase the onerous FICA tax beyond its current 12.6%. In fact, the rate should be reduced to provide my generation and those that follow with the extra funds to plan for their own retirements knowing Social Security will be means tested. Much has been said recently about allowing younger workers to personally invest a portion of their FICA taxes. President Bush wants to codify that self reliance by enabling workers to invest a portion of their FICA taxes.
Better yet, why do we need government permission to invest a portion of our own taxes? Simply lower the tax rate and let us invest our increased “pre-tax” earnings to fund our IRAs, 401Ks and company retirement plans. Lastly, I am vehemently against proposals to increase the taxable FICA wage to $ 200,000 from $ 90,000 as a source for additional Social Security funding. The resulting $ 13,860 in extra annual FICA taxes would be better spent by each individual in their own retirement plans so they, too, don’t depend on Social Security benefits when they retire.
I believe self reliance should be the most important source of our personal welfare with family support as its primary backup. In my opinion, government assistance should only be available as a true safety net and not as an entitlement that we plan our lives around. That said, I believe the Social Security System is in its current financial state only because politicians expanded it beyond its original role as a needed safety net for the poor retiree. In 1937, they began positioning it as a major part of most citizens’ retirement plans by enacting the Federal Insurance Contribution Act and its 2% payroll tax. Today that tax is nearly 13%. When the FICA tax was introduced, there were nearly 40 workers paying that tax to support 1 retiree. With far more workers than retirees, the Social Security Administration was able to put aside a portion of the tax into a so-called trust fund for future needs.
Today approximately 14 workers pay the FICA tax to support each retiree. In a few decades, projections are that only 2 workers will be paying FICA taxes to support each retiree. In 1997, President Clinton appointed a Social Security Advisory Panel which concluded that the FICA tax would have to be raised by 50% at that time in order to provide actuarially sound funding for projected future benefit levels. Otherwise, they felt the trust fund would be exhausted by 2029. In the seven years since their recommendation, nothing has been done to address the issue while our economy went through a painful recession which reduced FICA tax contributions and further endangered the trust fund, and the number of retirees continued to explode.
What can be done now to give Social Security the financial security it needs to continue as a worthy government program for the future? I believe Social Security needs to be properly repositioned as the safety net program it should have been. Thus I believe that, rather than fully paying social security benefits to all retirees, those benefits should only be fully paid to those who financially need it. Do the likes of Bill Gates, Warren Buffett, or the tens of thousands of affluent retirees really need the full safety net of Social Security? Immediately imposing a sliding scale benefit would not be fair to those current and near retirees who, although not necessarily needing Social Security, paid their FICA taxes over the years expecting to receive benefits when they retired.
I will leave it up to actuarial experts, Social Security Trustees, and Congress to determine which retirement age group should be the first to have their benefits means-tested although I would suggest that those age 49 or younger still have plenty of time to adjust their retirement planning to a lowered social security benefit based on their expected financial well being at retirement. As a 46 year old, I am prepared to refocus my retirement plans accordingly. Frankly, I have never counted on Social Security benefits when I plan my retirement. Rather, my wife and I have always made sure that putting money into our retirement accounts was more important than buying new cars, eating out regularly at fine restaurants, or taking expensive vacations. We look forward to those pleasures of life when we retire in the years to come.
By enacting a means test for Social Security benefits, I believe that there will be no need to increase the onerous FICA tax beyond its current 12.6%. In fact, the rate should be reduced to provide my generation and those that follow with the extra funds to plan for their own retirements knowing Social Security will be means tested. Much has been said recently about allowing younger workers to personally invest a portion of their FICA taxes. President Bush wants to codify that self reliance by enabling workers to invest a portion of their FICA taxes.
Better yet, why do we need government permission to invest a portion of our own taxes? Simply lower the tax rate and let us invest our increased “pre-tax” earnings to fund our IRAs, 401Ks and company retirement plans. Lastly, I am vehemently against proposals to increase the taxable FICA wage to $ 200,000 from $ 90,000 as a source for additional Social Security funding. The resulting $ 13,860 in extra annual FICA taxes would be better spent by each individual in their own retirement plans so they, too, don’t depend on Social Security benefits when they retire.
Tuesday, February 01, 2005
Tort Reform - February 2005
The legal system in the United States has been widely criticized for being one of the main reasons that health, auto, and business liability insurance rates continue to climb; for being a notable factor in a decrease in new products being introduced into the marketplace because of lawsuit fears; and for unnecessarily delaying or halting the implementation of building projects, government programs, and legislative decisions.
At the same time, the legal industry employs millions of workers; generates billions of dollars of economic activity, provides necessary services to those needing legal representation and advice; and ensures that our laws are constitutional and fairly administered. Our society needs lawyers but can it continue to afford them?
I, for one, do not agree with Shakespeare that “first you kill all of the lawyers”. Rather, I believe we need to reform the tort system in our society to ensure that safe goods and services are widely available but are not inflated in price by higher and higher costs of auto, liability and health insurance caused, in part, by larger and larger lawsuit awards.
There are thousands of articles citing thousands of statistics about how legal and tort reform could benefit us. But there are a like number of articles and statistics that can refute those arguments. Thus the issue of tort reform has become as competitive and combative as any good political fight.
My opinion on this matter is based on economic theory. I believe the noble practice of law has left its roots of providing the best possible representation to those who need legal services and, instead, has become just another profit oriented business in which too many lawyers are pursuing too many cases simply, and understandably, to earn a living. How else can you explain those specialized law firms that sue small businesses for technical breaches of the Americans with Disabilities Act; or those that specialize in manufacturing class action lawsuits when individual cases better serve the original claimants; or those that advertise on television and in the telephone books for slip and fall injuries that in my grandparents’ generation were heeled with an ice bag and bed rest.
As a small business owner, I have seen my firm’s auto insurance rates skyrocket because of the explosive number of contested insurance claims which sometimes involves teams of legal professionals who lengthen the process to maximize their revenues rather than simply settling a case as efficiently as possible. Our group health insurance costs have been rising upwards of thirty percent per year because doctors and hospitals now practice defensive medicine including prescribing multiple tests and procedures lest they be sued for less than comprehensive care. I have even noticed that more and more of my firm’s customers want to ensure that we have adequate business liability insurance before they will let my employees deliver our goods or perform our services at their sites.
What can be done to bring back common sense to our tort system? First let me state that I believe that the legal system provides an important check and balance process to ensure that bad doctors, shady businesses, and corrupt government projects are brought to justice and the injured are amply compensated. Lawyers are well schooled professionals who deserve compensation commensurate with their level of training and experience. That said, I believe and support those efforts to reform the tort system and reduce insurance and liability costs by changing the way contingency fees are paid to lawyers. One good plan I have read would end the use of the contingency fee in cases where the defendant makes a reasonable offer to settle early. If the early offer is accepted, then the plaintiff’s lawyer is amply paid based on an hourly rate plus expenses so that the injured party can benefit from more of the award proceeds. A fair legal wage for a reasonable effort. However, if the early offer is rejected, then a contingency fee can only be applied to awards in excess of the amount of the early offer while a minimal capped fee is paid for the amount below the early offer amount. This plan, I believe, would provide incentives for the plaintiff to accept reasonable early offers while making their lawyers think twice before forging ahead for a larger jury award.
I also strongly support those plans which would ensure the imposition of appropriate “economic loss” awards to compensate the injured party for their current and anticipated medical costs as well as for expenses associated with the degradation of their lives and earnings potential, while capping subjective “pain and suffering” awards to $250,000 and limiting “punitive” damages to only egregious cases where willful neglect or fraud are proven. To control the growth of multi-state class action lawsuits in which the injured receive pennies while the lawyers receive millions, multi-state class action suits should only be heard in Federal courts because of their impact on the broad interstate economy.
Unfortunately, as I stated earlier, tort reform has become a political hot potato with the legal profession and consumer interest groups typically supporting Democratic Party candidates who are usually against tort reform while doctors, hospitals, insurance firms, and business groups typically support the Republican Party candidates usually in favor of tort reform. This causes deadlock in the legislative process. And in those states where Republicans control the legislature and executive branches such as in Florida, the anti-tort reform lobby has smartly focused some of its political contribution dollars on key Republican legislative leaders where those dollars will gain important lobbying access to delay or water down tort reform bills.
Until broad coalitions of small business owners and individual citizens start personally contacting and lobbying their state and Federal elected officials about the need to reform our tort system, I believe that our society will continue to be penalized by ever increasing costs of health, liability, and auto insurance rates and a continued decrease in new and necessary products and services coming to market. The good news is that a recent Kaiser Foundation study showed that 63% of the public favors capping “pain and suffering” awards and 72% want independent case reviews before a lawsuit can be filed. If only our legislators would take heed of these sentiments and enact sensible tort reform sooner than later.
Art Waganheim has been a resident of South Florida since 1991 and was raised in the Washington, DC area which gave him the political bug at an early age. He is a partner in a South Florida small business, is involved in local Republican Party activities, ran for the Florida Senate in 2002, and tends to think conservatively on most political issues.
At the same time, the legal industry employs millions of workers; generates billions of dollars of economic activity, provides necessary services to those needing legal representation and advice; and ensures that our laws are constitutional and fairly administered. Our society needs lawyers but can it continue to afford them?
I, for one, do not agree with Shakespeare that “first you kill all of the lawyers”. Rather, I believe we need to reform the tort system in our society to ensure that safe goods and services are widely available but are not inflated in price by higher and higher costs of auto, liability and health insurance caused, in part, by larger and larger lawsuit awards.
There are thousands of articles citing thousands of statistics about how legal and tort reform could benefit us. But there are a like number of articles and statistics that can refute those arguments. Thus the issue of tort reform has become as competitive and combative as any good political fight.
My opinion on this matter is based on economic theory. I believe the noble practice of law has left its roots of providing the best possible representation to those who need legal services and, instead, has become just another profit oriented business in which too many lawyers are pursuing too many cases simply, and understandably, to earn a living. How else can you explain those specialized law firms that sue small businesses for technical breaches of the Americans with Disabilities Act; or those that specialize in manufacturing class action lawsuits when individual cases better serve the original claimants; or those that advertise on television and in the telephone books for slip and fall injuries that in my grandparents’ generation were heeled with an ice bag and bed rest.
As a small business owner, I have seen my firm’s auto insurance rates skyrocket because of the explosive number of contested insurance claims which sometimes involves teams of legal professionals who lengthen the process to maximize their revenues rather than simply settling a case as efficiently as possible. Our group health insurance costs have been rising upwards of thirty percent per year because doctors and hospitals now practice defensive medicine including prescribing multiple tests and procedures lest they be sued for less than comprehensive care. I have even noticed that more and more of my firm’s customers want to ensure that we have adequate business liability insurance before they will let my employees deliver our goods or perform our services at their sites.
What can be done to bring back common sense to our tort system? First let me state that I believe that the legal system provides an important check and balance process to ensure that bad doctors, shady businesses, and corrupt government projects are brought to justice and the injured are amply compensated. Lawyers are well schooled professionals who deserve compensation commensurate with their level of training and experience. That said, I believe and support those efforts to reform the tort system and reduce insurance and liability costs by changing the way contingency fees are paid to lawyers. One good plan I have read would end the use of the contingency fee in cases where the defendant makes a reasonable offer to settle early. If the early offer is accepted, then the plaintiff’s lawyer is amply paid based on an hourly rate plus expenses so that the injured party can benefit from more of the award proceeds. A fair legal wage for a reasonable effort. However, if the early offer is rejected, then a contingency fee can only be applied to awards in excess of the amount of the early offer while a minimal capped fee is paid for the amount below the early offer amount. This plan, I believe, would provide incentives for the plaintiff to accept reasonable early offers while making their lawyers think twice before forging ahead for a larger jury award.
I also strongly support those plans which would ensure the imposition of appropriate “economic loss” awards to compensate the injured party for their current and anticipated medical costs as well as for expenses associated with the degradation of their lives and earnings potential, while capping subjective “pain and suffering” awards to $250,000 and limiting “punitive” damages to only egregious cases where willful neglect or fraud are proven. To control the growth of multi-state class action lawsuits in which the injured receive pennies while the lawyers receive millions, multi-state class action suits should only be heard in Federal courts because of their impact on the broad interstate economy.
Unfortunately, as I stated earlier, tort reform has become a political hot potato with the legal profession and consumer interest groups typically supporting Democratic Party candidates who are usually against tort reform while doctors, hospitals, insurance firms, and business groups typically support the Republican Party candidates usually in favor of tort reform. This causes deadlock in the legislative process. And in those states where Republicans control the legislature and executive branches such as in Florida, the anti-tort reform lobby has smartly focused some of its political contribution dollars on key Republican legislative leaders where those dollars will gain important lobbying access to delay or water down tort reform bills.
Until broad coalitions of small business owners and individual citizens start personally contacting and lobbying their state and Federal elected officials about the need to reform our tort system, I believe that our society will continue to be penalized by ever increasing costs of health, liability, and auto insurance rates and a continued decrease in new and necessary products and services coming to market. The good news is that a recent Kaiser Foundation study showed that 63% of the public favors capping “pain and suffering” awards and 72% want independent case reviews before a lawsuit can be filed. If only our legislators would take heed of these sentiments and enact sensible tort reform sooner than later.
Art Waganheim has been a resident of South Florida since 1991 and was raised in the Washington, DC area which gave him the political bug at an early age. He is a partner in a South Florida small business, is involved in local Republican Party activities, ran for the Florida Senate in 2002, and tends to think conservatively on most political issues.
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